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ALG CEO Trefzger: Senior Living Providers Must Adapt To ‘New World’ Of Labor, Care To Survive

In the teeth of the Covid-19 pandemic last year, ALG Senior made some big shifts, going to a more decentralized operating model while at the same time changing the company name.

But in the midst of these changes and others wrought by the pandemic, the Hickory, North Carolina-based provider remained committed to clinical innovation, according to CEO and President Charlie Trefzger.

“We’ve been working on our clinical innovation projects extensively through Covid,” he told Senior Housing News.

These efforts produced data and best practices that were “incredibly powerful” in helping ALG manage care through the pandemic, he added. The clinical endeavors are also supporting ALG’s work to start a Medicare Advantage special needs plan, with an intention of launching in January 2023.

The company is now investing in capital projects and is also expanding the portfolio through acquisitions and new development. ALG currently operates across seven states, with a concentration in the Southeast, and Trefzger anticipates exceeding 150 communities by the end of 2021.

And ALG is focused on rising to the ongoing challenges related to Covid-19 and the labor crunch.

“I tell my operators, quit looking in the rearview mirror to drive your car, look out the windshield, because we’re going in a new direction,” Trefzger said. “The wage rates that existed previously are gone. We’re in a new world, and you better adapt to it or you won’t survive.”

Clinical innovation for a value-based world

Prior to the Covid-19 pandemic, ALG Senior was pursuing clinical innovations under the leadership of Chief Medical Officer Dr. Kevin O’Neil, an industry veteran who previously served as CMO at Brookdale Senior Living (NYSE: BKD) and Ascension.

O’Neil had laid out a plan to create “innovation hubs” at certain ALG communities, to pilot or otherwise test new approaches to care. When Covid-19 struck in 2020, ALG — like every senior living provider — went into pandemic response mode; however, O’Neil and Trefzger also remained committed to the innovation goals.

“During that time we made it clear that we can’t lose sight of the direction we need to go, especially with regard to clinical issues that we know are important,” O’Neil told SHN.

So, ALG proceeded with six innovation hubs, located in various North Carolina markets, including rural and more urban areas. And the company has set out to meet goals related to five priorities:

  1. Infection control and immunizations
  2. Reducing avoidable emergency department transfers
  3. Reduction in fall events
  4. Advanced care planning
  5. Behavioral interventions to reduce medication use in memory care

To address these priorities, ALG has worked with innovation hub communities on a variety of initiatives throughout the pandemic.

For instance, the company worked with the Geriatric Practice Leadership Institute, a grant-funded initiative of the University of North Texas Health, on an advanced care planning project.

O’Neil was “shocked” at how many memory care residents did not have medical orders in place regarding their scope of treatment for end-of-life care — for example, a POLST (physician orders for life sustaining treatment) form. The number of advanced care plans increased 30% in ALG communities that participated in the relevant innovation project.

With regard to falls, the company implemented a program called ARISE, for “ALG’s reduction in serious fall events.” This approach involves engaging home health, therapy and other health care partners to evaluate residents and ask them key questions to ascertain fall risk, with interventions geared toward different risk levels. A resident at mild risk might enter a fitness program with targeted strength and balance exercises, with more robust interventions related to people at higher risk.

Reducing medications in memory care has been addressed through work with Dr. Sheryl Zimmerman at the University of North Carolina, Chapel Hill. A prolific researcher in the senior living and care sector, Zimmerman has done work on non-pharmacological interventions to address dementia-related behaviors. ALG Senior is employing these — such as light therapy, aromatherapy, music therapy and robotic pets — with success, O’Neil said.

Also with Zimmerman, ALG is working on how to more effectively deliver dental care to memory care residents, and tested the effectiveness of perimeter lighting around the bathroom door, which reduced nighttime falls.

At Brookdale, O’Neil worked with Dr. Joseph Ouslander to adapt the INTERACT program for assisted living, and he is continuing these efforts at ALG Senior. INTERACT stands for Interventions to Reduce Acute Care Transfers, and involves various practices, many of which utilize checklists. Going through the checklists creates more discipline around assessing whether a resident needs to be transferred to an emergency room, and helps ensure smoother transitions when they do occur.

