The assisted living sector touts itself as the most cost-effective option to provide quality-of-life care and services for the nation’s older adults. But that value comes at a cost, according to a new report.

Seniorly set out to determine how much assisted living communities actually cost and how those costs stack up against other options, including in-home care, by analyzing the average cost to consumers in all 50 states.

The price of assisted living, as with most business offerings, is increasing. Between 2021 and 2023, 30 states saw average costs for assisted living rise — with Wyoming (a 53% increase), West Virginia (46%) and New Hampshire (46%) seeing the biggest average increases, according to the report. The 2023 national average monthly cost of $4,401 is an 8% increase over 2021.

Costs charged to consumers actually fell in 15 states — Washington saw the biggest decline, at 16% — and remained relatively flat in six states, according to the report. 

The average monthly rent for assisted living communities ranged from $2,946 in Louisiana to $8,248 in New Hampshire, where it was almost double the national average. Average monthly costs were more than $5,000 in 10 states, most of them concentrated in New England and the Mid-Atlantic, whereas the most affordable states included Indiana ($3,695), Iowa ($3,420) and South Dakota ($3,378).

Middle market highlighted

The cost of senior living is shining a spotlight on options for the “forgotten middle,” those whose incomes are too low for them to be able to afford current private-pay senior living options but too high for them to qualify for federal assistance.

A recent Milken Institute report, released in partnership with the National Investment Center for Seniors Housing & Care and CVS Health, projected that almost three-fourths of the estimated 16 million middle-income older adults who will be aged 75 or more years will be financially unprepared to afford housing to meet their needs in 2033. Even with home equity, the Milken researchers found, only 39% of those middle-income older adults will be able to afford assisted living.

Another recent study from the Harvard Joint Center for Housing Studies, released last month, found that only 13% of adults aged 75 or more years who are living alone across 97 US metro areas can afford to move into an assisted living community without starting to cash in their assets.

A NIC-funded 2019 study by NORC at the University of Chicago found that 54% of middle-income older adults will lack the financial resources to pay for senior housing and care in 2029, calling for a combination of public and private efforts to address the looming crisis.

The Seniorly study in part used data from the US Census Bureau’s 2022 median annual household income for states and savings rates from the Bureau of Economic Analysis. In doing so, Seniorly estimated that it would take the average American 17.2 years to save for one year of assisted living. 

Using those data to look at the affordability of assisted living, Seniorly found that New Hampshire residents would need to save for 26.8 years to cover a single year of assisted living, with West Virginia (26.1 years), Mississippi (24.8 years), Wyoming (24.6 years) and Delaware (21.7 years) rounding out the top five states as far as timing. 

Maryland came out at the other end of the spectrum, with residents needing to save an average of 11.7 years to cover one year of assisted living costs, followed by Utah (12.3 years), Minnesota (12.3 years), Georgia (13.3 years) and Washington (13.4 years). 

In comparing assisted living with home care costs, Seniorly pointed to a report from Genworth Financial that put the monthly cost of a home health aide at $5,462, although wide variation exists between states. Minnesotans will pay the most for home care, with a median monthly cost of $7,333, compared with $3,472 for assisted living. West Virginia was the least expensive state for home health aides at $3,793 per month, compared with $4,846 average monthly rent for assisted living.

Some question value

The assisted living industry’s pricing structure and providers’ for-profit status were two topics examined in a New York Times and KFF article package in November. Costs also were discussed in a December Washington Post article package looking at the deaths of residents who had eloped from communities. 

Those and other lay media investigations into the assisted living industry led the US Senate Special Committee on Aging to launch a review of the industry, including questions to three large providers, and to schedule a Jan. 25 hearing based on “significant concerns” about costs, staffing levels and resident safety.

A significant number of senior living companies have implemented diversity, equity, inclusion and belonging programs in the past year, indicating that more owners and operators are “leaning in” to those initiatives to meet strategic goals, according to new industry research.

But the authors of the report about the results of the 2023 Senior Living DEIB Survey, which was released Wednesday, say it’s time for operators to focus on actions aimed at improving retention in addition to recruiting.

“Organizations should establish a holistic vision for what they are trying to achieve through their DEIB efforts,” they wrote. “It is time to move beyond the focus of just recruiting diverse talent. Companies must foster inclusive work environments that provide a sense of belonging, so that they can retain the talent that they work hard to attract.”

