Senior Living: The Biggest Missed Opportunity in Health Care

By Anne Tumlinson Innovations

It’s easy for accountable care organizations (ACOs) and managed care organizations (MCOs) to overlook senior living as they develop strategies and partnerships to manage the complex care population. After all, senior living doesn’t appear — on the surface — to have much to do with health care. The primary purpose of senior living is to provide service-enriched housing for older adults who need some degree of assistance with basic life activities, not to provide medical care. But make no mistake, the very high rates of chronic illness, functional impairment, and health care utilization in senior living make it an obvious value-based care opportunity that few in the health care arena seem to see.

Assisted living is one of the most common types of senior living. It is often confused with nursing homes even though it was created to offer an alternative to nursing facility care. At its best, it provides a safe version of home that prioritizes hospitality, comfort, and independence over the constant supervision and medical care of a 24-hour nursing facility. Services that senior living providers offer can include prepared meals, transportation, housekeeping, and medication assistance.

Senior Living as Platform for Value-Based Care

Although senior living organizations are primarily oriented toward housing and hospitality, there are many reasons they provide a great platform for value-based care.

  1. Senior living is where some of the Medicare beneficiaries with the highest health care costs live. Many individuals who live in independent or assisted living are there because they face some degree of functional impairment and need assistance in taking care of daily needs, such as dressing, bathing, or eating. People with three or more chronic conditions and functional impairment have health care costs twice as high as their counterparts without functional impairment.
  2. Senior living operators need help managing health care. With the aging of the population, there’s been a commensurate aging of the population living in senior living. These residents’ needs have started to outstrip the ability of the facilities to manage them. In fact, one of the biggest complaints from family members about senior living is how often the residents are sent to the emergency room. Furthermore, very few senior living operators co-locate or integrate their services with a medical team or primary care provider. The bottom line is that there are many opportunities for community medical providers to improve the health care of senior living residents through partnerships with the facility operators.
  3. Senior living provides an efficient and effective way to manage health care in the context of someone’s home. One of the most valuable pieces of information in managing health care for a population with complex needs is knowledge about their home environment. But it’s hard to find out what’s going on in the lives and homes of individuals with complex needs when they are dispersed across a large geographical area in single-family dwellings. In contrast, senior living gives a primary care provider or medical teams access to the home environments of many individuals all living in the same place.
  4. It’s a good enrollment and/or attribution strategy. When a health plan or ACO offers dedicated and integrated medical care management programs, it increases the opportunity for attributed lives (under an ACO) and enrollment (in MCOs, Medicare Advantage, and other risk-based products).

A few senior living organizations are recognizing resident needs and establishing partnerships with upstream providers and payers. A recent example of this is the Juniper Communities Connect4Life model. Based in Bloomfield, New Jersey, Juniper Communities is a national owner-operator of senior housing. Juniper Communities developed the Connect4Life model to provide onsite comprehensive therapy, primary care, pharmacy, and lab services that are integrated with other services using a “high-tech/high-touch” communications protocol that transfers information from an electronic health record and coordinates care through a human navigator.

An independent analysis of Juniper Communities’ Connect4Life model found that hospitalization rates were half of what they would have been for a comparably frail Medicare population living in the community (.30 hospitalizations per resident at Juniper Communities compared to about .62 in a comparable population).

Juniper Communities is now working with other senior living providers to form a Medicare Advantage plan for its residents, through which it will be able to capture savings from reduced hospitalizations and reinvest in additional health care delivery innovations. Sunrise Senior Living, based in McLean, Virginia, has also taken this step, becoming one of the first senior living providers to offer a Medicare Advantage health plan to its residents. While hospitals have long been offering and operating health plans in communities, senior living providers like Juniper Communities and Sunrise Senior Living are increasingly considering their opportunities to manage health care risk for their own residents today.

Steps for Working Together

There are several steps ACOs and MCOs can take now to offer integrated health care within a senior living community.

  1. Identify Potential Partners. Take an inventory of the senior living organizations in your market and talk to your clinical teams, case managers, and discharge planners about where your patients live, and which facilities have the best quality and earn the best reviews from families.
  2. Start a Conversation and Identify Points of Mutual Interest. Approach the organization’s local and/or national leadership to explore level of interest, potential roles and responsibilities, and need for new investment. For example, most senior living organizations will not have electronic health record capabilities but they might be willing to invest in technology and other capabilities if they are assured that the partnership will produce financial results for them (e.g., solid leads for new residents; longer life and length of stay for existing residents — healthier, better-managed residents lead to fewer move-outs to nursing-home levels of care).
  3. Develop Partnership Terms and Processes. Create point people in each organization to develop the care coordination and communication processes necessary to identify and address residents’ clinical needs before they require hospitalization.

Senior living organizations often serve the most complex and high-cost health care patients. As they face increasing demand for health care and coordination from both current and prospective residents and families, partnerships with health systems are critical to meeting demand and ensuring satisfaction among residents. ACOs and MCOs have an opportunity to understand whom senior living organizations serve and how to increase the value of health care being delivered to improve the quality of life for their patients in these communities.

Editor’s note: For more information about innovative models that connect health care to the home, check out one of these Playbook blog posts: