5 Game Changing Predictions for Senior Care in 2015
For some strange reason we encourage ourselves to prognosticate about the future annually as one year recedes and another begins. These projections might not always be correct, but I think they nicely balance out our attempts at New Year’s resolutions and give us something to aim for. (I hope this list goes more smoothly than those resolutions usually do…)
I’d like to outline my predictions for long-term care and senior living in 2015 – the big things that may change how you run your communities and provide care for your residents. So without further ado, here we go:
1. Affordable Care Act Penalties: The Employer Mandate began January 1 after two years of delays, and we must now be very, very cautious in managing our workforces to ensure we do not get penalized. There was a bill proposed to exclude certain industries from having to participate due to large populations of lower-wage hourly workers and low margins. Guess what? One of the original intents of the ACA was to get these very workers healthcare benefits. Therefore, this bill is a non-starter, and we will not see our industry excluded. The Affordable Care Act will remain the law of the land until and unless we have a new party in the White House in 2016, so tracking employee hours will be key.
2. More Doc Fix Activity: The game of kick-the-can that has been the Doc Fix for the past decade will continue. However, in an effort to kick the can as far as possible, Adam Vinatieri will be the kicker, and he will kick it 21 months into the future. This will nicely coincide with the new administration taking office in January of 2017. (I don’t think Congress will want to deal with this again in 12 months.) Ideally, our friends at AHCA will be able to focus the pay-fors to other segments or maybe even help them find a permanent solution if in fact there is an appetite for one.
3. Workforce Hiring and Retention Challenges: Recruiting, hiring and retaining our workforce will continue to be more challenging, and I think later in the year we will start to see pressure on wages. We have been fortunate so far as it relates to wages, but there is a tipping point that we should prepare for. We need to find innovative and cost effective ways to improve in all areas of workforce management because quality is the key to our future, and our workforce is the key to quality.
4. Increased Competition in Senior Living: Senior living will become more and more competitive as new construction projects continue unabated in anticipation of the Silver Tsunami. Senior living providers will need to offer unique services at competitive prices to attract residents and their families to their communities.
5. Growth through Consolidation, Acquisition and Divestitures: Consolidation will continue at a rapid pace in both the SNF and senior living sectors. 2014 saw Genesis become the largest SNF provider with over 500 centers after acquiring Skilled Healthcare, and Brookdale became the largest senior living provider with over 1,100 communities by acquiring Emeritus. Once their recent acquisitions are digested, I expect to see more, and other providers have certainly been active. Many independent and mid-market providers will be facing the question of growing by acquisition or divesting. Source: Mark Woodka, CEO of OnShift.