The survey, which continued to track the industry’s progression addressing DEIB initiatives, was conducted by Ferguson Partners and sponsored by the Senior Living DEIB Coalition, a two-year-old partnership among Argentum, the American Seniors Housing Association and the National Investment Center for Seniors Housing & Care.

Although more work lies ahead, Argentum President and CEO James Balda said that it is important to acknowledge the progress to date.

“It is exciting to note that this year’s survey showed an increase in the percentage of companies with formal DEIB programs, from 27% to 40%, which indicates a growing recognition within the industry of the importance and positive impact of promoting diversity, equity, inclusion and belonging among employees and residents,” Balda said in a statement. “A formal DEIB program is an important step to foster a culture of diversity, equity, including and belonging, which also bolsters employee engagement.”

Recommendations

The survey, however, also revealed that well more than 80% of executive positions are held by white employees, presenting a “huge opportunity” for racial/ethnic parity at the executive level with employees of color. More work also is needed at the mid-management level, with women of color leaving at twice the rate of their promotion, according to the report. 

“Senior living is about creating communities where everyone feels welcome and valued,” NIC President and CEO Ray Braun said. “The results of this survey provide us with a roadmap for furthering our DEIB initiatives and creating an industry that is truly inclusive for all.”

DEIB trends

The results also provide a market overview of how the senior living industry is addressing DEIB, according to ASHA President and CEO David Schless. 

“The data collected provides valuable insights into current industry trends, best practices and areas of improvement for those looking to further their DEIB efforts,” he said.

Survey participation increased 36% — from 44 to 60 companies — from 2022. 

According to the results, 40% of respondents have a formal DEIB program in place — up from 27% in 2022 — and 37% have implemented some DEIB initiatives or policies. In addition, 93% of respondents said they are taking steps to recruit potential employees from underrepresented groups, and 95% said they are taking steps to increase retention and promotion rates of members of underrepresented groups.

Other findings:

• The majority of organizations focus on gender (91%), race/ethnicity (98%), sexual orientation (89%) and age (83%) as dimensions of diversity.
• 73% of senior living professionals are women.
• 50% of employees are white, and 46% are people of color.
• 14% of executive management is people of color, and women make up 50% of executives.

In most cases (57%), DEIB initiatives originate in the C-suite (57%), although some initiatives are developed by the human resources department (17%) or by a dedicated DEIB committee (13%).

An executive summary of the survey results is available on Argentum’s website.

The US Senate Special Committee on Aging is launching a review of the assisted living industry following recent articles in the Washington Post, which reported on the deaths of residents who wandered from communities, as well as the New York Times and KFF, which scrutinized an industry pricing structure that adds fees on top of basic charges to cover additional services, as well as rate increases and the for-profit status of most providers.

Committee Chairman Sen. Bob Casey (D-PA), who has scheduled a hearing for Jan. 25, sent letters dated Monday to the leaders of Brookdale Senior Living, Atria Senior Living and Sunrise Senior Living, asking them to address his “significant concerns” about costs, staffing levels and resident safety.

“Despite these high costs, residents in assisted living facilities have been put in harm’s way, leading to avoidable injuries and death,” Casey wrote in his letter to the large providers, detailing points made in the November Times/KFF articles and December Post articles. 

Assisted living communities primarily are regulated at the state level, but the committee frequently has used its authority to “examine private companies when concerns arise about potential health and safety, as well as financial risks posted to older adults,” the senator said.

“The Senate Special Committee on Aging has jurisdiction over the problems older adults face, including matters of maintaining older adults’ health, their ability to secure proper housing, and their ability to obtain care or assistance when needed,” Casey wrote. “As chairman, I have an interest in ensuring that older adults and people with disabilities are receiving high quality care, have access to proper housing and receive good value for their hard-earned dollars.”

Specifically, Casey asked the companies to provide information and documents no later than Feb. 5 detailing how they communicate the cost of services to residents and their families, rates they charge in each state, and their schedules of services and costs. Additionally, he asked them to provide information on average revenue per occupied unit for the past seven years, figures on the number of residents who have eloped or sustained injuries due to being left unattended, information about the accessibility of information about complaints and citations received by their communities, their policies and procedures for informing residents and families about accidents, applicable staffing requirements, and job titles and associated pay rates at their companies. 

