Like most issues about which I post, the topic of “Finding A Good Death” arose from a personal connection. In this case when a neighbor consulted me about his sister who was being referred to hospice care after battling cancer. While not an expert in hospice care, I have long studied seniors housing and care and, for a time, I followed the publicly traded hospice companies as a stock analyst. I also have some personal experience with hospice care. My older brother (only four years my senior) utilized hospice care before his death in late 2014 from a degenerative neurological condition. To supplement my own knowledge for this blog post, I interviewed a friend and neighbor who is a long-time bereavement counselor volunteer at a large not-for-profit hospice in Baltimore and researched the topic on line.
John McCain’s death, which appeared to come quickly surrounded by friends and family after the Senator elected hospice care, also makes the subject of Finding A Good Death very relevant.
Even though we all die eventually, talking about death and planning for death, beyond making funeral arrangements, are taboo subjects for most Americans. We are culturally geared to want to live as long as possible and most physicians and patients have a strong bias toward utilizing the most expensive, invasive and technologically advanced medical procedures to prolong life, viewing death as failure rather than an inevitable part of the life cycle.
According to data from the Social Security Administration:
- A man age 65 today can expect to live, on average, until age 84.3.
- A woman age 65 today can expect to live, on average, until age 86.7.
About one out of every four 65-year-olds today will live past age 90, one out of 10 will live past age 95; and longevity estimates for 65 year olds continue to rise. Also, these statistics are averages for the entire population, so healthy non-smokers and those with better health plans and medical care should expect to live longer. Once you reach 65, I would argue you already have a very good chance of living a long life and you and your family should be more concerned with the quality rather than quantity of the remaining life you lead, and with the quality of your death, the focus of this post.
A good death is generally understood to be one that comes quickly and peacefully and with minimal pain and suffering, ideally at home and with an opportunity for loved ones to say their goodbyes.
English physician Dame Cicely Saunders first applied the term “hospice” to specialized care for dying patients in the UK in 1948. Hospice care was introduced to the U.S, in the mid-60s and did not become a Medicare eligible benefit until 1982. History of hospice care
As defined by Medicare, hospice is a program of care and support for people who are terminally ill (with a life expectancy of 6 months or less if the illness runs its normal course) and their families. Hospice helps people who are terminally ill live comfortably.
- The focus is on comfort (palliative care), not on curing an illness.
- A specially trained team of professionals and caregivers provide care for the “whole person,” including physical, emotional, social, and spiritual needs.
- Services typically include physical care, counseling, medications for relief of pain and suffering, medical equipment, and supplies for the terminal illness and related conditions. Things like diapers are not covered by Medicare although catheters are. Patients and their families should not expect 24/7 physical care from hospice unless the patient is receiving inpatient care. Home health aides can be provided for bathing, etc. but cannot provide total care.
- Care is generally given in the home.
- Family caregivers can get support.
In order to qualify for Medicare’s hospice benefit, you must participate in Medicare Part A and
- Your hospice doctor and your regular doctor (if you have one) certify that you’re terminally ill (you’re expected to live 6 months or less).
- You accept palliative care (for comfort) instead of care to cure your illness.
- You sign a statement choosing hospice care instead of other Medicare-covered treatments for your terminal illness and related conditions.
Medicare will cover the cost of a one-time hospice consultation even if you decide not to elect hospice care. Once you elect hospice care, the first step in the process is development of an individualized care plan. Original Medicare will cover everything you need related to your terminal illness, but the care you get must be from a Medicare-approved hospice provider.
Hospice care is usually given in your home, but it also may be covered in a senior housing community, a nursing home or a specialized hospice inpatient facility. Depending on your terminal illness and related conditions, the plan of care your hospice team creates can include any or all of these services:
- Doctor services
- Nursing care
- Medical equipment (like wheelchairs or walkers)
- Medical supplies (like bandages and catheters)
- Prescription drugs
- Hospice aide and limited homemaker services. At Gilchrist, a large not-for-profit Baltimore area hospice, a volunteer may do light housekeeping but that is all
- Physical and occupational therapy
- Speech-language pathology services
- Social worker services
- Dietary counseling
- Grief and loss counseling for you and your family
- Short-term inpatient care (for pain and symptom management)
- Short-term respite care
- Any other Medicare-covered services needed to manage your terminal illness and related conditions, as recommended by your hospice team.
