Assisted Living Executive Sept 2005
Transcription
Assisted Living Executive Sept 2005
VOL.12. NO.7 , SEPTEMBER 2005 AssistedEXECUTIVE Living SMART Technology Business SMARTER OPERATIONS S0FTWARE PACKAGES LET EXECS CHART REAL-TIME METRICS WHEREVER THEY ARE GROWTH STRATEGIES Why Monetize Real Estate Assets? COMMUNITY SYSTEMS/ INFRASTRUCTURE Innovations in New Building SPECIAL REPORT Technologies Residents Want THE BUSINESS MAGAZINE OF ALFA: THE ASSISTED LIVING FEDERATION OF AMERICA YARDI Senior Housing Comprehensive Senior Housing Management Software Independent Living, Assisted Living, & Dementia Care Fully Integrated, Browser-Based Technology Complete Accounting Functionality Prospect Lead Tracking Resident Billing and Census Third-Party Billing Customizable Assessments Care Plans Scheduling www.yardi.com Yardi Systems, Inc. 430 S. Fairview Ave. Goleta, CA 93117 800.866.1144 Pass Meds. Not Errors. Pass Meds. Not Errors. Does your system catch errors before they happen? Does your system catch errors before they happen? Multi-Dose and Unit Dose Systems Available! All OPUS med pass systems do! For any particular resident, for any particular time of day or for any particular medication . . . the OPUS Unit Dose or Multi Dose points youdoes! to theFor only pillsresident, to give. That’s The OPUSSystem med pass system anycorrect particular for anypowerful partic- assistance and control for your caregivers. When you choose a pharmacy that provides an OPUSmed pass system, you ular time of day or for any particular medication . . . the OPUS system are doing everything possible you can to prevent errors before they occur. Each resident’s points you to the only correct pill to give. That’s powerful assistance and meds are pre-loaded by the pharmacist in an individual color-coded, tamper-evident cassette. control for your caregivers. When you choose a pharmacy that uses the This assures that the right person gets the right meds at the right time. Peace of mind OPUS medispass you are doingofeverything you can to preone system, of the many benefits the OPUSpossible system—the only syste m with eight beforeorthey occur. Each resident’ s meds are pre-loaded by the facility vent errorsvisual audible safety checks built right in. If you think your pharmacistmight in an be individual This ready tocolor-coded, move up to atamper-evident more efficient,cassette. safer, and more assures thatsecure the right person gets the right med at med pass system, give us a call. the right time. Peace of mind is one of the many benefits of the OPUS system—the only system with eight visual or audible safety checks built right For in. Ifmore you think your facility information on the OPUS med pass system, call 1-800-228-5021, ext. 120, or visit opusmedsystems.com. might be ready to move up to a more effiset upsecure a meeting with your current pharmacy or introduce an OPUS provider to you. cient, safer,We’ll and more med pass system, give us a call. For more information on the OPUS med pass system, call 1-800-228-5021, ext. 120, or visit www.opusmedsystems.com. We’ll set up a meeting with your current pharmacy or introduce an OPUS provider to you. Simple. Sa fe. Secure. OPUS Medication Systems is a member of the President’s Council of The Assisted Living Federation of America (ALFA} Simple. Safe. Secure. SEPTEMBER 2005 AssistedEXECUTIVE Living ADVANCING EXCELLENCE IN A S S I S T E D L I V I N G O P E R AT I O N S & C A R E Formerly Assisted Living Today , VOL. 12, NO. 7 Contents FEATURES 12 COVER STORY Smart Technology, Smarter Business BY ANYA MARTIN A new generation of operational software packages is helping assisted living executives chart and compare a wide variety of metrics in real time. Includes the annual list of operations software providers. 18 GROWTH STRATEGIES Rethinking Real Estate Assets BY RAYMOND J. LEWIS By selling off their real estate assets, senior housing providers are freeing up capital to be used elsewhere, such as redeployment into higher-returning opportunities needed to grow the business. 12 23 GROWTH STRATEGIES On a Roll? BY ADAM STONE Strong second-quarter numbers for assisted living indicate a business whose star is clearly on the rise, say insiders. 26 COMMUNITY SYSTEMS/INFRASTRUCTURE Building Excitement BY ANYA MARTIN Companies that have recently built from the ground up are unveiling exciting new models that blend seamlessly into their landscapes, both urban and elsewhere. Units also are bigger and incorporate lots of natural light and green space. 31 SPECIAL REPORT Resident-Focused Technologies 23 BY JIM MOORE Are you missing a major opportunity to offer high-tech solutions to enhance residents’ quality of life? Several ideas are offered here—from voice-recognition technology to Webcams to special TV channels for residents. DEPARTMENTS 5 6 9 35 31 37 TOP OF MIND BY RICHARD P. GRIMES, 40 ALFA President and CEO 41 EXEC TO EXEC Insights on today’s issues NEED TO KNOW Industry updates and ALFA news COMPLIANCE CORNER BY LORETTA LEBAR & KEITH MAURER AFFILIATE SPOTLIGHT: TALA BY BECKY SQUIRES & SKIP COMSIA 42 43 44 CONSUMER VOICE On aging and independence RESOURCE LINK Classified ads PEOPLE & PLACES Appointments and developments AD INDEX Guide to advertisers in this issue PRODUCTS & RESOURCES Assisted living solutions Assisted Living EXECUTIVE , SEPTEMBER 2005 3 TIRED OF THE JUGGLING ACT? We can help you make it easy. REPS Suite, by IDEAL Software, is the Senior Living Industry’s leading software solution. Designed with the user in mind, REPS Suite is simple to use and effectively integrates your most important tasks: marketing, lead management, referral sources, BUY OR WE’LL HOST FOR A LOW MONTHLY FEE resident care and assessments, billing and accounts receivable. Each of our modules can be run separately or combined as a tightly integrated solution. Our applications are web-based, giving you access to your community’s vital information anytime, from anywhere, including powerful, multi-community roll-up reports. And unlimited technical support is included in REPS Suite’s affordable, flexible pricing plans. Call us today to find out how REPS Suite can increase your revenues and profits by improving your overall efficiencies. www.idealsoft.com 813.935.4465 Executive Publisher Richard P. Grimes, ALFA President/CEO Publisher Debra J. Stratton Editor/Associate Publisher Angela Hickman Brady Associate Editor Marlene L. Hendrickson Contributing Writers Anya Martin, Whitney Redding, Adam Stone Art Director Becky McClimans PUBLISHING OFFICES Stratton Publishing & Marketing Inc. 5285 Shawnee Road, Suite 510 Alexandria, VA 22312 703/914-9200; fax 703/914-6777 E-mail: [email protected] For circulation information, call 703/691-8100. A D V E RT I S I N G S A L E S T E A M Alison Bashian, [email protected] Marianne Juliana, [email protected] Stratton Publishing & Marketing Inc. 800/335-7500; fax 440/349-3447 Insights and critical review provided by the A L FA O P E R AT I O N A L E X C E L L E N C E A D V I S O RY PA N E L Michel Augsburger, President & CEO, Chancellor Health Care Inc. Cindy Chastulik, Divisional VP, Eastern Division, Alterra Healthcare Corp. Page Estes, VP of Operations, CaraVita Senior Care Management Services Inc. Jill Haselman, SVP, Organizational Development & Culture, Benchmark Assisted Living Justin Hutchens, SVP & COO, Summerville Senior Living Benjamin R. Johns, VP of Operations, Carriage Court Communities Susan Klein, SVP, Brandywine Senior Care Linda L. Martin, President & COO, Signature Senior Living Jack Peters, VP of Operations, Silverado Senior Living Marla Sovereign, VP of Assisted Living, American Retirement Corp. Daniel Schwartz, SVP of Operations, Sunrise Senior Living PUBLISHED BY THE ASSISTED LIVING FEDERATION OF AMERICA, FAIRFAX, VIRGINIA Assisted Living Executive (ISSN 1553-8281) is published monthly, with combined issues in January/ February, July/August, and November/ December, by the Assisted Living Federation of America, 11200 Waples Mill Road, Suite 150, Fairfax, VA 22030. Circulated to ALFA members only; a portion of dues is for subscription. Periodicals postage paid at Fairfax, VA, and additional mailing offices. POSTMASTER: SEND ADDRESS CHANGES TO Assisted Living Executive, 11200 WAPLES MILL ROAD, STE. 150, FAIRFAX, VA 22030; 703/691-8100. Printed in USA. Copyright 2005. Prior to photocopying items for educational classroom, internal, or personal use, please contact the Copyright Clearance Center, Customer Service, 978/750-8400, 222 Rosewood Dr., Danvers, MA 01923 or check CCC Online at www.copyright.com. Assisted Living Executive will not be responsible for the return of any unsolicited manuscripts or photographs. Serving professionally managed assisted living communities for seniors by: t driving business excellence t influencing public policy and t building a more informed public. ALFA PRESIDENT/CEO TOP OF MIND Seeking Answers Together I n an essay titled “What Are We Going To Do With Dad?” in The Washington Post (August 7), a practicing geriatrician shared his gut-wrenching experience of attempting to care for his 86-year-old father who suffers from dementia. All of his professional training and years of experience cannot “fix” all the challenges he faces. Instead, it is in his role as an agonized and overwhelmed son that he seeks answers—and effectively confesses that he just does not have them. The challenge of planning for long-term care and caring for aging parents is complicated immensely when dementia is added to the picture. The recent Alzheimer’s Association Dementia Care Conference (August 2005) was the largest ever—full of individuals seeking answers in their professional and personal lives. I was privileged to represent ALFA on a panel of influential organizations in support of the recently published Alzheimer’s Association Campaign for Quality Residential Care: Dementia Care Practice Recommendations for Assisted Living Residences and Nursing Homes. ALFA made significant contributions to these recommendations and I spoke in support of their implementation. Research is starting to objectively quantify what our members already know: that more than half of all residents living in assisted living demonstrate some form of dementia—and that the problem is increasing nationwide. ALFA’s participation in the Alzheimer’s Association effort is entirely aligned with our increased focus on quality and operational excellence, as well as our continued commitment to share the knowledge and experience of our members to best serve our residents and our profession. In addition to our work with the Alzheimer’s Association, ALFA will release a study that analyzes state dementia care regulations and policies this fall. The study should shed some light on the states that model good practices—and those that need more intervention by coalitions of organizations such as the Alzheimer’s Association and ALFA. We’re also working with representatives of ALFA’s Clinical/Quality Executive Roundtable to develop operational practice guidelines on resident elopement, an issue that resonates with a dementia care population. Finally, though less directly related to the issue of Alzheimer’s and dementia, ALFA has entered into a coalition with other relevant organizations (AAHSA, ASHA, NIC, and NCAL) to survey assisted living providers. In the past, your company or your residence may have received surveys from several of these organizations at different times of the year asking many of the same questions. This year, we’re working together to ensure your company or residence will receive only one survey. Not only will this reduce the burden on our member companies and individuals, the result will be the 2006 Overview of Assisted Living: Facts and Trends— a report for the media, for regulators, for the public, and for you—that represents assisted living in America as it is today. I urge you to participate when you receive the survey. Richard P. Grimes ([email protected]) Assisted Living EXECUTIVE , SEPTEMBER 2005 5 EXEC TO EXEC INSIGHTS ON TODAY’S ISSUES—HUMAN RESOURCES What are your best tips for efficiently and effectively getting through the background check process for new hires? ake sure you have a thorough interview process in place. Reference checks are important, too. Depending on the level of the applicant, the reference checks may be more extensive. For a senior-level hire, check not only with the people they’ve worked for but also with people who have worked for them. One of my favorite questions to ask on a reference check is,‘Would you hire this person back? Why would you? Why wouldn’t you?’ For background checks, you’ve got to work with a good vendor that has the resources to do the kind of checks that you need. (Sunrise works with United States Investigations Services.) A person’s past is a very good predictor of future behavior. It’s not the only thing you’re looking at, but it is important. It’s also part of being a good steward of the business.” — Jeff Jasnoff (jeff.jasnoff@ sunriseseniorliving.com) “M Jeff Jasnoff, Senior Vice President of Human Resources, Sunrise Senior Living, McLean,Virginia Heather Blackburn, Director of Human Resources, Encore Senior Living, Portland, Oregon Terry Frisby, Senior Vice President, Human Resources, Corporate Compliance and Culture, American Retirement Corp. (ARC), Brentwood, Tennessee or new hires, each of our communities conducts its own background checks. Companywide, though, Encore Senior Living uses an ‘integrity test’ from Insights Worldwide Research. Each community can administer it on site and it only takes about 15 minutes; there are 70 questions. The questions are designed to get at any potential problems, for example, with deception, theft, dependability, and worker’s compensation “F 6 SEPTEMBER 2005 , Assisted Living EXECUTIVE issues.The test identifies ‘cautions’ in these areas. Applicants can take the test on a computer or on a handheld PDA—but once you answer a question it’s designed so you can’t go back and change your answer. We have found this test to be very effective. It’s been in place for about three years and in that time our retention rates have increased and our turnover has gone down.”—Heather Blackburn (heather.black [email protected]) e set our own requirements for background checks that meet or exceed requirements in every state. (ARC works with United States Investigations Services.) We also have several packages we use for background checks, depend- “W ing on the position you’re in. For example, the background check for the driver of the van for a community will include looking at Division of Motor Vehicles records, whereas the check for the person employed in the kitchen will not. Managers at each of our communities will undergo the most comprehensive background check package. USIS provides a broader net of background searches rather than just single-state checks. That is particularly helpful for hiring people who have moved from state to state.We want to make sure that if there is anything in their background, we’re able to find it. If we have a single value, it is safety and the quality of care we provide for our residents.”— Terry Frisby ([email protected]) QUICK TIPS Keep the following steps in mind when going through the background check process: Disclosure and Authorization. You must give the individual investigated a special notice in writing that you will request a consumer or investigative report and obtain his or her signed consent. You must also provide a summary of rights under federal law. If the individual investigated wants a copy of the report, he or she may obtain a copy from the consumer reporting agency or, in California, Minnesota, and Oklahoma, he or she may affirmatively request a copy by “checking the box” on the disclosure form. Certification. You must certify to the background check or investigation company that you will comply with federal and state laws by signing a form that it will typically provide to you. Providing Copies and Notice of Adverse Action. You must provide a copy of the report with a letter to the person investigated if: the individual has requested a copy in California, Minnesota, or Oklahoma; an employer in California obtains consumer information that is a matter of public record; or adverse action is taken based on information in the report. Adapted from Background Checks and Investigations of Applicants and Employees: Four Steps to Basic Compliance With Federal and State Law, Second Edition, published by the Legal Learning Group, a division of Littler Mendelson, P.C. © 2003 Littler Mendelson. All Rights Reserved. 