“We look forward to reviewing and responding to Sen. Casey’s letter on the assisted living industry with candor and transparency,” Sunrise Senior Manager of External Communications Heather Hunter told McKnight’s Senior Living. 

Atria Senior Living provided a similar response.

“Our top priority is our residents’ well-being and safety,” an Atria spokesperson told McKnight’s Senior Living. “We look forward to providing information in response to Sen. Casey’s letter.”

Brookdale said it is aware of the letter from Casey.

“Brookdale values the relationships we have created with our hundreds of thousands of residents at communities across the country over the last decade, and we are committed to providing high quality care,” a spokesperson said. “We take seriously our mission of enriching the lives of those we serve with compassion, respect, excellence and integrity.”

Atria, Brookdale and Sunrise are some of the largest senior living operators in the country. On the 2023 ASHA 50 list issued by the American Seniors Housing Association, Brookdale topped the list of operators, and Atria came in at No. 2. Sunrise was No. 3. On Argentum’s 2023 list of largest providers, Brookdale was No. 1, Atria was No. 2 and Sunrise was No. 5.

This isn’t the first time that senators have called for an investigation related to assisted living. In one of the most recent actions, a bipartisan group of US senators, all members of the Aging Committee, in 2015 asked the Government Accountability Office to report on Medicaid oversight and quality of care in assisted living communities. Their request resulted in a 2018 GAO report.

That report contained a to-do list for the Centers for Medicare & Medicaid Services related to state reporting of deficiencies in care and services provided to Medicaid beneficiaries in assisted living communities. Some federal lawmakers and consumer advocates, however, said that they would push for changes in assisted living because of the report’s findings.

‘Isolated incidents’

Senior living industry groups have called the number of deaths reported in The Post’s story a small fraction of the total number of assisted living and memory care residents, most of whom report high satisfaction with their communities.

“The Washington Post’s reporting featured isolated incidents that assisted living communities take very seriously,” Argentum President and CEO James Balda told McKnight’s Senior Living, adding that the elopement-related fatalities highlighted in the Washington Post stories are “exceedingly rare,” occurring with 0.0015% of more than 6.2 million residents served during the timeframe of the reports.

“Our communities look forward to demonstrating to the committee that as the nation grapples to care for our aging population, assisted living provides independence and dignity for seniors,” he said.

Argentum, Balda added, “strongly supports” state regulations already in place to investigate incidents and punish any wrongdoing, and he said that any fatality is “devastating for our staff, our residents and their families.”

Calling elopements rare while acknowledging that any resident injury is “truly tragic,” National Center for Assisted Living Executive Director LaShuan Bethea said she welcomes the opportunity to engage with the committee to “further their understanding of the assisted living profession, its oversight and our deep commitment to providing quality care.”

“The assisted living profession is committed to continuing to learn all that we can about dementia and the disease process to meet the ever-changing needs of our residents,” Bethea told McKnight’s Senior Living. “Policymakers, providers and other stakeholders should come together to find ways to advance memory care while honoring why seniors and their families love assisted living — by supporting their independence and autonomy in a home-like environment.”

Assisted living will continue to evolve with the nation’s changing needs, and regulations, staffing and training requirements must evolve with them, LeadingAge President and CEO Katie Smith Sloan told McKnight’s Senior Living.

“Our elected officials and other stakeholders must prioritize policies to support older adults and the professionals working in aging services to ensure equitable access to high-quality care in assisted living, as well as other care settings,” she said.

In a response to the original package of Washington Post stories, American Seniors Housing Association President and CEO David Schless said the stories “inaccurately” suggest that elopements in assisted living or memory care settings would not occur if there were federal oversight of the setting. He also said that the articles failed to recognize the contributions of the vast majority of frontline caregivers and other senior living professionals.

Schless called assisted living “highly regulated” by states that impose strict requirements, including licensure, and cover a broad range of provisions such as those Casey asked about in his letter to providers. Schless added that states are actively involved in updating and modifying regulations and statutes on an ongoing basis.

“The states are far more responsive than the federal government in addressing the needs of residents and their families to ensure innovative services and programs are available to meet their needs and those of a rapidly aging population, including those with Alzheimer’s and related dementias,” Schless said. 

ASHA, he said, also plans to respond to the committee with a rebuttal of the Post’s “misrepresentation” of the industry, providing information he said was overlooked in the reporting as well as information about the benefits and value of senior living.

