Not long ago, Salmon Health and Retirement had a significantly larger skilled nursing footprint. But the company is in the midst of implementing a growth strategy based around greater diversification of services, including in senior living.
The Milford, Massachusetts-based operator is investing in a growth platform centered on evolving for the future customers. To help achieve that, the company is pivoting specifically more toward hospitality and different kinds of care in its services, in part with a new product called Enhanced Care Neighborhoods — a reflection of the shift occurring in the broader senior living landscape.
“We’re trying to implement a growth strategy around hospitality in IL and AL — meeting folks where they’re at — and putting our actions behind it,” Chief Future Officer Andrew Salmon told Senior Housing News.
He added that the company is integrating “hospitality [workers] into what has been a care-first business for a long time.”
Staffing is another focus of the company in 2023, and Salmon is creating scholarship opportunities for young people considering careers in senior living.
All the while, Salmon added the company is looking to make gains in the months ahead over its pre-pandemic occupancy totals.
“As the industry changes, how do we change with it?” Salmon said. “We’re … leading with the independent living and the assisted living and really having a strong community presence.”
Salmon Health and Retirement owns and operates five communities in the northeast.
Diversifying services for a changing customer
Salmon said he envisions a senior living industry where operators must “fundamentally change the sales process” due to rising acuity levels and to better convey the value of communities after years of raising rates.
“The most effective operators in the next decade are going to be the one that can balance the bottom line with the subjective components of customer satisfaction,” Salmon said.
As the company prepares to serve the next generation of senior living residents, the company is in turn preparing for a new state of demand by diversifying the various services it offers. That process started two years ago with a significant retrenchment in skilled nursing.
Since 2021, the company has undergone a period of “intelligent decompression” honing down the number of skilled beds, going from more than 600 to just 300. Inflation of expenses and “chronic underfunding” from public-sector payers were two big reasons why. The company also offloaded two nursing facilities for about $27.2 million in 2022.
“I think the headwinds in the nursing home space are getting stronger, particularly when you factor in the … patterns of referrals for hospitals [and] the reimbursement rates,” Salmon said.
At the same time, the company last year rolled out Enhanced Care Neighborhoods in three communities in an effort to fill a gap within the assisted living space. Through that program, residents can live in private residential apartments and get services including around-the-clock emergency response, some medication administration, support with some activities of daily living (ADLs) and certain clinical care if needed.
That was driven by the fact that the company had heard from prospects a “desire for advanced care within a comfortable, homelike setting that didn’t feel overwhelmingly institutional,” Salmon said in an announcement at the time of the launch.
“It was a way to honor the work that we do in the skilled space and have clear defined lines between our communities and what they can and can’t do,” Salmon said. “The individual gets to maximize their insurance benefits in the comfort of an apartment,” Salmon said.
And not long before that, Salmon Health took aim at another growing trend in the senior housing space, home care, with the launch of a new agency covering 58 towns and cities across Central Massachusetts.
At the end of the day, independent and assisted living are now more lifestyle-oriented product types than they were even just a decade ago. And while that raises the bar on what operators must provide, it is also an opportunity to get a leg up over competitors.
“The food is better. The programming is better. The environment is better,” Salmon said. “As things change, how do we connect with the client that should be with us and could benefit from us?”
Salmon said he is bullish on the idea of private-equity investment opportunities helping to remake senior living operators’ services and offerings. He also sees opportunities for investment to make assisted living more affordable for the masses.
“How do you create affordable assisted living in a meaningful way for both the individual and the provider?” he said.
At the end of the day, the company’s growth is centered on building out a continuum of care that isn’t based on a specific product type, but instead “focused on options that meet people where they’re at — and we never want to force people into what we have,” Salmon said.
“If we can really get creative and connect on how to solve problems locally, we can meet our clients where they are at,” Salmon added. “It’s about asking how we can keep people where they want to be and not move them up the continuum too soon or too quickly.”
Meeting the industry’s ‘new normal’
Salmon said he felt labor challenges were improving in 2023, but noted that another pain point for operators, expenses, could remain elevated and become the “new normal” for operators.
“So our focus is really trying to recruit and retain the best talent that we can,” Salmon said. “I’m really optimistic as we come out of Covid and get back into the real world.”
Earlier this year, the company hired Shawn Neville as chief operating officer (COO) as part of a succession plan for the position. The company also has a “great career ladder” for front-line staff, a fact that has helped the company fill jobs, Salmon noted.
The company has partnerships with local schools, including a scholarship program with Worcester State University in Worcester, Massachusetts That is a reflection of the company’s relationship with the school, which served as alma mater for “essentially all” the company’s executive suite.
“We’re really trying to find creative ways to partner with local organizations to tie our people to them,” Salmon said.
Salmon is also looking to forge new partnerships with other kinds of organizations to stay ahead of current trends. For example, the company is working on a partnership with a company in Medway that will be able to provide services for residents living in the company’s independent living units.
“We’re talking about how we use insurance companies the right way,” Salmon said. “Being able to partner with creative medical groups to meet people where they’re at is huge.”
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