9HQWDV+HDOWKFDUH3URSHUWLHV1RZ$PHULFD¶VVHFRQGODUJHVWKHDOWKFDUH5(,76KDUSO\IRFXVHGRQ GHOLYHULQJWKH¿QDQFLQJVROXWLRQVWKDWPHHWWKHVSHFL¿FQHHGVRIWKHVHQLRUKRXVLQJLQGXVWU\2IIHULQJ VXSHULRU¿QDQFLDOVWUHQJWKEDFNHGE\DQH[FHSWLRQDOWHDPRILQYHVWPHQWDGYLVRUVZLWKPRUHWKDQ \HDUVRIFRPELQHGH[SHULHQFH²DVHDVRQHGWHDPWKDWFOHDUO\XQGHUVWDQGVWKHFKDOOHQJHVIDFHG E\RSHUDWRUVLQWRGD\¶VFOLPDWH:HRIIHUXSWR¿QDQFLQJIRUGHDOVIURPPLOOLRQWRPLOOLRQ WRJHWKHUZLWKWKHDELOLW\WRPL[VDOHOHDVHEDFNDQGFRQYHQWLRQDO¿QDQFLQJ6RLI\RX¶UHUHDG\WRGLVFXVVD FXVWRPWDLORUHG¿QDQFLQJVROXWLRQZHKDYHWKHSRZHUWRLQYHVW&DOO5D\/HZLV6WHSKDQLH$QGHUVRQ RU(ULF*RUGRQWRGD\DW9(17$6RUYLVLWZZZYHQWDVUHLWFRPWROHDUQPRUH 60 60 9HQWDV,QF1<6(975 &+,&$*2/28,69,//( How are Assisted Living providers achieving operational excellence? Just ask our customers… We focus on the person rather than the task. “Personal preference is at the heart of our service philosophy. Vigilan helps us capture and share information, making it easier for our staff to serve the individual needs of residents.” Marge Coalman, Director of Wellness Programs, Touchmark We eliminated service creep that we didn’t know we had. “With Vigilan we are better equipped to serve our residents and support our staff. In our first quarter, our assisted living service revenue per occupied unit grew by 91 2 percent without adding assisted living labor.” Paul Dendy, President, Lifestyles Senior Housing Managers, LLC We select only the best tools. “Just like a carpenter needs a good hammer, administrators need Vigilan. I simply can’t imagine my job without it.” Megan Lee, Administrator, Bridgewood Rivers Assisted Living We make it simple. You make it yours. Vigilan’s operational management system makes it easier for assisted living facilities to profitably improve their quality of care. We understand that when it comes to delivering care, your personal touch makes all the difference, so we have created an adaptive solution that can work the way you do. Request a demo today: 800-443-1127 [email protected] www.vigilan.com I N D U S T R Y U P D AT E S & A L F A N E W S NEED TO KNOW Acquisitions Market Heats Up uggy summer days are waning throughout the country, but the acquisitions market in seniors housing continues on its hot streak.The market demand for senior care properties is at its strongest since the mid-1990s and owners of high-quality portfolios continue to flood the market with properties. “I have never seen the market this active with so many large portfolios available for sale,” says Stephen M Monroe, a partner in the investment research firm Irving Levin Associates Inc . In June, the firm released The Blue Light Therapy Helps Seniors Sleep A recent pilot study by the Lighting Research Center (LRC) in Troy, New York, has concluded that exposure to blue light may reduce sleep disturbances and increase the likelihood of stable sleep in seniors.The study included seniors with Alzheimer’s as well as seniors without dementia who have trouble sleeping. “Physical changes to the eye, neural changes in the brain, and lifestyle changes can mute the light/dark signal sent to the body’s master clock, presumably contributing to major sleep disturbances in seniors,” says Mariana Figueiro Ph.D., LRC director, and coprincipal investigator for the study. LRC researchers have found that exposure to blue light can efficiently and effectively stimulate the body’s circadian system, create a light/dark pattern the body can recognize and react to, and influence normal sleep cycles. For more about the blue light therapy study, visit LRC online at www.lrc.rpi.edu. Health Care M&A Report, which examines mergers and acquisitions in the senior care market for 2004 and the first part of this year. “The strong senior care acquisition market has continued, especially in the assisted living and independent living sectors,” Monroe says.“A few years ago, per-unit prices of $200,000 were uncommon, but now we are heading toward $300,000 in a few cases.” More than 50 publicly announced senior care property or company acquisitions took place in the first half of 2005, compared with 34 in the first half of 2004. In addition to a jump in the number of mergers and acquisitions, more of this year’s transactions have carried larger price tags. By the end of the second quarter this year, there had been six acquisitions valued at more than $100 million each, compared with three acquisitions valued at that much last year. ™ National Assisted Living Week he theme for this year’s National Assisted Living Week (NALW) is “A Fair to Remember,” encouraging assisted living communities across the country to celebrate by holding special events that harken back to the local fairs of the past—complete with blue ribbon bake-offs, petting zoos, and parades.The week begins on September 11 (Grandparents’ Day) and runs through September 17. An annual event supported by the Assisted Living Federation of America (ALFA) and other organizations, NALW highlights the important role assisted living communities play in helping the nation’s seniors live as independently as possible while enjoying a meaningful quality of life. To download free NALW materials, including a planning guide, media advisory, and logo, go to www.nalw.org. T Logo created by the National Center for Assisted Living. Assisted Living EXECUTIVE , SEPTEMBER 2005 9 NEED TO KNOW Government Relations Update Medicaid To Cover Assisted Living in Ohio The new two-year state budget will allow seniors in Ohio to use funds they receive from the state-federal Medicaid program to pay for assisted living services. On July 1, 2006, about 1,800 individuals who currently receive Medicaid benefits will be eligible for the Assisted Living Medicaid Waiver Program, which will pay for services only— not room and board. “We are thrilled that this has passed.We feel it will be successful,” says Jean Thompson, executive director of the Ohio Assisted Living Association (OALA). “Once it is proven to be successful in this two-year budget period, we are hopeful that the number of slots will be increased. It’s a good start.” Thompson says the OALA does not expect “a great deal of new regulation” to 10 SEPTEMBER 2005 , Assisted Living EXECUTIVE Legislators and Department of Aging officials “are keenly aware that if they drown this in additional paperwork and regulation, communities will not opt to participate,” Thompson adds.“I’m sure there will be changes at some levels, but we don’t anticipate major regulatory changes.” Louisiana Amendment Addresses Assisted Living accompany the program, particularly since it is voluntary. All licensed residential care communities in the state can apply to be providers under the new Assisted Living Medicaid Waiver Program, which will be directed by the Ohio Department of Aging. An amendment approved by the Louisiana legislature in the session’s final hours could dramatically impact assisted living care in the state by allowing nursing home owners to convert licensed beds to assisted living units that can service private pay or Medicaid residents.The ALFA state affiliate and ALFA National Office both opposed the measure.The amendment was an add-on to a bill imposing a moratorium on nursing home construction. The amendment’s sponsor, Sen. Joe McPherson, chair of the state Senate’s Health and Welfare Committee, vice chair of Appropriations, and a nursing home owner, claimed the amendment would save state Medicaid dollars and address nursing home occupancy issues. Converted assisted living units will be licensed under a different agency than other assisted living—the Department of Health and Hospitals (DHH)—and will be permitted to offer different services, such as medication administration.The amendment may place assisted living facilities at a competitive disadvantage, since it is unclear whether they will be allowed to offer the additional services, like medication administration, even if they agree to supervision under DHH. ALFA and the Louisiana Assisted Living Association continue work to ensure regulations promulgated as a result of the amendment guarantee a level playing field for all assisted living providers. often comes from the family,ALFA’s Paul Williams told the Times, “but forward-thinking operators are receptive.They know the reluctance of most people moving in, and this builds good will.” For more about the Times article, e-mail [email protected]. ■ An ABC News online article—“Many JoltedMF_AsstLvng_ALE by Cost of Long-Term Elderly Care”— 2/7/05 9:31 AM reported that roughly 9 million elderly Americans currently require some kind of long-term care. By 2020, that number will jump to 12 million. The article also reported that four in 10 Americans don’t know what steps to take to prepare for their own long-term care, according to a recent study. For more this ABC News report, go Page about 1 to www.abcnews.com. ▼ SAVE TIME, ENERGY AND MONEY WITH OUR TOTAL APPLIANCE SOLUTION. AIA Includes Assisted Living Design Guidelines The 2006 Guidelines for Design and Construction of Hospitals and Health Care Facilities manual, issued by the American Institute of Architects (AIA), will include a new section on assisted living residences. ALFA has participated throughout AIA’s two-year drafting process for the manual and provided input regarding proposed amendments in the assisted living section. A spokesperson for AIA says the manual is scheduled for release next spring and will be available for purchase at www.aia.org/ store.The price will be around $75, which is what previous editions of the manual have cost. Assisted Living in the News The New York Times in July reported on the decision-making process seniors and their families go through when considering housing options, such as assisted living. In an article by reporter Jane Gross—“TestDriving a Retirement Community (Yes,You Can)”—the paper reported that temporary stays in assisted living communities to “kick the tires” are a valuable option for prospective assisted living residents, as well as for family caregivers in need of respite care. The initiative to ask for a temporary stay ■ • Maytag commercial-grade washers and dryers • Maytag and Amana • MicroFridge® combination residential appliances refrigerator-freezer-microwave units THREE GREAT BRANDS FROM ONE TRUSTED SOURCE. Add them to your facility to enhance resident satisfaction and reduce energy costs, too! ENERGY STAR rated MicroFridge ® units come in a range of sizes to meet every need. And they’ll cut utility costs thanks to our patented Safe Plug™ technology, which limits electrical draw and prevents overloaded circuits. Maytag and Amana residential appliances are renowned for superior quality and value. ENERGY STAR rated Maytag high-efficiency commercial laundry machines can help you save big money in water and energy expenses. For details, call 800-994-0165, ext. 2697 or visit www.microfridge.com. MicroFridge® and the MicroFridge logo are registered trade marks of Intirion Corporation, a subsidiary of Mac-Gray Corporation. Safe PlugTM and the Safe Plug logo are trademarks of Intirion Corporation. © Mac-Gray 2005 Assisted Living EXECUTIVE , SEPTEMBER 2005 11 COMMUNITY SYSTEMS/INFRASTRUCTURE Smart TECHNOLOGY, Operational software revolutionizes assisted living with real-time metrics available wherever you go By Anya Martin s founder and CEO of Portland, Oregon-based Vigilan Inc., Christian Mason (chrism@ vigilan.com) helped develop The Analyzer, an operational management portal that provides a comprehensive picture of current and projected results for multiple communities. However, when he installed his new Web-based software into his two highest performing communities, he immediately learned something he never would have learned under the old system. “My top-performing community was 13 assessments behind and the other was 11 behind,” Mason says.“From a regulatory standpoint, that’s a potential problem. From a quality standpoint, that’s a potential problem. I immediately got in my car and drove to each of those buildings to see what was going on.” Today, a new generation of operational software packages is helping assisted living executives chart and compare a wide variety of metrics in real time, not just identifying problems before they become crises but allowing providers to take charge of the bottom line like they never have before. What’s more, costs have come way down and it’s likely that one program or a suite of complementary ones can integrate billing with marketing, staff scheduling with service plans, and census with resident satisfaction. A REAL-TIME METRICS Fifteen years ago, every individual assisted living community had its software programs loaded manually onto one or more PCs, 12 SEPTEMBER 2005 , Assisted Living EXECUTIVE with no real-time connection even among residences that shared the same operator, recalls Lance Raab ([email protected]), president and CEO of Tampa-based Ideal Software Inc. Today if a sales manager is snowed in at home, he can log onto the Internet, access his database of leads, and make sales calls. Or a CEO can consult his laptop, or even his PDA, at the airport and see a dashboard of real-time metrics ranging from census to staff turnover across every community in the company. “The days of having isolated areas for PCs is rapidly fading away, while the idea of blending technology into the caregiver environment is gaining ground in some revolutionary ways,” says Bill Caldwell ([email protected]), president and CEO of Jackson, Mississippi-based American HealthTech Inc. During more than 30 years in the senior living industry, Caldwell has watched information technolo- gy go from bulky mainframes to a technology explosion that transcends the basics of Web enablement.“I think we see a ready parallel in the way personal communications devices have grown in recent years from beepers to true personal assistants that combine telephone and real-time e-mail service in the same device.” The Internet, PDAs, and wireless technology have been around for a while, so why are these products coming of age now in assisted living? It took longer in part because the market, made up of people with health-care and real estate backgrounds, overall was one of late and reluctant adopters of technology, says Paul Budak ([email protected]), president and CEO of Kirkland,Washingtonbased Point of CareWare Inc.“For the late adopter market, the value has to be there, and ease of use has to be there.” As software has become more user- Smarter BUSINESS friendly, assisted living’s need to manipulate large amounts of data also has increased, with higher-acuity residents, increased regulations and liability concerns, high staff turnover, and resident and family expectations for even higher levels of service, Mason says. On the other hand, the answers executives need now are evolving as this young model grows up, says Rita Burgett ([email protected]), president of Bedford,Texas-based Move-N Software Inc. “Historically people looked for software that helped increase their census because they needed to build their population. What people are looking for now is software that increases their revenues and enhances their operations.” Or as Doug Fullaway (dougf@vigilan. com), Vigilan’s president and CEO, puts it, now that cash flow is the main issue,“CEOs no longer want to wait until the end of the month.They tell us that [they] can’t stay on top of problems if [they] don’t know what happened.” Indeed,Vigilan got the idea for the Analyzer from quizzing vice presidents of operations and other key executives about their day-to-day worries. One of those problems has been knowing what census really is in multiple communities at any given moment, he adds.Another is the integrity of the data.According to Fullaway, a typical complaint might go like this:“It takes a couple of days to get the data in, and once I see it in my accounting system and my marketing system, it doesn’t match.” What are the benefits of software that charts census, the number of notices to vacate, and scheduled move-ins yesterday, today, and tomorrow? If managers see a drop-off in studios in one community happening day by day, they can respond much sooner and send marketing right away to go shop the competition to see if they’ve dropped their fees, Fullaway says.The same thing could apply to employee turnover. Have competitors raised their hourly rates? Truly integrated, real-time operational software also can help identify cost-creep, “Being able to compare the seven buildings within my own company to the bigger world would be great.” Joan Hyde Ph.D., Hearthstone Alzheimer Care Mason says. For example, a resident may be being billed $500 a month for services, but when the services received are tracked, data reveals that the person is receiving an extra $100 of services that aren’t being reflected in their service plans and thus not being billed. In sum, real-time metrics lead to executives asking questions they’ve never asked before, Fullaway says.“It’s very interesting to see what happens after they’ve installed the Analyzer,” he adds.“We get phone calls from operations asking,‘Is that 15 hours delivered by nurses normal or is that a little high?’They have a burning desire to compare [their stats] with others.” Web-based applications have made it possible to access data quicker and anywhere, but this change has even more ramifications.As noted previously, in years past, software had to be installed on multiple individual computers. This task had to be done most likely by an IT expert, and operators purchased expensive licensing fees, Raab says. Now, many companies are uploading the client’s software once online and charging a subscription rate.The other benefit is the ability to install updates seamlessly and invisibly to one location, making deployment even cheaper. COMPARING SOLUTIONS When choosing operational software, consider products specifically developed for assisted living and its needs, recommends Burgett.When assisted living first emerged as a model, software providers for the nursing care industry just tried to remarket their products, but nursing home software was built to fill very different needs such as government-mandated electronic care plans and accommodating the codes needed for Medicare and Medicaid. Assisted living, in contrast, is predominantly private pay and service-oriented. Beyond that, the most important factor to consider when buying a new operational software package is what you need it to do and who needs access to the data, and that means being specific, Burgett adds. A vendor may claim it can do a wide variety of tasks, but if it can’t perform the ones you need in the way you need it to do them, then it’s a waste of time and money. Burgett cites an on-the-surface simple billing issue,“A lot of companies will say we want our communities to do the billing themselves. However, they want to access everything from the corporate office and want the corporate office to collect payment and then document that record for the communities.This means both have to have real-time access to software.” After you’ve queried about a program’s capabilities,“say, show me how,” Burgett adds.“Have them actually take you through the process and then see for yourself how simple or complicated it is.” If the software doesn’t let you do what you need, can it be adapted to do so? On the other hand, if a vendor is willing to customize, make sure that vendor has the resources to do so, Budak says.