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What's Keeping Senior Housing Owners Up At Night?

In a changing world, senior housing/healthcare owners and operators have plenty to toss and turn about on sleepless nights.

A changing of the political guard at the White House always brings uncertainties.  But this time around, we appear to be dealing with a course correction unlike any that has gone before.

It looks like fundamental disagreements regarding the best way to care for the nation's aging population - and what the government's role should be - will be with us for the foreseeable future.

Other things that might keep owner/operators up at night are rising interest rates, local and national minimum wage hikes, and issues related to government regulations.

Assisted living owners, especially for higher-end private pay buildings, will not find rising wages to be a major issue.  But the same cannot be said for buildings in lower demographic areas and third-party payor buildings, and more affordable buildings where an increase in the minimum wage might provide some cause for concern.

If anything, the government regulations are becoming less cumbersome, not more.  But there's this: AARP, the nation's largest lobby for senior citizens, is opposing Republican proposals to transform Medicaid into a state block grant program.  The concern is that this could cause hardships for low-income seniors, including those in senior care dwellings.

AARP argues that moving from the current Medicaid structure to a block grant, whick gives the state a fixed amount, could shift costs to states and their taxapers.  The fear is that as seniors age, the rising needs of the chronically ill and those with some form of dementia will make it difficult for some states to meet increased Medicaid costs.

The AARP group also expressed concerns about per-capita caps, which provide a fixed amount of federal funding per person but allow for growth in Medicaid rolls.  But it's unclear how Congress would determine the baseline amount of the caps for individuals in each state.

In a letter to House lawmakers, AARP indicated it was concerned about how the caps would be created for children, adults and seniors.  And it was especially concerned about setting caps at a time when pre-beneficiary spending for poor seniors is likely to increase in future years as the baby boomer generation ages.

The opposition from AARP comes as four Senate and House committees are starting to craft legislation to replace Obamacare, which expanded Medicaid in 32 states.  Working through all this could prove to be a real nightmare.

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