Developer talks about the future of long-term care

Allan R. Brown, Jr., is co-founder and principal of Prevarian Senior Living, a relatively new real estate development and investment firm based in Dallas. (The company just broke ground on its first assisted living facility this past May.) In the upcoming October issue, I profile the company’s genesis and strategic plan, but my talks with Brown led to more insights than I had room for in the print story. Of course, the conversations ended up touching on the future framework of this industry. Here are excerpts from the interview with Brown responding to questions about:

Accountable care organizations

Brown: I spend a lot of time talking to people about ACOs and bundled payments and the role that skilled nursing is going to play in them. ACOs are effectively a very geographically focused managed care approach. Ultimately, one way or another, bundled payments are coming to healthcare starting in 2013, and that is certainly going to be a factor. The success of skilled nursing facilities [will be found] in their ability to integrate themselves into those systems and provide the services and level of care that these general acute care providers are going to demand.

Challenges to the industry

Brown: I foresee the same challenges that I guess everybody else does. We’re as concerned about reimbursement and the whole other host of issues related to a resident’s ability to pay for those services, but our overall view is very optimistic. It’s fascinating to me that there’s so much relative pessimism in this business and it’s a little bit bewildering. You watch to see what’s happening in healthcare services right now and the natural winner is skilled nursing. It’s going to face challenges like every other aspect of healthcare delivery, but who is going to provide for this onslaught of people who are going to need care and do it at a cost that skilled nursing can provide those services for?

Caring for a higher-acuity resident population

Brown: Skilled nursing is getting better at providing nursing care, and nursing care is a broad category. There are so many different specialties. I foresee a lot of specialization in skilled nursing, and that’s going to be a big part of [providers’] success, just like it did in general medical-surgical healthcare delivery. The ordinary, do-it-the-same-way-we-used-to companies are going to suffer greatly, and the more innovating, proactive providers are going to be beneficiaries of a huge amount of growth in this business.

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