“If a vendor says, we’ll do anything you want, sometimes that doesn’t result in the best vendor because they wind up trying to solve everybody’s individual problems.You also wind up with not one product but a different one for every customer, which isn’t necessarily the best thing for everyone.” Another pitfall to avoid is being blinded by the “wow” factor, Caldwell says.“The Assisted Living EXECUTIVE , SEPTEMBER 2005 13 S O F T WA R E F O R A S S I S T E D L I V I N G O P E R AT I O N S he following list, compiled by Assisted Living Executive staff, includes only providers of software used in assisted living management, operations, and marketing. Life safety solutions will be included in the October issue. Every effort was made to include all providers in the market; however, providers who did not respond to our requests for information are not included here. Companies in BOLD type are members of ALFA. T COMPANY CITY, STATE CONTACT FOR SALES – PHONE NUMBER WEB SITE Achieve Healthcare Technologies Eden Prairie, MN Tim Moore – 800/869-1322 ext. 9791 www.achievehealthcare.com ADL Data Systems Inc. Dobbs Ferry, NY Wayne Jobe – 800/965-7475 ext. 231 www.adldata.com (Optimum Series Clinical and Financial Suite) A.L. Wizard San Diego, CA 858/457-0566 www.alwizard.com American Computer Software Madison, WI Heather Gullickson – 800/527-9449 www.acsoftware.com American Health Care Software Enterprises Inc. South Burlington, VT Irene Wright – 800/336-1776 www.ahconline.com (Harmony Health Care Management System) American HealthTech (LTC) Jackson, MS Linda Trammell – 800/489-2648 ext. 1051 www.healthtech.net CaraVita Senior Care Management Inc. (CaraSyst) Roswell, GA Beth Cayce – 770/552-9788 www.caravita.com Cignify Corp. Atlanta, GA 770/551-1761 www.cignify.com Compu Might Inc. (Compu Care 2000) Flushing, NY Judy Sachs – 718/939-2076 www.compumight.com Concurro Inc. (Collaborative Care Palo Alto, CA Michael Sturm – 650/969-2015 www.concurro.com Management System) Creative Solutions Unlimited Inc. (Dextrosity Suite) Sheffield, IA Martha Koch – 800/253-7697 www.creativesolutionsunlimited.com Eldermark Software Minneapolis, MN Craig Patnode – 866/809-7600 www.eldermark.com Health Care Software Inc. (INTERACTANT) Farmingdale, NJ Thomas J. Fahey – 800/524-1038 www.hcsinteractant.com HealthMEDX Inc. (CareMEDX) Ozark, MO Leigh Daniels – 877/875-1200 www.healthmedx.com Hearthstone Alzheimer Care (AlphaPLAN) Waburn, MA Joan Hyde Ph.D. – 781/674-2884 ext. 30 www.thehearth.org Ideal Software Inc. (REPS) Tampa, FL David Griffin – 813/935-4465 ext. 2157 www.idealsoft.com INTRAcare (Vitals) Wichita, KS Amy Gillogly – 800/395-0132 www.intracare.com Keane Care Inc. (VistaKEANE) Redmond, WA Jim Ingalls – 800/426-2675 www.keanecare.com LifeCare Software Solutions Inc. (LifeCare Plus) Budd Lake, NJ Lisa Sangastiano – 908/852-7400 www.lifecare.net LINTECH (COMET) Fort Lee, NJ Udi Polonsky – 201/944-3235 ext. 24 www.lintechsoftware.com Mature Solutions Cincinnati, OH 513/871-0030 www.maturesolutions.com MedicaOne Inc. San Francisco, CA Michael Whitworth – 650/464-2799 www.medicaone.com MDI Technologies Inc. (On-Line Advantage) St. Louis, MO Tom Kerrigan – 800/552-9846 www.mditech.com MicroMain Corp. Austin, TX Wes Amann – 888/888-1600 www.micromain.com Winnipeg, Houston Klassen – 877/231-3836 www.momentumhealthware.com Smithfield, VA Bob Adams – 757/357-8701 www.monette.com Bedford, TX Jennifer Griffitts – 817/282-7300 www.move-n.com (Resident Safety and Communications Software) (MicroMain XM computerized management system) Momentum Healthware Manitoba, Canada Monette Information Systems (ULTRACare Suite and MORE! Marketing Software) Move-N Software Inc. PenSoft (PenSoft Payroll Plus) Newport News, VA 888/736-7638 www.pensoft.com Point of CareWare Inc. (AL Suite) Kirkland, WA Troy Blackmon – 425/463-3959 www.pointofcareware.com Proven Solutions Inc. Atlanta, GA 770/399-1993 www.provensolutions.com SOS Corp. (HelpCare+) Liverpool, NY Sean Garner – 800/432-7672 www.sosc.com UltraBridge Inc. Owings Mills, MD Keith M. Farley – 410/753-9028 www.ultrabridge.com VCPI Milwaukee, WI 866/407-6377 www.vcpi.com Vigilan (The Administrator, Marketing Manager, Wilsonville, OR Doug Fullaway – 503/682-8828 www.vigilan.com Goleta, CA Bonnie Novella – 800/866-1144 ext. 184 www.yardi.com The Analyzer, The Scheduler) Yardi Systems 14 SEPTEMBER 2005 , Assisted Living EXECUTIVE MT NG MG NI GMT G T & N M A N G PL E M LI MG IN S ACK L ICE NC /BIL ING N A L G S L V TIO TR RO ER EN NT U IN T RA EAD PAY E/S INT COU HED ORT GM E E P /L R/ R MA AC /SC EP N M IC V R O S L/O G /H CA Y/ IA ETIN ING AL ERT ENT ITIE ENT ATI SER C C P ID IV ID C D F I I K N F A D O R A T C IN O S FIN MA ST CL PR RE AC IN ME FO ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ Information not available ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ Information not available ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ TRAINING AND SUPPORT ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ Information not available ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ Information not available ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ most common mistake buyers make is allowing a particular bell-and-whistle feature shown by a sharp salesperson to overly sway the buying decision.At the end of the day, the real need is a solid, full-featured package that can address all your vital business needs.” Operators should also assess the software publisher itself, Raab says, adding, “You want to make sure they are committed to the industry and they have viability long term. Do they have a lot of references, users in the industry? Do they keep the product up to date? Are they keeping up with new technology?” He suggests a few more questions to ask: ■ How long have they been in business? ■ How many employees do they have? ■ What percentage of the company’s budget goes into research and development? ■ Do users need to key in data, or does data just flow into the system? ■ Are there extra fees for technical support, and if yes, are they charged monthly, per-incident, or how? ✔ ✔ ✔ ✔ Indeed, assessing ease of use remains the essential ingredient when it comes to evaluating software.“The biggest problem is getting nurses to feel comfortable with technology,” says Joan Hyde Ph.D. (hyde@ thehearth. org), CEO of Lexington, Massachusetts-based Hearthstone Alzheimer Care, developer of AlphaPLAN. “If they don’t, they aren’t going to use it.” “We have had people make huge investments and then dump it because people wouldn’t use it,” Burgett says. In fact, when selecting new software, don’t just leave it up to the IT guy, Hyde says. Instead, she suggests considering who will be using it and if that’s frontline staff, involve them on the decision-making team. “If they pick it out themselves, you’re going to have a lot more buy-in.” Consider how a company offers training, whether in-person,Web-based, or by other means, and how staff will respond to the mode, the content, and the delivery, Raab says.While face-to-face may seem ideal, he advises providers not to discount Web-based training as a component. “Our Web-based training has been designed to be simple,” he adds. “The days of having isolated areas for PCs is rapidly fading away, while the idea of blending technology into the caregiver environment is gaining ground in some revolutionary ways.” Bill Caldwell, American HealthTech Inc. American HealthTech staff work with management to familiarize themselves with the old system before developing a customized knowledge transfer plan specific to that particular new client, Caldwell says. However, he cautions against a common misconception that “good software can correct sloppy operations management,” he adds. Instead company-wide training at the time of new software installation can provide a great opportunity for companies “to challenge their existing business processes and incorporate training for those changes in concert.” Also, don’t forget training doesn’t end in the first few months of use, he adds. What if there’s a problem? Will the company still be there for you? “There was an interesting study by Deloitte & Touche a couple of years ago,” Caldwell says.“It compared customer buying motives and how those motives had changed from their initial purchase of a system to the second time.Where price was the No. 1 motivation for the initial purchase, the majority of second-time buyers ranked vendor support as their top buying motive.” Finally, consider the written documentation that comes with software, whether in hard copy or posted online, Campbell says. Must questions for references include whether it is understandable to lay readers and up to date.“One additional problem with hard-copy documentation is that it cannot be context-sensitive,” he adds.“With good Assisted Living EXECUTIVE , SEPTEMBER 2005 15 A L Exec mag ad.qxp 7/7/2005 11:40 AM 7,000 providers, researchers, educators and business partners from across the country— an unrivaled learning opportunity. AAHSA 2005 ANNUAL MEETING & EXPOSITION November 7 - 10, 2005 Henry B. González Convention Center San Antonio, TX Experience . . . n More than 200 education programs with comprehensive coverage of today’s aging services issues n 32 continuing education credits for a variety of professional service areas n 600-plus educational exhibits and three specialty pavilions n Dozens of networking opportunities Quality through Community Visit www.aahsa.org/am2005 to view complete program information and register online. american association of homes and services for the aging 16 SEPTEMBER 2005 , Assisted Living EXECUTIVE Page 1 COMMUNITY SYSTEMS/INFRASTRUCTURE online help, the system should take you directly to the relevant section of the text based upon where you currently are in the system. Our stance is that hard copy documentation is a developer’s shortcut, and that it should be a red flag to a buyer that could signal other shortcuts might be taken at the expense of the user experience.” Indeed, when it comes to whether a company delivers on training and support, checking references is the only way to get a true advance picture, Budak says.“In a market that requires high touch with vendors, the bottom line is,‘Down the road as my business changes, will my issues get resolved quickly?’” FUTURE ADVANCEMENTS These trends starting now will mature over the next few years into even more exciting capabilities, allowing users to do things faster, more easily, and at steadily lower costs, most experts agree. As technology allows more data to be tracked, the most exciting potential is for providers to benchmark key stats against competitors.“Ultimately, when it’s all Webenabled, everybody is going to share data,” Hyde says.“It’ll just be a matter of making sure your fields can translate.To me, that’s the most important thing about software other than being a repository for information. Being able to compare the seven buildings within my own company to the bigger world would be great.” Hyde cites the MASS PEP project as an example. Members of the Massachusetts Assisted Living Association, an ALFA affiliate, all conducted the same customer satisfaction survey and shared their results.To win over everyone’s trust, Hyde says,“We made a pact not to compare data in advertising, but we all knew where we stood. It gave us not just a way to benchmark ourselves, but also something to take to regulators.We could say,‘This is what our consumers are saying to us,’ which is positive, and ‘Here are some areas we needed to improve,’ and,‘Here’s what we did.’” Enter hand-held devices,Web-based, and wireless technology, and providers will be able to go far beyond using software just to track metrics or marketing leads, says Beth Cayce ([email protected]), CEO of Roswell, Georgia-based CaraVita Senior “The bottom line is, ‘Down the road as my business changes, will my issues get resolved quickly?’” Paul Budak, Point of CareWare Inc. Care Management Inc., which operates 18 communities in the southeast and recently began marketing its CaraSyst software package. Cayce also chairs ALFA’s recently formed Emerging Technology in Assisted Living Task Force. As large hospitals and physicians’ offices get wired to facilitate rapid exchange of information, she sees the PDA as a key risk-monitoring device to allow assisted living caregivers instant access to medical records, as well as the ability to send data directly to medical experts and to input data into medical records.At CaraVita, caregivers already are entering key resident data directly into hand-helds designed to be ready for these new capabilities. “Utilization of PDAs and wireless communication, not only for charting, but also for diagnostics, will facilitate less costly and more timely care of our residents,” Cayce says.“For instance, a nurse or care assistant utilizing a plug-in diagnostic device for blood or urine can send information on a resident to the physician’s office at the first sign of a resident’s change of condition and, within a matter of an hour or so, receive an assessment, prescription, and chart entry that will immediately address the health situation.All this means better care and healthier residents.” Translated another way, companies on the front end of the technology curve ultimately will likely see their census on the rise, Campbell says.“Clients tell us that they have a competitive advantage to attract new residents when family members see their caregivers equipped with the latest wireless technologies to better care for their loved one.” ▼ Reach contributing writer Anya Martin at [email protected]. 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Just visit www.homeinstead.com/care for the locally owned and operated office near you. www.homeinstead.com/care Ask us about the “After Dinner with the Gaithers” program for Activity Directors. Each Home Instead Senior Care franchise is independently owned and operated. ©Home Instead, Inc. 2005 G R O W T H S T R AT E G I E S RETHINKING Real Estate Assets T he recent years have been rife with senior living companies strategically moving from owning their real estate assets to instead managing or leasing them.The trend seemed to start in 2003, when Sunrise Senior Living announced the sale of 16 of its properties to CNL Retirement Properties and another five to Macquarie Capital Partners.At the same time, Sunrise secured a long-term, manage-back agreement to manage these 21 properties During third-quarter 2005—Capital Senior Living Corp. is expected to complete an approximate $85 million sale-leaseback transaction for six of its communities with Ventas Inc. Why do companies sell their assets? Are there advantages to moving away from owning real estate and deploying the resulting capital elsewhere? What can be learned from the actions of these operators? On a very basic level, owning real estate ties up a company’s capital. By selling the real estate, this capital can be utilized elsewhere, such as redeployment into higherreturning opportunities needed to grow a business. Let’s say, for example, that you own a portfolio of three or four properties with $10 million of total equity capitalization. By selling these assets, the $10 million can be used as working capital to manage or lease 10 or 15 properties. For a publicly traded company, there is a strong incentive to manage or lease assets in lieu of owning them, because the equity markets tend to evaluate an operating company on earnings per share, not on actual cash flow generated from held real estate. By owning assets, the company is forced to carry the real estate depreciation costs on its income statement. Even though depreci18 SEPTEMBER 2005 , Assisted Living EXECUTIVE Senior housing providers divest real estate assets, using the resulting capital to improve operations in their communities or expand elsewhere By Raymond J. Lewis ation is a non-cash charge (designed to show that the asset devalues over time), the cost lowers a company’s net income. As such, the company’s stock price will not benefit from the cash flow generated and, in fact, will be negatively affected by depreciation costs. Many companies (especially those that are publicly traded) have decided to sell some, or all, of their real estate, primarily for one of three reasons. As previously noted, these companies are not getting credit from Wall Street for owning their real estate. Secondly, the depreciation costs tend to offset any gains realized from increased cash flow. Finally, these companies can redeploy the capital received in an asset sale into investments or projects that will produce larger growth and higher yields. PUTTING PROPERTIES INTO PLAY In the case of Sunrise, the company has been using its freed-up capital to open communities in international markets, including Canada and the United Kingdom. Early this year, the company introduced its first community to Germany, which is a potentially higher-growth market. According to Chairman and CEO Paul Klaassen, the demographics in the major metropolitan markets in Germany and other European countries “suggest a demand for high-quality senior living care and services.” But even privately held providers may find it advantageous to sell their real estate. Consider, for example, companies with aging properties, especially facilities that are 20 years and older. Properties such as these are more than likely to have depreciation issues, requiring significant capital investments for large deferred maintenance items. Providers may decide that it is better to sell the properties than to spend the money required to upgrade them. Jim Moore, president of Moore Diversified Services, who advises many smaller and single-facility operators on their exit strategies, is well aware of this problem. “I recommend that clients look at the age of their properties—even though they may be superbly maintained—as yet another variable that they are going to need to put on the table,” he says.