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Category: CCRCs

A Houston-area continuing care retirement community recently broke ground on a massive $70 million expansion project, adding more than one hundred new units to the existing community along with brand new common areas.

The Brazos Towers at Bayou Manor is getting a 14-story addition that will add 84 new one- and two-bedroom independent living apartments, 25 new assisted living apartments, and eight memory support units. The ground floor of the tower is comprised of common spaces, including a new indoor swimming pool, fitness center, bistro, event center, and health clinic. 

Brazos Presbyterian Homes, the not-for-profit sponsor of the entry fee-model CCRC, has been pre-marketing the new units for more than two years. The independent living units are 80% reserved, says Mike Wallace, director of marketing at Brazos. 

BB&T Capital Markets will be marketing tax-exempt bonds to finance the new construction, which broke ground on November 15. 

The original goal was to reach 70% reserved before breaking ground, but that was accomplished ahead of schedule in late July, Wallace says. Since then, the organization has been moving forward with its plans to prepare for the bond sale, which will likely occur in December. 

“It’s all taking shape,” he says. “The marketing pace has stayed very, very steady.” 

Occupancy for the 50-year-old CCRC’s existing independent living units stays between 97-100% reserved, according to Wallace.

“There’s definitely a need for us to do this expansion,” he says. “We actually have more demand than we have the supply to offer. This new expansion is very timely right now.”

Atlanta-based THC Architecture designed the project, with Lend Lease Corp. serving as general contractor. The new tower is expected to open in 2015.

Written by Alyssa Gerace

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Kisco Senior Living acquired ownership of a 289-unit Florida continuing care retirement community (CCRC) in August about a year after purchasing $48 million of its debt.

The for-profit senior living developer and operator has acquired about $107 million of debt for three CCRCs in the past few years, going on to gain ownership of two of them, including the transaction that closed last month.

While all three communities were experiencing some level of financial distress at the time their debt was acquired, Andy Kohlberg, founder and president of Kisco Senior Living, believes there’s also opportunity for investment in properties requiring extensive renovations.

“Many out there that don’t have capital structure issues do have large, looming capital expenditures needed in order to remain competitive in the marketplace,” he says. “We think there are lots of opportunities to come up with creative structures for these CCRCs that might be 20-30 years old and need major renovations.”

Kisco now operates 20 communities after gaining ownership interest of La Posada, a 289-unit CCRC in Palm Beach Gardens, Fla., in early August about a year after acquiring an approximately $48 million loan on the property.

As owner, Kisco plans to expand the community with another 40-60 units of assisted living on an adjacent parcel of land.

“What we’re looking for is the ability to add value through whatever means that takes, whether it’s adding capital or management expertise or both,” says Kohlberg. “What we generally look for is, ‘What’s the value add? What can we bring to the table that’s a win-win for the residents and the community?’”

The operator and developer has acquired the debt of two other CCRCs in the past few years, University Village in Tampa, Fla., and The Village of San Antonio in Texas, and now owns two out of the three (Kisco is having “ongoing conversations” with the borrower that currently owns and operates University Village).

Kisco Senior Living continues to consider distressed communities for acquisition, but Kohlberg expects more activity when it comes to those in need of a capital infusion. Even CCRCs that are performing well at the present will likely need substantial capital expenditure to be sustainable for the next 20 years, he says.

“A lot of companies don’t have the capital to do that,” says Kohlberg. “We see that as an opportunity.”

Written by Alyssa Gerace

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Kisco Senior Living acquired ownership of a 289-unit Florida continuing care retirement community (CCRC) in August about a year after purchasing $48 million of its debt.

The for-profit senior living developer and operator has acquired about $107 million of debt for three CCRCs in the past few years, going on to gain ownership of two of them, including the transaction that closed last month.

While all three communities were experiencing some level of financial distress at the time their debt was acquired, Andy Kohlberg, founder and president of Kisco Senior Living, believes there’s also opportunity for investment in properties requiring extensive renovations.

“Many out there that don’t have capital structure issues do have large, looming capital expenditures needed in order to remain competitive in the marketplace,” he says. “We think there are lots of opportunities to come up with creative structures for these CCRCs that might be 20-30 years old and need major renovations.”

Kisco now operates 20 communities after gaining ownership interest of La Posada, a 289-unit CCRC in Palm Beach Gardens, Fla., in early August about a year after acquiring an approximately $48 million loan on the property.

As owner, Kisco plans to expand the community with another 40-60 units of assisted living on an adjacent parcel of land.

“What we’re looking for is the ability to add value through whatever means that takes, whether it’s adding capital or management expertise or both,” says Kohlberg. “What we generally look for is, ‘What’s the value add? What can we bring to the table that’s a win-win for the residents and the community?’”

The operator and developer has acquired the debt of two other CCRCs in the past few years, University Village in Tampa, Fla., and The Village of San Antonio in Texas, and now owns two out of the three (Kisco is having “ongoing conversations” with the borrower that currently owns and operates University Village).

Kisco Senior Living continues to consider distressed communities for acquisition, but Kohlberg expects more activity when it comes to those in need of a capital infusion. Even CCRCs that are performing well at the present will likely need substantial capital expenditure to be sustainable for the next 20 years, he says.

“A lot of companies don’t have the capital to do that,” says Kohlberg. “We see that as an opportunity.”

Written by Alyssa Gerace

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A CCRC in an Arizona town with a dense senior population is branching out into the community offering services that are helpful for consumers and also increase the provider’s presence and potential referral base.

La Posada at Park Centre, a not-for-profit Life Care CCRC in Green Valley, Ariz., made the decision to start expanding services outside their community’s walls to fill gaps in service and fulfill unmet needs through a community connection center. The CCRC is one of the largest employers in Green Valley, which was designed as a retirement destination and had an 72% 65-and-older population as of 2010, according to U.S. Census data.

