Tech in Senior Living

Some senior living providers need to both shift their mindset and implement new technology, or they will miss an emerging opportunity to partner with Medicare and Medicaid managed care plans and could be behind the eight-ball for years to come.

In managed care, private-sector insurance companies receive federal and/or state funds to create benefits packages as an alternative to traditional Medicare or Medicaid. The idea is that by designing smart plans and efficiently managing their beneficiary populations, the insurers can turn a profit while enhancing health outcomes. Managed care plans, including Medicare Advantage, have proven increasingly popular with consumers, who are drawn to perks such as additional benefits related to foot care or dental.

“About 10 years ago, in the Medicare population, about 5% to 7% were enrolled through private insurers. Today, it’s over one-third and growing,” said Anne Tumlinson, founder of Washington, D.C.-based advisory and consulting firm Anne Tumlinson Innovations, at the recent Senior Housing News Summit in Los Angeles.

Recent legislative and regulatory changes are opening the door for these insurers to partner with senior living providers in more robust ways. For instance, Medicare Advantage plans will be allowed to cover non-skilled in-home care for the first time starting in 2019, which could open up coverage for certain services offered within assisted living settings.

Forward-thinking senior living providers are aware of this business opportunity, and some even believe that carving out a role in a managed care world is an industry imperative, noted Bryan Fuhr, vice president of connected health at GreatCall.

But early efforts in this area — such as a partnership between Solterra Senior Living and Mercy Care in Arizona — show that forging constructive partnerships with managed care organizations is no simple matter. It demands an investment in systems and processes and, in some cases, a new way of thinking about the senior living product itself.

Managed care matches well with senior living

Managed care plans are seeking ways to expand their enrollment, reduce health care spending among their beneficiary population, and keep health outcomes and customer satisfaction high. Working with senior living providers can help them achieve all those goals, Tumlinson explained.

On the cost issue, about 5% of Medicare beneficiaries account for 20% of program spending. These are people with multiple chronic conditions who require a high volume of care and often experience exacerbation’s that send them to high-cost settings like the emergency room. In other words, assisted living residents fit this profile, so managed care plans see senior living communities as a “hotspot” for better controlling costs.

And importantly, residents call their senior living community “home.”

“Talk to anyone who is an expert in population health management, and getting insight into where somebody lives and knowing them in their home setting is the most valuable key to managing their health care costs,” Tumlinson said.

In addition, senior living residents already are living in a place where there are readily available services that can be leveraged to keep them out of the hospital — what Tumlinson described as the “holy grail of population health management.”

Finally, managed care organizations make money largely on volume, and senior living communities present a golden opportunity to enroll a large number of people into a plan.

Given all these factors, it might seem that senior living providers would have an easy time gaining traction with managed care organizations. The reality is more complicated.

A false distinction

Even before making the first call to a managed care organization in their markets, a senior living provider might have to change its mindset and even the culture of the organization. That’s because working with managed care demands that a senior living provider offer robust health care services and work closely with other health care providers, and this is sometimes unappealing given that the private-pay senior housing model has been built on a strong basis of hospitality.

“We work on helping organizations understand that’s a false dichotomy — it’s not health care or hospitality, it’s both,” Tumlinson said.

This is becoming more apparent as acuity rises across the senior living spectrum, said Steve Jorgenson, partner and CEO of Solterra, a Scottsdale, Arizona-based provider with eight properties across Arizona and Colorado.

Providers that are stubbornly sticking with a hospitality-only model are actually fostering consumer discontent, Tumlinson added. She convenes family caregiver groups across the nation through her Daughterhood platform, and described one of the most common complaints she hears about senior living.