“Eventually, those properties will be discounted, not because of their financial performance initially, but because of their perceived age. So that’s certainly another issue that comes into play.” FINANCIAL STRUCTURES FOR SOLD ASSETS Smart companies develop strong portfolios by employing a three-pronged financial strategy. These companies strike a balance among the number of properties they own, the number they lease, and the number they manage. By having a third of its portfolio in each of these areas (a good rule of thumb), a company can ensure that it realizes the benefits of each of the three strategies. To manage or lease properties, a company typically enters into two common financial agreements.The first type is a salemanageback. Under this arrangement, companies sell off their assets and manage them back on behalf of the new owner. The company is paid a fee to run the residence— generally a percentage of revenues, typically between 3 and 5 percent. Except for paying this management fee, the new owner of the real estate receives all of the cash flow that the property generates. The second financial arrangement is a sale-leaseback. In this scenario, after selling its real estate to the new owner, a company enters into a long-term (10 years is standard) contract (with that new owner) that effectively grants the operating company the right to be the owner for the period of that lease. This entitles the operator to receive all of the excess cash flow… after making a rental payment to the new owner. PROFIT-ENHANCING TREND There is no question that selling real estate assets is becoming more popular.All large companies—particularly the publicly traded ones—have engaged in either a sale-leaseback or a sale-manageback transaction within the past several years. This trend is likely to continue as more companies recognize that they can be as, or more, profitable being a property manager or tenant versus being an owner of real estate. A company that enters into one of these transactions will free up the equity currently residing in the real estate, allowing it to pursue a business model that is much more scalable (that is, the management or operation of residences). Additionally, valuations are strong for many sectors of the senior living industry, a further reason why companies will continue to monetize their real estate assets. “One might speculate that there’s eventually going to be a turnaround in the extremely low capitalization rates currently present in the market,” says Moore.“Interest rates, in fact, have been creeping up, and normally, capitalization rates tend to follow them. But that has not happened. Eventually, increasing interest rates have got to have an impact on cap rate trends. So all the indicators are very favorable right now, if you choose to exit.” NEXT STEPS AND STRATEGIES Let’s say that you are considering a move away from ownership of your real estate to managing or leasing some of your assets. What steps should you take? First, you need to do a careful review of your portfolio. Try to identify, and then prioritize, those assets that you want to monetize. Ask yourself the following questions: What is the growth in the cash flow stream of this asset going forward? Does it still have a lot of opportunity to extract value through occupancy gains, rent increases, or by better managing expenses? Is the facility aging and requiring large influxes of capital? Is the asset stabilized or not? If the asset is stabilized, it will be harder to realize significant gains in cash flow. Instead, you may want to consider selling the property and redeploying the money Assisted Living EXECUTIVE , SEPTEMBER 2005 19 G R O W T H S T R AT E G I E S ZPV$BSF'PS&MEFST 7E#ARE&OR9OUR2ISKS 7INWINSERVICESWITHYOUROWNAGENTs3TRONGRELATIONSHIPSWITH RESPECTEDCARRIERSs2ISKMANAGEMENTPROGRAMSTAILOREDTOYOURBUSINESS 5P MFBSO IPX XF DBO IFMQ ZPV QMFBTF DPOUBDU VT BU 7490 Accents Ad ALT 05 12/30/04 1:03 PM Page 1 PS WJTJU PVS XFCTJUF BU XXXLCVOEFSXSJUFSTDPN Genuine Marble and Stainless Steel Receptacles UNITED RECEPTACLE 800-233-0314 20 SEPTEMBER 2005 , | FREE Catalog • Call Today ® Fax: 800-847-8551 Assisted Living EXECUTIVE | www.unitedrecept.com in a new asset that has not yet stabilized or one that has more upside potential. Are there situations where it may be prudent to hold on to an asset? Absolutely. Consider, for example, the debt associated with an asset. Is the financing attractive in today’s marketplace? If not, then it may be better not to sell the property. Otherwise, you’ll get penalized in terms of value because the debt comes along with the deal. Another reason that argues for holding on to assets is that a company can always monetize or borrow against the value of owned properties at a future date in order to add more capital back into the company. Thus, it stands to reason that a company that sells its assets loses this financial flexibility upon doing so. After making the decision on whether or not to sell your assets, there are two choices. If you already have proven management experience and are looking to grow, you can either raise equity from various sources or you can partner with REITs or other real estate investors. In the latter case, the partner will buy the real estate, and you can either manage or lease it. Conversely, if you don’t have quite as strong operations experience, it may be more advantageous to first strengthen your management track record, as financing sources are generally hesitant to invest with less mature management teams. So for those with a proven management track record—especially those operators with properties in attractive markets—selling some of your real estate assets provides a way to bring balance into your real estate portfolio. Having a portfolio with some assets that you own, some you lease, and some you manage will give you the most flexibility.Your owned assets will always be available as an equity source, and your off-balance sheet properties (those you only lease or manage) will help optimize your operating leverage. ▼ Raymond J. Lewis is senior vice president and chief investment officer for Ventas Healthcare Properties, a REIT with offices in Chicago and Louisville, KY. Reach Lewis at 877-4VENTAS or visit www.ventasreit.com. In our healthcare branch of lending, we’re the specialists. Healthcare and senior housing properties are the only kind we finance. And it isn’t just our bedside manner that is reassuring it’s our knowledge, acumen and ingenuity. We have the fresh ideas to structure every deal to meet your own distinctive needs. We have the experience to navigate in this complex and highly regulated business. Most important, we have the resources to get it done on time and just as promised. When it comes to financing your healthcare properties, we are – if you’ll excuse the phrase – just what the doctor ordered. John P. Fogarty, Senior Vice President /Managing Director: 626-568-7406 Monique Bimler, Senior Vice President : 214-265-4255 Philip Brooks, Senior Vice President: 804-780-9205 William Kauffman, Senior Vice President : 312-845-8567 James Thompson, Senior Vice President : 205-870-1124, ext. 17 Ingenuity wins. www.gmaccm.com 056GM577 G R O W T H S T R AT E G I E S ON A ROLL? Market data continues to support strengthening of assisted living’s market position By Adam Stone L ast quarter’s financial data saw 2005 off to a good start for assisted living, with strong occupancy rates and move-in numbers. Now the second quarter appears to be continuing the trend, with statistical information and anecdotal reports all pointing toward a healthy market demand for assisted living products and services. That is certainly the case at Bickford Senior Living Group, a 31-property enterprise based in Olathe, Kansas.“The second quarter has been good for us in terms of occupancy.We also have seen an increase in terms of move-ins, which again have outpaced move-outs in the second quarter,” says Senior Vice President of Operations Alan Fairbanks (alan.fairbanks@ eby.com). “Our rates continue to be very strong, especially considering we are not in the very biggest markets, and we continue to see those rates rise.” Fairbanks’ experience confirms the latest findings from the National Investment Center for the Seniors Housing & Care Industries (NIC).Those indicators had a distinctly positive bend in the second quarter. In terms of occupancy rates,“you see the continued ‘getting healthy’ of the industry,” says NIC President Bob Kramer. Having risen steadily over the past several years, starting at about the 84 percent range, occupancy today is holding stable at 88 percent. While strong overall, the occupancy numbers are especially impressive in the 30 largest metropolitan areas, where the rates continue to run about five points higher than in other markets. In the second quarter, properties in the largest markets showed an average occupancy rate of 93.8 percent. “This continues to demonstrate why so many major operators do concentrate in the large metropolitan areas,” Kramer says. In another key indicator of financial health, major national lenders reported that nearly all borrowers in the assisted living category are performing flawlessly. Ninetyeight percent of loans in this arena are healthy and sound. In cases where the numbers do look questionable, researchers say the cause is most likely a statistical variation. Consider the CCRC market where occupancy in these properties dipped to 91 percent in the second quarter, down from 92.5 in the previous quarter.“But we have seen this fluctuate between .01 and .03 percent in the last couple of years, so this is likely just a temporary fluctuation,” says NIC Research Director Tony Mullen. NIC also began to compile some new figures this quarter, which could help property owners determine the future of their service mix.While conventional wisdom tells us that people will pay more money for more services, the latest numbers offer some surprises in terms of just how much more residents and their families will pay. The typical resident in assisted living today will spend $2,700 a month for care. Add dementia care and that number goes up by $1,500 a month, while private-pay skilled nursing draws an average $5,200 per month, almost twice the revenue generated by assisted living alone. Numbers like these may be helping to drive public policy in a way that favors operators.“There clearly is a progression of hands-on care and clinical care that is being provided as you move from assisted living to skilled nursing, and the government has finally acknowledged that the margin on private pay is indeed being used to subsidize Medicaid beds,” Mullen says.“That in turn is helping keep the reimbursement levels steadier than they have been in the past.” The down side is that the steep rise in cost as care increases can be a detriment to business overall.“It tends to cause sticker shock in many people’s minds, so we do Assisted Living EXECUTIVE , SEPTEMBER 2005 23 G R O W T H need to be very sensitive to the value equation,” Kramer says. Operators need to be ready to demonstrate the value inherent in those higher-priced levels of care. PREMIUM PRICES FOR THE ASSISTED-INDEPENDENT COMBO In a related development, new numbers show that the type of property can also S T R AT E G I E S have a direct bearing on revenues. Say, for example, an assisted living residence stands on a campus that also includes an independent living component. The typical assisted living resident will pay $550 a month more in order to be on that combined property, as compared to being on an assisted living-only campus, NIC found. It works the other way, too. The average independent living resident will pay $400 a month more to live on a campus that also offers assisted living. Some see the phenomenon largely as a product of inertia, as it were, especially among older people who may be wary of relocating. For these residents, the promise of a combined campus offers a readily perceived advantage,“and people have shown that they are willing to pay the price if they see added value in your services,” Fairbanks says. New NIC numbers also show for the first time the potential economic advantage in incorporating some proportion of semiprivate rooms into a residence. The average semiprivate assisted living unit will generate revenues of $1,473 per month, while a semiprivate room in the dementia unit generates $2,077 per month. Both these numbers are 52 percent higher than the per-unit revenue from comparable private units. Today, about 12.5 percent of assisted living units are semiprivate, and the NIC figures suggest that number could probably stand to go a little higher. Still, Kramer says, it has to be done with a delicate hand, since demand for semiprivate units will by nature be limited. Another surprise in the findings this quarter was in bigger vs. smaller market revenue rates, with the gap between the two running far wider than might have been expected. In New York City, for example, one day in a private-pay nursing bed costs $270 as compared to $100 a day in Dallas. This significant gap may help shape the market-analysis efforts among firms with an eye on future geographic expansions. Bigger-is-better is looking better all the time. Taking a step back, Fairbanks says the strong second-quarter numbers are indicative of an industry whose star is clearly on the rise.“The awareness of our industry continues to be enhanced,” he says.“We are getting better at our marketing efforts. We are getting better at being able to explain the benefits of assisted living, and I think the industry as a whole is reaping the benefits of that enhanced awareness in the consumer world.” ▼ Reach contributing writer Adam Stone at [email protected]. 24 SEPTEMBER 2005 , Assisted Living EXECUTIVE CaraSyst ® promote efficiency, maximize revenue, minimize risk We c a n m a k e y o u r b o t t o m l i n e b l a c k ! 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For more information about our exclusive CaraSyst® program, please contact Rob Ewbank at [email protected]. 9755 Dogwood Road • Suite 300 • Roswell, GA 30075 • 770-552-9788 • www.caravita.com COMMUNITY SYSTEMS/INFRASTRUCTURE Building EXCITEMENT Latest trends in new assisted living construction feature larger living spaces, lots of natural light, green space, and luxurious amenities BY ANYA MARTIN S unrise at Lincoln Park sports that signature turret in its corner, and its interior finishes and upscale elegance mirror the traditional suburban Sunrise mansion, but its outer walls aren’t pastel-painted wood; they’re solid red brick.The five-story, 68,405-square-foot building with 45 assisted living and 15 memory-care units blends seamlessly into the downtown Chicago neighborhood. “Since the Chicago fire, people don’t build frame downtown,” says Cindy Musikantow (contact: 703/273-7500), senior vice president of market strategy and product development for McLean,Virginiabased Sunrise Senior Living Inc. “It’s an all-brick building with retail attached on the first floor. We’d never done that before. Now it’s something we consider when we go into a new area.” Sunrise’s goal was to provide a product to attract a new market share of culturally savvy city-dwelling seniors. Making the $15.4 million building match the style of the community helped the company win the support of locals. Sunrise signed onto a mixed-use development of condominiums and shops planned to revitalize a deteriorated area previously home to a bus maintenance and storage facility.The assisted living community, which opened in February 2004, is linked with it via a 30-square-foot courtyard. Other unique features include rooftop decks to compensate for the lack of 26 SEPTEMBER 2005 , Assisted Living EXECUTIVE ground-level green space; a city club-like atmosphere inside, including a posh fifth floor lounge; and a porch with rocking chairs where residents can watch the street action. Few assisted living providers have been building from the ground up over the past couple of years, but those that have are looking to exciting, new models that blend seamlessly into their landscapes, both urban and elsewhere. Units are larger, natural light streams in, and green space remains the holy grail. MORE NEW MODELS As the nation’s largest assisted living provider expands its offerings both here in the United States and in Canada and Europe, it has been adapting its design to respond to each unique market and setting, says Phil Downey (contact: 703/2737500), Sunrise’s senior vice president of strategy and development.“We find a great site and then figure out a building that works on that site,” Downey adds. Set to open in 2008, Sunrise at Turtle Creek, just north of downtown Dallas, will introduce another new Sunrise model for seniors who want a more urban lifestyle— an opportunity for equity ownership. Residents can buy one of 144 state-of-theart premium independent living condos in the 22-story high-rise, but two floors are reserved for approximately 40 assisted living and dementia care units. Downey says the community will distinguish itself from the average CCRC by making assisted units virtually indistinguishable in quality and size from those on the independent floors. Independent residents with health changes can choose to move to the assisted levels or to contract with the Sunrise-At-Home program.And assisted living residents will not only have their own common areas but have complete access to the same amenities as their independent neighbors, including a full-service spa with treatment and massage rooms, a fitness center, and multiple dining environments, which will embody what Downey calls the “fun and excitement of a great restaurant experience”—casual areas, a cocktail lounge, an elevated fine dining room with views of Lee Park, and a chef demonstration kitchen.