Wednesday, October 29, 2014

Non-Profit versus For-Profit Long-Term Care Providers: Does It Make a Difference?

LeadingAge is an organization representing "nonprofit" long-term care providers, including operators of CCRCs, home health agencies, day-care centers, nursing homes, Section 8 public housing, and similar companies.  During the recent national meeting of LeadingAge in Nashville, one topic was an "alarming trend" in the growth of the for-profit long-term care sector.  As reported in McKnight's,  during the conference LeadingAge Chairman David Gehm warned the audience that the for-profit sector is "growing nearly eight times as fast as the nonprofoit sector ... citing figures from investment bank Ziegler."  Gehm is reported as pointing to reduced access to affordable capital as as one factor contributing to the pressures on the nonprofit industry.  He argued a "vibrant nonprofit long-term care sector benefits the whole country."  

On the consumer-cost side of the equation, it does seem that what was once a price differential between the two sectors for cost of care is narrowing.  Nonetheless, historically there has been a certain additional trustw0rthiness factor associated with monprofit providers that often gave them an edge in the marketplace. But is that still true? 

As my students in my Nonprofit Organizations class come to realize, there is often a difference between "charitable" care and "nonprofit" care.  But is the difference between nonprofit care and for-profit care becoming harder to evaluate?

Consumer Information, Health Care/Long Term Care, Housing | Permalink

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I am a CCRC resident, having visited several CCRCs in my search. Most were non-profit, but a few were profit. At the time my mother was in a non-profit CCRC and that’s how I learned about the “we won’t kick you out if you run out of money through no fault of your own” characteristic of non-profits. This applies to independent living and long term care, even if the non-profit chose not to be Medicaid-certified. Because of what I knew about non-profits, I would ask the Marketing rep in the For Profit about what would happen if an independent resident ran out of money, even if they were “insurance rich” with a healthy long term care policy waiting in the wings. The answers I got were that living in independent living would be just like not being able to pay rent in an apartment complex; i.e., one would have to find another place to live. One Marketing person even suggested that the resident in financial trouble find a doctor to say that one’s health required care, thereby activating the LTC policy! What was I, the consumer, to think? If the industry is changing at the rate cited by LeadingAge, a question that should be at the forefront in “competing” with the For Profit sector Is this: “Would you ask a resident who ran out of assets to leave your community?” If the For Profit can make that "we won't kick you out" promise, then the non-profits should sit up and take note. If the For Profits remain silent on the issue, or continue to allow their Marketing reps to respond as they did to me, the non-profits have a selling point to emphasize. (Hopefully the non-profit would financially qualify prospective residents so that residents running out of money would be a long shot.)
It's my opinion that to convince the babyboomers (I am one) to leave their homes and move into a CCRC, the community needs to resemble a country club/cruise ship. This will be a generation who is not inclined to leave their home, so the lifestyle HAS to be the attraction. But look at society's message: the Boomers are listening to the government say that "aging in place, at home" is a goal. Besides the country club environment, the CCRC should emphasize priority access to health care. The Achilles Heel for NOT moving out of a private home is that priority access to long term care, if needed. That dire strait will soon catch the attention of the babyboomers, as they begin to see doctor shortages and the need of the USA to import health aides for custodial care. If the For Profits are prepared for all these aspects, more power to them.

Posted by: Jennifer Young | Oct 29, 2014 6:37:53 AM

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