Lutheran Services of America (LSA) has named Charlotte Haberaecker as the next president and CEO. Haberaecker has held positions with Global Impact, Fannie Mae, and Price Waterhouse. “I am honored to accept this position with Lutheran Services in America, which represents so much effective work to improve the lives of our neighbors. To be able to combine my nonprofit and business background and my faith is an amazing opportunity,” she says.
There may be a big change around the corner for continuing care retirement communities and other care continuum campuses seeking financing from the Department of Housing and Urban Development (HUD) regarding the agency’s guidelines for providing loans to communities where more than 25% of their units are unlicensed.
Traditionally, HUD financing has a limitation on the percentage of unlicensed units that could be allowed for senior living communities seeking to utilize its LEAN program, generally set at about 25% with the ability to grant waivers of up to about 30%.
In early June, during the annual Committee on Healthcare Financing, HUD representatives gave a couple presentations on the agency’s Section 232 program. One of those presentations caught HUD/FHA lender Lancaster Pollard’s eye, including two slides in particular that discussed the historical and proposed treatment for independent living or unlicensed units.
“They said in their presentation that the limitation of 25% is not statute, it’s not legally required; [rather,] it’s programmatic,” says Nick Gesue, senior vice president and director at Lancaster Pollard Mortgage Company. “They feel they can go well above that 25% so long as the property is providing care for what’s defined as ‘frail elderly,’ which is law—but that percentage is not.”
Basically, HUD still requires that some level of a facility or community be licensed, but the unlicensed units, perhaps now in greater percentages, can be acceptable so long as they’re providing care to frail elderly, which Gesue says is loosely defined in HUD statutes as people aged 62 or older who need assistance with at least three activities of daily living (ADLs). These ADLs could range anywhere from needing help with money management, light housework, and meal preparation, to bathing, dressing, and toileting.
“This seems to open up facilities—including independent or assisted living freestanding buildings [in addition to CCRCs]—where it’s pretty common that part of it is licensed, and the other part is not,” says Gesue. “Historically, they wouldn’t qualify for HUD financing because of the 25% standard, but now, as long as they’re providing those services [to the frail elderly], those facilities would now be eligible.”
CCRCs have traditionally been “completely ineligible” as a campus, he continues, and if CCRC providers wanted to use HUD, they’d have to separate their skilled nursing and assisted living components from the independent living component.
“I think you’re going to see more of these communities out there that have assisted living and independent living, and even with skilled nursing attached to it,” says Erik Lindenauer, president of Chevy Chase, Md.-based lender Housing & Healthcare Finance. “They need financing for the whole community, and it seems to be a model that makes sense moving forward.”
Updating guidance for CCRC-financing is especially relevant regarding the aging in place movement, says Lindenauer, as many seniors prefer the ability to remain in one community even as their healthcare needs escalate.
“HUD’s realizing that the program is viable and that the guidelines previously set were excluding a lot of very good projects,” he says.
“What this change that HUD is talking about would effectively allow someone to do is finance an entire CCRC,” says Gesue. “The only caveat to that is, HUD still has a prohibition from collecting entry fees, so this is a limited subset of the entire CCRC properties out there. It would have to be a pure rental CCRC.” (Lindenauer also noted that it’s unlikely the program will extend to CCRCs with an a la carte model of services or tiered pricing.)
HUD said during the Committee on Healthcare Financing event that it was working on written guidance that would be issued either in a mortgagee letter or as a notice, says Gesue, who expects this will be issued “sometime soon.”
In the meantime, the agency has indicated willingness to continue to accept applications for communities whose unlicensed component may comprise more than 25% of its overall units, but they’ll have to request that as a waiver until the guidance has been handed down.
Lancaster Pollard has already gotten a few nibbles of interest from both existing clients and potential ones that may take advantage of new guidelines, says Gesue. But because this new development is very recent, the financing firm is currently only able to put together some proposals modeling what using HUD financing would look like for communities that historically couldn’t have qualified.
As of press time, HUD had not given SHN a comment regarding details of, or a possible timeline for, updated guidance.
Written by Alyssa Gerace
The debate between Republicans, Democrats, and everyone in between rages on regarding President Obama’s controversial Affordable Care Act, but in their fervor to debate the constitutionality of the individual mandate, among other of the law’s provisions, many aren’t even mentioning three key benefits to seniors that the healthcare reform law does provide, says a Forbes article.