“Everything about the place is going to be new and different in many respects,” says Downey. A community center on the fourth floor will flow directly into an outdoor terrace, which Downey says is “going to be a fabu- Boulder Associates Inc. lous urban garden.” Other unique design elements include natural wood accents and millwork on the interior and generous use of glass in both units and common areas to emphasize natural light. Sunrise plans to open a similar ownership community, Sunrise at Fox Hill, in Bethesda, Maryland, in 2008, but on a wooded 16-acre site within a dense suburb of Washington, D.C. That building will be six stories or less and incorporate a more naturalistic design evocative of the arts-andcrafts design movement from the turn of the century. It also aims to “set a new standard in this local market and perhaps nationally in design excellence,” Downey says. And it will even include a full performing arts center for theater, music, and lectures. Sunrise’s philosophy of matching exteriors to the surrounding neighborhoods also has helped it adapt to the European market, Musikantow says. As in the U.S. urban residences, interiors remain faithful to the When Eskaton Senior Residences and Services Inc. acquired 52 acres to build Eskaton Village Roseville in California, it faced an added challenge. Seller Stephen DesJardins retained architectural control of all structures being built on his land, which already included a business center, upscale winery, restaurants, and retail and had mandated that everything down to the window shapes, building materials, colors, and landscaping resemble a small town in the Provence region of southern France. Sunrise model of an adaptive environment that doesn’t look adaptive, but all five London and two Hamburg, Germany, communities have different outer looks.“We integrate features that we know really work for seniors all around the world, but the building fits the local market,” she adds. URBAN OASIS With America’s increasingly diverse cultural mix, many people have suggested that the future of assisted living depends on appealing to people from many different ethnic backgrounds. At The Plaza at Punchbowl in downtown Honolulu, Bainbridge Island, Washington-based Sound Health Management Inc. has put that theory to the test by designing a building to appeal both to Hawaiians and the numerous ethnic groups that have settled there, including Japanese, Chinese, Korean, Portuguese, and Latino. Indeed, assisted living communities remain a rarity in Hawaii because of its large Asian population, whose cultural values encourage family members to take care of aging relatives. Another challenge was to balance Sound Health’s service delivery philosophy with the realities of the high cost of construction and land on the islands, says Stephen C. Wattenbarger (stevew@wattenbarger. com), owner and president of Bellevue, Washington-based Wattenbarger Architects, the project’s design firm. The six-story building had to fit a tight urban footprint, requiring that spaces be smaller than in similar mainland properties. However, while the building also has independent living units, the rarity of assisted living in the area helped it score a HUD grant. Total cost was $22.5 million, $14 million for the building and the rest for the land. The Plaza’s exterior is simple and consistent with surrounding midrise structures, reflecting modest touches of local symbolism in its decorative accents. Inside are 137 studios, and one-bedroom and two-bedroom apartments, with higher acuity residents needing 24-hour access to nurses placed on the third floor, and the second floor devoted to memory-care with its own dining room and a secure garden terrace with walking path. Units run from 350 to 850 square feet, designed for maximum efficiency in limited space by eliminating hallways and angling bathroom entries and closet space. Placing the parking lot underneath the building is another space-saving strategy. The building’s interior paint and finish colors show a Japanese influence, while wood frames and elements match island architectural aesthetics, says Rick Tolleshaug ([email protected]), a principal at Wattenbarger and project manager.“We picked a darker stain and oriented the trim to create a fluted or grooved effect, arranged in that angled way that makes a very Hawaiian look. It Assisted Living EXECUTIVE , SEPTEMBER 2005 27 COMMUNITY SYSTEMS/INFRASTRUCTURE has a sense of palm trees in an abstract way.” Sound Health also added more plants than in its mainland communities and lots of fresh tropical flowers. Large glass windows don’t just let sunlight stream in but provide views of a modest but lush social garden in front and a tranquil healing garden for relaxation and meditation.“Whether you’re talking about the Asian, Hawaiian, or even the large Portuguese population in Hawaii, they all live outdoors and want to be able to enjoy it,”Wattenbarger adds. Indeed, the entire lobby, reception, and activity areas on the first floor were designed with openness and light in mind, as well as a synergy among spaces, says Lisa Skelton (lskelton@soundhealthmanage ment.com), Sound Health’s operations officer. “Creating an open feel reflects the Hawaiian spirit of ohana [family],” she adds. “There are no closed areas in the reception area, nobody looking at a closed desk through a window.” “All of the spaces are interconnected visually rather than being separate,” Wattenbarger says.“Residents walk through the core of common areas and see a variety of activities in a number of different places. They also have the opportunity to preview what’s happening in the various spaces so they can make the decision to walk by or join in.” That the building is perched on the slope of Punchbowl Crater, which holds the National Memorial Cemetery of the Pacific, had its ups and downs. Being built into a crater’s edge meant that light only flowed in from one side, a challenge the architects met by adding interior windows so sunlight could pass through every room on the entire ground level except a private spa-like private tub area and massage therapy room, designed with Japanese bathing customs in mind. On the other hand, the views from higher floors are stunning, including the Pacific Ocean and Diamond Head on one side and the mountains behind.“The design reflects a desire to create as many ocean views as we could,”Tolleshaug says. Sound Health even arranged for a Hawaiian priestess to bless the construction site before building commenced and for a Hawaiian priest to bless each room, even every closet, upon completion. 28 SEPTEMBER 2005 , Assisted Living EXECUTIVE COUNTRY LIVING, LARGER SPACES Located in a 17-acre wooded site in suburban Springfield, Massachusetts, Keystone Woods features two separate residences, The Gardens Independent Living Community and Grayson House Assisted Living Community, which includes a memory-care wing. But anticipation is so high that while construction would not be complete for another four months, a preview party in June attracted 750 people to tours of model apartments and the unfinished common areas, says Joseph L. Roche, president of Wilbraham, Massachusettsbased The Roche Associates Inc., the property’s co-developer in partnership with Franklin, Indiana-based Keystone Senior LLC, and Tony Mullen, research director of the National Investment Center for the Seniors Housing & Care Industries (NIC). “They were just astonished by the overall size and design of the assisted living [projet],” Roche says.“Our assisted living apartments probably are 25 to 50 percent larger in general than the ones in marketplace.” For the partners, the goal was to differentiate the community from their competitors, he adds. Grayson House is 80,000 square feet, just 20,000 square feet smaller than The Gardens. Inside, however, there’s very little difference. The developers opted for more home-like, larger assisted living units because consumer research shows that both seniors and their adult children saw smaller living quarters as a downside to assisted living. Conversely, providers were finding it tougher to rent studios.While the memory care area includes 346-square-foot studios, most of the community ranges from 608- to 708-square-foot one-bedroom residences to spacious 784-square-foot deluxe two-bedroom, two-bathroom units perfect for couples or for residents who wish to share. As one tour participant remarked, the bathrooms themselves were “large enough to fit 12.” Many apartments also have patios or balconies.The overall look blends solid brick and wood siding to mimic a grand Cape Cod hotel, complete with a whitecolumned porte cochere in front and a cupola and dormers built into the gray shingle roof. Again, natural light is important, in this case flowing in through bay windows in both the apartments and in common areas, Roche says.Thanks to overwhelming positive response from residents in Keystone Cedars in Cedar Rapids, Iowa, developers also are incorporating an in-house theater with a 52-inch television and a popcorn machine. “A lot of times, people used to think about a nice end-of-life living experience; we’re now focusing on life enhancement,” Roche says. In the middle of the property, the developers were banned from building on seven acres of wetlands, so instead they will transform the sprawling outdoor area into an asset. The front entrance features a cascading waterfall and a natural walking path with benches and birdfeeders that allow residents to explore the woodlands. Residents also can enjoy flower gardens and a sculptured garden area with sitting areas and reflecting pools. “Some people could say, too bad that there’s all that wasted land, but I look at it as an advantage; we can’t take those trees down,” Roche says. The community also is built to be energyefficient with tight building seals and other EnergyStar components, which results in lower rental fees.The day of the tour was a hot one, Roche recalls, and even without power, temperatures were 15 to 20 degrees cooler inside than out. TOUCHES OF TUSCANY AND PROVENCE Two other new assisted living properties within CCRCs also embody a luxury virtually indistinguishable from their independent living neighbors. Carmichael, California-based Eskaton Senior Residences and Services Inc. has been perfecting its vision of blending independent living patio homes and apartments, a skilled nursing facility, and a central lodge, including dining areas, wellness center, other social areas, and assisted living apartments. But when the company acquired 52 acres to build Eskaton Village Roseville in California, it faced an added challenge. Seller Stephen DesJardins retained architectural control of all structures being built on his land, which already included a business center, upscale winery, restaurants, and retail and had mandated that everything down to the window shapes, building materials, colors, and landscaping resemble a small town in the Provence region of southern France.To ensure complete accuracy, Eskaton sent the plans designed by Boulder, Colorado, architectural firm, Boulder Associates Inc., to a French architect for review, says Trevor Hammond (trevorh@eskaton. org), Eskaton’s vice president of operations. Construction starts in November, and when completed in early 2007, Eskaton Village Roseville’s lodge will boast cement plaster walls in a variety of warm tones such as taupes, tans, and some ochre, as well as stone trim, says Tim Boers (tboers@boulder associates.com), the principal at Boulder Associates supervising the design. The casement windows will have a traditional French appearance with some sporting shutters. The roof will be clay tile punctuated by dormers with shutters and chimneys for at least five fireplaces within. Residents and visitors will enter through a stone and timber porte cochere into a two-story shared lobby with a tower in its center that lets filtered daylight flow down from shuttered windows at the third level. To one side will be the grand entry into the two-story assisted living wing, which includes a living room with French doors, balcony railings, and library shelving flanking a stone fireplace. Boer adds that “finishes on walls, drapery, fabrics, and furnishings will also have the suggestion of being in France. It’ll be very warm, very inviting.”A large dining room will feature a serving kitchen that includes display cooking and opens up onto a courtyard patio. Upstairs, residents will have their own bathing area designed to be spa-like with decorative tiles on walls, framed mirrors, and subdued lighting.Assisted living residents also can share amenities available to the independent residents, such as a beauty salon, wellness center, onsite medical office, and conference center. The 40 assisted living apartments will include no studios, just one-bedroom and spacious two-bedroom apartments.“They’ll be very similar to the independent living in terms of finishes and layout,” Boers says. “They’ll have walk-in closets, generous windows. For some of the upper-level units, there are French doors that open onto a European balcony. The windows are detailed and the divisions of glass propor- Even though construction would not be complete for four months, Grayson House Assisted Living Community hosted a preview party for 750 people to tour model apartments and the unfinished common areas. tioned to what one would find in the south of France.” Large bathrooms will feature roll-in showers, linen closets, and decorative lighting with a “bit of a French flavor,” Boer adds. The quality of finishes and other design elements won’t be compromised in a separate one-story area that will house 24 dementia-care residents, he continues.“The goal for all levels of care is that residents feel like they’re in the same lodge, even if they do move from level to level.” Their amenities include two dining rooms, one of which opens into an outdoor courtyard with vine-covered trellises and elaborate landscaping. Another community setting new standards for high-end assisted living is part of Independence Village at the Dominion, a CCRC being built by San Antonio,Texasbased Dial Communities Inc. in the Dominion suburb and designed by Costa Mesa, California-based Irwin-Pancake Architects. Planned to blend into the area where home values range from $2 to $12 million, the long, narrow building will feature lots of towers and domes, says Gregory Irwin (irwing@irwin-pancake. com), a principal with Irwin-Pancake Architects. The 90 assisted living units are divided into two levels of acuity, but everything about the planned design and amenities is upscale to attract seniors who want to remain close to family who live in the area. “It has to be more than a concept if you’re going to provide assisted living to people at this level,” Irwin says.“They’re not going to move out of independent living to a small place with no services. They can afford to pay someone to bring services to their house.” The country club feel starts in the twostory lobby with an impressive view onto a golf course.Amenities include a day spa with beauty shop and massage therapy, as well as a theater room. Every effort is being made to make public spaces invite residents to pause, for example, to view fish ponds and two-story bird cages. The one-bedroom apartments cover more than 720 square feet and include a butler’s room where staff can pick up or drop off laundry, the morning paper, or room service without disturbing the occupant and which can be locked from the inner residence for privacy. Each unit also has a washer and dryer connection with a built-in ironing board. Both living room and dining room have full window views with balconies. Bathroom elements to ensure units look more like a home include a wall on the side of the toilet, dual sinks, a make-up area with a chair and a walk-in closet that opens directly into the bathroom. And tech-savvy seniors even have a small office space to set up their computers. “What do people do with their computers in assisted living?” poses Pancake.“They don’t want it in the kitchen or the bedroom. If they don’t have a computer, it could also be a sewing room or even a storage area.” ▼ Reach contributing writer Anya Martin at [email protected]. Assisted Living EXECUTIVE , SEPTEMBER 2005 29 (% . 44 4)/ 8 3! 3) 4 ( 4 5 0 / )/ 4 3) 8 /. // 6) 3!% !.4 4( " ( !! 3!. ). "%2 6% ./ "/2.).4(%!'%/&02).4 ,)6).').4(%!'%/&4(%).4%2.%4 -ORE AND MORE OF YOUR AUDIENCE ARE LOOKING FOR YOU ONLINE 3O THERES NO NEED TO WASTE MONEY ON OVERPRICED PRINT ADVERTISING 7ITH 3ENIOR(OUSING.ET YOULL GET STRONG REGIONAL AND NATIONAL EXPOSURE UNLIKE ANY OTHER ONLY 3ENIOR(OUSING.ET CAN LIST YOUR COMMUNITY WITHIN ALL OF THE SENIOR HOUSING SECTIONS OF !/, -3. AND 9AHOO !ND WITH A LOW COST PER RESIDENT THERE IS NO TIME LIKE THE PRESENT TO REACH THIS ONLINE AUDIENCE #ALL US TODAY AT TO LEAVE THE PAST BEHIND YOU S P E C I A L R E P O R T Resident-Focused TECHNOLOGIES High-tech quality of life enhancements offer a competitive edge By Jim Moore ome say high-tech innovation won’t work with today’s traditional seniors— a shortsighted view considering the mounting evidence that consumers are ready to accept and respond favorably to new beneficial impacts of high technology. The changing psychographics of today’s senior consumers make them more computer-friendly. A growing number of today’s seniors are technologically savvy as evidenced by the growth in computer workstations within senior communities— from one or two seldom-used workstations to 10-15 stations in continuous active use. Residents increasingly are including computer workstations within their individual apartments as well. Couple this with today’s typical 45to 64-year-old sophisticated, computeroriented decision influencer and you can readily see the growing involvement of high technology in general and computers in particular. The foundation for applying technology to enhance seniors’ quality of life in assisted living communities involves three technological breakthroughs. 