Other clinical innovation initiatives have proven effective in driving toward several priorities. For instance, ALG Senior created a “certified provider program.” Under this program, third-party care providers that work on site in ALG communities are asked to become “certified,” meaning that they go through a process of understanding their roles and responsibilities and those of ALG.

Although residents always can choose their health care providers, the approach has helped elevate the quality of care by identifying best-in-class partners, O’Neil said.

All these efforts and others are not only aimed at enhancing residents’ health and wellbeing, but are part of ALG’s larger value-based care strategy. Trefzger and O’Neil believe that the writing is on the wall, in terms of assisted living becoming an ever-more important setting of care for population health efforts — that is, health systems, payers and other entities recognize that senior living providers can drive better outcomes and lower costs for key patient and beneficiary groups.

To succeed in a value-based care world, senior living providers must have strong clinical programs in place — particularly to provide more proactive care — and collect the data proving their value to the overall health care system. This creates a baseline for partnering across the continuum and garnering financial upside from payers.

Senior living providers also can themselves become payers by starting Medicare Advantage plans, as ALG intends to do.

Having proper care coordination among various providers is another critical capability to succeed in value-based models, and this is an area that Trefzger is especially attuned to after a personal experience. Earlier this year, his own mother suffered from a lack of care coordination among various specialists who were working at cross-purposes.

“It’s going to become increasingly important for providers like ourselves to be actively engaged involved, if not in charge, of care coordination,” he said. “… You have got to have this capability at your fingertips — and because it doesn’t really exist right now, the innovators and disruptors have to go out and do it, literally, for themselves.”

A new world

As the clinical innovation hubs determine what approaches work — and which don’t — pilots are expanding across the portfolio, O’Neil said. And before the pandemic, ALG was a leader in mandating that staff be vaccinated against influenza, and a Covid-19 vaccine mandate took effect on Nov. 1.

But in other aspects of operations, ALG has moved away from company-wide mandates, to empower local leaders.

It’s a strategy that other providers also have been pursuing, given a widespread recognition that senior living remains in many respects a local business, driven by the market dynamics and referral relationships at the micro-market level.

The financial and operational pressures of Covid accelerated this change at ALG, and it was the right decision to go down this path, Trefzger said.

“Covid really required, in many respects, a decentralized approach,” he said. “We couldn’t go into buildings, we weren’t able to necessarily provide the on-site supervision that many companies do, as a result of that. In many respects, EDs were left to figure many things out for themselves.”

They did “extraordinarily well” in this regard, and he remains committed to the current approach, in which EDs and other community-level leaders make key decisions but receive support from the corporate level.

At the moment, leaders at every level of the company are focused on the incredibly tight labor markets. ALG has increased its wage rates and also is offering health insurance that is “to a very large extent employer-paid,” Trefzger said.

Building loyalty among the team through wages, benefits and other efforts is crucial, he emphasized. High turnover not only exacts a significant financial cost but can erode an organization’s culture and service quality.

“Why not just hire folks that are willing to work … at the elevated wage rate from the very beginning, and have a very good service, very good product,” he said. “That’s the ethos that I’m employing right now.”

However, he also acknowledges that ALG and other providers cannot pass along all the increased labor costs to residents — particularly the middle-market cohort on fixed incomes that ALG specializes in serving.

So, ALG and other providers must learn how to operate more efficiently in order to safeguard margin, Trefzger said. He believes that the decentralized model is helping to achieve this efficiency by leveraging scale to handle tasks related to areas such as billing and human resources, while enabling staff at the community level to focus more intently on providing the best services and care.

As 2022 approaches, Trefzger and O’Neil are cognizant of the challenges that will continue in the new year, with communities squeezed not only by the labor and other operational pressures, but the continued threat of Covid-19.

“We’re not out of the woods yet,” O’Neil said, noting that European nations are seeing increased infection rates, which could presage another spike in the United States.

So, he has stressed that ALG’s teams “can’t get complacent,” and must keep moving forward with the clinical innovation efforts — and disseminating the results.

“I’m a big believer in giving it away,” he said. “I don’t think it’s good for us or the industry to hoard information. So if we find something that’s working, we’re going to be happy to share it.”

The post ALG CEO Trefzger: Senior Living Providers Must Adapt To ‘New World’ Of Labor, Care To Survive appeared first on Senior Housing News.

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