Association leaders previously submitted letters to the editor to the New York Times and the Washington Post in response to their articles. Although The Post has not published letters from the associations, it did post a letter from Andrew Carle, lead instructor in senior living administration at Georgetown University. He said that the more than 6 million Americans affected by dementia and prone to wandering would be “exponentially safer” in assisted living communities than at homes in the greater community.

Industry quality initiatives

The industry has launched several initiatives focused on building consensus around assisted living quality measures, as well as infection prevention and control efforts. NCAL last week released its 2023 regulatory review report, which highlighted regulatory requirements across all 50 states. 

The Center for Excellence in Assisted Living, known as CEAL@UNC for the past year, itself was launched in 2003 as a result of a recommendation in the landmark Assisted Living Workgroup Report, delivered to the Senate Special Committee on Aging. 

In a recent podcast interview with McKnight’s Senior Living, Sheryl Zimmerman, MSW, PhD, the center’s executive director, called on all assisted living stakeholders “to be more mindful in a pragmatic, feasible way” across all of assisted living to address resident care needs.

“Most everyone involved in assisted living is aware there are opportunities for improvement,” Zimmerman told McKnight’s Senior Living. “The Senate Aging Committee delved into assisted living 20 years ago with the Assisted Living Workgroup Report, which led to the national Center for Excellence in Assisted Living, and as the executive director, I welcome the opportunity this brings to coordinate efforts to work towards excellence while providing person-centered care and quality jobs.”

LeadingAge, Argentum, NCAL and ASHA in June announced that they had joined with the National Association for Regulatory Administration to develop guidance for the industry and resources for operators, regulators, policymakers and other stakeholders. The groups, working together as the Quality in Assisted Living Collaborative, first turned their attention to the area of infection prevention and control, an issue brought to the forefront during the COVID-19 pandemic, with plans to address other issues.

NCAL also has its own National Quality Award program, based on the Baldrige Performance Excellence Framework. It recognizes assisted living providers that meet certain goals. The organization’s voluntary quality initiative for assisted living communities also has goals related to staff stability, customer satisfaction, hospital readmissions and the off-label use of antipsychotic medications.

When it comes to senior living leads, digital sources are king, but senior living communities lack the processes and systems in place to handle those leads, as well as the urgency to work them, according to one sales and marketing expert.

Senior living marketing consultant Bild & Co. analyzed more than 40 senior living communities in the third quarter of 2023 to identify lead sources between July 1 and Sept. 30. Results, CEO Jennifer Saxman told McKnight’s Senior Living, show that senior living continues to see more leads coming from digital channels, but sales teams continue to treat paid referrals with more urgency and bemoan that they need more leads. Details of the research are shared in a new white paper.

“Most clients actually don’t need more leads,” Saxman said. “The problem is that they don’t work their leads with the same intensity and diligent follow through and follow up.”

Pre-COVID-19, Saxman said, anyone who walked into or called a community was considered a “hot lead,” whereas online inquiries were seen more as “tire-kickers.” That all changed, however, as consumers became more digital-savvy. 

On average, digital leads made up 30% to 40% of total lead traffic before the pandemic, she said. Post-pandemic, digital leads represent as much as 85% to 87% of all lead traffic. Although a minor uptick in walk-ins occurred during the third and fourth quarters of 2023, Saxman said, a phone call, digital or online inquiry all require the same sense of urgency.

“Now what we’re finding is that the digital leads that are coming in, you have to treat it as a call in or a walk in. It’s just as hot,” she said, adding that sales teams must get past the notion that one bad digital lead means that all digital leads are bad.

“If we don’t let it go and don’t start treating our digital leads as if they were a walk-in, sitting there waiting for you to tour them, you’re going to miss the opportunity and you’re going to always feel you need more leads, more leads, more leads,” Saxman said.

Digital sources produced the highest rate of tours, at 43.4%, in the third quarter, followed by 41.8% from paid referral sources, according to the white paper. Digital lead sources produced the top new leads (52%), tours (80%) and move-ins (85%) in independent living in the third quarter. In assisted living and memory care, digital sources led to more than 80% of new leads and initial tours.

To capture those digital leads, Saxman said, it is important for operators to make it easy for prospects to buy online. That means having chatbots, forms on websites that work and no broken links. She also recommended that communities have a three-person-deep team notified of web inquiries and to chart conversations, to create accountability.