Note that the above list does not include the cost of room and board in a seniors housing or skilled nursing facility, so the patient or their family may have to cover this cost if routine hospice care cannot be provided at home.
If your usual caregiver (a family member or other caregiver) needs rest, a hospice patient can get inpatient respite care in a Medicare-approved facility (such as a hospice inpatient facility, hospital, or nursing home). Your hospice provider will arrange this for you. You can stay up to 5 days each time you get respite care. You can get respite care more than once, but only on an occasional basis.
Medicare pays the hospice provider for your hospice care. There’s no deductible. You’ll pay:
- Your monthly Medicare Part A (Hospital Insurance) and Medicare Part B (Medical Insurance) premiums.
- A copayment of up to $5 per prescription for outpatient prescription drugs for pain and symptom management.
- 5% of the Medicare-approved amount for inpatient respite care if used.
Medicare won’t cover any of these once your hospice benefit starts:
- Treatment intended to cure your terminal illness and/or related conditions. Talk with your doctor if you’re thinking about getting treatment to cure your illness. You always have the right to stop hospice care at any time.
- Prescription drugs (except for symptom control or pain relief).
- Care from any provider that wasn’t set up by the hospice medical team. You must get hospice care from the hospice provider you chose. All care that you get for your terminal illness and related conditions must be given by or arranged by the hospice team. You can’t get the same type of hospice care from a different hospice, unless you change your hospice provider. However, you can still see your regular doctor or nurse practitioner if you’ve chosen him or her to be the attending medical professional who helps supervise your hospice care.
- Room and board. Medicare doesn’t cover room and board. However, if the hospice team determines that you need short-term inpatient or respite care services that they arrange, Medicare will cover your stay in the facility. You may have to pay a small copayment for the respite stay.
- Care you get as a hospital outpatient (such as in an emergency room), care you get as a hospital inpatient, or ambulance transportation, unless it’s either arranged by your hospice team or is unrelated to your terminal illness and related condition.
The Medicare hospice benefit is paid by original fee-for-service Medicare. To understand how the hospice benefit relates to Medicare Advantage plan, Part B or D coverage speak with Medicare or your hospice provider and you might consult the publication Medicare Hospice Benefits – Medicare Hospice Benefits
A Popular Benefit
Hospice care enjoys wide support from patients and patient advocates who are supportive of patients dying with dignity and having control over the final chapter of their lives. It is supported by policy makers who believe hospice can save Medicare funds by having terminally ill patients avoid expensive procedures at the end of life that often provide little lasting benefit. Mean medical spending during the last 12 months of life is reaching $80,000 in the U.S., with 44.2% spending for hospital care (57.6% is hospital spending during the final three months of life). To the extent hospice care can reduce expensive end of life hospital care it has the potential to reduce growth in Medicare spending. Hospice Impact On Medical Spending
Hospice care is also viewed favorably by investors and for-profit healthcare companies who see it offering stable reimbursement, attractive margins and very attractive growth prospects as Baby Boomers age. Because hospice reimbursement is designed to adequately fund small not-for-profit hospice providers, not-for-profit and for-profit operators with scale can generate an excess revenue/profits from spreading their overhead costs over a large number of patients, thereby generating reasonable margins from hospice reimbursement.
Electing Hospice Care
The key issue for patients and their families in electing hospice care is that doing so requires you to forgo additional curative treatment for the condition that is expected to lead to your death in order to receive funding for palliative care designed to give you a dignified death with minimal pain and suffering. As noted above, In order to qualify for hospice care a physician, typically your primary care doctor or a hospice doctor, certifies that you are expected to live no more than six months if your disease follows its typical progression. With this physician’s certification and your election to shift from curative to hospice/palliative care you will qualify for Medicare hospice benefits or hospice benefits from a private insurer. If you live more than six months in hospice care, the hospice benefit can be extended but Medicare manages this by penalizing operators that have average length of stays in hospice care.
