By: Dexter Braff
Last month, The NIC – National Investment Center – a highly respected organization dedicated to providing seniors, investors, and operators with the data, analytics, and research they need to collaborate on behalf of America’s elders – devoted its entire spring conference to rethinking the value proposition in seniors housing.
Not an easy task for a market sector that, at least to many outsiders, is a whole lot more Murder She Wrote than Game of Thrones.
With a theme of “Unlocking New Value Through Senior Care Collaboration,” more than 1,600 providers and real estate investors were challenged by some of the best and brightest of the industry to think outside of the four walls of their units and reimagine seniors housing – retirement communities, to assisted living, to skilled nursing facilities – as one piece (albeit a central-one) of a coordinated suite of services.
And not just the post-acute continuum that rolls off the tongue as easily as “the frozen tundra of Lambeau Field.”
But also, the role of seniors housing in the pre-acute continuum; an environment that provides the care and services necessary to keep seniors out of the acute care setting in the first place.
There were sessions on partnering with – or outright acquiring – home care, hospice, primary care, and other service providers to gain a seat at (or even own) the table in developing the transformational, fast emerging, here-to-stay, alternative payment models, such as bundling, accountable care organizations, and population health. Models that take aim at the triple aim – better outcomes, reduced costs, and enhanced patient satisfaction.
Equally important, is demonstrating the case to the real estate side of the equation, that not only are such innovations necessary to enhance patient care, but they can – and arguably should – play a critical role in determining the credit-worthiness of operators seeking to finance new construction.
After all, if the operators can’t keep their beds filled, they can’t pay the rent.
Now you wouldn’t think this would be a difficult connection to make, but one of the reasons real estate investors invest in real estate is because bricks and mortar are comparatively less risky than operating businesses. Moreover, new twists on an old theme don’t fit neatly into long established and widely held hard – and soft – algorithms for evaluating investment options.
And one more thing.
The space between cutting edge and bleeding edge can be awfully small.
But just as the lines are blurring between health care providers, so is the once hard line between the real estate and operating side of seniors housing.
In the end, then, when it comes down to the four walls of seniors housing, it’s not hip to be square.