“Those leads matter so much,” Saxman said. “If you’re really stuck on needing more leads, look at your CRM [customer relationship management]. Your next move-in is in your CRM already.”

The senior living occupancy rate (assisted and independent living combined) increased 0.8 percentage points in the fourth quarter of 2023, to 85.1%, according to the data, analyzed by the National Investment Center for Seniors Housing & Care. That rate is up 7.3 percentage points from a pandemic low of 77.8% in second quarter 2021, bringing senior lying occupancy within less than two percentage points of the 87.1% pre-pandemic rate in March 2020.

The assisted living occupancy rate improved 0.9 percentage points from the third quarter to 83.4%, whereas the independent living occupancy rate increased 0.8 percentage points, to 86.8%. As a result, the occupancy rate for assisted living was only 1.1 percentage point from the pre-pandemic level, and the occupancy rate for independent living was only 2.8 percentage points from its pre-pandemic level.

The cities of Boston (90.7%), Baltimore (88.6%) and Minneapolis (88.1%) had the highest occupancy rates of the 31 primary markets that NIC MAP Vision watches, whereas Houston (79.3%), Atlanta (81.8%) and Las Vegas (82.1%) had the lowest occupancy rates.

NIC MAP’s 68 secondary markets fared even better, with assisted living occupancy fully recovered and 1.2 percentage points above its pre-pandemic occupancy level of 84.2%. 

Demand outpaced supply in both assisted living and independent living properties within the primary markets in the fourth quarter, driving occupancy rates higher. 

Higher capital costs and a challenged lending environment, however, continued to weigh on new supply, NIC said. Inventory for the primary markets grew by only 0.4% from the third quarter. Year-over-year inventory growth held steady at 1.4%, among its smallest increases since 2012.

“At this pace, we anticipate occupancy recovery to pre-pandemic levels in the second half of 2024,” NIC Senior Principal Caroline Clapp said in a statement. “If this environment of robust absorption coupled with relatively moderate new inventory continues, owners and operators will need to determine when to jumpstart new construction to meet consumer demand.”

A new report released Tuesday by the Milken Institute presents four potential solutions to improving the financing and delivery of housing for the “forgotten middle,” those whose incomes are too low for them to be able to privately pay for current senior living options but too high for them to qualify for federal assistance.

This group was named and quantified in 2019 and 2022 studies. The Milken Institute undertook the research due to the long-standing — and growing — gap in available senior housing and care options affordable care options to this group, according to Lauren Dunning, director of the Institute’s Future of Aging Advisory Board. More than half of middle-income Americans 75 and older are projected to fall into the “forgotten middle” by 2029.

But a central purpose of the report, Dunning told McKnight’s Senior Living, was to spotlight the flip side of the challenge — the opportunity for innovative senior housing and care offerings, options and solutions addressing the unmet needs and wants of older adults.

“Pioneering operators are already utilizing unique levers to serve the ‘forgotten middle,’ creating healthcare and payer partnerships, developing models centered around resident volunteering, and introducing new a la carte arrangements,” Dunning said. “Lowering housing and care costs can also increase the value proposition for investors and present compelling selling points for prospective consumers.”

Senior housing operators are innovating, Dunning said, and now the call to action is to bring that to scale across the nation.

The potential solutions presented in the new report, Dunning said, embody an overarching theme that senior housing is “approaching a new era” of integration in the healthcare continuum, within communities, and across sectors, such as technology:

1. Establish a social enterprise to refinance and rehabilitate existing distressed senior living properties.
2. Design a revolving loan fund to provide a sustainable source of long-term capital.
3. Use a pay-for-performance model to attract upfront funding for housing and provide a new revenue stream to offset the ongoing costs of providing care by delivering long-term cost-savings for payers.
4. Launch a regional pilot program to generate data supporting partnerships between senior housing operators and payers in value-based care.

The report, titled “Innovative Financing and Care Models to Scale Affordable Housing Solutions for Middle-Income Older Adults,” comes as the need to address cost barriers to affordable senior living and care increases. It presents research findings from Milken’s Financial Innovations Lab conducted by the institute’s Innovative Finance and Future of Aging teams. Milken partnered with the National Investment Center for Seniors Housing & Care and CVS Health last summer to host a series of meetings with 80 experts from healthcare, senior living and care delivery, finance, technology, government, philanthropy and academia.

There are a few groups of stakeholders working to advance the recommendations outlined in the report.