1. The Elder Justice Act
If we want to stop seeing so many horrifying stories of elder abuse, both physical and financial, we need a national coordination of effort to fight elder abuse. Now, it’s here, in the ACA. The Act will establish grants to create centers for developing forensic expertise to collect evidence relating to elder abuse, neglect or exploitation. It will enhance training of staff in nursing homes. It will strengthen the enforcement ability of Federal and State entities to prosecute elder abuse cases, among other things.2. Community First Choice Option
This provision is for participating states who want the 6% increase in Federal Medicaid funding to pay for community-based attendant services for elders who would otherwise have to go to a nursing home or other care facility. This is the only kind of attendant care support available through Medicaid that has the purpose of keeping people out of nursing homes, a far more expensive option than staying at home. Is anyone really in favor of forcing people into nursing homes because they can’t pay for the hours of attendant care that allow them the independence of staying in their own homes? Typically, it costs three times as much to put someone in a nursing home as it does to care for them with attendants at home.3. Improving seniors’ access to home-based primary care physicians and nurses
Through the Independence at Home demonstration, the ACA will pay physicians and nurse practitioners to provide home-based primary care to targeted chronically ill individuals for a three-year period… Preventive care and monitoring seniors at home heads off complications of chronic illness. This will keep the cost of care down in the long run. If Medicaid eligible seniors go to nursing homes, the taxpayers are footing the bill. It’s over $95,000 per year, on average, for a shared room in a nursing home.
The cost of elder care continues to rise, and the burden placed on adult children keeps getting bigger, the Forbes writer says, adding that “Regardless of your politics, you can’t miss how urgent these problems are becoming. Without legislation to try to repair these problems, they just keep growing on a massive scale.”
Read the full piece at Forbes.
Written by Alyssa Gerace
Prudential Closes $46.5 Million Loan for CNL’s Portfolio Acquisition
Prudential Mortgage Capital Company, the commercial mortgage lending business of Prudential Financial, Inc. (NYSE:PRU) recently closed on a $46.5 million Fannie Mae refinancing loan for CNL Lifestyle Properties, LP and Solomon Senior Living, a portfolio of four senior living complexes in the greater Atlanta, Ga. area.
The portfolio includes: Dogwood Forest of Alpharetta, a 76-unit facility in Alpharetta, Ga.; Dogwood Forest of Eagles Landing, a 61-unit facility in Stockbridge, Ga.; Dogwood Forest of Fayetteville, a 62-unit facility in Fayetteville, Ga.; and Dogwood Forest of Gainesville, a 148-unit facility in Gainesville, Ga.
The loan term is for 7 years and will amortize on a 30-year schedule after an initial 2-year interest-only period. Karen McGinnity, a director with Prudential Mortgage Capital Company, was the lead on this transaction.
Senior Housing Properties Trust Announces Public Offering of 12 Million Shares
Senior Housing Properties Trust (NYSE:SNH) announced on Tuesday it had priced its public offering of 12 million common shares at $21.75 per share, which will settle on Friday, June 13 for up to $261 million. The REIT expects to use the proceeds of this offering to repay amounts that are outstanding under its revolving credit facility.
The underwriters of the offering have also exercised their option to purchase up to an additional 1.8 million common shares, bringing the total potential public offering to more than $300 million.
Jefferies & Company, Inc., Citigroup, and UBS Investment Bank are the joint bookrunning managers for the offering. The co-lead managers for this offering are BofA Merrill Lynch, Morgan Stanley, RBC Capital Markets and Wells Fargo Securities. The co-managers are Janney Montgomery Scott LLC, JMP Securities and Sandler O’Neill & Partners, L.P.
Cambridge Capital Closes $4.9 Million Loan for Calif. Senior Care Facility
Cambridge Reality Capital Companies recently closed a $4.9 million HUD LEAN loan for Gladstone Care & Rehabilitation Center, a 118-bed skilled nursing facility located in Glendora, Calif.
The fully-amortized, 26-year loan was arranged for the facility’s owner, a California limited liability company, and was underwritten by Cambridge Realty Capital Ltd. of Illinois, Cambridge’s business arm that specializes in underwriting FHA-insured HUD loans.
The property was financed through HUD’s Section 232/223(f) funding program. The loan was coordinated by Hymie Barber, Cambridge’s National Originations Manager and Managing Director of Catalyst/Cambridge Healthcare Finance in Los Angeles.