The community’s efforts have resulted in making more than 700 connections to the wider community and an increase in referrals to La Posada services, according to Steve Kolnacki, the community’s director of health services, during a Spirit of Innovation Awards presentation at the 2013 LTC & LINK Conference in July.

While the CCRC already is home to about 700 residents, Kolnacki says they know the CCRC lifestyle isn’t for everyone.

“Not every resident in Green Valley will want to move [to La Posada]—they’ll want to stay at home,” Kolnacki says. “We decided to look into what has done well on campus and what could be farmed out into the community [at large].”

The goal, he says, was to do something that would help people not even enter an acute care center, and help them be more proactive and assisted with their lifestyle out in the community. The main thought is to increase downstream referrals to La Posada and establish a wider community presence, with future plans to establish fee-based services for transportation, geriatric assessment, balance screening, navigation, home evaluations, and home health care.

“We’re starting to brand La Posada not just as a place for rich people to go to retire in the community, but also that it’s there for the community,” says Kolnacki.

About a year ago, the CCRC got together with other local nonprofits after identifying a gap between services that organizations provided, and public knowledge about those services and how to access them.

“We thought there was need for virtual hub/communication center to link everyone,” Kolnacki says. Initial reactions from other nonprofits were mixed, but La Posada decided to move forward on its own by renting office space in a busy shopping plaza with lots of foot traffic.

The center, called Connect, provides front-office space that La Posada staffs with someone who can help connect visitors with resources. There’s also event space that other nonprofits can utilize for educational classes and health screenings along with other possible activities, in addition to office space in the back.

Connect functions as a hub for marketing and sales—which Kolnacki points to as something necessary to cover costs—as well as a hub for community partners to offer information about their services.

“We’re finding that it creates new services,” he says of Connect. One screening offered is for balance, and the equipment produces color-coded reports depending on the level of someone’s balance.

“Many fall into the [intermediary level] and there’s no balance class in Green Valley to assist that,” says Kolnacki. “We might create a small fee for service balance class, hosted on [La Posada's] campus. It gets people on campus, and it’s something we already do for residents but are now bringing out to the community.

Another initiative being explored is for navigation services, geared toward adult children who don’t live in the area but who want care and lifestyle coordination for their elderly parents, whether it’s figuring out levels of care needs, medical billing, transportation to doctors’ appointments.

The center is in the process of applying for two different grants totaling about $200,000 and is slated to begin offering new fee-based services in September 2013. While La Posada is currently footing the bills for the center, the uptick in recognition and a broader referral base could easily be worth it, according to Kolnacki, although the CCRC is open to partnering with other organizations to fill gaps in community services for seniors.

“When you put people in the same room, are open and start talking, then things happen,” Kolnacki says. “That’s the concept: put everyone in the same room and start talking about what’s needed [and] you generate a lot of good ideas.”

Written by Alyssa Gerace

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With new development in the pipeline and coming onto the market, senior housing operators and landlords are looking for ways to reposition existing properties to target future generations and achieve return on investment.

“There’s more segmentation [in the senior living industry]. People are trying to brand,” said Daniel Decker, founder and principal of investment firm CoastWood Senior Housing Partners, LLC, during SHN’s 2013 Senior Housing Summit in July. “For new development, the question is really, will the product evolve sooner? Will the next generation trump the existing generation?”

Capital Senior Living (NYSE:CSU) launched a new branding strategy during the second quarter involving an integrated marketing program that included a “refreshed” corporate logo, enhanced marketing content, and an updated website with a new color palette and image scheme.

“Our new responsive website was designed to make searching for senior living communities easier than ever.The complete makeover of our branding strategy and website unites the company’s 104 communities under one corporate identity and facilitates the assimilation of newly acquired communities in a consistent manner,” said Lawrence Cohen, CEO of Capital Senior Living, during the company’s second quarter earnings call.

The new branding strategy has already produced a 36% increase in web-based lead generation, according to Cohen, and numbers are expected to increase more as the company’s online reputation and search engine optimization efforts take hold.

Barriers to building new CCRCs are “extremely high,” making it another segment that’s under the repositioning microscope, said Rick Exline, executive vice president and director of operations management at LCS, during the Senior Housing Summit.

“We’re seeing a lot of repositioning of older assets on the CCRC side,” he said. “These are 25-35 year old assets, and the consumer is changing. The are requirements for multiple food venues, etc., that need to be built into the community.”

CSU is in initial stages of repositioning two of its CCRCs that it has previously looked to sell off. The company’s “plan B” was to reposition the two properties by enhancing private pay revenue, and is currently seeking approvals and working with families of residents.

“We believe that the strategy could actually double or triple the value of this property from the offer that we ended up receiving [when the properties were brought to market] through the process,” Cohen told an analyst during the second quarter earnings call.

Additionally, Capital Senior Living is investing in cash-flow enhancing renovations, refurbishments, and conversions of units to higher levels of care in its portfolio. Combined with the company’s operating leverage, the initiatives are expected to increase revenues, margins and cash flow, Cohen said. For every 3% increase in average monthly rent, about $10.4 million of incremental revenue is generated, he said, while every 1% improvement in occupancy is expected to generate $3.5 million of revenue.

“We have had much success in converting units to higher levels of care to meet the needs of our residents and allow them to age in place, as well as generate excellent financial returns to our company,” said Cohen. CSU is in the process of converting 210 units of independent living to assisted living and expects the conversions, when stabilized, to add approximately $3.4 million of incremental revenue.

The company is also considering conversion opportunities at 10 other communities to license all or part of them for assisted living, a strategy that could increase levels of care by about 300 units with the potential to increase revenue by nearly $4 million.

REITs are interested in repositioning assets in their portfolios in search of returns. Ventas, Inc. (NYSE:VTR) has $151 million of approved redevelopment deals in its pipeline, and $240 million of development projects overall.

