Senior living company wades through COVID cost impacts as new Reno location opens
First residents move in Oct 19 to Mission Senior Living's 121,000 sq. ft. community in South Reno
EDITOR’S NOTE: This is the third in a six-part series of stories regarding the business of healthcare in Northern Nevada as part of the NNBW’s special B2B industry focus in October on healthcare. The full series lineup is below:
- Part One: With patient volumes and revenues plummeting, hospital CEOs talk state of Northern Nevada’s healthcare industry
- Part Two: Experts: COVID fueling stress among Nevada’s already-small physician pool
- Part Four: The doctor will Zoom you now: Telehealth visits surging in Carson-Reno
- Part Five: Private practice perspective: 4 Reno-Sparks medical businesses discuss impacts, trends during pandemic
- Part Six: Renown, UNR Med working to finalize new ‘destination health’ partnership
RENO, Nev. — The coronavirus pandemic has disrupted senior living providers’ bottom lines across America, and the COVID-19 crisis is bound to have lasting impacts.
As communities went on lockdown in March to stop the spread, move-ins halted and occupancy dipped, slowing revenue to a crawl. All the while, expenses swelled as personal protective equipment (PPE), enhanced sanitation supplies, and hero pay for workers became new and sizeable costs for providers.
As a result, 55% of assisted living facilities and nursing homes in the United States are operating at a loss, and 89% are operating a profit margin of 3% or less because of the pandemic, according to an August study by the National Center for Assisted Living (NCAL) and American Health Care Association (AHCA).
Still, some companies are seeking to limit the pain and believe they can avoid margin compression while continually keeping their residents safe. One of those providers is Mission Senior Living, which operates four communities in Northern Nevada (Reno, Fernley and Gardnerville).
“We came into COVID extremely strong with a very accountable business and that’s been pinnacle in us making it to where we have,” Sarah Green, vice president of operations at Mission Senior Living, said in a video call with the NNBW. “But, the cost impact is significant. I’ve seen us have to get fairly tight within our organization.”
‘CREATE A PROTECTIVE BUBBLE’
Since the pandemic took hold, Mission Senior Living has purchased large quantities of PPE — masks, face shields, gowns, and gloves — for all six of its properties; the average increase in monthly costs has been $5,000-$6,000 per community, according to the company.
The senior living provider also installed ultraviolet germicidal irradiation lights in its HVAC systems — a cost ranging from $26,000-$30,000, Green said — and implemented the use of sanitizing foggers.
“Given our residents’ age and the likelihood they have underlying health conditions, we were not going to risk exposure to the coronavirus,” Darryl Fisher, president of Mission Senior Living, said in an email to the NNBW. “We did our best to create a protective bubble around each of our communities to prevent the virus from entering. Handwashing and wearing facemasks before it was mandated to do so, restricting visitors, and instituting rigorous infection control procedures and guidelines helped keep residents safe.”
In addition, for the first 60 days of the COVID outbreak, the company gave all of its employees a $5 increase in their hourly wage. With nearly 400 people on staff, implementing hero pay for two months added an estimated cost of $250,000, according to MSL.
Notably, the company received federal Payroll Protection Program funding for each community, which helped MSL avoid instituting wage freezes or layoffs.
“Our team members are working long, hard hours under strenuous circumstances,” Fisher said. “Yet, every day they come to work with a smile, a positive attitude, and tireless dedication. We know that’s not easy. We know at home they’re caring for their spouses, children and parents. The emotional and mental toll COVID-19 is taking on all of us is immeasurable.”
‘WORK TOGETHER AS AN INDUSTRY’
Though Mission Senior Living’s occupancy dipped at the onset of the pandemic and is currently down 5%, Fisher said that’s beginning to change — the company’s Nevada communities have remained COVID-19 free and are seeing move-ins increase “because we did the right things early on to keep residents and team members safe.”
Throughout the pandemic, despite the increased COVID-related costs and decrease in revenue, the company has avoided having to raise its rates, Green noted.
While MSL has managed to stay afloat and is seeing its move-in numbers climb, 72% of assisted living facilities in the U.S. say they won’t be able to sustain operations another year at the current pace, according to the NCAL.
Facing the reality that the pandemic is far from over, many providers are likely left wondering about the long-term effects on the industry and their organizations.
“What we need to do to kind of balance out that cost and margin is really work together as an industry,” Green said. “From our government offices to our state, city, county, to your private sector … to really come together, share knowledge, share resources, and collaborate together. That’s probably the biggest, quickest impact that you could make to improve the bottom line for everybody.”
NEW SOUTH RENO COMPLEX READY FOR MOVE-IN
Mission Senior Living’s portfolio also includes communities in Southern Nevada, Oregon and Arizona. The company’s newest community is Mountain Lakes Estates Retirement Living, a 121,000-square-foot lakefront property at 765 South Meadows Parkway in South Reno that first broke ground in August 2019.
Featuring 131 apartment homes for adults 55 and older, monthly fees start at $2,495 and include dining, housekeeping and maintenance. The community’s first residents were scheduled to move on in Monday, Oct. 19.
“Retirement communities serve a very important purpose, period, but in today’s world it’s even more important,” Green said. “Seniors are able to come together in a safe environment and socialize, engage, eat meals together, even though we are going to have social distancing … it gives them the human presence and the ability to connect.”
NEW COMMUNITY COMING IN 2022
Meanwhile, another company bringing more senior living to the region is Integral Senior Living (ISL), which recently assumed management of a new assisted living and memory care community planned for Sparks.
The 74,000-square-foot development planned within the Kiley Ranch Master Planned Community in Sparks broke ground in August, according to an Aug. 25 press release from the company.
Slated to open in early 2022, the project is being developed by Investcor Development in partnership with the Bow River Capital Real Estate Fund II and SMC Construction.
“Our dedicated team has designed a community that will provide residents with comfortable, stylish accommodations and spacious, inviting amenities both indoors and out,” Justin Hobson, partner at Investcor Development, said in a statement.
The ISL-managed community will feature 90 units, with 66 being 1- and 2-bedroom units for assisted living and 24 for memory care units, in addition to various amenities such as restaurant-style dining, courtyards and a salon, among others.
“Breaking ground on this beautiful, new community is the result of hard work and determination by the ISL and Investcor Development teams,” Collette Gray, ISL president and CEO, said in a statement. “We are proud of what we’ve accomplished so far and are excited to see this project come to life. We look forward to cultivating great relationships throughout the area while we work toward the opening date.”
Construction could begin next year and require about 500 to 600 workers, with a permanent workforce starting at 150 to 200 people with potential to expand.