1. WIRELESS TECHNOLOGY. Wireless technology expands the potential resident monitoring and other information transfer applications within existing senior housing communities. Hard-wired connections are no longer required. Infrared and radio frequency (RF) information transfer can distribute valuable information within a resident’s living unit and throughout the community S to central information gathering points.This wireless technology also allows practical expansion and retrofits of existing and older communities. For example, state-ofthe-art personal emergency response systems can now be retrofitted within existing communities with relative ease using wireless technology. (The October issue of Assisted Living Executive will look at life safety technology solutions.) 2. THE INTERNET. The Net has quickly transformed a relatively expensive hard- wired national and international communications network into a flexible, personalized, and surprisingly inexpensive audio and video gateway to the world. For example, most of us already are accessing cell phone, satellite TV, and wireless Internet access. Today, we can connect residents with their families or their medical practitioner in a direct personal manner at virtually no cost. Audio and video conferencing among multiple family members is now possible, either free or for a very modest cost. Combine these capabilities with real-time photo transfer, e-mail, and instant messaging and the connection between residents and their families can be virtually seamless regardless of geographical displacement. Equally important is the vast amount of online information about the aging process that is now available from numerous Web sites. These communications work best with broadband Internet connections and can be accomplished either live (in real time) or stored for on-demand access by family members on a personal Web page with information links that can be accessed anytime. 3. WEB-BASED SERVER TECHNOLOGY. This technology allows top management to access and monitor the frontline performance of either an individual campus or multiple communities within a portfolio from anywhere in the world 24/7 (see cover story). Essentially, management can easily telecommute from their “virtual office,” checking on details of in-house marketing, Assisted Living EXECUTIVE , SEPTEMBER 2005 31 S P E C I A L financial and management information systems, and even the clinical/directcare status of individual assisted living residents, by discrete activities of daily living. Of equal importance, they can ensure that their operation is maintaining appropriate standards of care and receiving fair and adequate compensation for services delivered on a resident-by-resident basis. Are you missing a major opportunity to offer high-tech solutions to enhance residents’ quality of life? Here are some ideas. Voice recognition software that automatically converts the spoken voice into typed text, e-mails, or specific commands in digital format has now arrived for practical use.With a modest degree of indoctrination, seniors can avoid the sometimes threatening or difficult task of keystroking or handwriting to communicate with far away loved ones.Voice recognition can also transmit digitized requests for help or other assistance with living needs, which 32 SEPTEMBER 2005 , Assisted Living EXECUTIVE R E P O R T are then transmitted through wireless technology to appropriate monitoring and communication centers. Menu-prompted computer touch screen technology provides yet another userfriendly computer communication interface for seniors.A simple example would be a friends-and-family address book whereby seniors using touch screen technology can make automatic e-mail and telephone connections. A daily “I’m OK” or other frequently used messages or requests to family members can also be incorporated within a customized touch screen format. Conversely, text can now be converted to a spoken voice for information transfer to visually impaired seniors. New emerging technology also is addressing two significant health-care issues involving seniors. Medical practitioners don’t make many house calls anymore, and not all general practitioners have a depth of experience in geriatrics. Extensive communication and doctor-patient interaction are being accomplished via the Internet along with the transfer of vital signs and other medical records. In addition, family and medical practitioners are accessing the best available Internet information on geriatrics that is now available from both United States and international sources. While not totally replacing doctors’ S P E C I A L R E P O R T THREE PRINCIPLES OF RESIDENT TECHNOLOGY f some of this appears blue sky to you, it’s time to start an information technology initiative for your community. The senior housing business overall is clearly behind the power curve in the practical exploitation of today’s available technology. We can easily bridge the gap between available high technology and serving residents in an innovative, but practical, manner. But don’t get too carried away with high technology. In dealing with residents (and their families), high technology must focus on three basic principles: ■ Sustaining or enhancing standards of care and quality of life for your residents and their families. ■ Creating a seamless four-way communication between the senior, your professional staff, the family, and possibly a family medical practitioner. ■ Achieving a delicate balance between high-tech and high-touch, while striving to improve the economics and effectiveness of serving seniors. This means we must enhance staff productivity with new technology with absolutely no compromises in a senior’s quality of life. I bedside manner of the past, new technology has dramatically closed the information and communications gap between the senior, family members, and the medical practitioner. Technology also has intensified and enhanced the flow of important geriatric information. A geriatric health-care clearinghouse of valuable information could exist within the next several years. The nuclear family may be largely a thing of the past, but the concept of the “virtual family” is fast becoming a reality through advances in technology. Consider these realworld innovations: ■ Grandma can play simple games with the grandkids via an Internet connection. ■ Using low-cost Webcams, geographically displaced family members can view live video images of each other as they privately communicate by both voice and live text— at no additional cost. In addition, a “white board” capability allows grandchildren to draw pictures with Grandma watching (live). ■ Photographs with family member voice-over can be transmitted either live or 34 SEPTEMBER 2005 , Assisted Living EXECUTIVE While not totally replacing doctors’ bedside manner of the past, new technology has dramatically closed the information and communications gap between the senior, family members, and the medical practitioner. stored on a family Web site for viewing and listening on demand by the senior. ■ For some time, many senior living communities have had special TV channels for their residents. Now these channels are being highly customized by specific campus living arrangement (independent living, assisted living, etc.) and resident interests and preferences. Far away family members can also tap the goings-on at their loved one’s community by accessing this information via a customized Web site—one that frequently changes content daily. Long-distance phone charges are plummeting as carriers merge and scramble to capture market share. But while this is occurring, the Internet offers increasing communications capabilities—at little or no cost. Much of this capability works best with broadband (cable, satellite, or DSL) computer hook-ups. Once thought to be a serious limitation with consumers, we now know that broadband Internet connections have established a surprisingly high consumer market penetration. Satellite radio broadcasts hundreds of stations representing vast geographical and program content diversity. Today’s seniors grew up during the radio era and many may find this to still be an interesting experience. Digital video recorders (like TiVo) can store TV programs as well as transmit them to other TiVo-equipped locations.This means that seniors and their families can enjoy programs and favorite movies long after the actual broadcast. These are just a few examples.The future potential is high. Introducing high technology has significant upside potential and embracing it does not have to be a high-risk endeavor. In fact, senior living can succeed in the high-tech world where many companies failed when the Internet bubble burst. In most cases, the technology was sound, but many companies lacked a marketresponsive product or a flawed business mode.That is certainly not the case with assisted living. We must use existing and emerging technology to enhance the standards of care and quality of life of residents, while also improving the operational effectiveness of assisted living communities. ▼ Jim Moore is president of Moore Diversified Services Inc., a national senior housing and health-care consulting firm based in Fort Worth, Texas. He is the author of Assisted Living Strategies for Changing Markets and Independent Living Congregate Care and CCRCs. Reach him at 817/731-4266 or [email protected]. A R B I T R AT I O N A G R E E M E N T S I N A S S I S T E D L I V I N G With Arbitration, Resident Disputes Are Resolved Faster, Cheaper BY LORETTA LEBAR AND KEITH MAURER roviders of healthcare services nationwide are choosing arbitration to resolve disputes with consumers, and for good reasons: It costs less, it saves time, and it’s fair. Courts and commentators find arbitration is less expensive compared with overall litigation costs. Part of the cost savings results because arbitration is much faster than litigation. The U.S. General Accounting Office (GAO) found that arbitration hearings typically require two to four days, compared with several weeks for court hearings in traditional litigation. Researchers conclude that individuals fare at least as well in arbitration as they do in court. Plus, a Kaiser Permanente study found that arbitration participants report a high degree of confidence in arbitration. Including arbitration clauses in providerconsumer agreements at the start of the business relationship keeps both parties out of expensive, often sluggish lawsuits in favor of what arbitration proponents describe as a fair, inexpensive, and efficient system. P LEGAL PRECEDENTS Agreements to arbitrate, including those contained in assisted living resident docu- ments, generally are governed by the Federal Arbitration Act (FAA).The FAA represents Congress’s strong endorsement of arbitration, and requires that arbitration agreements be enforced as written, subject to the laws that govern all contracts. Some states have enacted laws to govern arbitration in the health-care field, but the FAA pre-empts state laws that are inconsistent with its guidelines. Courts have repeatedly reaffirmed the role of arbitration in all areas of business and consumer transactions, including health care and long-term care. In Madden v. Kaiser Foundation Hospitals, for example, the court compelled arbitration of a medical malpractice claim brought by a state employee against a health plan, honoring the agreement to arbitrate between the state of California and the health plan.The COMPLIANCE CORNER court concluded that arbitration was “an accepted and favored method of resolving issues … praised by the courts as an expeditious and economical method of relieving overburdened civil calendars.” In a recent Florida case, Blankfeld v. Richmond Health Care, the court did not enforce an arbitration agreement because it substantially limited the remedies created by Florida’s Nursing Home Residents Act.The court also ruled that a substitute decision-maker or statutory health-care proxy did not have the authority to bind a nursing home resident to arbitrate claims in that state. These decisions, as well as others, provide guidance to assisted living providers when using arbitration in their agreements with consumers.The Florida Court’s finding illustrates the importance of using only fair arbitration procedures and not over-reaching. Managing litigation risks through the use of arbitration makes sense so long as the procedures and methods used are fundamentally fair, welltested, and have a history of being accepted by the courts. WHAT, WHEN, AND HOW Critics of arbitration contend that parties should be offered the choice between arbitration and a lawsuit only after a dispute arises.They disagree that arbitration has all the attributes espoused by its proponents, and argue that if it does, parties will gladly agree to arbitration post-dispute, rather than in a pre-dispute arbitration agreement. Researchers, however, have found that post-dispute arbitration agreements often fail to provide reasonable hope of resolving a legal dispute outside litigation.The odds Assisted Living EXECUTIVE , SEPTEMBER 2005 35 COMPLIANCE CORNER are not great that an agreement for binding arbitration would be entered after a dispute has arisen. At that stage, parties already are polarized about the dispute itself, and one party or the other will have a view that traditional litigation offers some advantage, which they likely will not voluntarily relinquish by choosing to arbitrate. Berkeley University researchers have found that both businesses and individuals are hurt by the failure to establish an agreement in advance. An arbitration clause needs to be consumer friendly, which is possible without sacrificing the care provider’s objective to have disputes resolved efficiently, rationally, and inexpensively by arbitration. Select a reputable independent entity to administer the process.The National Arbitration Forum (NAF) is a good source, for example, offering a reputable panel of arbitrators, reasonable fees, and efficient rules of procedure. Keep these points in mind throughout the process: ■ Make the agreement mutual and allencompassing. The agreement should bind both the consumer and the provider and state that all disputes will by decided by the arbitrator. In other words, both billing disputes brought by the provider and negligence claims brought by the resident should be covered. ■ Prevent financial burden. The cost of arbitration should not stand in the way of people bringing a claim. By referencing a reputable administrator’s rules in the agreement, drafters may automatically incorporate the fee schedules that typically reflect reasonable fee allocation among the parties. ■ Tell the truth and be open.The agreement should make it clear to the consumer that he or she is foreclosing the option of a judge or jury trial and instead agreeing to an alternative forum. ■ Make it optional. Consider allowing consumers to enter a residency contract even if they choose not to sign the agreement.Alternatively, allow consumers to opt out of the arbitration provisions within a certain period from signing, such as 10 days. ■ Invoke the FAA. State arbitration laws vary from one state to another. By invoking the FAA, health-care providers can use the same agreement in several states and parties are assured that the agreement will be enforced according to its terms. 36 SEPTEMBER 2005 , Assisted Living EXECUTIVE ARBITRATION AT-A-GLANCE quick look at some arbitration basics for assisted living providers: (Go to www.arbitration-forum.com for more information.) ■ Arbitration allows assisted living providers and consumers to resolve disputes without resorting to lawsuits. In arbitration, the disputing parties present their side of the story to an arbitrator or panel of arbitrators. An arbitrator is a neutral person who hears all sides of the dispute, decides the matter, and issues an award. This award is binding and legally enforceable, and can be reviewed by the courts. ■ Consumers typically agree to arbitration through admission documents upon becoming a resident at a provider community. An arbitration agreement is a legal contract between two parties. ■ Arbitration is similar to court in some ways but is far less expensive and less time-consuming than filing a lawsuit. Legal experts have concluded that consumers win at least as often and receive as much compensation in arbitration as they do in court. A The following is a sample clause and has withstood many legal challenges. Note that it is not intended as legal advice nor intended as a substitute for obtaining legal advice from competent, independent, legal counsel. “By signing this agreement, the resident agrees with the facility that any dispute between you and us, including any services rendered prior to the date this agreement was signed and any dispute arising out of the diagnosis, treatment, or care of the resident, including the scope of this arbitration clause and the arbitrability of any claim or dispute, against whomever made (including, to the full extent permitted by applicable law, third parties who are not signatories to this Agreement) shall be resolved by binding arbitration by the National Arbitration Forum, under the Code of Procedure then in effect.Any award of the arbitrator(s) may be entered as a judgment in any court having jurisdiction. In the event a court having juris- diction finds any portion of this agreement unenforceable, that portion shall not be effective and the remainder of the agreement shall remain effective. Information may be obtained and claims may be filed at any office of the National Arbitration Forum, at www.arbitrationforum.com, or at P.O. Box 50191, Minneapolis, MN 55405.This agreement shall be governed by and interpreted under the Federal Arbitration Act, 9 U.S.C. Sections 1-16.” This agreement binds all parties whose claims may arise from or be related to treatment or services provided by the residence, including any spouse or heirs of the resident. The consumer understands that the result of this arbitration agreement is that claims, including