Time to regroup

Nursing Homes, Dec, 2004 by Richard L. Peck

Whether you're a reveling Republican or a dejected Democrat, I suspect many of us are feeling some degree of exhaustion in this postelection aftermath. It was a tough, emotional contest on both sides. Still, it is incumbent upon us all to drag our weary selves up to the summit of "Mount Perspective" to See What It All Means. And from where I'm standing, it doesn't look good for institutional long-term care, whether nursing homes or assisted living.

For starters, Republicans are more ascendant than ever. Not that Democrats can take any particular prize for being long-term care friendly, but Republicans have never been noted for the creative social financing it will take to come anywhere near fixing LTC's broken financing system. It sounds as though our legislative majority will be intent, in 2005, on "reforming" Social Security on one hand and reducing the federal deficit on the other. And, for anyone outside the Defense Department, Republican budget balancing does not bode well; keep an eye out, for example, for new proposals to control Medicare costs.

Both Republicans and Democrats at the state level are sharpening their knives for their Medicaid programs. The political clout and federal add-ons that helped nursing homes skate through the recent years of budgetary tightness are dwindling away or long gone, as states show favor to home-based long-term care and the other major state budgetary obligation, education.

Assisted living, for its part, has yet to crack the affordability barrier. In this case, lack of government financing is both a blessing and a bane. For those who can private-pay upwards of $2,000 a month, properties are out there with units available that can offer excellent support and ambience. For all others--and that potential market is huge--it's a matter of hanging on at home as long as possible, with hopes that home- and community-based financing really will provide the support they need. And the jury on that is still out. Meanwhile, in striving to maintain its market, assisted living has to worry about avoiding the federal regulatory entanglements that have so bedeviled nursing homes over the years.

In truth, the good operators in both nursing homes and assisted living will find a way to survive, if not necessarily prosper. The smart operators, the creative ones--for this is where creative restructuring of long-term care is really happening--will likely find ways to work together to provide a "one-stop" senior housing alternative (a campus, perhaps) so that people will feel actively drawn from their homes toward a lifestyle more suitable to the needs of the aging. Maybe more public awareness and acceptance of long-term care insurance will help grease this transition.

In short, the outlook isn't all bad, just more challenging--more challenging than ever, in fact. Nursing homes, although dependent on government financing, can't look to government for help. Assisted living, with its free but boutique market, can't do business as usual. Both will have to depend on their own resources to meet baby boomer demands that will continue to grow, no matter what Republicans and Democrats do or don't do.

BY RICHARD L. PECK, EDITOR-IN-CHIEF

To comment on this editorial, please send e-mail to peck1204@nursinghomesmagazine.com.