Types of Senior Care Facilities

​

Independent Living

Independent living properties typically serve the healthiest residents among seniors housing and care properties, and offer a lifestyle choice that provides hospitality services, access to meals, and freedom from daily chores, such as cooking, cleaning, and home maintenance. Independent living is often a choice for seniors looking to increase social interaction, while reducing routine housework and home maintenance.

 

The focus of this section is on independent living communities, including all those in which the predominant care segment offered across all units is independent living. This section does not include continuing care retirement communities (CCRCs), also referred to as life plan communities (LPCs).

​

Resident Population

Independent living properties are generally designed for
residents over age 75. The number of households is a common
gauge of potential demand, as one household generally will
transition to one unit, even if the household has multiple
members—e.g., a married couple.

 

The current occupied penetration rate—i.e., the share of age 75+ households living in independent living communities—is 2.5%.

​

Resident Profile

The typical new resident of an independent living property is an
83-year-old widowed female. She is relatively healthy and does not
require assistance with activities of daily living (ADLs). Over the past
decade, the age of entry for new residents has been rising from the
early-80s to the mid-80s, as the 2008-2009 economic recession
and its aftermath caused many residents to delay relocating to
these properties. This delay has resulted in residents being a bit
frailer at move-in, which necessitates, in some cases, assistance
with walking.

​

Assisted Living

Assisted living serves residents with more needs than those in
independent living, but fewer needs than those typically in nursing
care. Assisted living residents generally do not have needs that
require 24/7 medical attention or supervision.

 

The service mix emphasizes convenience and hands-on care associated with the activities of daily living (ADLs). Assisted living properties often include a separate memory care segment, generally in a dedicated wing or floor.

​

​

Resident Population

Assisted living often focuses on slightly older residents than those
in independent living because service needs typically increase with
age. The current occupied unit penetration rate (i.e., share of age
75+ households living in assisted living communities) is 3.8%.

​

​

Resident Profile

The typical new resident in assisted living is an 85-year-old widowed
female requiring assistance with two ADLs. She moved to assisted
living from a private home or apartment located within the same zip
code or county as the property.

​

Memory Care

Alzheimer’s disease is the most common form of dementia and
accounts for 60%-80% of all dementia cases.

 

However, there are many different forms of dementia, each requiring specialized care.

In 2019, an estimated 5.8 million Americans had Alzheimer’s, and
5.6 million of those with the disease were over age 65.

 

The number of people with Alzheimer’s disease over 65 years is expected to grow by 27% to 7.1 million in 2025, and may grow to 13.8 million in 2050, as the size and proportion of the U.S. population age 65 years and older increases.

 

Between 2019 and 2025, every state across the country is expected to experience an increase of at least 12% in the number of people with Alzheimer’s due to increases in the population age 65 and older.

 

The West and Southeast are expected to experience the largest percentage of increases. These increases will have a substantial impact on states’ healthcare systems, as well as Medicaid programs.

​

Resident Population

The current occupied unit penetration rate for memory care
communities is 0.4%.

​

Resident Profile

In a traditional assisted living community, 40% of residents are
living with Alzheimer’s disease or other dementias.

 

Residents living with mild cognitive impairment (MCI), early-stage Alzheimer’s disease, or the early stages of other forms of dementia can typically be cared for along with the general assisted living population.

However, challenges may arise in caring for these residents as the
level of dementia advances.

​

​

Nursing Care

Nursing care differs from other types of seniors housing and care in several important ways:

 

• Nursing care properties—also called skilled nursing properties, 
  reimbursement—Medicaid and Medicare—for over two-thirdsskilled nursing facilities, or SNFs—rely on government  
  of their revenue, while other types of seniors housing are predominately private pay.

 

• Nursing care properties house two types of residents/patients care while Medicare is the largest single payor for the carecare. Medicaid is the largest single payor of patients’ long-term acute one for long-stay custodial care and the other for short-stay post- of short-stay post-acute patients. 

 

• Changes in federal and state healthcare policies, delivery, and funding can have a more direct impact on nursing care properties and operators than other types of seniors housing.

 

• Key performance drivers for nursing care properties include capacity utilization, regulatory compliance, and the ability to manage total care delivery costs—including real estate costs—appropriate for the acuity of each resident population. Referral patterns from partnering hospitals, condition specific specialization, managed care (insurance company) relationships and participation in alternative care delivery models also impact performance.

 

• In conjunction with ongoing efforts by the Centers for Medicare and Medicaid Services (CMS) to limit Medicare spending by reducing post-acute care use, the ability of nursing care providers to deliver desired patient outcomes with shorter lengths of stay and reduced rehospitalization rates has become a significant performance driver.

 

• Much of the nursing care property inventory dates from the 1970s and 1980s and, as such, is being updated in some markets. The reinvestment generally is being driven in an  effort to better accommodate the type of care being provided in properties today and the evolving demands of the patient marketplace. Third-party payors add another consideration for investors.​ Over half of states restrict the construction of new nursing care properties through Certificate of Need (CON) requirements.

​

Resident Population

Nursing care properties are the largest component of the seniors
housing and care industry.  Primary and Secondary Markets, the occupied penetration rate is 8.0% as of 4Q19.

 

Over the course of any given year, nursing care properties care for a larger portion of this population because of the number of short-stay residents. Nursing care properties also care for some residents below 65 years of age.

​

Resident Profile

The traditional long-stay custodial care resident is between 75

and 95 years of age, with an average age of 82 years. 

 

A somewhat younger, higher-acuity short-stay patient entering nursing care for post-acute rehabilitation and recovery after a surgical procedure or other hospital stay, or in lieu of an inpatient hospital stay.

​

Continuing Care
Retirement Communities

Continuing care retirement communities (CCRCs), also referred
to “life plan communities” (LPCs), provide older adults with
independent living, assisted living, and skilled nursing options—
frequently with specialized memory support options—typically from
one provider in a single location. This arrangement allows older adults to remain in the same community with the same provider even if their future care needs change. CCRCs tend to target an independent living customer seeking hospitality-style amenities and services with the security of knowing that future care needs will be met.

​

Resident Population

The current occupied unit penetration rate for CCRCs
(i.e., the share of 75+ households living in CCRCs) is 3.9%.

​

Resident Profile

The majority of CCRC residents initially live in an independent living
unit. The average age of a CCRC resident at move-in is between 80
and 83 years of age. The typical resident does not require assistance with any activities of daily living (ADLs). While CCRCs serve a predominately single-female population, entrance-fee CCRCs have a significantly higher percentage of married couples (42%) compared to 29% at rental CCRCs. Prior to moving into a CCRC, the typical resident lived in a private home within 10-12 miles of the property.