malpractice claims he/she may have against the residence and its employees and agents, cannot be brought as a lawsuit in court before a judge or jury, and agrees that all such claims will be resolved as described in this section. The consumer also understands that nothing in this agreement prevents him or her from contacting regulatory or administrative agencies in relation to services provided by the facility, and that, once admitted, the resident cannot be discharged for refusing this agreement. Putting the management of the arbitration into the hands of skilled arbitrators provides an even playing field that is often not found in the litigation setting. Using a tested arbitration clause that does not put limits or restraints on resident rights or remedies provides the best opportunity to steer future disputes away from the courts. ▼ Loretta LeBar is of counsel for the law firm Stoll Keenon & Park in Lexington, KY. Reach her at 859/231-3693 or [email protected]. Keith Maurer is director of healthcare and insurance ADR (alternative dispute resolution) services and assistant general counsel for the NAF in Minneapolis. Reach him at 952/516-6426 or [email protected]. TEXAS ASSISTED LIVING ASSOCIATION Accreditation Victory Fuels a Legislative Campaign BY BECKY SQUIRES AND SKIP COMSIA n past years, the Texas Assisted Living Association (TALA) merely reacted to legislative issues rather than meet them head on. During each session, the organization would hold its collective breath and wait for what the legislators decided.Then the association would rally the troops and do whatever was necessary to make the legislative decision less burdensome for members.We often got the things we wanted from our legislators, but we did not actively seek them. For instance, a few years ago we were able to get aging in place legislation passed, but only by tacking it on as a quid pro quo to other legislative issues. During the last session in 2003 (the Texas legislature meets every other year),TALA joined with health-care organizations to get tort reform legislation passed. This year, however,TALA took a different stance—a proactive one—and lobbied to pass legislation for accreditation in lieu of annual licensing surveys.With support from Sen. Kyle Janek and Rep. John Davis, the Texas Department of Aging and Disability Services (DADS) is now required to accept an accreditation report from any approved accreditation authority, such as the Joint Commission on Accreditation of Healthcare Organizations (JCAHO) or the Commission on the Accreditation of Rehabilitation Facilities (CARF), in lieu of an initial or annual licensing survey. Because it eliminates initial and annual inspection requirements, the legislation provides assisted living communities a real incentive for pursuing JCAHO or CARF accreditation. The program is purely voluntary. Communities may still choose to be surveyed by DADS, and the state will continue to conduct complaint investigations. In I these cases, however, the legislation provides time for DADS to adopt rules and otherwise implement the optional accreditation program.And, perhaps as important as the initial legislation,TALA will work with DADS over the next several months to establish a successful and fair accreditation program. ACCREDITATION BONUS BENEFITS Many providers consider accreditation a business strategy to support performance improvement.Texas assisted living providers report many benefits of integrating the accreditation authority’s standards into the culture of their organizations to continuously improve the quality of their services. Benefits of investing in accreditation include: 1. Peer review and consultation conducted by an independent thirdparty accreditor 2. Self-evaluation that discloses policies and procedures in need of improvement 3. Increased satisfaction in the organization expressed by the persons served, leadership, and staff 4. Improved employee team communication and interaction The Senior Star Living communities in Texas—12 Oaks East and 12 Oaks Irving—chose CARF accreditation a few years ago and feel it was a wise decision. They have seen an increase in the quality of resident care as well as a decrease in employee turnover. Mike Cawood, 12 Oaks East executive director, says the operational AFFILIATE SPOTLIGHT improvements at his community are like “the difference between a bachelor’s degree and a master’s degree.” In other words, he says, the accreditation took resident care to the next level. Since the CARF (and JCAHO) standards are outcome-oriented, unlike the action-oriented state regulations, employees are empowered to become more engaged with the residents, predicting needs, and enhancing care. Staff at 12 Oaks East and 12 Oaks Irving also have found that accreditation boosts their marketing efforts.The average consumer may not be familiar with the specific accrediting organizations, but they certainly can recognize exemplary standards which must be met to receive an accreditation. The successful accreditation initiative has fueled TALA’s proactive legislative drive. The next legislative session begins in January 2007 and the association already is planning its agenda and forming strategic partnerships to strengthen its lobbying efforts. To date, there are three initiatives TALA will pursue in the next session—medication packaging, state rule interpretations, and deficiency reporting. MEDICATION PACKAGING Currently,Texas assisted living residents may obtain their medications from any pharmacy they choose and the provider may require that those medications be packaged a certain way. Many providers have established packaging requirements to help eliminate medication errors.TALA will ask the state to mandate that all medications sent to assisted living properties be packaged by dose by the pharmacy. The rationale for this initiative is three-fold: fewer medication errors, reduced risk, and less waste resulting in reduced costs. The immediate and greatest benefit of this initiative is the reduction of medication errors since the pharmacy would be solely responsible for appropriately prepackaging medications. Fewer medication errors result in reduced risk on the part of the provider. Pharmacies would be allowed to accept returns of unused and unopened medica- Assisted Living EXECUTIVE , SEPTEMBER 2005 37 AFFILIATE SPOTLIGHT tions to reduce waste and ultimately costs. Additionally, pharmacies would be allowed to use medications from entities that do not use dosage packaging (such as county health clinics or mail order pharmacies) as stock or to repackage them. STATE RULE INTERPRETATIONS Currently, the state regulatory authority issues rule interpretations without any input from the provider community. It also issues life safety interpretations in one region that don’t apply to another region. TALA will push for legislation that will require the state to include provider input in the rule and life safety interpretation process, with the recommendation that these interpretations be applied evenly throughout the state.As a part of this legislation, the state would be required to issue AT-A-GLANCE: Assisted Living in Texas ■ http://tala.home.texas.net ■ Number of licensed assisted living providers: 1,398 ■ Number of assisted living units: 43,875 ■ Number of TALA provider members: 235 ■ Number of assisted living units among TALA members: 11,872 ■ Average number of assisted living units per TALA member: 50 interpretations specifically tied to an existing assisted living regulation. DEFICIENCY REPORTING 4HE$RIVETO3UCCESSIN3ENIORS(OUSING IS3MOOTHER7HEN9OU(AVEA2ELIABLE-!0 7HEREVERYOUGOCHARTYOURCOURSE WITHCONlDENCEWITH.)#-!04- THElRSTCOMPREHENSIVEDATABASE OFSENIORSHOUSINGPERFORMANCE INFORMATIONONTHENATIONSTOP METROPOLITANSTATISTICAL AREAS-3!S%STABLISHEDASTHE $EALMAKERS.AVIGATION3YSTEM .)#-!04-ISTHESENIORSHOUSING INDUSTRYSONLYSOURCEFOR s3TANDARDIZEDLOCALOCCUPANCY REVENUEPROPERTYANDDEMOGRAPHIC DATAANDTRENDS 38 SEPTEMBER 2005 , -!0XINDD Assisted Living EXECUTIVE s#OMPLETESUPPLYINFORMATIONFORALL SENIORSHOUSINGPROPERTIESINSIDETHE TOP-3!S s3YSTEMATICRANKINGSOFTHETOP-3!S BASEDONKEYMETRICS s.EWCONSTRUCTIONDATAANDLISTINGSFOR THETOP-3!S 3OPOINTYOURSELFINTHERIGHT DIRECTION&ORMOREINFORMATION VISITWWWNICMAPORGORCALL -ICHAEL(ARGRAVEAT 0- Currently, deficiencies reported during inspections are posted on the DADS Web site for public review. Consumers can check a property and see a list of deficiencies before choosing a residence for themselves or a loved one.This is currently a one-sided list. Deficiencies are listed even if they are later found to be invalid or if they are minor and corrected immediately. TALA will seek legislation to allow for provider response to the deficiency— such as the plan of correction filed or the plan to take the issue through the informal dispute resolution process— posted online along with the reported deficiency. ▼ Becky Squires ([email protected]) is TALA executive director. Skip Comsia (skip@verandaliving. net) is chairman of TALA Board of Directors. Contact them at 512/479-0425. Michael Crowe J.D., Susanne Matthieson M.B.A., and Mike Cawood contributed to this article. ALFA d Living Assiste a of Americ Federation ds of n i M e h t e Insid Executives in Leadinivging & Seniors Houstainilged Assisted L LIO O F T R O P IVE T U C E X E A ALF THE FUTURE OF ASSISTED LIVING ve a de : ecutives gi Leading ex sider’s perspective on T in tegies ra St th w ro G adership T Strategic Le agement T an M es T rformance Quality Pe uality Resident Servic Q rtners LLC Growth Pa of the by Acclaro on behalf conducted A). erica (ALF ion of Am ing Federat Liv ted Assis 20 y Ma 05 report A research has been redefined “The ALFA Executive Portfolio will definitely cause a ripple at your company. It will challenge what you thought you knew about the assisted living business and give you insights in surprising ways.” Tom Grape, Chairman & CEO Benchmark Assisted Living Everyone wants to know what’s on the horizon for assisted living. But without a clear map, planning can be a challenge. ALFA’s 2005 Executive Portfolio: Inside the Minds of Leading Executives in Assisted Living & Seniors Housing reveals jaw-dropping insights from a “who’s who” of assisted “. . . an indispensable market research living executives. The ALFA Executive report detailing unprecedented executive Portfolio challenges business model perspectives from leading companies,” assumptions of the past, fueling Tiffany Tomasso, COO renewed dialogue about the future. Sunrise Senior Living It is not just another research report. “No assisted living executive can be without Key Findings... this ground-breaking insider report. It’s critical to operational excellence and ■ Rapid acceleration in new capacity keeping ahead of the competition.” may occur between 2008-2009, Steven Vick, CEO, Signature Senior Living “. . . challenges my business assumptions and shows me what the bigger competition is planning for. This report is vital to my business.” Skip Comsia, CEO/President Veranda Living Inc. “In this constantly changing assisted living industry, the ALFA Executive Portfolio is the definitive tool for busy executives trying to keep up with the direction of the industry in a variety of operational areas.” Loren Shook, President/CEO & Chairman Silverado Senior Living Inc. leading to a short over-supply period. ■ Five key growth drivers include organic new expansion, predatory M&A, and others. ■ Pricing is migrating to a tiered model with concierge-style service options. ■ Independent living, home care, and CCRC models impact assisted living’s market definition. View the first few pages at: www.alfa.org/public/articles/ALFAExPort_C1-9.pdf. Purchase the ALFA Executive Portfolio at: www.alfa.org/store CONSUMER VOICE O N A G I N G A N D I N D E P E N D E N C E Focus on Resident Strengths, Not Weaknesses, To Boost Quality of Care BY KATE NEWTON onsumers look to assisted living communities and caregivers to provide a positive environment where residents can focus on their strengths and abilities—not their limitations. As a society “we tend to focus on what they can no longer do well or do at all,” says Jeff Ferguson (jferguson@ericksonmail. com), president of management and operations for Baltimore-based Erickson Retirement Communities. “Our approach is to find out what capabilities people posses and work with them as distinct individuals.” A new program called Champions of Change at Erickson Retirement Communities is focused on creating positive, goals-oriented environments for Erickson residents and boosting quality of care efforts companywide.The goal is to optimize residents’ well-being through active aging and a commitment to initiatives that focus on people’s personal strengths and preferences—whether they live completely independently or in assisted living or skilled nursing communities. “This person-centered and strengthbased model benefits those who live on an Erickson campus by teaching our staff to focus on what a resident can do, not on what he or she cannot do or has trouble doing,” Ferguson says. C BUILDING COMPANYWIDE CHANGE Champions of Change is directed by Judah Ronch Ph.D. (jronch@ericksonmail. com), vice president of mental health and wellness for the Erickson HealthSM system. “We use the most available personal, 40 SEPTEMBER 2005 , Assisted Living EXECUTIVE The Champions of Change program at Erickson Retirement Communities creates positive, goals-oriented environments for residents and boosts quality of care efforts companywide. family, and community resources and the least necessary professional intervention to achieve the best outcomes in line with each person’s preferences,” says Ronch, whose background includes years of clinical and research-based experience. The company recently held a three-day training session to launch Champions of Change. “This isn’t something that could go out in a companywide memo or trickle down from the top,” Ronch says.“Each individual campus is driving the process for its campus, based on the unique needs of the people who live there.” Each community has one to five champions who work with Ronch to weave the person-centered, strengths-based philosophy into various facets of campus life. Twenty-five employees from 13 Erickson campuses attended the training session. They are now the program’s ambassadors at each location.They also will identify and work with a team of departmental and resident champions to maximize collaboration. Resident Life Director Kelly Trudell ([email protected]) says the staff at Henry Ford Village in Dearborn, Michigan, guide the program there. “A lot of people on the staff have been here a long time,”Trudell explains. “They have histories and close relationships with the residents. They’ve known these people for the last nine or 10 years. Maybe they’ve been with them through the birth of a great-grandchild or the loss of the spouse. In some situations, the staff can act as the residents’ memory and remember their strengths even as they themselves start to forget.” UNIQUE CHALLENGES, BIG BENEFITS Providing care from a perspective of strength and ability is a change that must also affect the way staff members and residents think, which can present unique challenges. For example, Henry Ford Village has been open for more than 10 years, so “routines and the campus culture are well established,” Trudell says.“What we’re really trying accomplish is to challenge the staff and residents to rethink the what, who, where, and why of how we approach care and respond to residents as individuals.” Lyn Lubic ([email protected]), marketing director at Greenspring, an Erickson community in Springfield, Virginia, agrees that such substantive change is difficult—but the benefits are great. “This is going to be a welcomed stretch for staff because it’s essentially changing the way we do business. Our staff is ready and eager for the change.We want to do a better job. “The residents can give us their perspective and can talk to the resident body better than we can, getting information out to their neighbors as their peers,” Lubic continues.“We also want to use residents’ background and expertise in fields like health care as we try out new programs.” The initial Champions of Change action plan for Greenspring includes holding PRINCIPALS WANTED To develop a continuing care retirement community on property located in the Appalachian Mountains. This property is located near the new I73 & I74 currently under construction and a proposed new county airport. Said property is within the corporate limits of a small town and adequate utilities available. The owner can be reached by addressing inquiries to: Clarion Bathware RESOURCE LINK 44 Amsler Ave. Shippenville, PA 16254 814/226-5374 ext 822 Faxfor814/226-0730 dementia training all staff, starting an adult daywww.clarionbathware.com program, expanding a fall [email protected] prevention program, and taking apartment customization services a step further to Celebrating ourneeds 30th regarding anniversary better meet residents’ Bathware in 2003, dementia issues,Clarion low vision, hearingis proud to be and a leader impairment, gait. and innovator in living industry. the assisted Michael Shaw (mshaw@ericksonmail. over 50 models of of com) isManufacturing the associate executive director andErickson ADA compliant units. Eagle’saccessible Trace, a new community Clarion the knowledge and in Houston, andhas is directing the Chamexperience to servethere. you. See our pions of Change program SHOWER, “For CONVERTIBLE existing communities, thiswhich model realconverts from ashift shower to a ly involves a paradigm and culture on oura Web site. change,bathtub, ” he says.