Lifesprk — a company that specializes in providing value-based care largely through home- and community-based services — is acquiring Tealwood Senior Living.
The transaction could prove to be a milestone for how senior living providers are integrated into population health efforts, with Green House and Eden Alternative visionary Dr. Bill Thomas leading the efforts to combine the two companies’ operations.
Bloomington, Minnesota-based Tealwood operates a portfolio of 35 senior living communities across Minnesota and Wisconsin. Three locations offer skilled nursing services. Going forward, the communities will be rebranded as Lifesprk Senior Living.
Leaders with Lifesprk and Tealwood did not disclose financial details of the transaction. However, Lifesprk is fully acquiring the Tealwood operating company and is also taking a real estate interest. Tealwood’s senior living portfolio was developed from the ground up with friends and family financing, with two primary development partners.
Founded in 2004, Lifesprk has grown into a “$35-plus million company” and last year secured a $16.1 million investment from a group led by private equity firm Virgo Investment Group.
Lifesprk Founder and CEO Joel Theisen first connected with Tealwood Co-Founder and President Howie Groff a little over a year ago. At that time, Tealwood was exploring succession planning, but the current transaction took shape gradually.
“If we were sitting here a year-and-half ago and you said, is this what your pursuit would be, I would have said, not really,” Groff told Senior Housing News. “ … The more we talked, the more excited we got.”
Specifically, Groff realized that combining with Lifesprk could help meet Tealwood’s goal to reduce “bottlenecks” in care and services and provide a more holistic and wellness-oriented experience for residents. And Lifesprk already had been interested in adding senior living communities to its integrated care platform, which among other components includes home-based primary care and Medicare-certified home health; hospital-at-home and SNF-at-home; programs to address social determinants of health; pharmacy; and hospice.
“As we’ve evolved and the world opened up in the last four or five years with where value-based payment was going … it made a lot of sense for us to think about, there’s a lot of aggregation in a senior campus, a lot of opportunity,” Theisen told SHN. “There’s a lot of senior population in these settings, and they are still siloed in the way that health care treats them — and so, let’s just do it ourselves.”
Bringing the Lifesprk model to senior living
A registered nurse, Theisen founded Lifesprk — originally called AgeWell — to solve problems that he saw in the fractured health care system for older adults.
“We’re all about breaking down the walls between private-pay home care, home health care, hospice and palliative care, transitional care, skilled nursing, assisted living services — you name it,” Theisen said last year in a Changemakers interview with SHN’s sister publication, Home Health Care News. “Let’s take all that and put it into a model that focuses around the client, not around the payer or the environment or the disease.”
To accomplish this goal, Lifesprk relies on proprietary technology, provides a range of services and care, and partners with health care systems and payers.
The company’s “life care managers” are registered nurses who act as care consultants and coordinators, connecting clients with needed services and programs, which are delivered in home- and community-based settings. The technology includes an electronic “life record” that is under development, which will blend a traditional electronic medical record with additional information related to a person’s “purpose, passion and identity,” Theisen said. The ultimate goal is to harness big data and AI to drive more personalized and effective care.
In the years since Lifesprk’s founding, changes in the U.S. health care system have facilitated the company’s growth, as more health care systems and insurers are now focused on population health efforts — that is, their financial success is more tied to their ability to keep their patients and beneficiaries out of high-cost settings like hospitals.
Lifesprk has emerged as an attractive partner, and has taken on global risk for nearly 6,000 clients associated with North Memorial Health and UCare in the Twin Cities, and also formed a joint venture with Intermountain Healthcare in Utah.
As Lifesprk has grown, the company has attracted the attention of other innovators who are seeking a more integrated approach to senior housing and services — including Bill Thomas, an advisory board member who became the company’s Independence Officer.
Lifesprk has long viewed senior living communities as a home- and community-based setting, and in 2018 began to bring its primary services into five Minneapolis-area senior housing sites.
