America’s co-located villages and nursing homes decline in real numbers

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At the LEADERS SUMMIT last week we interviewed by video conference Stephen Maag, Director, Residential Communities at LeadingAge, the peak body for America’s 6,500 Not For Profit operators. He had disturbing news.

Co-located villages in America have changed their name from Continuous Care Retirement Communities (CCRCs) to Life Plan Communities because extensive research shows the new resident does not want the label ‘care’. This is despite the fact that the average age of entry is 80.

Life Plan Communities ‘penetration’ is in decline. Occupancy is 91% and in 2016 just seven commenced construction with 1,609 units over 12 months. Across America there are 1,964 Life Plan Communities delivering 605,000 units. 80% are NFP.

The traditional retirement village as we know it, without care, is known as Assisted Living and caters for the 70+ entry market. Just three villages a year are being built and they are largely ‘memory support’ units and all are For Profit villages.

(Steve pointed out the large lifestyle villages in such locations as Florida and operated by companies like Del Webb target the 55+ market and many of the residents are still working).

Some other facts:

  • Nursing homes – flat for 15 years with little new construction and growing number of closures. Total beds down 3-5% in the last two years including move to convert double beds to the private rooms
  • Nursing homes – 82% occupancy, 1.66M beds across 15,600 locations. Just 24% a Not-For-Profit.
  • Nursing homes – USA population 320 million / 1.36M beds occupied. Australia population 24.6M / 181K beds occupied. USA 0.004 beds per person and dropping. Australia 0.007 beds per person and growing.
  • Memory Care communities – 1,100 freestanding locations, 53,000 units, 22% not-for-profit
  • Staying at home – the biggest competition for new customers of village communities
  • Technology supporting staying at home – immense growth
  • Workforce – the US is facing full employment. Manufacturers and care organisations can’t get staff now and getting worse
  • Capitation – government and insurers moving away from fee-for-service to capped payments with recuperation risk transferring to the provider

We will announce when the video from the SUMMIT is complete and posted on