One issue that we haven’t heard a lot in the sessions at the last couple of NICs is affordability. Much of what is currently being constructed today is a high-end assisted living/memory care product that is all private pay. And on the skilled nursing/transitional care side, developers like Mainstreet are looking to take on majority Medicare or private pay patients into their luxury rehab resorts. But what about that segment of the population that cannot afford most of the seniors housing and care options out there? And what about those luxury communities that simply can’t draw a large enough census of people who both want to leave their homes and can pay for it? These, among other potential problems, will likely result in the rise of Medicaid in assisted living, especially since one-in-five people are enrolled in Medicaid, and that becomes one-in-four in just three to five years. That may also breathe new life into those 40-year old skilled nursing facilities falling into obsolescence, which could be converted to Medicaid assisted living.
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We couldn’t agree more that the demand for “more affordable assisted living” will continue to grow and represents a major business opportunity. While there is no one solution, Lancaster Pollard is aware of several emerging paths for more affordable assisted living, as defined as both assisted living affordable to those with middle incomes and assisted living for those that qualify for rental assistance. Programs that subsidize either capital costs, income, or both, such as the Illinois Supportive Living Facility (SLF) model, the assisted living conversion program (ALCP) and Wisconsin’s Residential Care Apartment Complex (RCAC) program have found solutions compatible to state specific needs and Medicaid reimbursement characteristics. We would like to share success stories and collaborate with providers, government agencies, trade associations and others to advance this important issue.
Thanks for your comment Steve, it will certainly be interesting in the next decade to see how this issue is addressed state-to-state. Have you seen much investment/construction in these programs the last few years?