“We are excited that the industry has embraced the report’s findings, and we will continue to help facilitate the execution of the solution alongside the working groups,” Dunning said.

The ‘forgotten middle’ dilemma

It is projected that nearly three-fourths of the estimated 16 million middle-income older adults 75 and older will be financially unprepared to afford housing to meet their needs in 2033, with more than half projected to live with three or more chronic conditions and mobility limitations, according to the report authors.

Even with home equity, 39% of middle-income older adults will be unable to pay for assisted living, but 67% of those individuals are expected to experience three or more chronic conditions, and 60% will have limited mobility.

Compounding the problem is the intensifying shortage of direct care workers and lasting economic effects of the COVID-19 pandemic on senior housing developers in the form of higher costs for materials, labor, operations and employee benefits. Those factors contributed to a 17.8% increase in senior housing development costs between 2020 and 2022, according to the report.

But optimism exists within the industry that pandemic disruptors have changed the way developers and operators design and deliver housing and care, with innovation driving the overall value proposition of senior living, according to the authors.

In a case study, the report highlighted 2Life Communities’ Opus Communities project, which broke ground in March as one of the nation’s first senior housing projects designed specifically for the middle market. Among the approaches the project is taking to reduce operating and state costs, Opus will require residents to volunteer 10 hours per month, offer meal service just three nights a week and encourage membership in nearby Jewish community centers for activities, to reduce in-house entertainment and activity costs.

The persistence of a pandemic-associated increase in antipsychotic, antidepressant and anticonvulsant medication use in assisted living residents — and a greater increase in antipsychotic use in dementia care settings — raises concerns about the risks for residents, say the authors of a study published in the January issue of JAMDA–The Journal of Post-Acute and Long-Term Care Medicine.

Prescriptions for antipsychotic medications in assisted living communities increased during the first two years of the COVID-19 pandemic, especially in residents living with dementia, according to the researchers. They examined the proportion of assisted living residents in Alberta, Canada, who were prescribed an antipsychotic, antidepressant, benzodiazepine, anticonvulsant or opioid medication between January 2018 and December 2021. 

Antipsychotic medication use prevalence increased to a larger degree than antidepressant use and was approximately 8% higher for memory care compared with other assisted living residents during the latter two pandemic waves — wave 3 (March to May 2021) and wave 4 (September to December 2021). Assisted living residents not living in memory care settings also showed a statistically significant but small increase in anticonvulsant use during the pandemic waves 2 (September to November 2020, and December 2020 to February 2021) through 4. 

For both assisted living and memory care residents, the pandemic was associated with a statistically significant decrease in benzodiazepine use and no significant change in opioid use, they found.

The study results revealed that the increase in antipsychotic use among assisted living residents in dementia care (3.5% to 7%) was larger than estimates previously reported for nursing home residents living with dementia (more than 1.7%). 

“The significantly greater increase in antipsychotic use among residents of dementia care was surprising given our hypothesis that the presence of specialized dementia care staff and environments might mitigate behavioral changes and antipsychotic use in this population,” the authors noted.

Lead author Colleen Maxwell, PhD, a professor in the University of Waterloo School of Pharmacy in Ontario, told McKnight’s Senior Living that she and colleagues believe that the substantial challenges and losses faced by assisted living communities and nursing homes during the pandemic partially explain the increase in use of the medications. Those challenges included staffing shortages, declines in services and comprehensive integrated care, loss of family caregivers, an increase in resident pain and mental health conditions due to pandemic-related restrictions, and difficulties in implementing nonpharmacologic interventions to address pain, sleep, mental health concerns and responsive behaviors among residents. 

The researchers also said that the increased use of antipsychotic medications in assisted living likely was “inappropriate.” Although they acknowledged that the mental health distress that assisted living residents likely experienced, as well as the lack of nonpharmacologic alternatives early in the pandemic, might have supported the short-term use of antidepressants and antipsychotics, their use remained elevated throughout the pandemic. 

“Prior to the pandemic, there is strong evidence that once started, these medications tend to persist beyond what might be considered an appropriate period of treatment, leading to an increased risk of polypharmacy / hyperpolypharmacy and medication-related adverse events,” Maxwell said. 

She added that when faced with public health crises, it is important that the senior living industry direct careful attention to implementing strategies for the appropriate oversight and administration of high-risk medications, particularly among at-risk residents and those living with dementia. 