Selecting A Hospice Provider
According to the National Hospice and Palliative Care Organization (NHPCO) Medicare paid about 4,200 different hospice providers for services in 2015. About 60% of these hospice providers were profit-making companies and 40% are not-for-profit (Long-Term Care Providers and Services Users in the United States: Data From the National Study of Long-Term Care Providers, 2013–2014 Department of Health and Human Services, Centers for Disease Control, Center for Health Statistics, February 2016 – CDC Report On Hospice Services
Hospice providers served approximately 1.3 million patients in 2013 with an average length of stay of 23 days – indicating an average daily census of about 14 patients per hospice.
The statistics above suggest two criteria for selecting a hospice provider 1) for-profit vs. not-for-profit and size. Many hospice providers are small not- for-profit operations. For-profit companies tend to be larger in size, as are some well established not-for-profit organizations, such as Gilchrist Hospice in Baltimore. Smaller operations may offer more personalized care options but larger operations may have their own specially designed dedicated inpatient hospice units and greater resources to Invest in family grief counseling, for example.
Your physician or a social worker/discharge planner at a hospital should be able to recommend or refer you to one or more hospice providers. A simple online search on “finding a hospice provider” results in links to larger for-profit and not-for-profit providers in your area (Heartland, Amedysis and Gilchrist in Baltimore) and links to referral services, such as A Place for Mom, an Internet focused senior housing and care referral company, and the National Hospice and Palliative Care Organization (NHPCO). Keep in mind that referral services will only refer you to organizations that are members of that organization or agree to pay a referral fee.
The Medicare.gov/hospice compare website provides ratings for hospice providers with percentage scores for a number of objective and subjective measures including results from user surveys. The site allows you to search for specific providers and provides near particular zip codes. See Medicare Hospice Compare. Some of this data is likely self-reported but still appears useful for comparing providers.
Before committing to a particular hospice provider a prospective patient and their family should ideally meet with the provider to assess the staff who will oversee and deliver care to your loved one, share information about your family’s situation and discuss options for delivering hospice care in a way that best meets your families needs. Care will most likely be delivered at home with family members engaged in the hospice care delivery process. It can also be provided in a seniors housing or skilled nursing facility but this may require the family to pay for the coast of board. If required, typically right at the end of life when 24/7 oversight is needed, the location of care may be shifted to an inpatient hospice care facility and you should understand when and how such a facility might be used. You may wish to check on the location and quality of the inpatient option.
I welcome comments and questions on this blog and hope it aids you finding a good death for you and your loved ones.
On Monday June 6, 2016, The “Ask Encore” column by Glenn Ruffenach in the Wall Street Journal responded to a question from a reader about “what features, at a minimum, should be added to our current home or incorporated in a new home so that we can stay in our home as we get older.” The columnist’s response identified three resources to make a home accessible and adaptable for seniors. These included:
- “Housing America’s Older Adults: Meeting the Needs of an Aging Population” by the Joint Center for Housing Studies at Harvard University, July 2015.
- “Aging-in-Place Remodeling Checklist” by the National Association of Homebuilders
- “HomeFit Guide” by AARP
These all appear to be useful resources and the Wall Street Journal column cites the Harvard Study as saying five features, in particular, that make for safe and acceptable homes are: no-step entries; single-floor living; switches and outlets reachable at any height; extra-wide hallways and doors and lever-style door and faucet handles. The Harvard Study indicates that 90% of existing homes have one of these features but that only 57% have more than one.
Research (AARP United States of Aging Survey, 2012) indicates that 90% of seniors would prefer to stay in their own home vs. moving to a seniors housing community and I have no doubt that for some seniors making adaptations to an existing home or buying a new home with adaptable feature may allow them to defer a move to seniors housing for some period of time. However, because of most seniors’ strong bias toward staying in an existing home, I see far too many seniors resisting a move to seniors housing even when this would be more beneficial for their health, their finances and their families.
I believe it is important for a senior and her or his family to also consider other issues when considering whether to modify an existing home vs. moving to a seniors housing community. Chief among these are (1) the location of one’s existing home, (2) the age and medical conditions of the residents, (3) access to companions and support services, and (4) the cost of maintaining a home. The key points I want to make are:
- seniors and their families need to think through how making accessibility improvements to a home will meet a senior’s physical and mental health needs over time, not just at a single point in time, and
- staying vs. moving should be considered in light of the full occupancy and care costs for each alternative.
