Cadence Living Implements Covid-19 ‘Alarm System,’ Grows Management Services Business

For Rob Leinbach, one of the two principals at Cadence Living, the Covid-19 pandemic is personal.

Leinbach’s mother was living in an independent living community in Seattle when the pandemic hit hard early last year, and like most other senior living residents, she was forced to isolate in her room out of safety. And as is the case with many other residents, her condition quickly deteriorated.

“By summer, she needed memory care,” Leinbach said during a recent appearance on the Senior Housing podcast, Transform.

Although Leinbach’s mom did improve once he moved her from the independent living community in Seattle to a Cadence memory care community in Phoenix, Arizona, the experience underscored his belief that the industry’s top priority after protecting residents must be finding a way back to pre-pandemic levels of engagement.

In the meantime, Scottsdale, Arizona-based Cadence is working on new ways to help keep residents safe at its now-28 communities, including a new wastewater outflow testing initiative with Pangolin Health that can identify the presence of pathogens such as Covid-19. Leinbach hopes that, when layered with traditional PCR and rapid testing, the outflow testing can act as an early warning for new outbreaks during the Covid-19 era and potentially beyond.

“The challenge with current PCR testing for individuals with coronavirus is that sometimes you have to wait two to three days for results, and if the labs are really overwhelmed, that can even go out four, five, six, or seven days,” Leinbach said. “This added layer of protection allows us to analyze the data all the time. It’s kind of like an alarm system.”

Cadence is also making progress on its vaccination efforts, and is on track to to have held 36 clinics by the middle of February. If all goes according to plan, every Cadence community will have completed its third and final vaccination clinic for residents and team members by the end of March.

Highlights of Leinbach’s podcast interview are below, edited for length and clarity. Subscribe to Transform via Apple Podcasts and SoundCloud. The interview took place in early January.

On dealing with Covid-19:

I think a lot of operators had interesting plans for 2020. And then for all of us, the plan became one thing and one thing only: protecting our residents through this pandemic. It really has been our entire team’s singular focus. We’ve been fortunate enough to continue to measure growth from a company perspective, but it’s been all-hands-on-deck all year for our residents.

We’ve been subject to the states’ [vaccine] distribution efforts, and there’s been certain states that have been a little slower than other states, as I’m sure everybody’s been reading in the news.

On how the pandemic shifted Cadence’s 2020 growth plans:

We came into the year thinking that there were going to be some interesting acquisition opportunities in 2020 because of some of the overbuilding in certain markets. But Covid changed everything. We just really focused on protecting our residents. Our team did a really fantastic job, I think that that was recognized. And so, we saw some third-party management opportunities increase because of those efforts and the recognition of those efforts. So we were able to add a few communities in 2020, but they were mostly on the third-party management side, as acquisitions pretty much dried up.

The result of the pandemic is that it has pushed those opportunities out. [For example], if you acquire a building in May, unless you’re getting a really steep discount on the value, then you’re more than likely to see some occupancy drain throughout the pandemic. So, everybody is sort of sitting on the sidelines and waiting to get through the vaccine. And there’s been some PPP money and HHS money that has helped owners survive the pandemic. So, I think that opportunity is still coming, it just got pushed out a year or two.

We shifted back to looking at specific development projects, because we were now looking at a scenario where we wanted to be two or three years past, hopefully, the existence of this coronavirus. The virus had delayed a lot of the additional projects in the pipeline across the country, therefore giving demand an opportunity to catch up, whereas previously, there had been some overbuilding.

This did re-focus our attention to the high barrier-to-entry markets, and we’ve really been looking coastal. And that was just intensified, because you definitely want to make sure that you’re in areas where the demand is much-needed coming out of this. And there are all sorts of design changes that have been going on throughout the development industry, such as multiple entries, filtration systems, different wings and smaller dining venues where you can separate out individuals within the community.

The lesson for us is that diversity is key. If you’ve got all your eggs in one basket, and something hits to affect that basket, then you’re in a little more trouble than if you’re well-diversified. We are doing active adult, we’re also continuing to do our age-in-place IL-AL-memory care communities. We license the entire building for assisted living, and we’re putting full kitchens into every unit. That gives us the flexibility. If there’s a hit to independent living, we can still move in assisted living residents. If there’s a hit to assisted living, we can still move in independent living residents. And we’re looking at affordable, as well.