“The redevelopment pipeline targets assets in our portfolio where we can add additional value by adding programming such as memory care or upgrading the facilities to drive rate. So far, with the projects that we’ve completed and that have stabilized, we’re achieving 11% returns,” said Ray Lewis, president of Ventas, during the REIT’s second quarter earnings call. “I would say the pipeline is very consistent with the projects that we’ve done, historically. So we would hope that they would achieve similar types of returns as we implement and stabilize those.”

Reinvestment in Brookdale Senior Living’s (NYSE:BKD) portfolio “continues to be our highest priority for capital investment,” said CEO Andrew Smith during the company’s second quarter earnings call. So far in 2013, Brookdale has completed seven Program Max projects with 16 more under construction and another 18 in active development.

Brookdale is spending about $150 million on Program Max in 2013, although returns won’t be seen right away, said Mark Ohlendorf, co-president and CFO.

“We have to get the capital deployed, build the assets, open the assets and fill them up,” he said. “So while we target mid-teens yields based on project costs, you probably don’t see that until three to four quarters after the project opens and has an opportunity to stabilize.”

Written by Alyssa Gerace

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Capital Senior Living Sees Sales Up 13%, More Private-Pay Opportunities

Capital Senior Living reported second quarter earnings this week with cash from facility operations up 15.1% to $9.5 million or $0.43 per share. Revenues rose during the same time period to $87.5 million, a 13% increase over the same period in 2012. 

“We are very pleased to report continued positive results for the second quarter as we recovered from the effects of the flu season in the first quarter,” said Lawrence Cohen, Capital Senior Living CEO.

The company said it is repositioning two CCRCs, which will further drive private-pay revenues. 

“After considering a number of alternatives, including a sale of these owned communities, we decided that a reconfiguration of the services we offer will enhance annual CFFO, improve our operating metrics and enable meaningful gains in shareholder value,” Cohen said. 

Capital Senior Living is additionally looking to its pipeline for growth, Cohen said, with due diligence under way for $65 million of additional senior living transactions. —EE

Sharp Reduction to Kindred NOI Offset by Home Health Earnings

Despite sharp declines in Kindred Healthcare’s net income in the second quarter ended June 30, 2013, the company’s home health and hospice division recorded

Home health and hospice revenues jumped 84% for Kindred Healthcare in the second quarter ended June 30, 2013 from last year, helping to offset the company’s overall revenue and operating income declines. 

Consolidated revenues decreased by 1% to $141 billion, in part due to federal sequestration cuts of 2% to Medicare reimbursement rates, which resulted in a $13 million reduction to revenue in the second quarter. Home health and hospice revenues, however, reached $53 million compared to $28.9 million in 2012′s second quarter. 

Income from continuing operations dropped by more than 60% to $6.2 million, or $0.12 per diluted share, in 2013′s second quarter. Net income dropped to $1.7 million from last year’s $15.5 million. 

Among Kindred’s business divisions, home health and hospice recorded the biggest jump in income from continuing operations, improving 42% to nearly $4 million compared to last year. Income from the rehabilitation division’s continuing operations rose about 7% to $42.1 million, while the nursing center division dropped slightly to $54 million and the hospital division increased minimally to $142.9 million. 

“Despite significant reimbursement pressures brought on by federal sequestration cuts of 2% beginning April 1, Kindred reported solid second quarter core results. This accomplishment reflects the commitment of our caregivers, and a relentless focus on cost management across the enterprise, all while maintaining our culture of quality service and patient satisfaction,” said Paul Diaz, CEO of Kindred, in a statement. 

The second quarter provided “tangible evidence” that Kindred’s asset repositioning strategy and capital redeployment activities are accelerating, he added.

“In addition to the Ventas nursing center disposition, we recently completed the sale of seven nursing centers for $47 million, and we have announced another transaction to sell non-strategic facilities that should provide net sales proceeds of approximately $180 million before the end of the year,” Diaz said. 

Looking forward, Kindred maintained its earnings guidance for 2013 and expects consolidated revenues to approximate $5.8 billion. Kindred expects to report income from continuing operations for 2013 between $60 million to $70 million. 

Operating cash flow guidance for 2013 was raised to a range between $235 million to $255 million, up from a prior range of $230 million to $250 million. Estimated routine cap-ex was lowered to a range of $112 million to $122 million, a decrease of $8 million. 

View Kindred’s second quarter 2013 earnings report. —AG

NHI Beats Earnings Estimates, Reports Expanded Credit Line

National Health Investors (NYSE: NHI) reported quarterly performance Tuesday, including normalized funds from operations up more than 14% during the quarter ended June 30 to $24.4 million or $0.87 per diluted share.

The company beat analysts’ estimates of $0.85 per diluted share during the quarter for its FFO performance.

Net income for the REIT was $20.1 million, up from $16.9 million in the second quarter of 2012 based on revenues of $28 million.

The company highlighted more than $220 million of new investments during the period, as well as the expansion of an unsecured credit facility of $370 million. —EE

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A Texas continuing care retirement community (CCRC) is in the midst of a widespread repositioning project to transform into a hospitality environment focusing more on independent and assisted living rather than institutional-style skilled nursing with an eye toward long-term sustainability.

The C.C. Young campus, in Dallas, Texas, contains many buildings built in the 1960s and ’70s. Care levels include independent living, assisted living, memory care, skilled nursing, rehabilitation, home health, and hospice.

Ten years ago, the CCRC had about 240 nursing beds. Today, it’s licensed for 134 beds and operates around 90. In August 2011, a 108-unit, $54 million independent living building opened, and the CCRC has also gained 66 assisted living units with plans to add more, along with additional independent living units.

The transition stems from futuristic thinking.

“That’s the way we’ll be able to stay in business,” says Russell Crews, C.C. Young’s executive vice president and chief financial officer. ”People learned a long time ago you can get most of the services you get in a nursing home in assisted living, and it’s a home-y, inviting, warmer environment.”