Location is important for the resident, her or his family and other formal or informal caregivers. Too often, seniors of advancing age become increasingly isolated in their homes because they are not located where public transportation, taxi or Uber-like services are readily available. If this is the case, as a senior’s ability to drive diminishes, which it invariably does, a senior’s ability to visit friends, see medical professionals, attend social, educational and civic events will be restricted with negative implications for their physical and mental health. If they are living alone, studies have show poor diet and social isolation can take a heavy toll. Technology may be able to reduce these isolating effects in the future but is not yet able to overcome all the location issues noted here.
Location is also important for family members and other formal and informal caregivers. If you live hundreds of miles from your children or if your home is not readily accessible in good and bad weather to formal and informal caregivers, a home modified to be accessible for a senior may still prove unable to meet a senior’s needs over time as their physical or mental health deteriorates and caregivers are needed.
Age and Medical Condition
The age and medical condition of residents is also important to consider when thinking about whether to modify one’s home or move to a retirement community. Physical limitations, such as needing a walker, shower grab bars, lever door handles can help extend the ability of an existing home to accommodate a senior. But, if a senior is 85 or older or has medical conditions that will escalate over time, the benefit of these types of improvements may be short lived and fully modifying a home for a wheelchair equipped senior – completely flat floors, wider doorways, larger baths with turning radius for a wheelchair can get very expensive. In addition, if a senior has early signs of dementia, this condition too is likely to deteriorate over time and may require a more secure setting with full time care at some point, which an individual’s home cannot provide.
Access to Companions and Support Services
The cost to bring qualified caregivers and other support services into one home can quickly exceed the cost of a seniors housing community if care is required on a 24/7 basis. It can also be difficult for a senior or their family to manage care and home maintenance services and to monitor the quality of care delivered in a senior’s home, particularly if the family does not live nearby. The availability of qualified caregivers varies with geography, with access to public transportation and with population density tending to improve the availability of care.
Cost of Maintaining A Home
When comparing the costs of staying in one’s home vs. moving to a senior housing community, seniors and their families too often view the cost of staying in one’s home as only including the cost of making accessibility modifications and do not fully consider the cost of part-time or full-item care, the cost of taxes and maintenance, or the income that can be generated from investing proceeds from the sale of a home. This sticker shock of a $2,500 to $6,000 per month fee for seniors housing may seem a lot less daunting when one makes a accurate assessment of the costs of staying at home. It is also important to understand that the average length of stay for an 85 + senior in assisted living is about two years, so $150,000 in home sales proceeds is usually sufficient to fund an average stay.
There is some additional discussion of housing options and issues to consider when moving to seniors housing on this blog www.robustretirement.com. The American Seniors Housing Association also has a new website Where You Live Matters with a lot of information for seniors considering whether to stay in their existing homes or move to a retirement community, including cost calculators. Specific posts on this website that may be of interest include:
- UnSenior “Seniors Housing” – April 2016
- Confessions of a Recent CCRC Mover – March 2016
- Finding Happiness In Seniors Housing – August 2015
With NIC-MAP data starting to report an upturn in senior housing development activity, many older senior housing properties are or can soon be expected to face a more competitive market for new residents. Senior housing, and particularly purpose built assisted living and memory care, are relatively young industries and most early assisted living properties were developed in the mid-1990s. Nevertheless, early assisted living properties, particularly those that did not receive substantial capital infusions during the recession, are becoming dated in comparison to newly constructed buildings. As a result, repositioning of older assisted living and memory care properties is likely to become increasingly important for the senior housing industry as more new units are constructed and competition increases.
Because many, but certainly not all, early assisted living and memory care properties are located in very attractive, hard-to-duplicate infill locations, repositioning good 1990s vintage properties may prove a very attractive investment alternative if such properties decline in value because of occupancy declines in a more competitive environment. In this blog, I focus on repositioning opportunities for the classic Sunrise Mansion property as a proxy for all older assisted living and memory care properties. I focus on Sunrise properties not because I believe the company has underinvested in their assets relative to other operators but because the Sunrise Mansion is the prototype for almost all of the mid- to late-1990s assisted living and memory care buildings. As I write this, it has been 3 – 4 years since I toured a Sunrise mansion. So some of my observations may be dated. However, over the course of my consulting, equity research and investment banking careers I easily toured dozens of Sunrise Mansions and similar vintage properties operated by national companies, regional and local operators. I had the opportunity over the years to meet with several generations of Sunrise senior and operational management as well as senior and operational management of many other national and regional senior housing operators. I also have had many informal discussions advising family and friends about senior housing options and getting feedback on their senior housing experiences and was actively engaged with the placement and experiences of my own parents in both assisted living and skilled nursing care.