On Cadence’s new outflow Covid testing initiative:

I believe we’re the first senior living operator to partner with an outflow testing company. The challenge with current PCR testing for individuals with coronavirus is that sometimes you have to wait two to three days for results, and if the labs are really overwhelmed, that can even go out four, five, six, or seven days. And so you’ve got this gap where somebody who is positive might be spreading the virus within the community.

With outflow testing, what you do is you put a sample box that is immersed in the sewage outflow from the community, and it is collecting data 24/7 in real time. And that data is being uploaded to our partner, Pangolin Health, which is then analyzing that data with its labs. It can tell you in real time when you have coronavirus in your building. And if we have multiple outflows, we can isolate within the building where that positive result is occurring, and then immediately lock that down and test everybody and do contact tracing from there.

It’s in tandem with PCR testing and rapid testing, but this added layer of protection allows us to analyze the data all the time. It’s kind of like an alarm system, if you will, that will allow us to be more proactive in stopping the spread. The plan is to roll it out across the country, based upon the infrastructure timing from Pangolin because it’s their sample boxes that we’re installing.

I think the other neat thing about this technology is that you don’t have to just test for coronavirus. You can test for anything. The industry has had shutdowns of our communities before with things like norovirus. We’re going to be able to get to see whatever is coming out of that outflow, whatever we want to test for going forward. It’s data- and analytical-driven, and it’s going to give us a foot up on everyone.

On whether the pandemic will make senior living engagement or wellness programming harder in the future:

I hope not. At the end of the day, we’re humans, and what we need is that connection. We need that engagement, we need that interaction, we need to be able to hug people. Does [the pandemic] make me realize and recognize the importance of outdoor space? 100%. But does it make me think that we’re not going to get to a place where we’re hugging each other and connecting as human beings? I sure hope not.

I want to give you a personal example. When this pandemic started, my mother was in independent living in a community in Seattle. And as everybody knows, Seattle got hit [by Covid-19] first and hard. She was locked down as an independent living resident in her apartment for months, and she deteriorated so quickly. By summer, she needed memory care — she just skipped over assisted living — so I had to drive up to Seattle this summer, put her in a car, drive her back down to Arizona and place her into the memory care [neighborhood] of one of our communities here. It was pretty shocking to see how fast isolation can affect residents.

Now that she’s in a memory care setting where we have all those protections in place, my mom is getting engaged on a daily basis with activities and friends and being able to go out in the gardens. She’s actually improved substantially since going from independent living and into memory care. So it’s really been a lesson in the importance of engagement.

The biggest unfortunate circumstance of the pandemic has been the limitation of family visitation. Although my mom is now getting engaged and she’s doing well, I still can’t go hug her. We have implemented supervised visitation, but it’s with masks, it’s at a safe distance and it’s just not the same. So, it is the most challenging thing about this pandemic.

What we’re really looking forward to on the other side of this vaccine is bringing back the outside community back into our community, and bringing our inside of the community back out to the outside community. It’s that community interaction and human interaction that we so incredibly value. Our team has adapted by using iPads and doing window visits and doing, like I said, supervised outdoor visits. And in some cases, if the community [Covid-19] count surrounding them was low, we could get them inside the building in an isolated area that was disinfected after every visit.

So, we’ve been doing everything possible to make that interaction happen in a safe way. Social distancing, that term does not exist in our communities. It’s physical distancing, because we’re constantly socially engaging. We’ve done spaced-out small group activities, we’ve done hallway activities, we’ve done Zoom entertainment and bands playing outside the window. The team has been great about being as creative as possible to create an engagement and to make it as normal as possible. At the end of the day, we really do need to get on the other side of this vaccine, so we can bring the outside world back into the communities.

On what Cadence is preparing for in 2021:

We’ve been fortunate that we’ve been able to have the growth we’ve had over the last couple of years. We like our size and where we are now. The first six months for us is going to be focusing on execution and bringing back the joy to the communities that existed pre-coronavirus, getting through the vaccine, and re-engaging with the outside community. I think that’s the immediate goal for us.

The second thing is something that I mentioned earlier: a listening tour, and then how do we take those responses from the listening tour, how do we convert those into being the most innovative, progressive, team-oriented senior living operator out there? That’s what we want to be, and we’re fortunate we have employees that want to get better every day. But the truth is every operator needs to get better every day. And so, we understand that, and we’re going to be pushing a commitment to culture this year. And then on the actual community growth side, we’ve really been looking at a development pipeline, and we’re still focused about two years out. So, we want to make sure that we’re outstanding in our current portfolio and then we’re looking forward, two to three years out.

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