The other thing C.C. Young is promoting through the campus is personal care services, so people can age in independent living longer and stay longer in assisted living, says Crews. THe CCRC has its own hospice and home care services that it promotes for residents, who also have the option of contracting those services with a third-party.

“The time you spend in the nursing home is going to get less, probably each year going forward,” he says. The goal is to get to a six-to-one ratio of independent living units to skilled nursing beds, along with adopting a small house/greenhouse model for higher levels of care.

For the past several months, the community has been undergoing a substantial repositioning of unit mixes. D2 Architecture, a Dallas, Texas-based firm specializing in senior living design, was brought in to aid C.C. Young’s efforts.

“Things are not broken at C.C. Young, though—they’re going in and fixing something that’s good, and making it great,” says David Dillard, president at D2. ”A really good trend we’re seeing is converting unused common areas to units, although I don’t see it [happening] that much.”

At C.C. Young, some rarely-used communal spaces on the upper floors of the assisted living building are being converted into nine additional assisted living units—at an “obvious” financial advantage to the community, Dillard says.

The bottom floor will also get a makeover, with plans for a new dining area, new art studios, and new meeting areas. D2 recommends putting everything from coffee shops, mail rooms, and TV lounges in central locations where people are forced to interact, instead of being shut away behind closed doors in their rooms.

The next wave of the project is for the community’s rehabilitation buildings.

One of D2′s architects, Keith Wilson, recently conducted a “sleepover” at C.C. Young—a movement pioneered by the design firm where an architect goes to a facility and spends a night as one of the residents. The twist: Each architect is assigned a disability a senior may have, which helps him or her figure out exactly what a potential resident might go through and how to make life easier for that person.

For Wilson’s sleepover, he was given the symptoms of being a right-side stroke victim and couldn’t use the right half of his body. Takeaways from his experience include plans to create rehab units that are similar to what a recovering resident’s home is like.

“You need [a setting] like your house, so caretakers can teach you how to go home, and cook, and use the bathroom, and go down the hall, etc.,” Dillard recounts of Wilson’s findings.

In many communities, that’s not the norm. Generic rehab rooms have often been designed as a space where someone’s going to live the rest of their life, for perhaps their final six months or a year, according to Dillard, rather than functioning as a stepping stone back to an assisted living or even independent living unit.

“We’re going to employ Keith’s takeaways to make common spaces with fake kitchens and bathrooms that are great training for someone who just wants to go home,” says Crews.

Many parts of the project are being financed with community cash-flow rather than a bank loan.

“We’re seeing a lot of focusing on repositioning, laser shocks on various parts of the campus to make it better,” says Dillard, who says he’s getting calls to do projects at other communities ranging in cost from about $1-1.5 million. “There are pieces of work on C.C. Young’s campus that are [costing] half a million, where you zoom in, spend the money out of cash-flow, and get a great reward for it from a marketing standpoint.”

Already, the 108-unit independent living community that opened two summers ago has achieved positive cash-flow. “It took about 24 months, and our Pro Forma study had said about 28 months,” Crews says. “We’re trying to move into a quicker return [on investment] than we’ve seen historically. “

It’s too early to speculate on costs of the project, he says, especially as the number of new units is still unknown for another independent living community that is planned to take the place of an existing, institutional-style skilled nursing building.

“My guess is, at some point, standalone skilled nursing facilities are going to be few and far in between,” Crews predicts. “You need a campus that drives through the continuum of care as people go through different aging processes, and we want to be positioned to take advantage of that. I believe the CCRC is the most sustainable way of the future.”

Taking a proactive approach is the best approach, Dillard says.

“Rather than looking at a community and thinking, ‘This is in trouble, what do we do now?’ it’s, ‘This is working now—what’s the landscape going to look like 15 years from now?’” he says. “That’s fresh thinking.”

Written by Alyssa Gerace

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Although many salaried positions at continuing care retirement communities (CCRCs) saw significant compensation increases between 2011 and 2012, only a handful had back-to-back salary increases the following year to achieve combined double digit growth, according to a recent report. 

Out of 42 salaried positions tracked at all participating facilities for the CCRC Salary & Benefits Report 2013-2014, published by the Hospital & Healthcare Compensation Service, consecutive-year salary increases above 10% were reported for just six positions from 2011 to 2013.

While executive directors of CCRCs had the largest salaries out of all salaried positions tracked by HCS, they came in at number six with a two-year, 10.32% increase to an average $148,007 in 2013.

Next were assistant directors of dining/food services for non-graduate dietitians, up a total 10.48% to $50,728 in 2013 from 2011.

Chief financial officers had the third-largest back-to-back cumulative salary gains, at 11.51% to $130,650 on average—the second largest salary behind executive directors. 

Salaries for assistant directors of dining/food services for graduate dietitians increased 12.59% from 2011-2013 to $57,660.

The largest cumulative salary increase for two consecutive years was for the position of facility controller, with a 15.45% salary boost to $85,562.

Positions that had double-digit salary gains from 2011-2012 followed by decreases on average the following year include associate directors of CCRCs; nursing home assistant administrators; directors of dining/food services for graduate dietitians; and social service and activity directors, which saw a 29.4% jump in salaries before a decrease of 8.56% by 2013. 

Written by Alyssa Gerace

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Despite average increases in salaries for marketing professionals working in continuing care retirement communities from 2012 to 2013, the field saw the highest average turnover rates nationally at nearly one-third, according to a recent salary and benefits report.

A total of 515 facilities participated in Hospital & Healthcare Compensation Service’s 2013-2014 CCRC Salary & Benefits Report. Nearly 79% indicated they are not-for-profit, while 21% said they are for-profit, and 95% identified as a CCRC.

National annual turnover rates for positions ranging from department heads, dietary, environmental services, marketing, therapy, RNs, LPNs, and CNAs averaged 26%, led by marketing with a 32% turnover rate. Department heads had the lowest national average turnover, at 14.5%. 

