By Steve Moran
Senior living has a massive identity crisis that no one wants to talk about. Never was this more evident than at the spring 2025 NIC conference.
On the first day we heard a new version of the song we have been hearing for a decade or more: The boomer age wave is going to be so big that it will take a massive building effort to meet the demographic needs of my generation. I do so want this to be true.
The next day on the main stage, Dr. Joe Coughlin, founder of the MIT AgeLab, and Bob Kramer, co-founder of NIC, had an inspiring conversation about how senior living could be this amazing, highly desired product that was sought out, even lusted for by the vast majority of older people who want the very best out of their last few years.
And yet in that same conversation/presentation, Coughlin talked about the many advancements in aging technology and services that are allowing people to live home alone.
Rose-Colored Glasses
I am fearful that as an industry, we are looking at what we do and the demand for our services through rose-colored glasses, to the detriment of the industry, the detriment of older people, and the detriment of society. The reality that I see:
- Most people are doing all they can to avoid moving into senior living until they have to. This has not changed in the 15 or so years I have been writing about the industry. It persistently remains a last resort choice.
- While occupancy rates have improved substantially from their COVID low — and they do feel so much better — sub 90% is hardly anything to write home about, and there is some evidence to suggest that nationwide, the overall occupancy rate is significantly lower than it is in the constellation of communities that make up the NIC data.
I am not convinced we believe in our own product.We don’t believe in our own product. I have been asking industry thought leaders if they know any retired senior living executives who have moved into senior living as a lifestyle choice. I have been told there are maybe one or two but have not been able to confirm that. Let’s suppose there are a dozen. Where are the rest of them? It suggests that our leaders see senior living as a need-driven health care product, not a lifestyle product. I do know there are a fair number of leaders who have moved their moms and dads into senior living, but in those cases it is about need, not lifestyle.I recently asked a thought leader about their plans for senior living and they sort of whispered, “Age 90.” Not a very compelling endorsement.- We don’t tell enough stories about improved lives — perhaps because we don’t really believe it improves lives.
- It feels like we are flailing around looking for a successful product, with success being defined primarily by making lots of money. Way back when, it was independent living, then came big assisted living communities, followed by memory care communities that were supposed to be like printing money. Today we are back to independent living and active 55+ as the newest gold mine.
Perhaps the real problem is that, given the nature of how capital flows into senior living, the goal is more about creating pots of gold than providing optimal experiences for older people and their family members.
Greast topic – Minnesota had it right several years ago. The model was Housing With Services. The building was certified as as Housing With Services Establishment (subject to landlord tenant rules, etc.) and the ‘program of services’ provided in the building were licensed as a home care agency. So, assisted living was a licensed program of services provided in a certified housing with services establishment. And, under that former Class F license, providers could opt to provide the same services offered in-house to area individuals in their own home. This was a model unique in the nation, and it worked, until regulatory authority stepped in and decided to follow the rest of the country and license the building as a facility. ‘Senior Living’ basically meant that you lived in an apartment building (certain life safety code provisions applied) where a program of supportive services was available – anything from assistance with housekeeping to sliding scale diabetes management. I am thinking that this model is worth a re-visit as a viable model everywhere. It may even be more economical than current models where senior living affordability is becoming an access concern. Something to think about….
What worked in Minnesota sounds like the NORCs in Canada, which are very successful.
Steve, you are absolutely right. providers do not go beyond making sure that they make lots of money, which would be OK – if they provided QUALITY services to their customers. Unfortunately, as you personally experienced it when taking care of your FIL, residents do not get what they pay for, even when they have a caring advocate. What’s waiting for one at the end of the road is not what it should be. This industry is not reputable and cannot be trusted. It is not enough to put smiley pictures in brochures…
Part of the problem is that it is really hard for consumers to figure out who actually does a good job and who doesn’t. Maybe Google reviews help, but I have seen some crummy operators with good google reviews.
I continue to believe the path to highest long term profitability is doing a great job.
This is a fascinating model and could make senior living more affordable. I tend to think more and more people will get care like this on an ad hock basis.
