Selling An Assisted Living Facility

Selling An Assisted Living Facility

Selling Your Assisted Living Facility

Whether you want to retire, move away or get into another business, the best option is often to sell your assisted living facility. Unlike selling a residential home, selling an assisted living facility takes more care to plan for and more work to find the right buyer. 

Getting a loan to purchase an assisted living facility is also quite different than it is when buying a home. When somebody buys a new home they simple go to any bank or mortgage broker, have their credit checked and income verified, get an appraisal, then close 30 days later. When it comes to purchasing an assisted living facility, buyers must choose a lender that’s experienced and knowledgeable in working with assisted living facilities. In addition to running a credit check and verifying the buyer’s income and available funds, the lender has to do a fair amount of due diligence on the business itself to ensure that the income can support the loan payments. They also have to make sure the buyer is capable of running the assisted living business so they’re able to make their payments. The timeframe to close on an assisted living facility loan is also significantly longer. Most sales take between 90 – 120 days. 

Preparing the assisted living facility to be sold

Preparing your assisted living facility to be sold involves more than some fresh paint and a little landscaping. There are many aspects of the business that should be looked at, and possibly adjusted, to make it more attractive to a buyer. While there are professionals available that can help you with this process, there are a lot of things you may be able to do on your own. 

Get your finances in order

Having clean books is not only important to the buyer, but it also goes a long way to help the lender review the business and ultimately approve the loan. Make sure that your expenses are clearly categorized and all of the income is accounted for. You’ll also want to make sure that you have financials available for the previous three years. 

Review expenses

Once you have your books in order it’s a good idea to review your expenses to see if there are any that you can cut back on to increase profit. Often times, people get comfortable with certain vendors and service providers and don’t realize that they’re paying more than they would elsewhere. You may be able to negotiate better pricing with who you’re currently using, or find a new vendor or service provider that can save you money. You may also see other areas that you can improve, such as groceries, supplies, utilities and wages. Being more conscious of the food and supplies you buy or restructuring staff schedules may be able to add more profit to the bottom line. 

Pass of some respsonsibilities 

If you’re the only one that knows how to do certain tasks, like accounting or finding new residents, it’s going to be difficult for a new owner to step into the business and continue running it. Start training other staff members on how to do these tasks so the business can continue to run smoothly when you’re gone. Some buyers may not want to spend as much time in the business as you do so they’ll need somebody who’s capable of running things when they’re not there. 

We also discuss more ways to prepare your assisted living facility to be sold in more detail in another post. 

Determining What Your Assisted Living Facility is Worth

You’ll also need to figure out what your real estate and business are worth, and what they can be sold for. Some sellers make the mistake of asking for too little and leave money on the table, while others ask for too much and are never able to sell. Asking for the right price will help you sell in a reasonable amount of time and get you a fair price. You can hire an appraiser or business valuation expert to get the most accurate valuation, or you can talk to a broker that’s experienced in selling assisted living facilities to get an opinion of value. While an appraiser will give you the most accurate value that a lender will base their decision on, it can be quite expensive. Having a recent appraisal may also help the buyer in their loan approval process and speed up the deal. However, what a property and business are appraised at and what they will actually sell for in the current market may be two different things. Discussing your situation and business with a knowledgeable broker can give you a better idea of what you can expect to be offered for your assisted living facility and will cost much less than an appraisal. 

We also discuss determining the value of your assisted living facility in more detail, including different methods of valuation in another post. 

How to Sell Your Assisted Living Facility

When it comes to actually selling your assisted living facility, you’ll need to gather the necessary information on the business and property, locate a capable and qualified buyer and navigate the transaction. While some owners choose to sell without the assistance of a broker, most people that go this route can wait several extra months, or even years, to find a buyer and often lose the deal in the middle of the transaction because they aren’t familiar with the process. While selling on your own to save money in commission may sound attractive, it’s important to understand that it can be a very complicated process and, in most cases, sellers walk away with less money than if they would have paid the commission to have the assistance of a broker. 