Mass. Senior Housing Complex Gets $8.9 Million HUD Loan to Stay Affordable
A senior housing community in Braintree, Mass. is getting a loan from the Department of Housing and Urban Development (HUD) designed to make sure the complex can remain affordable for low- and moderate-income seniors, reports Wicked Local Braintree.
The $8.9 million loan is for the 100-unit Logan Park community and was awarded in June; it will help finance a reserve account to cover future maintenance needs and is funded through MassHousing’s Section 8 Proactive Preservation Program.
MassHousing is an independent state authority that raises money through selling bonds and using the proceeds to help finance affordable housing projects. The Logan Park complex was in danger of converting to market-rate units after its original 30-year deed restriction expired. Under the terms of the Section 8 loan, all of its units, which are currently all affordable, will continue to receive state subsidies, with 20 units set aside for low-income tenants.
Logan Park has 25 studio units and 75 one-bedroom units, along with a community room, a kitchen, laundry facilities, and an on-site beauty salon.
Despite the Middle Ages often getting referred to as the “Dark Ages,” people in that era got at least one thing right: elder care, by incorporating their seniors into the community at large and promoting multigenerational interaction, according to a BBC News article.
British actor and presenter Tony Robinson shared his thoughts on his country’s elder care system after spending a week in a residential care home in England for a BBC television documentary.
BBC News reports:
“When you’re in an old people’s home… everything is regulated, it has to be, but it is a huge price to pay and one that I came to the conclusion, I couldn’t bear to pay,” [he said].
[Robinson] would also like to see a change in the attitude of our society, encouraging further strategies around support for elderly people in their own homes and greater communication and collaboration between the residents of nursing homes and members of the public.
Drawing on an example from history, Robinson claims we can learn something from the Middle Ages.
“There was much more interaction,” he says, between hospitals, hospices and the rest of the community in those times. “You look at the architecture of those places… the people were far more incorporated into society.”
When it comes to elderly care, he believes that a new outlook would inspire new ideas.
However, Robinson also acknowledged that some care homes for the elderly can have a lot to offer, and can be crucial to supporting residents who need a certain level of care.
Read the full piece here.
Written by Alyssa Gerace
The National Governor’s Association begins its annual meeting in Virginia today with the group asking federal authorities for clarification on expanding Medicaid in their states.
Care.com, an online service that connects families with care providers, announced on Wednesday it has acquired Besser Betreut GmbH, Europe’s largest online destination for care and service providers, creating the world’s largest online care destination.
Betreut is based in Berlin, Germany and will becoming one of Care.com’s operating units. It will continue under its current name but will serve as Care.com’s European hub under the Care.com Europe banner.
The site’s two CEOs, Steffen Zoller (who’s also the founder) and Manuel Nothelfer, will continue to manage the organization and will report to Ted Preston, General Manager, International and SVP of Operations for Care.com.
“We have always believed that care is a global issue. By bringing together Betreut and its extensive international operations with Care.com, our leadership position in the U.S., and our new operations in the U.K. and Canada, we are creating a dynamic portal for families around the world that provides best-in-class services to help families find the local care they need,” said Sheila Lirio Marcelo, founder and CEO of Care.com, in a statement about the acquisition.
“Both Care.com and Betreut were founded on the belief that it simply must be easier for families to find suitable, affordable care,” said Zoller. “Be it child care, elder care or pet care, the need is universal but the challenges families face in each market can differ. By blending Betreut’s European expertise with Care.com’s U.S. expertise we hope to become even more adept at speaking to each market’s care challenges and providing a solution for care beyond boundaries.”
Terms of the transaction, which has been completed, were not disclosed.
Written by Alyssa Gerace
Although states can opt out of the Affordable Care Act’s Medicaid expansion, they still may not tighten eligibility requirements, the nation’s top health official warned this week.
Terminally ill cancer patients had a better quality of life when they could die at home and avoid intense life-prolonging measures, a new study finds.
Following the U.S. Supreme Court’s decision upholding the constitutionality of the Patient Protection and Affordable Care Act (ACA), the House of Representatives voted July 11 to repeal the law. The Senate leadership has no plans to bring repeal legislation up for a vote, so for at least the remainder of this year the ACA remains law. The Supreme Court’s decision left all ACA provisions intact except for the expansion of Medicaid to cover everyone with incomes at or below 133% of the federal poverty rate. The Court’s decision essentially made the Medicaid expansion a state option.