Directors of marketing saw a 1% salary increase between April 2012 and March 2013 to $71,970, looking at all participating facilities in HHC’s study. Marketing coordinators saw the biggest jump among marketing positions listed, up 6.3% to $43,277. Marketing representatives saw salaries trend upward an average of 2.42% to $47,236.

During that 2012-2013 timeframe, management salaries for CCRCs reporting increases rose an average of 2.69% across the nation, with the highest average increases (3.26%) seen in the northeastern central states of Illinois, Indiana, Ohio, Michigan, and Wisconsin. 

Nonmanagement positions saw salaries increase slightly less, an average of 2.47%, similar to rates for registered nurses (up 2.44%), licensed practical nurses (up 2.43%), and certified nursing assistants (up 2.45%). 

Positions with the highest percent increases in wages include household coordinators for activities and social services (14.2% and 14.6%, respectively); occupational therapy aides (10.5%); marketing coordinators; registered clinical dietitians (6.1%); chief financial officers (6%); and executive directors (5.8%). 

Among positions seeing the biggest average decreases in salaries between 2012 and 2013 are directors of dining/food services (down 8.9%); social service and activity directors (down 8.6%); and nursing home assistant administrators (down 7.06%). 

The full report can be accessed through HHC’s website. 

Written by Alyssa Gerace

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Assisted Living News

From the Times-News (Ida.)—Assisted Living Concepts Community Regains License, Opens Doors

“A year after Chaparelle House closed its doors, the assisted living facility received its license back and is reopening. In April 2012, the Idaho Department of Health and Welfare revoked the license for the Twin Falls assisted living facility, which forced 18 residents to find new homes,” reports the Times-News. “State surveyors determined the facility wasn’t employing enough staff, Idaho Department of Health and Welfare spokesman Tom Shanahan told the Times-News last year. Prior to recent administrative changes, there were 10 complaints filed against parent company Assisted Living Concepts [NYSE:ALC] between 2009 and 2011.” Read more

Nursing Home News

From The Daily Republic (S.D.)—Rural Nursing Homes Struggling to Survive

“What’s the gap between breaking even and making money on the average patient in a rural South Dakota nursing home? About $30 to $40, according to many nursing home officials interviewed in The Daily Republic’s print circulation area. That’s the difference, they say, between Medicaid reimbursements and the actual cost to provide care for residents,” reports The Daily Republic. ”Rural nursing homes in South Dakota are largely dependent on state and federal funding to provide care for residents, leaving little left left over to provide extra amenities and upgrades.” Read more

From the Hartford Courant (Conn.)—State Doubles Financial Penalties for Nursing Homes

According to a spokesman for the [Connecticut Department of Public Health], the department’s licensing and investigations unit “recently reviewed and updated the financial penalties it levies against nursing homes for the various classes of violations it issues.” The fines were generally doubled,” reports the Hartford Courant. “[Spokesman William] Gerrish said the federal Centers for Medicare & Medicaid Services (CMS) recently updated their civil penalties, and ‘we felt it was also appropriate for us to review and update the penalties we had been levying under our state jurisdiction. Because the fines had remained at the same level for many years, DPH felt it was time to increase their level to bring them into alignment with today’s economy and make them a more effective regulatory tool, he said.” Read more

From the Herald Tribune (Fla.)—Lawmakers, Lobbyists Push for Nursing Home Tort Reform

“Florida lawmakers are pushing for sweeping deregulation of the nursing home industry that would protect owners and investors from financial penalties resulting from lax patient care,” reports the Herald Tribune. “The overhaul comes as advocates for seniors say loose government oversight has already weakened standards for care of the elderly in a state considered the nation’s nursing home capital. Lobbied for by nursing home investors, who have financially backed the campaigns of several GOP lawmakers, Senate Bill 1384 would stop all patient lawsuits at the direct management level.” Read more

From The Woonsocket Call (Mass.)—Health Inspectors Shut Down Nursing Home

“Town health officials Sunday abruptly closed the Blackstone Nursing & Rehabilitation Center and ordered the evacuation and relocation of the nursing home’s 25 residents after it was discovered the Butler Street facility had been without heat and hot water since Thursday afternoon. Town officials were tipped off about conditions at the facility after the daughter of one resident went to visit her mother Sunday and saw her and other residents sitting around wearing coats and eating off paper plates. The facility had no heat or hot water due to a cracked boiler plate,” reports The Woonsocket Call. “The 25 residents were brought to various nursing facilities owned and managed by the same company that owns the Blackstone facility—Norwood, Mass.-based Rehabilitation Associates, which operates nine small rehabilitation and skilled nursing centers, as well as an outpatient rehabilitation center.” Read more

From the St. Cloud Times (Minn.)—Health Bill Proposal Includes Wage Raise for Nursing Home Workers

“Minnesota’s nursing home and long-term care workers would get small salary increases in a health spending bill up in the Minnesota House,” reports the St. Cloud Times. “The raises are 3 percent for nursing home workers and 2 percent for long-term care workers. The Democratic-sponsored, $5 billion health and human services budget is on the House floor Monday.” Read more

From the Associated Press—Okla. House OKs Nursing Home Camera Proposal

“The Oklahoma House has approved a bill that says people can’t be denied residence or kicked out of nursing homes if they or their families place cameras in their rooms,” reports the Associated Press. “The bill passed without opposition Monday. It now goes back to the Senate for further consideration.” Read more

From the Sacramento Business Journal (Calif.)—Nursing Homes Reduce Antipsychotic Meds Use, But Don’t Reach Goal

“California nursing homes reduced unnecessary use of antipsychotic medications by 8.5 percent last year, making better progress on the initiative than 39 other states, but not meeting the targeted 15 percent drop,” reports the Sacramento Business Journal. “California nursing homes reported a 19.3 percent average use of antipsychotics, below the national average of 22.9 percent.” Read more