4 Ways to Modernize Your Assisted Living Facility

4 Ways to Modernize Your Assisted Living Facility

There are around 1 million residents in assisted living. Trying to keep up with all the assisted living residents and your assisted living facility can be daunting without modernization. Here are four ways you can modernize your facility and make it the best it can be for residents and easier for staff members to do their jobs.

Smart Tech

Imagine how much time your staff would save if they could get the facility up and running at the touch of an app each day. They don’t have to run around and flip on every single light, every single appliance, every single television—you get the idea. By having smart technology for the appliances and electronics in your facility, a staff member can quickly control things from their pocket, giving them more time to focus on the more important task of taking care of your residents.

Automation

While dealing with residents of an assisted living facility is very hands-on, there are certain aspects of the job that don’t have to be. For example, automatic pill dispensers can save a lot of time. There are so many residents in an assisted living facility that giving out pills to each individual person could be extremely time-consuming. An automatic pill dispenser for some of the more able residents could cut the time it takes to do this task in half.

Digital Records

Healthcare software can provide an alternative to keeping data on notepads and spreadsheets, and having centralized information on apps can help your staff keep track of allergies or other health conditions. Just imagine having to sort through a bunch of papers in a file cabinet while your resident is having an emergency. Not only will having centralized information on apps save time, but it can save lives by reducing response times.

Renovation

New technology is great, but sometimes modernization can be as simple as redecorating and redesigning the facility. This can be especially helpful if your facility looks more like a hospital than a place to live. Beds are one area to look at. Mattress technology is advancing all the time, so getting more comfortable mattresses could be beneficial to the physical health of your residents. Updating the colors, lighting, and furniture can help your residents feel more at home. Modernizing your assisted living facility doesn’t have to be a daunting undertaking.

These four tips provide a great start to a fresh, new, modernized way of taking care of your residents.

Read on a similar topic: Types of Assisted Living Facilities

What Safety Features Should the Ideal Senior Living Facility Have?

What Safety Features Should the Ideal Senior Living Facility Have?

Getting older is a fact of life. No matter how well you take care of yourself, a time may arise when you need to consider moving to a senior living facility. And even if you are in perfect health, growing older means taking the necessary precautions to prevent accidents and injuries. Before making a final purchasing decision, you need to know that the facility you choose is equipped to take care of everyone else who resides there.

Safety Alert

Living by yourself as a senior citizen can be scary. With age comes safety risks, so when you’re looking to buy or to invest in a senior living facility, you want to make sure that it’s equipped with proper alarms for everyone who lives there. A reputable senior living facility should have alert systems installed throughout the community. People should be able to access them easily if needed, particularly if someone were to fall. Even independent living centers for elders who are healthy and full of vigor need that extra peace of mind.

Hand Rails

People of all ages can lose their footing, trip, and fall down. However, as people get older, it’s not uncommon for them to become unsteady on their feet. More so for seniors, falls can cause serious injuries. Take note of whether the facilities you tour have handrails installed. They should be in every bathroom, hallway, and staircase. Handrails should also be at the right height, so if someone falls, that person can reach them easily. This simple but effective upgrade should be a top priority.

Intercom Systems

Alert systems are not the same as an intercom system. While alert systems can call EMS, having an intercom system is also important, especially for seniors with reduced mobility. Being able to call for help, even in the next room, saves lives. If you don’t see one installed, ask whether you’re allowed to install one on your own. If you’re considering buying a unit, there may be restrictions on what you can and cannot do inside the unit or facility.

In addition to these above-mentioned safety features, take note of current residents and staff if possible. Inquire whether there are community activities that encourage positive social interaction. Social interaction is crucial, especially as people get older, to avoid feeling isolated and alone. Finally, ask whether there is a physician on staff. Many senior living facilities do employ both physicians and nurses just in case they’re needed. Take all of these amenities into account as you consider the available safety features at any senior living facility.
If you’re looking to buy an assisted living center property, get in touch with us today!