A spokesperson from the American Health Care Association / National Center for Assisted Living told McKnight’s Senior Living that the groups have been active partners in a national effort to reduce the unnecessary use of antipsychotics in assisted living and skilled nursing and has made progress in the past decade, including focusing more on nonpharmacologic interventions.

“Along with prescribing physicians and family decision-makers, we must continue to educate ourselves about these conditions and the proper use of medications, as well as explore and promote innovative memory care techniques to help individuals with dementia thrive,” the spokesperson said.

A continuing challenge in assisted living

More than two-thirds of assisted living residents have dementia or cognitive impairment, and antipsychotics commonly are prescribed off-label for behaviors that include aggression, agitation, anxiety, delusions, hallucinations and sleeplessness, according to a 2023 study also published in JAMDA, by researchers from Brown University and the University of Michigan. 

In the early 2000s, studies showed that the off-label use of antipsychotic medications for older adults living with dementia was associated with a higher risk of early mortality, leading the US Food and Drug Administration to issue a “black box” warning on the use of the drugs in this population.

The Centers for Medicare & Medicaid Services, through the National Partnership for Quality Dementia Care, developed quality improvement efforts related to the use of antipsychotics in nursing homes. But evidence was lacking about antipsychotic medication use in assisted living / residential care facilities, staff training and use of nonpharmaceutical interventions and potential discrimination against older adults whose behaviors were deemed challenging, according to a study published in early 2023. 

Reducing the off-label use of antipsychotics in assisted living communities has been a goal of the senior living industry. One of the performance measures used by an assisted living community accreditation program launched in 2021 by The Joint Commission is medication management, specifically, off-label antipsychotic drug use. The National Center for Assisted Living’s Quality Initiative also lists antipsychotic medication use among its goals. 

With a projected need for 200,000 additional senior living units by next year, inventory and investment isn’t set to keep pace with the growing demand, Lisa McCracken, head of research and analytics at the National Investment Center for Seniors Housing & Care, writes in a new blog. But the industry is moving in the right direction. 

Calculations by NIC MAP Vision project the need for an additional 200,000 senior living units by next year, when the first baby boomers, born in 1946, approach 80, McCracken said. The youngest boomers are turning 60 this year.

“With record-low construction starts observed in 2023, the projected gap between available and needed senior housing units will be significant,” she wrote. “To maintain the current market penetration rate in the senior housing sector, we will need significant near-term growth in the senior housing inventory.”

An industry-wide investment of $400 billion is necessary to complete the required new development to meet anticipated demand, she said, but only 40% of that investment need is on pace to be fulfilled.

The industry is facing the situation with an “undeniable sense of optimism” coupled with a “drastic sense of urgency” as it contemplates the coming “age wave” and its “profound implications” for the sector, according to a NIC MAP Vision blog.

Call to action

“This strong demand presents a golden opportunity for stakeholders in the senior housing industry,” the NIC MAP Vision blog read, adding that the “possibilities are boundless.”

That optimism, however, comes with a call to action. 

Although today’s older adults are living longer and healthier than members of previous generations, chronic conditions and age-related ailments necessitating specialized care also are on the rise and will necessitate changes to traditional support systems, according to the NIC MAP Vision blog. Additionally, the availability of fewer family caregivers will shift the burden of care to congregate care environments. 

“The industry must, therefore, focus on creating environments that are not just residences, but holistic communities that prioritize health, well-being and social connectedness,” the NIC MAP Vision blog read. “Within these communities, balancing affordability with quality becomes paramount — especially given this generation’s longer lifespans and potential for increased healthcare needs.”

In 2023, approximately 5,000 new senior living units were under construction per quarter — a pace not fast enough to keep up with growing demand, according to NIC MAP Vision, which also echoed McCrakcker’s remark that investments in senior living aren’t keeping pace with demand. The result, according to NIC MAP Vision, could mean potential difficulties in affordability, accessibility and quality of care. 

“In essence, while we are moving in the right direction, we are not moving fast enough,” the NIC MAP Vision blog reads. “The required investment to maintain the current market penetration rates is estimated to be over $1 trillion — the majority of which is not estimated to be met.”

The blog concluded that the future of senior living is bright, with strong demand and ample opportunities. 

“It is incumbent upon stakeholders — developers, investors, policymakers and care providers — to rise to the occasion,” the blog concluded. “By accelerating investments, fostering innovation and strategically planning for the future, we can ensure that the growing demand is not just met, but exceeded, crafting a future where our seniors live their golden years in comfort, community and care.”