Miscellaneous 

From the New York Times—State Suspends Managed Care Enrollment on Fraud Suspicions 

“State officials have suspended enrollment in New York’s largest managed long-term care plan for frail elderly and disabled people, and investigators have begun examining the relationships between such plans, which are financed by Medicaid, and the social adult day care centers that send them new customers,” reports The New York Times. “On Thursday, investigators from the Medicaid fraud control unit of the state attorney general’s office were in Brooklyn gathering evidence that some centers had persuaded seniors to sign up with incentives like free takeout food, casino visits and cash before steering them to managed care companies eager to enroll them in plans designed for older people with long-term needs like home health care and nursing.” Read more

From the TR Tribune (S.C.)—University-Affiliated Senior Community Annexed by S.C. City

“At its regularly scheduled meeting Thursday night, Travelers Rest City Council unanimously approved an ordinance to annex Furman University and Furman Foundation properties into its city limits. This was the second and final reading of the ordinance, which was approved on first reading in March,” reports the Travelers Rest Tribune. “Multiple properties—including the university campus, the golf course, the Vinings at Duncan Chapel apartments and the Woodlands at Furman retirement community—are included in the annexation. The annexation will increase the size of Travelers Rest by over 900 acres, about one-third of its current size.” Read more

From the Post-Gazette (Pa.)—State Looks to Develop Dementia Care Plan

“Twenty-eight states have adopted strategic Alzheimer’s plans to address what many view as the biggest scourge afflicting the elderly population, but Pennsylvania — the fourth-grayest state in the country — is not among them,” reports the Post-Gazette. ”The Corbett administration is attempting to acknowledge the disease now with appointment of a broad Alzheimer’s Disease State Planning Committee charged with producing recommendations by February.” Read more...

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Cain Brothers Arranges $11.2 Million Loan for Ore. Senior Care Facility

Cain Brothers Funding arranged an $11,212,000 taxable loan insured under the FHA Section 232-223(a)7 LEAN program for Dallas Health Care Center, a 161-unit skilled nursing, assisted living, and memory care facility located in Dallas, Oregon. The proceeds of the new loan were used to refinance an existing FHA-insured loan.

The new FHA-insured loan has an interest rate of 2.50% for 32 years. This new loan will generate annual debt service savings in excess of $340,000.

Beech Street Capital Closes $9.6 Million Refinance for Ill. SNF

Beech Street Capital, LLC recently closed a $9.6 million loan using the HUD Section 232/223(a)(7) program to refinance Lake Park Center, a 210-bed skilled nursing facility in Waukegan, Ill. 

The transaction was originated by Joshua Rosen, executive vice president of Beech Street Capital working out of the company’s Chicago office.

Beech Street was able to negotiate a deal to cut in half the borrower’s original interest rate of more than 5%, and was also able to make the case with HUD that the borrower’s professional liability coverage was sufficient given its excellent claims history, even though it doesn’t comply with current guidelines. 

Ziegler Closes $78.6 Million Epworth Villa Financing

Ziegler recently closed a $78,635,000 fixed-rate, Series 2012 Bond issue for Epworth Villa, a continuing care community located in Oklahoma City, Okla. on an approximately 40-acre campus. Epworth Villa is related to the Oklahoma Annual Conference of The United Methodist Church and currently has 227 independent living units, 87 skilled nursing beds, 26 traditional memory support beds, and 24 memory support assisted living beds.

The Series 2012 Bonds are being issued to refund a portion of prior debt; finance the expansion and repositioning project; fund various debt service reserve funds; fund a portion of interest on the new money-related bonds; and pay certain costs of issuance. The Series 2012 Bonds are all unrated fixed-rate bonds, and include two series of TEMPSSM to be redeemed with entrance fees, and longer-term fixed-rate bonds.

GE Capital Serves as Administrative Agent for $65 Million Senior Credit Facility

GE Capital, Healthcare Financial Services announced today that it is serving as administrative agent on a $65 million senior secured credit facility for National Hospice Holdings, LLC doing business as Life Choice Hospice. The financing supports Life Choice’s acquisition of SolAmor Hospice Corporation from Genesis HealthCare, LLC. GE Capital Markets served as sole lead arranger and bookrunner on the facility.

Life Choice Hospice is a privately owned and operated hospice organization headquartered in Dresher, Pa. The company offers comprehensive services including case management, pain management, palliative care, personal care, counseling, spiritual care and emotional support. With the acquisition of SolAmor Hospice, the organization will provide hospice services from 29 offices across 12 states.

Cain Brothers Arranges $120 Million Refi and Debt Restructure for CCRC

Cain Brothers recently assisted Mirabella Seattle in restructuring and refinancing its 2006 bonds. The investment banking firm served as lead underwriter on Mirabella’s $89.24 million Series 2012 Bonds and also assisted with respect to the restructuring of $30.75 million of subordinated bonds with banks that provided letter of credit support for the 2006 bonds. The 2012 bonds are unrated.

Ziegler Closes $127.5 Million ESC Financing

Ziegler recently announced the closing of the $127,480,000 fixed-rate, Series 2012 Bond issue for Episcopal Senior Communities (ESC), a California not-for-profit public benefit corporation providing housing, related facilities, and services for elderly.

The Series 2012 Bonds are being issued to (i) refund prior Series 2000 VRDBs; finance the expansion and renovation of Spring Lake Village; fund various debt service reserve funds; fund a portion of interest on the new money-related bonds; and pay certain costs of issuance.

The Series 2012 Bonds are all rated fixed-rate bonds, and include three series of TEMPS to be redeemed with entrance fees, and two series of longer-term fixed-rate bonds.

Ziegler Closes $24 Million Financing for New Mexico Retirement Community

Ziegler recently closed a $24,030,000 fixed-rate, tax-exempt, Series 2012 Bond issue for El Castillo Retirement Residences in Santa Fe, New Mexico.