Safety Equipment Your Assisted Living Facility Absolutely Needs to Have

Safety Equipment Your Assisted Living Facility Absolutely Needs to Have

Safety is one of the most important reasons families decide it is better for aging loved ones to reside in an assisted living facility than in their own homes. There are a number of things necessary for owners of assisted living facilities to understand to make good on this promise of safety. This includes what safety equipment should be available on the premises at all times.

Well-Stocked First Aid Supplies

It is vital to be proactive in your approach to handling any possible injuries and emergencies that might occur. One important first step is to make sure a well-stocked first aid kit is always on hand. Older people possess more brittle bones and thinner skin which makes it necessary for them to receive a higher level of care for minor injuries than other people. According to Family Resource Home Care, your first aid kit should at least include the following:

  • scissors 
  • transparent film dressing
  • self-adhesive bandages
  • butterfly closures
  • rolled gauze
  • paper tape
  • nonstick gauze

Fall Prevention Equipment

Falls are a major cause of injuries for people of all ages but can be especially problematic for people who have reached an advanced age. The use of fall prevention equipment can be the determining factor in whether an incident is a minor inconvenience or a life-threatening injury. According to Bohn & Fletcher, assisted living facilities should provide things such as handrails, grab bars, bedding, safe and comfortable seating, and walkers or canes. Fall mats are also useful, especially alongside beds and in bathrooms. Fall management socks are excellent for providing extra traction when walking on slippery surfaces. The handrails and grab bars you purchase will be especially useful in the bathroom where the floor is often moist and residents will have to get in and out of the bathtub.

Security Equipment

Your assistant home living facility will provide housing for vulnerable people. Because of this, it is extra important for you to take security measures that will ensure the safety of your residents. According to Keri Systems, perimeter access to the facility should be tightly controlled. This will prevent access by unauthorized people and keep residents from wandering off without the knowledge of you or your employees. There should be a point of contact at each door that makes communication with an employee inside the facility necessary. Only known visitors with a photo ID should be allowed inside. You and your staff will not be able to have eyes on patients at all times. In-patient monitoring systems will allow you to make sure residents do not need assistance while in their rooms. Also, be sure that your assisted living facility has a capable fire alarm system.

Providing for the safety of residents is job number one for you as the owner of an assisted home living facility. There are many things to consider as you work to improve safety standards for your residents. The three tips above will provide you with a solid foundation for making your facility as safe as possible.
If you’re looking to buy an assisted living facility, take a look at our listings!

Types of Assisted Living Facilities

Types of Assisted Living Facilities

The Different Types of Assisted Living Facilities

What are the different types of assisted living facilities? What are their specialties?

If you’re looking to start your own assisted living facility, those are two questions you’ll need to ask (and answer).

Essentially, five different groups need assisted living in some form or another:

  • Seniors
  • Dementia patients
  • The developmentally disabled
  • The mentally ill
  • The brain-injured (traumatic brain injury, spinal cord injury, etc)

In this article, we’re going to review exactly what types of assisted living facilities cater to each group so that you can have a better idea of the licensing, possible bed rates, demand, and level of care required to service them.

The Different Types of Assisted Living Facilities: Focus on the Demographic

“Assisted living” has come to mean a lot of things. Naturally, it can get a little confusing.

We’ll use the term “assisted living,” generally but, as you’ll see, you can just as easily replace it with any terms that encompass the same level of medical care and assistance.

Nursing homes are still technically “assisted living facilities” because they assist dementia patients with basic living tasks, so people might refer to their grandparents’ nursing home as an “assisted living facility.”

However, there’s also a specific name for facilities that cater to an elderly crowd that doesn’t yet require serious medical treatment or 24-hour supervision: literally titled an “assisted living facility.”

What’s even more confusing is that the name of the assisted living facility that you’re looking to start might vary from state to state – like we noted in our article on “Starting an Assisted Living Facility in Michigan.