“One-hundred percent of the people living in [senior living communities] need access to primary care, and over time an increasingly high percentage of them need access to supports and services,” Thomas told SHN at the time. “What if a provider of housing is able to wrap the housing access around to primary care and supported services? That’s what’s coming down the pike.”
Lifesprk aims to fully realize this vision with the Tealwood acquisition, with Thomas providing leadership on the ground as the organization melds its model with Tealwood’s operations. Groff will transition to an advisory capacity, but the rest of the Tealwood leadership will remain in place.
The goal is to bring a full array of services to residents of Lifesprk Senior Living communities, so that they would only have to visit a hospital or other health care setting rarely, Theisen said. The expectation is that this will result in greater resident and family member satisfaction and increase length of stay by enabling aging-in-place and reducing health-related discharges.
The model also holds the potential to drive affordability. Lifesprk could leverage its existing health system and insurance partnerships, enrolling residents in plans that would cover the cost of some programs and services. New senior living-focused contracts are also in the works.
Furthermore, Lifesprk is one of just a few direct contracting entities (DCEs) in a new payment model rolled out by the Centers for Medicare & Medicaid Services (CMS) in 2019. Under this program, Lifesprk can receive capitation payments to provide its services to Medicare fee-for-service beneficiaries, with upside and downside financial risk.
“We think with population health and being at global risk, we can use some of that money — I hope, in the future — to actually help fund housing,” Theisen said.
Residents will naturally still have their choice of provider, if they would rather work with, say, a different home health provider than Lifesprk. But Groff and Theisen are confident that residents and their family members will see the benefits of working with Lifesprk.
As an example, Groff described his own mother’s situation; an assisted living resident, she developed leg wounds. The wound care ultimately involved multiple people, which were a mix of Tealwood caregivers and those from outside organizations.
“What Lifesprk brings to the table now is that they can have their own doctors controlling that care, and we can point to the person who’s the right one to be in that room delivering whatever that service is, because sometimes you have home health nurses for a certified agency that have the same skillset as the people in our buildings already, and they are both trying to get there and do the job,” Groff said.
A landmark for the industry
Lifesprk is not the first company to recognize that senior living communities could play an important role in population health, given that they are home to large numbers of potentially high-cost patients and insurance plan beneficiaries.
Several senior living providers have launched their own Medicare Advantage special needs plans in recent years, including Sunrise Senior Living and a group of providers in The Perennial Consortium. Like Lifesprk, organizations such as Juniper Communities — one of the founding Perennial members — have created integrated care models, and believe they can drive significant savings to the health care system at large and garner financial benefits as a result.
Other senior living providers have not started their own insurance plans but have begun working more closely health systems and payers. For example, real estate investment trust Welltower (NYSE: WELL) and Anthem affiliate CareMore have partnered to bring medical services into senior living communities.
At the same time, recent years have seen the rise of tech-forward startups that aim to create more integrated care for older adults, partnering with Medicare Advantage insurers or offering their own MA plans. Some of these organizations, such as Oak Street Health and Cano Health, are working with senior living providers or have expressed interest in doing so.
With all this activity as the backdrop, Lifesprk’s outright acquisition of Tealwood brings senior living under the ownership of an HCBS-focused population health company and will provide another test case for the industry as to how much value senior living can contribute to an integrated care model.
Theisen is confident that the value will be substantial, and he also believes that other companies will start to acquire providers to add senior living to their value-based care models.
“I think within 24 months, more people will start to do things like Lifesprk,” he said.
Subscribe the SHN+ for further analysis of Lifesprk’s acquisition of Tealwood, including:
— Why Theisen and Groff believe REIT ownership has constrained innovation, and why REITs will have to change their investment approach
— The potential for Lifesprk Senior Living to address pain points in the current senior living model
— Other signs, including a new strategy from Formation Capital, that senior living is moving toward a population health model
The post Value-Based Care Innovator Lifesprk to Acquire Tealwood Senior Living; Bill Thomas to Lead Creation of Operational Model appeared first on Senior Housing News.
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