As part of Perkins Eastman’s year-long The Clean Slate Project, co-sponsored by J+J Flooring Group, the firm is exploring the senior living market through fresh eyes, looking to other sectors to inspire unforeseen innovations in this industry.

In this fourth and final article in this series, we take a glimpse at industry disruptors on a global scale, focusing especially on systemic patterns and trends that affect our climate, politics, and financial markets. This article will cite some examples of sea change-type events in our recent history, such as Hurricane Katrina and The Great Recession, and address how such milestones led to the implementation of new strategic paradigms for operations, development, and investments across the senior living industry.

In recent years, the precipitous increase in frequency of extreme weather events brought on by climate change has placed great strain on many towns and municipalities in the U.S., and senior living communities are no exception. In 2005, Hurricane Katrina took 1,833 lives, 75 percent of whom were over the age of 65. And in 2017, Hurricane Harvey forced the evacuation of 143 senior living communities in the Houston area. The impact of such extreme weather events on places and areas where older adults live in large clusters—particularly in the Sun Belt states—can no longer be ignored or merely dismissed as freak occurrences.

This reality means that providers are obliged, now more than ever, to adopt resilient design and planning strategies, with ideas ranging from a photovoltaic panel array for on-site power backup to installing cisterns that help with on-site water management when potable water becomes unavailable during a disaster.

Looking beyond the need to shore up resiliency measures at select sites, investments are also needed on a macro scale that will have a more lasting and long-term impact. Whole towns and cities in otherwise vulnerable regions of the country must decide whether they will work toward resiliency on an infrastructural level. This means creating region-wide flood mitigation plans; introducing storm water capture systems near critical facilities like schools, hospitals and senior living; and investing in renewable energy sources.

Another key to senior living’s success is having a firm grasp on the financial situations of its consumer base, both existing and prospective, which is no small feat. Baby boomers were once thought to be a sure thing, an entire generation built on strong savings and pensions, diversified investment portfolios, and little consumer debt. But The Great Recession posed a major setback in more ways than one.

Savings and investments vanished, home prices plummeted, and student debt ballooned, all resulting in a retirement savings gap of nearly $10 trillion. When coupled with rising healthcare costs, the shift from pensions to 401(k)s, and an opaque picture of the future of social security, the situation has left future generations of would-be senior living consumers unsure of what comes next.

The political and regulatory landscape is equally fraught with certain unknowns that are impacting the senior living sector, including continued fallout from the Affordable Care Act. On one hand, community hospitals, physician groups, and academic medical centers are incentivized to partner with proven, high-quality providers of short-term rehab and long term care that will reduce their readmission rates and improve other outcomes.

Meanwhile, increased regulations and tighter reimbursement rates are driving some providers to forgo their skilled nursing license altogether. Who’s going to provide necessary skilled care and in what kind of settings—hospital-like, hotel-like, or home—is still up in the air, leaving many smaller and single-site providers wondering where they will stand once the dust settles.

Another political lightning rod is the issue of immigration reform, and the senior living industry is far from immune to this debate. Approximately 20 percent of all nursing assistants working in the U.S. are immigrants, with many working in senior living. Any reform measures that reduce this workforce could place pressure on an already tight labor marketplace.

Ultimately, climatic, financial, and political disruptions are those that the senior living industry has the least control over. Will an even more dire work shortage lead to technology driven, automated solutions? What will the healthcare landscape of 2030 look like? Where will the next natural disaster hit?

When considering all these unknowns, it’s imperative that senior living look beyond its own practices and standards for answers. The Clean Slate Project (to be published in early 2019) will synthesize some of the lessons from other industries and suggest future directions for the senior living market as it prepares to face these myriad disruptors head-on.


Emily Chmielewski is senior associate at Perkins Eastman (Pittsburgh). She can be reached at e.chmielewski@perkinseastman.com. Max Winters is an associate at Perkins Eastman (Pittsburgh). He can be reached at m.winters@perkinseastman.com.

Read additional articles in this series at efamagazine.com:
Making A Connection With Technology
Decentralizing Housing Options
Redefining the Golden Years