Sunrise Mansion Pros and Cons
Before providing my thoughts on repositioning Sunrise Mansions and properties of similar vintage, I wanted to list the pros and cons I see for these Sunrise Mansions as a proxy for well located, good quality 1990s vintage assisted living properties:
Suggestions For Repositioning Sunrise Mansions and Properties Of Similar Vintage
Location – Most locations are very good. However, some may have become less viable because of changing neighborhood conditions, because some site locations were forced at height of late-1990s development push or because newer competition has come on the market. You can’t move the buildings but in most cases existing locations work and some existing sites may offer redevelopment or new construction options.
Design – Property sizes range from 75+/- resident capacity to 120+ resident capacity. While I conceptually agree that residents should be out interacting with other residents and staff, not in their units, some Sunrise and other early assisted living units may be too small for current affluent senior preferences, which I summarize as independent living size apartments with assisted living + level services. I continue to like pricing flexibility that flexible single/dual occupancy units provide but some may need to be reconfigured into more interesting larger units given demand.
Since, in most cases, buildings are on in-fill sites and cannot be enlarged, the practicality of combining some existing units to increase average room size, reduce total unit count and add some common space elements should be explored. Given building size, an opportunity may exist to differentiate a Sunrise Mansion type property as the boutique/exclusive/personalized sized provider with somewhat smaller buildings than competitors if the economics will work. I do not know the economic impact of reducing residents/increasing unit size but believe these options need to be explored and believe that there may be pricing flexibility for more exclusive, more personalized services in smaller buildings.
I believe the basic building design in Sunrise Mansion type properties is excellent but I would add room for a personal trainer and possibly some weight equipment, and perhaps more dedicated space for classes like yoga/palates, more space for a spa (facials/pedicures/massage, etc.) rather than just a beauty shop and perhaps space for a rehab therapy provider, which might be combined with personal trainer space. If rooms are being enlarged and number of residents reduced, I believe it should be possible to convert a few smaller rooms to the uses noted above. I believe these changes should appeal to affluent consumers and their children and can be used to offer more personalized care options than three levels of care that have traditionally been used by Sunrise and many other operators. Personal trainer, yoga classes, extra beauty treatments could all be offered on fee for service or club membership plan. I believe personalized services like those described above could all be offered in relatively small spaces and still make Sunrise type buildings much more competitive with larger AL and IL properties with services.
I believe space for Internet café within building and a broader look at use of technology for patient interaction with families, staff monitoring, etc. is important. See my blog on “Technology In Seniors Housing” for a more extensive discussion of how technology can be used to increase resident and family engagement, interaction, mobility and evaluation. But FaceTime or Skype interaction between residents and families, regular email or video reports to families on the condition of loved ones, computerized links to physicians and other care providers, computerized tools for patient monitoring and stimulation and things like Uber for more flexible transportation services are all things that might reasonably be incorporated into existing senior housing communities. Some of these require dedicated space and all require trained or specialized staff.
Overall decor, which in early Sunrise properties I remember as being a bit fussy “Laurel Ashley-like” may need to be updated.
The levels of cap ex spending by operator varied, particularly during the recession but I expect basic-cap ex and infrastructure investment will be needed for mid-90s vintage properties to remain competitive as new properties are introduced to the market.
After a fire last year in senior housing facility in Canada, the importance of life safety standards, which I believe is high at Sunrise Mansion properties but not all 1990s vintage properties, should be emphasized.