Steve,
Let’s remember history.
Nursing homes came of age in approximately 1960 with one million seniors.
In 1990, there was a need to care for three million seniors.
But the nursing home industry did not triple.
It split in half with the advent of assisted living.
In 2030 the market will almost double again.
I don’t think the nursing home and assisted living market will double.
I think there will be a third rail of people staying at home, but not just home alone.
There will be 2-3 friends in a home; Norc type neighborhoods where people will share care.
There will be moderate growth in the industry, but watch out for brand new models.
I like the idea of friends sharing housing and supporting each other. I actually think there is a business opportunity here for someone, maybe you. I do think this needs will continue to grow for maybe the next 10-15 years. It won’t matter so much to be but I am starting to wonder what will happen to the industry when we Boomers start dying off.
Steve. I do agree with you that the “baby boomers will save us” mantra, is a foolish mission. Today, seniors, like myself, have options that my grandparents would have never dreamed of. For them, retirement communities were an absolute lifestyle choice. In those days, it was mostly a not-for-profit religious or fraternal organization sponsorship. People moved to communities where they would have common interests with other residents.
Today, retirement most often does not include moving to a retirement community. Baby boomers today often have more income than their grandparents. They are often healthier at age 75, than their grandparents were at the same age. The idea that at age 70 or 75 you are old, and need to move to the home, is no longer seen as a reflection of who we are. It makes no difference what lifestyle options are available, today seniors are more mobile, are less interested in living out their “golden years.” Instead, most 70 – 80-year-old people see themselves as capable and vibrant.
Assisted Living, and to some extent, Independent Living, will continue to be need-driven. Seniors, even those of us who spent our careers in senior housing, will continue to live in our homes, and as the need arises, we will purchase services that will allow us to stay in our homes for as long as possible.
Now, this does not mean that senior housing professionals do not believe in their product. We absolutely know that Assisted Living is need driven, and always will be. And we also know that Independent Living can give a senior a life enriching experience, when living at home, no longer enhances their life. For example, my mother moved to Independent Living at the age of 84. Why? She said she was sick and tired of having to take the garbage cans out to the sidewalk every week. She was done. And her experience in Independent Living was terrific.
Senior housing professionals do believe in their product and they know that, at the right time, moving into a community can make a major positive impact on a person’s life.
And while I also agree that the capital partners are looking for the biggest bang for their buck, it is the operators that must help them understand the balance between profits and quality. The final sentence of your article is an insult to the senior housing professional. In my 40-year career, I never attended a conference or a seminar on how to make pots of gold. In my 40-year career, I never attended a trade show where there was a vendor selling pots to hold all my gold.
You owe operators an apology for not simply insinuating, but boldly stating that everyone is in it for the big bucks. Now as Bill Sherriff would tell us, “no margin, no mission”, and he was right. Every business needs to make money. But you are saying that we are no longer interested in providing exceptional service, but only about lining our own pockets. Shame on you.
It sounds like we are largely in agreement. I was a bit taken back your suggestion that I owe operators an apology and had to go back and read what I wrote.
Perhaps my writing was not as artful as it could have been, but I was not talking about operators specifically but the whole industry ecosystem. We know for sure there are some good operators and some not so good operators, but that sometimes capital in general only care about a rate of return. And if we are honest, there are some operators who are a lot more interested in profits than quality.
I would also note that the article was written the context of the NIC conference which is fundamentally about money.
Sheila, not to criticize, but Steve is accurate in one respect. You are not looking at another whole segment happening in senior living over the past 10 years and is more prevent than ever post Covid. It is the involvement of national companies and investors that have a renewed interest in making money in our space through two methods. Either buying up cash flowing facilities and then stripping out everything that made them successful because the buyer felt those things were detrimental to the bottom line. The other method is purchasing a troubled facility for far less than value and then doing minimal to operate it better while marketing it as “new and improved”. We see it time and time again, especially with memory care. Plus, the NIC conference is ALL ABOUT improving the bottom line and making more money.!
Yes, all of this.