El Castillo Retirement Residences, Inc., a nonprofit organization organized in 1969, owns and manages El Castillo Retirement Residences, the first continuing care retirement community in New Mexico that remains the only Santa Fe retirement residence offering life care to its residents under a “continuing care” concept. 

Proceeds of the Series 2012 Bonds, together with other sources of funds, will be used to refund, on a current basis, the outstanding Series 1998 Bonds in the amount of $12,230,000 and to fund approximately $11,700,000 in improvements to the health center, says Ziegler. The improvements will include expanding and renovating the health center by adding new assisted living, memory care, and skilled nursing units and beds. In addition, El Castillo Retirement Residences, Inc. plans to renovate and convert some existing semi-private nursing beds into private rooms.

Greystone Communities has been engaged to provide development consulting services and to assist with implementing the development plans.

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There’s an new option for the growing portion of people who may need assistance in their daily lives but aren’t interesting in moving into a senior living community: continuing care retirement communities (CCRCs)-”without-walls,” says a New York Times’ The New Old Age blog.

In order to reach this demographic, some care communities are beginning to extend services outside of the traditional bricks-and-mortar setting to people who still reside in their homes, and the opportunity for others to do the same is growing.

The New York Times reports:

In a continuing care program without walls, members also pay an entry fee ($20,000 to $70,000) and monthly fees ($250 to $800) and receive a similar guarantee of lifelong care, with a twist. The main focus of these programs is helping people stay healthy and independent in their homes for as long as possible. This model can be summed up as “let us bring what you need to you — or find a way to make it easy for you to get it.”

With retirement nest eggs shrunken because of the recession, and 90 percent of older adults indicating they want to age in place at home, “this was something we feel makes a lot of sense,” said Larry Yachcik, president of Porter Hills Retirement Communities and Services in Grand Rapids, Mich., one of the nation’s newest providers of such services.

…Why aren’t there more programs of this kind?

“The focus of the senior housing industry has been on bricks and mortar,” not community-based services, said Stephen Maag, director of residential communities for LeadingAge, an industry association. “But we’re now getting a recognition there is a significant market out there of people we haven’t been serving, and that represents an opportunity.”

In some states, laws that govern continuing care retirement centers didn’t allow for these kinds of services and had to be changed. Efforts are under way, or have already succeeded, in California, Connecticut, Florida, New Hampshire, North Carolina and Virginia, according to a paper on the centers that Mr. Maag prepared in February.

The blog post notes that most CCRC-without-walls programs screen entrants carefully and operate on the condition that new members must be healthy and mostly independent, although there are one or two exceptions.

Read more at The New Old Age blog

 Written by Alyssa Gerace

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As assisted living regulations evolve, Medicare and Medicaid reimbursements fluctuate, and healthcare reform begins to take effect, many states are facing their own challenges as they continue to develop, operate, and implement new rules and programs. Here is a collection of long-term care related news bites from across the nation.

From CCHGroup.Com—Ill. CCRC Not Exempt from Property Taxes

“Except for the chapel on the property, property used by a religious order as a continuing care retirement community (community) was not exempt from Illinois property tax under either a religious use theory or a charitable use theory. A ruling denying the exemption was upheld,” writes CCH. “The community did not qualify for the religious use exemption because, except for the chapel, the primary use of the community was for upscale senior housing and care with an enhanced lifestyle. While there was a religious component to the community, advertisements and enticements for living at the community made it clear that advancing religion was not the community’s primary purpose.”

From the Kennebec Journal—Maine Prisoners Provide Hospice Services to Fellow Aging Inmates

“The Maine Hospice Council and Center for End of Life Care has been involved at the Maine State Prison for 12 years as part of its mission to reach out to underserved populations. It started with classes about end-of-life issues and then trained staff members,” reports the Kennebec Journal. “In the past three years, the council has been training volunteers drawn from the prison population and has graduated two classes with 14 volunteers. They supplement the infirmary staff and sit with men who are dying, providing round-the-clock attention, sometimes just sitting and listening, Powell said. …The Department of Corrections doesn’t track changes in the average age of prisoners, but Warden Patricia Barnhart estimates it is equivalent to the national rate of growth. An aging prison population means more inmates face dying in prison.” Read more

From PennLive.com—Care Choices Don’t Exist for All Pa. Seniors (editorial)

“Today, more families are turning to home and community-based services to ensure their loved ones remain independent for as long as possible, allowing them to stay in their home or apartment or a homelike setting and around their families,” says an editorial published on PennLive.com. “However, our government fails to provide proper support for low-income persons who need these crucial senior services. That’s unfortunate because home and community-based services provides a wide variety of opportunities to protect the quality of life seniors expect to enjoy. The problem is that choice doesn’t exist for all Pennsylvania seniors. In most areas, our senior care provider community has a multitude of options for families to consider if they are paying privately. However, low-income seniors relying on state funded services face a different reality.” Read more

From NorthportPatch (N.Y.)—Another County-Run Nursing Home Privatizing, Sells for $23 Million

“After years of debate, it looks like Suffolk County is finally going to get the John .J Foley Skilled Nursing Center in Yaphank off its books after the County Legislature on Thursday approved the $23 million sale to a private nursing home operator. Legislators voted 10-7 to sell Foley, the county’s only government-run nursing home,” writes the local Patch. “Suffolk County Executive Steve Bellone has said the sale to Sam and Israel Sherman will trim the county’s $250 million deficit by more than $30 million when factoring in the nursing home’s $10 million annual loss with the sale price. The Sherman’s run 13 nursing homes in the state.” Read more

From CBSDetroit (Mich.)—Survey Says: UM’s Care Coordination for Dual Eligibles Works

“In a nationwide program that aimed to provide better care at a lower cost for Medicare participants, the University of Michigan made the most progress in reducing costs and improved the quality of care patients received,” reports the local CBS affiliate. “Those findings come from a new independent analysis published this week in the Journal of the American Medical Association by researchers from the Dartmouth Institute for Health Policy and Clinical Practice…[which] finds that UM was able to decrease annual spending by $2,499 for each patient who had both Medicare and Medicaid coverage. These “dual eligible” patients, as they are called, tend to have medical costs that are higher than people who use Medicare alone — as a group, they account for 31 percent of all Medicare spending and 39 percent of all Medicaid spending.” Read more

http://detroit.cbslocal.com/2012/09/13/saving-dollars-while-improving-care-um-did-both-in-medicare-project/

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Reaching out to aging Americans early—as early as their 60s—and offering amenities that promote an active lifestyle could help continuing care retirement communities (CCRCs) attract seniors and then keep them as residents for the duration of their retirement, according to a new study by a mature market research firm.