Services – Service has and will continue to be more important than space for high quality senior care. Sunrise was a trendsetter in quality and personalized care compared to traditional skilled nursing properties and I believe continues to have a strong commitment to resident independence, dignity and quality care. However, patient wellness and treatment standards for memory care have evolved since the core Sunrise care concepts were developed in the 1990s and I believe a complete review of Sunrise’s memory care service offerings and those of many other AL/memory care operators with an eye to setting a new standard for quality and personal attention is likely needed. Key elements in a revision to services that I see include:
- A wellness program that provides individualized and integrated exercise, nutrition and mental health services for each resident. This would incorporate a personal trainer rather than the group exercise programs now seen at Sunrise Mansion and other facilities, even more personalized meal planning and both computer assisted and staff provided mental agility and health services screening and stimulation. This assumes additional staff on contract or employed with specialized training not now found in Sunrise facilities to the best of my knowledge.
- More active review of medication management, particularly for memory care residents. This may require a more active link between Sunrise facilities and healthcare or mental healthcare providers. I am no expert in this area but believe that some dedicated memory care providers, such as Silverado, are more active in reviewing medications and medication management than most AL operators, are more likely to recommend changes in medication regimens and have more active involvement by attending physicians in reviewing their resident’s medications. I believe over medication and adverse medication interaction remains a bit issue for seniors and this is an area with AL operators may be able to distinguish their service offerings.
- A review of the memory care program. My sense is that providers like Silverado, with links to leading healthcare researchers at many of its facilities, have developed more comprehensive memory care treatment protocols than Sunrise any other operators who have been in the business for a while and Sunrise and other national AL operators should again set the standard.
- I believe respite care is offered at many Sunrise communities but not certain if this is considered an integral part of the service offering that could be coordinated with a more robust therapy offering to position Sunrise as a post-acute or recovery option in a more integrated healthcare system. My recollection is that respite care is just used where units are vacant as a marketing and supplemental revenue generation tool. I am not certain that Sunrise or other assisted living providers should be in the post-acute or respite business but these options should be evaluated and a business decision made. Focusing some buildings on respite/post-acute care may make sense and it may be possible to combine on site respite care with rehab therapy to offer a more attractive and lower cost post-acute care alternative for some seniors and insurance providers.
- Other ancillary services, in addition to rehab therapy and medications management noted above, such as hospice and home healthcare care have been at times offered by Sunrise and other operators both in and outside their properties with company staff. I believe home healthcare and hospice care continue to be offered by third parties at some Sunrise properties. I believe Sunrise’s commitment to let residents age and ultimately die in place is an important part of the Sunrise culture and a differentiated element of the Sunrise brand and is also an important part of some other operators culture. However, there are a range of ancillary care options for assisted living operators ranging from: avoiding supplemental ancillary services to make their buildings more appealing to healthier seniors, to allowing residents to purchase services from third parties, to having approved partners, to directly providing ancillary services. My sense is that directly providing of ancillary services would be a significant distraction for many assisted living operators but a clear policy about the use of ancillary services in all of a company’s properties should be made if this has not already been done and using different levels of ancillary care at different buildings may be a way to differentiate a particularly property within a market.
- Medicare managed care for residents is another option that Sunrise and other operators may wish to consider, likely teamed with a partner. The only senior housing operator to operate its own Medicare Advantage plan, to the best of my knowledge, is Erickson Retirement and only at some of its communities. Sunrise, Brookdale and some regional operators may have the resident density in some markets to either operate a MA plan themselves or team with a managed care or healthcare provider partner to operate one. This could be an important differentiator if it helps ease the burden of coordinating healthcare services for residents and their families and is seen an providing quality care. It might also be a more effective way of providing other ancillary services rather that teaming with various hospice, healthcare or therapy providers. In some markets it may be possible for multiple operators with links to a single healthcare REIT to join in a Medicare Advantage or other type of ACO plan to gain sufficient scale to be effective.
- Transportation – Mobility is an important factor for many seniors. A review of transportation options with multiple vehicles and multiple drivers available in lieu of the single bus should be considered. I envision each repositioned property having or having access to two or more of the new small SUV cab-type vehicles increasingly seen in major cities, and becoming standard in New York, that can readily accommodate a wheel chair and perhaps up to four passenger in total. In addition, I envision each facility having something more akin to Uber to schedule cars and pick ups as needed, giving residents much more flexible mobility. It may even be possible to use an outside Uber or Lyft like service specially tailored to seniors for this. The traditional facility bus might or might not still be needed for group outings.