Lisa McCracken, the new head of research and analytics for the National Investment Center for Seniors Housing & Care, talked during Wednesday’s LeadingAge policy update call about what she is seeing in her crystal ball as the industry enters the new year. 

“The pandemic was an accelerant across a lot of different levels. A lot of things unfolded much quicker,” she said.

The industry, McCracken said, is in the earlier stages regarding much technology, especially as relates to adoption. That reality, she added, brings questions about how to pay for it, who will pay for it and what providers can cover from an investment standpoint if technology helps improve outcomes and efficiencies.

Artificial intelligence also presents opportunities in terms of predicting when a resident’s health might start to decline or when a resident might be prone to falling, and to identify signs of employees who may be more likely to leave their jobs, McCracken said. 

“There is a lot of predictive data out there,” she said. Generative AI, McCracken added, processes data in different ways and helps with the human touch aspect of care and service provision by allowing staff members “to do the more important things.”

“I’m a big fan of a lot of the workforce tech that helps from an efficiency standpoint to reallocate staff time,” she said.

NIC, she added, is working with NORC at the University of Chicago to quantify the value that senior living brings to individuals from the standpoint of quality of life, longevity and health outcomes — and how that value can translate to the reimbursement side for some operators. Organizations, McCracken added, must adopt a business intelligence and analytics mindset to better quantify the sector’s story.

“How can you prove your own worth?” she asked. “We know it, we feel it, we see it — but we live in a world that demands the evidence. We need to do better at that.”

The integration of wellness into offerings, as well as risk partnerships with payers, are other innovative happenings that McCracken said she is seeing, “recognizing we can’t do this alone, and maybe we don’t need to be the end all, be all, but a convener to make bold moves.”

Partnerships, she added, are helping NIC propel some initiatives forward. McCracken mentioned a partnership with the Milken Institute that will yield a report next week regarding middle market solutions for senior housing and care. This report follows the November announcement of a $3 million grant that NIC provided to the institute’s Center for the Future of Aging to “develop bold new models” for senior housing and care. As part of that effort, Nexus Insights, a think tank founded almost four years ago by NIC founder Bob Kramer, is merging with the new Aging Innovation Collaborative within the center.

“We recognize that NIC has a powerful voice within the senior housing and care space, but others are looking at the population of older adults and saying what we need to know, how to partner, how to think innovatively,” McCracken said.

A wrongful death lawsuit alleging failure to comply with COVID-19 protocols can move forward after a circuit court judge ruled that assisted living communities are not healthcare providers and therefore not entitled to immunity from such legal action.

In a decision issued last month, Judge Douglas L. Fleming Jr. of the Loudoun County (Virginia) Circuit Court denied a motion to dismiss a Jan. 19. 2021, complaint filed against Tribute at One Loudoun and parent company Cadence Living, according to Virginia Lawyers Weekly. Cadence combined with Cogir Senior Living in late 2022.

According to the complaint, Frances Hamilton moved into Ashburn, VA, senior living community in 2019 and died from complications from COVID-19 on Jan. 19, 2021. The complaint alleged that Hamilton contracted the virus at a Dec. 31, 2020, New Year’s Eve party at the community due to understaffing, substandard care and the community’s failure to follow COVID-19 protocols. 

The community moved to dismiss the complaint on the basis that an expert opinion was not obtained by the plaintiff before bringing the wrongful death lawsuit against a healthcare provider as required by Virginia law. The community also claimed emergency COVID-related immunity as a healthcare provider under the COVID-19 public health emergency. 

But in his Dec. 4 ruling, Fleming found that assisted living communities are not healthcare providers because they are not licensed as nursing homes or hospitals, nor do they employ licensed healthcare providers to “primarily” render healthcare services. The decision meant that an expert opinion was not required to bring the lawsuit, nor was Tribute at One Loudoun covered under the statutory immunity provided to healthcare providers under the COVID-19 public health emergency. 

Fleming denied the senior living community’s motion to dismiss the case in its entirety.

“One only has to look at the statutory distinction between an assisted living facility and nursing homes,” Fleming wrote in his opinion. “[W]hile each facility renders healthcare services, only a nursing home primarily does so.”

Cogir Senior Living told McKnight’s Senior Living it could not comment on ongoing matters.