“With start-up like Eagle’s Trace or Sedgebrook [in Lincolnshire, Illinois], we have the chance to weave this philosophy into our culture from the inception. “The heart of person-centered care BUS INC. involves many areas,” Shaw continues,“but a company three particularly stand out: utilizing lifeInc.individlong learning Champion as the basis toBus, achieve P.O. Boxelder 158 stereotypes ual development; avoiding Imlay City, MI 48444 and and outdated solutions as outcomes; Contact: Rick Lee promoting optimal physical, emotional, and 800/776-4943 spiritual aging though a person’s preferFax 810/724-1844 ences and capabilities. Eagle’s Trace is trying www.championbus.com to set a tone and establish this model so [email protected] consumers can access it as soon as they move in.” How To Have Better Satisfied Residents and Families Property Call Toll-Free Drive 8 Poplar Hill Charleston, WV 25311 1-888-206-2244 (recorded message) www.ridgetopretirement.com or visit [email protected] www.mycaring.com Senior Living Depot™ True Fitness P.O. Box 1747 Roswell, GA 30077 800/474-7646; Fax 800/474-7647 www.truehospitality.com [email protected] Fitness facility design and leading state-of-the-art fitness equipment. Contact John Sarver. Over 400 Products Catering to the Needs of the Assisted Living Industry Marketing Wellness Reminiscence Activities Elder Transition Coaching Perfect proVisit&our duct mix for online store Resident Staff Services every area; to order the Bradley Ann Morgan & Stephan Marais We’ve done Total Pack4750 Lincoln Blvd. Suiteage-Solution 134 the research catalog! for you! 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Ranging in sizes resident 37this passengers 7 model that wellness with “Ourfrom goal 8isto models,through each bus ourcan firstbe will bedifferent what we follow to meet all customer resident] point ofequipped contact [with a future requirements. through palliative care,” says all the way Ronch.“In some ways, this is what we already do, but as the company continues MAY 2004 A S S I S T E D L I V I N G T O D A Y to grow, this is the right time to really formalize and solidify this culture throughout the company and help people understand why it’s so important.” ▼ Kate Newton is the corporate communications manager for Erickson Retirement Communities. Reach her at 410/4022025 or knewton@ ericksonmail.com. Walks Beside Life Coaching specializes in the transition of Elders from their Outreach homes into independent Community Results Enhancement or assisted living. We are certified “The ultimate coaches & members of the training solution…” International Coaching Federation. Trainer Tracy Lux will show you how to create a Our program, ‘The Home theworks. Heart’ community outreach program thatofreally Increase andtheir revenuefamily, while lowering assistsoccupancy the Elder, and your marketing costs. Results guaranteed! the community staff take the heartfelt Go to www.tracemarketing.com steps to create new home. and download the PDFtheir with full C.O.R.E. details and testimonials, or call 800/798-7223. 45 RESOURCE LINK Advertise in the magazine that reaches the real decision-makers. Contact Alison Bashian ([email protected]) or Marianne Juliana ([email protected]) 800.335.7500 Assisted Living EXECUTIVE , SEPTEMBER 2005 41 Pag PEOPLE & PLACES SALES & NEW DEVELOPMENTS than $750,000 on renovations, including interior upgrades and exterior landscaping and walking paths. Summit Builders, based in Phoenix, in July completed construction of a major expansion and renovation to The Terraces, a CCRC in Phoenix that provides independent living, assisted living, and skilled nursing residences. The expansion and renovations include a 124-apartment independent living building, a 74-unit assisted living center, and a 50-bed skilled nursing facility. American Retirement Corp. (ARC), based in Brentwood, Tennessee, has begun construction on a 57-unit expansion to the health-care center at its Freedom Village at Brandywine community near Philadelphia.The approximately $11 million project will renovate units for 63 new assisted living residents and reconfigure the health-care center to enhance dementia care and skilled nursing services. ARC has completed its $23.4 million purchase from Maybrook Realty of a senior living community in Phoenix, which ARC had previously leased.The company also has purchased the interests of its joint venture partner in a 47unit assisted living community called The Villages in The Villages, Florida. Plus, the company has agreed to purchase land and placed an option on an additional land parcel for the future expansion of The Villages community. Silverado Senior Living, based in San Juan Capistrano, California, in August opened a 42 SEPTEMBER 2005 , 56-unit memory care community in Plano,Texas. Silverado acquired ActivCare at Gleneagles and renamed it Silverado Senior Living—Plano. The company will spend more Sunrise Senior Living REIT, based in McLean,Virginia, entered into an agreement to acquire controlling interests in 13 U.S. assisted living communities valued at $290 million, reflecting a 7.7 percent capitalization rate on expected net operating income.Acquired from an institutional partner of Sunrise Senior Living, the controlling interest acquired by the REIT represents an approximate 75 percent ownership of the communities.The remaining 25 percent will continue to be owned by Sunrise. APPOINTMENTS & PROMOTIONS Wellesley, Massachusetts-based Benchmark Assisted Living has promoted Jack McCarthy to chief operating officer (COO). McCarthy most recently served as Benchmark’s senior vice president of sales and marketing. Based in Chicago, Covenant Retirement Communities has appointed Timothy Johnson chief operating officer (COO). Johnson most recently served as vice president of Presbyterian Homes, a not-for-profit seniors housing and care organization based in Evanston, Illinois. In his new role as COO, Johnson is responsible for overall operations for not-forprofit Covenant Retirement Communities and its 14 retirement communities nationwide. Asbury Services, based in Gaithersburg, Maryland, has appointed Terry Thompkins Sr. regional vice president of operations— southwest. In that role,Thompkins is responsible for directing operations of Inverness Village,Asbury Services’ affiliate in Tulsa, Oklahoma, as well as managing growth opportunities in the company’s southwest region. Assisted Living EXECUTIVE Sterling Glen, a New York-based seniors housing provider, in May opened a new assisted living floor at Sterling Glen of Stamford, in Connecticut. The community has 14 assisted living apartments and 152 independent living units. CORPORATE NEWS With headquarters in Louisville, Kentucky, and Chicago, Ventas Inc. agreed to sell 3.2 million shares of its common stock to Merrill Lynch & Co., as solo underwriter, in an underwritten public offering.Ventas expects to receive net proceeds of about $97 million from the sale. American Retirement Corp. (ARC), based in Brentwood, Tennessee, has been added to the Russell 2000 Index, which measures the performance of the 2,000 smallest companies in the Russell 3000 Index. New York-based One Lantern Senior Living agreed to acquire substantial interests in 17 communities from Needham, Massachusetts-based Newton Senior Living, which include 1,655 units and are located in Massachusetts, Rhode Island, Connecticut, New York, and Pennsylvania. Atria Senior Living Group, based in New York and an affiliate of One Lantern owner Lazard Senior Housing Partners LP, will manage the acquired communities. ▼ AD INDEX A L FA B O A R D O F D I R E C T O R S Chair: Steven Vick, CEO Signature Senior Living Vice Chair: Michel Augsburger, President & CEO Chancellor Health Care Inc. Secretary: Tiffany Tomasso, COO Sunrise Senior Living Treasurer: John “Skip” Comsia, President Veranda Living Immediate Past Chair: Thomas Grape, Chairman & CEO, Benchmark Assisted Living Evrett W. Benton, President, CEO, and Secretary Five Star Quality Care Beth Cayce, CEO CaraVita Senior Care Management Services Horace D’Angelo Jr., President Caretel Inns of America Joe Eby, President Bickford Senior Living Group Inc. Thomas Fairchild Ph.D., Director, Special Projects on Aging, University of North Texas Health Science Center Jeff Johns, President Carriage Court Communities W. Bradford Klitsch, Vice President of Market Development, Direct Supply Mark Ohlendorf, President & CEO Alterra Healthcare Corporation AMERICAN ASSOCIATION OF HOMES AND SERVICES FOR THE AGING (AAHSA) . . . . . . 16 202/783-2242 www.aahsa.org CARAVITA SENIOR CARE MANAGEMENT INC. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 Beth Cayce, 800/566.3872 www.caravita.com CNL RETIREMENT CORP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 800/522-3863 www.cnlretirement.com DIRECT SUPPLY HEALTH CARE EQUIPMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C4 800/216-4832 www.directsupply.com GMAC COMMERCIAL MORTGAGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 888/334-GMAC www.gmaccm.com HOMEFREE SYSTEMS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Brian Verban, 800/606-0661 www.homefreesys.com HOME INSTEAD SENIOR CARE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Holly Batchelder, 888/484-5759 www.homeinstead.com IDEAL SOFTWARE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Lance Raab, 813/864-2160 www.idealsoft.com Ross Roadman, SVP for Investor Relations and Strategic Planning American Retirement Corporation IT POWERED. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 Loren Shook, President, CEO & Chairman Silverado Senior Living INTRACARE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 AAEC Representative: Sally G. Michael, President California Assisted Living Association COS Representative: Eric L. Johnston, President Retirement Community Specialists Inc. Steve Arndt, 866/217-7804 800/395-0132 www.itpowered.net www.intracare.com JCH CONSULTING GROUP INC. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Jim Hazzard, 888/916-1212 www.jchgroupinc.com K&B UNDERWRITERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 703/761-7088 www.kbunderwriters.com A L FA P R E S I D E N T ’ S C O U N C I L MICROFRIDGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Michael H. Cook, Baker & McKenzie Brad Klitsch, Direct Supply Healthcare Equipment Susan V. Kayser Esq., Duane Morris Joel Goldman, Hanson Bridgett Marcus Vlahos & Rudy J. Michael Stephen, Health Care REIT Inc. Joe Whitt, HomeFree Inc. John Baker, IMA Financial Group Vivek Bhide, Invista Bryan A. Baird, K&B Underwriters LLC Casey Pittock, Lifeline Systems Inc. Art Seifert, The Lighthouse Companies Carol A. Muratore, McKesson Medical Surgical Lisa Hanauer, MED-PASS Inc. Curt Schaller, Merrill Lynch Capital Elizabeth Finn-Elder, Nathan Sallop Insurance Agency Inc. Debbie Zwiefelhofer, Novartis Nutrition Corp. George F. Quintairos, Quintairos, Prieto, Wood & Boyer PA Stephan Axelrod, SeniorMed Norrell Walker, Senior Psychological Services Inc. Kevin Pope, Stanley-Senior Technologies Inc. Loretta LeBar, Stoll Kennon & Park Douglas MacLatchy, Sunrise REIT John M. Atkinson, Thilman & Filippini Greg Thompson, Thomco Raymond J. Lewis, Ventas Healthcare Properties Inc. Mary Culpepper, 800/994-0165 ext. 2679 www.microfridge.com MOVE-N SOFTWARE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C2 Move-N Representative, 817/282-7300 www.move-n.com NATIONAL INVESTMENT CENTER (NIC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 410/267-0504 www.nic.org OPUS UNIT DOSE SYSTEM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 OPUS Representative, 800/228-5021 www.opusmedsystems.com RF TECHNOLOGIES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C3 Lorna Miller, 800/669-9946 www.rft.com SENIOR HOUSING NET . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 Brad Fuqua, 888/525-2546 www.seniorhousingnet.com UNITED RECEPTACLE INC. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Greg Bondura, 800/233-0314 www.unitedrecept.com VENTAS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Raymond J. Lewis, 877/4-VENTAS www.ventasreit.com VIGILAN INC. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 800/443-1127 www.vigilan.com YARDI SYSTEMS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Bonnie Novella, 800/866-1144 ext. 184, www.yardi.com Assisted Living EXECUTIVE , SEPTEMBER 2005 43 PRODUCTS & RESOURCES ■ The Memory Lane Company, based in Lone Tree, Colorado, in July released a new line of Connect and Reflect products that can be purchased separately or together as part of an integrated program for people with memory loss. The Connect and Reflect Family Kit includes a DVD (or VHS tape), book, and CD—all designed to foster connections through reminiscence activities. The kit uses brief stories about milestone life experiences, singalong music and video segments, and book archiving activities that can be created and shared with loved ones. For details, go to www.memorylane media.com, 877/963-6679 (8779-MEMORY). ■ Based in Clarksburg, Maryland, the Alzheimer’s Family Relief Program (AFRP), a program of the American Health Assistance Foundation, has released two new informational brochures. “Staying Safe:Wandering & the Alzheimer’s Patient” is an eight-page brochure that addresses how to prevent wandering and what to do if a person is missing, among other related topics. “Care for the Caregiver: Managing Stress” is a 12-page brochure that offers tips for reducing caregiv44 SEPTEMBER 2005 , F O R er stress and practicing a positive attitude. Single copies of both brochures are free.There is a fee for multiple copies. Order online at www.ahaf.org or call 800/437-2423. ■ With headquarters in Chicago and Covington, Louisiana, inFront provides tools for risk management in the long-term care market.The iQuest Workforce Management Suite from inFront features the iPoint Intelligent Controller, which acts as an access controller, time clock, and data capture device.The iPoint will accept any kind of identification technology, including barcode, magnetic stripe, or biometric. The iPoint can be upgraded in the field and additional units can be added as needed. For details,go to www.infrontusa. com or request information by e-mailing [email protected]. LeaderStat, based in Westerville, Ohio, provides management staffing, executive search, and consulting services to businesses that provide seniors care and housing. LeaderStat’s clinical and operational assessments provide feedback focused on enhancing quality improvement initiatives. Consulting areas include survey ■ Assisted Living EXECUTIVE A S S I S T E D L I V I N G management, recruitment and retention, marketing and census development, operations and administration, and quality improvement.Visit www.leaderstat.com for more information or call 877/699-7828. ■ Based in Woodbury, New Jersey, Waste to Charity is a 501(c)(3) organization that col- lects excess inventory from corporations, businesses, and individuals and supplies it to those in need.The organization accepts food, furniture, medical supplies, clothing, office and school supplies, and vehicles, among other items.Waste to Charity does not charge donors or partner organizations for its services. For detail go to www.wastetocharity.org or call 865/456-4996. BOOKSHELF Time Mastery: How Temporal Intelligence Will Make You a Stronger, More Effective Leader By John K. Clemens and Scott Dalrymple This book was released in June by AMACOM, the publishing division of the American Management Association.The authors say leaders who understand that time isn’t a management problem, but a leadership opportunity, exhibit the critical skill of “temporal intelligence.”They say it is a competency that can make the difference between being a run-of-the-mill leader and a great one. Time Mastery offers strategies for cultivating seven crucial time mastery behaviors, such as:“get and set an organization’s tempo”—synchronization techniques for achieving individual, departmental, and organizational harmony and “go beyond calendars and clocks”—methods for harnessing the power of unscheduled moments and fast-approaching tipping points. For details, go to www.amacombooks.org or call 800/714-6395. The One Thing You Need to Know: … About Great Managing, Great Leading, and Sustained Individual Success By Marcus Buckingham Released in March by Free Press, this book is written by a social science researcher and well-known business consultant and public speaker. Buckingham wrote the best-selling book First Break All the Rules:What Great Managers Do Differently in 1999. In The One Thing You Need to Know, Buckingham identifies the traits you must learn about people in order to manage them effectively, as well as personality traits that all great leaders must possess. To read excerpts and reviews, go to www.amazon.com and search by the book’s title or author. ▼ BE HERE. KEEP AN EYE HERE. GUARD THERE. CHECK THERE. MONITOR HERE. LOOK IN THERE. WATCH HERE. ©2005 RF Technologies, Inc. SAFETY THAT’S ALWAYS ON-CALL. The safety and security of all your residents is of the highest priority. For those at risk of wandering, your staff can deliver the safe, secure care residents require without infringing on the privacy and dignity they deserve. Code Alert® Wandering Management stands strong as part of an integrated safety solution that minimizes risk while maximizing staff efficiency. CUSTOMIZABLE AND SCALEABLE. Comprised of multiple, easy-to-install and use monitoring solutions, the Code Alert® family of products is designed to deliver enhanced safety throughout your facility — working in step with your policies and procedures while allowing you and your staff to focus on the ever-important task at hand. CODE ALERT® Wireless Call and Telecom Solutions CODE ALERT® Wandering Management Solutions CODE ALERT® Fall Monitoring and Incontinence Solutions TESTED. TRUSTED. With over 10,000 installations world-wide, including long-term care and assisted living facilities of all sizes, Code Alert® provides a total continuum of care that can only come from years of experience. Years that add up to an unparalleled benefit for our partners. Code Alert® delivers total peace of mind for you, your staff and your residents. Any time. Anywhere. For more information, visit www.rft.com or call 1-800-669-9946.