Access to technology and the availability of mentally stimulating activities were the top demands by seniors, found researcher Cheryl Slavinsky in a month-long study conducted by Harrisburg, Pa.-based research firm Varsity for Project Looking Glass II (PLGII).

Over the course of a month, Slavinsky lived in Frasier Meadows, a Boulder, Colo. CCRC, and observed the mindsets and needs of the community’s residents through dining, socializing and holding meetings with them.

As an 80-million-strong generation, boomers are expected to control 70% of the country’s disposable income in five years and inherit $15 trillion over the next 20 years, according to a Nielsen report. Boomers make the most money and spend much of what they make, says Nielsen, and because of their financial stability, many expect more out of their retirement years, even before they reach their 80s (the average age of CCRC residents).

By recruiting seniors even before they turn 65, CCRCs can offer residents programs to help live an active lifestyle from an early retirement age, Slavinsky suggests.

“Our job as marketers should not just be about the amenities, but getting people into the community at an earlier age so they can take advantage of wellness programs, build social networks and stay healthier long,” Slavinsky told SHN.

Seniors are becoming increasingly computer savvy and are using the Internet to conduct research on topics of their choice, the research found. With boomers now accounting for 33% of Internet users and 40% of customers paying for wireless internet connection, according to Nielsen, nearly one-third of boomers use the internet so often that they consider themselves “heavy users.”

“They expect Wi-Fi to be everywhere, and they’re not just using it to email kids; they’re doing research,” Slavinskly notes in her study.

Their savvy also spans health and wellness: Seniors are not afraid to speak up and demand more access to programs that will help them maintain their physical and social health.

“Personal health and wellness is a number one priority. Communities are going to have to respond to those needs,” says Slavinsky.

One way to respond to the increasing demand for health and wellness amenities is through dining options, she says.

Seniors are seeking communities that follow trends in foodservice and offer a variety of high quality options when it comes to dining. Frasier Meadows includes many fresh and locally grown ingredients on its menu.

“The menus are all marked with icons for gluten free, organic, vegetarian, no dairy, low sodium, etc.,” says Slavinksy of the menu at Frasier Meadows. “The dining room staff know people and what their diets are.”

Moving into the future alongside residents—and not simply expecting them to follow—helps build a successful community, she says.

The strong community creates a home-like atmosphere, according to the researcher, and the option to move from independent living up through receiving skilled nursing without leaving the community contributes to the ability to aging in place.

“One woman [who had only lived there for a year] said she hurt her shoulder at some point and she didn’t have to go somewhere else to get rehab; she could stay in independent living and go to the skilled nursing building to get taken care of at no extra costs,” says Slavinksy. “Everything is in one building: dining rooms, activity rooms, wellness, chapel, lecture rooms, assisted living, skilled nursing facility, and an enclosed courtyard for gardening.”

Seniors are also seeking communities that offer shuttle vans or public transportation options that allow them to run errands and take care of needs outside of the community on their own.

It is imperative that today’s CCRCs listen to their residents in developing new programs and amenities that appeal to them early, Slavinsky says.

“The people who are going to succeed in the future are those who listen to their residents, and get their input—especially when they’re building or renovating,” she concludes.

Written by Erin Hegarty

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Life Care Services recently announced that it will provide management services to two Milwaukee, Wisc.-area continuing care retirement communities (CCRCs) and will acquire one of them. 

The senior living operator will take on management of Newcastle Place in Mequon, Wisc. and Eastcastle Place in Milwaukee, Wisc. beginning around the first of October.

LCS and The Westminster Funds reached an agreement to acquire Newcastle Place for an undisclosed amount. The closing is expected to take place or around Sept. 30 of this year.

Milwaukee Protestant Home developed Newcastle Place and also owns Eastcastle Place.

“We are privileged to serve as owner and manager of this well-respected senior living community,” says Rick Exline, Executive Vice President, Director of Operations Management. “We are fully aligned with the Milwaukee Protestant Home’s commitment to health, wellness, dignity and respect for those who call Newcastle Place home.”

Newcastle Place offers a continuum of care and has 130 independent living apartments, 29 carriage homes, 36 assisted living residences, 16 memory care rooms, and 47 skilled nursing beds. Other community amenities include an aquatic, spa, and wellness center with trainers; two restaurant-style dining venues; library; game room; interfaith chapel; and beauty salon/barbership. 

By selling Newcastle Place, the Milwaukee Protestant Home is able to further its strategic plans for Eastcastle Place. A portion of proceeds from the sale will be allocated to renovations of the Eastcastle community, another CCRC with 117 independent apartments, 39 assisted living residences, 18 memory care rooms, and 40 skilled nursing beds.

“We chose to affiliate with LCS because it allows us to continue our mission and 125 year history of service to Milwaukee area seniors,” says Carmen Witt, chairman of the board of directors of Milwaukee Protestant Home. “We’re not just turning the keys over. It is a true collaboration of organizations with like cultures, philosophies of care and service to residents. The sale of Newcastle Place strengthens the cash position of both communities, and allows us to move into the future with confidence.”

Written by Alyssa Gerace 

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