Thus, don’t get hung up on the terminology. Focus, instead, on the group of people you’re looking to help. The terminology will change from state to state, but the people that you’re looking to help will stay the same.

Then, when you’ve found out the type of facility you want, follow our guides on how to get started with financing for those facilities.

Seniors: Assisted Living, Board and Care, Adult Living, Supported Care

It’s a sad fact of life: With old age comes decreased cognitive functioning and increased dependence on others – even for the most basic tasks. Everyone, at some point, will reach the age where they need someone to help take care of them. You and your loved ones are no different.

Assisted living facilities are designed with this purpose in mind. Unless they’re connected to nursing homes, they typically don’t assist people with dementia or other serious illnesses. Instead, they’re focused on helping the elderly with everyday functioning; nursing homes would provide too much care, in this instance, and therefore would probably be too expensive for the care recipient. This way, with these senior care facilities, the owners don’t need to pay for expensive services that the recipients don’t actually need.

Some of these facilities are able to get Medicare, and most of the patients in these types of facilities either pay privately or they qualify for long-term care insurance.

The level of skilled nursing varies from facility to facility. Some seniors haven’t yet reached the point where they need a licensed medical professional to insert a catheter into them, for instance, while others have. Therefore, it’s important to keep in mind that senior care facilities vary. Here are some of the different types of assisted living facilities that are available for seniors who need a little bit of help but haven’t yet reached the point where they need serious medical care:

  • Assisted Living Facilities (also “board and care,” “adult living,” and “supported care”). The key term here – what assisted living facilities actually assist with – is called an “activity of daily living” (ADL for short). According to MedicineNet, typical ADLs include feeding, bathing, dressing, grooming, work, homemaking, and leisure. As we mentioned above, the patients in assisted living facilities typically don’t require a high degree of medical care, so assistance with these tasks can be performed by anyone with a basic degree of training.

Dementia Patients: Memory Care, Long-Term Care, Skilled Nursing, Custodial Care

According to the World Health Organization, the percentage of adults 60 years and older living with dementia at any given time is around 5-8%. The total number of people with dementia is expected to reach 82 million in 2030 and 152 million in 2050. Just like assisted living facilities, there’s a growing market for facilities that cater toward dementia patients.

And, when it comes to informal caregiving, the jury is out: When friends, family members, and other relatives are tasked with the assistance of a person suffering from dementia, both suffer. 98-99% of informal caregivers experienced problems with trying to take care of their loved one by themselves – and it ended up seriously affecting their social lives in the later stages of the illness. A vast majority of them ended up needing additional professional support anyway.

In fact, according to that same study published in The Open Nursing Journal, “The amount of available professional care is, however, not expected to rise in line with the growing demand in the ageing population.” However, this is good news for those of you looking to start nursing homes and other care facilities catered toward dementia patients.

Naturally, these facilities demand a higher level of care: more skilled and more attentive. The facilities themselves are usually on lockdown to prevent any patient from wandering off, and some of them have amenities such as aromatherapy, pet therapy, and greenhouses – in order to keep patients at ease.

  • Memory Care Facility (also called “long-term care facilities,” “skilled nursing facilities,” and “custodial care facilities”). These types of facilities demand a higher level of care than simple assisted living facilities. Licensed medical professionals are typically on staff 24/7 to help with patients’ needs. Typically, these have higher bed rates than senior care facilities. Many researchers believe that professional care for those with dementia won’t scale in proportion to the level of demand, so opening a nursing home might be a smart investment.

The Developmentally Disabled: Facilities Serving People With Developmental Disabilities (FDD), Intermediate Care Facility for Individuals with Intellectual Disabilities (ICF/IID)

Alternatively, there are facilities designed with no age requirements – for people of all ages who need some level of assisted care with their daily activities. Just like most of the other types of facilities designed for these different demographics, there are varying levels of expertise required for those living in a facility for the developmentally disabled.

For instance, some members are relatively high-functioning members of society. They might even have day jobs, so they’ll leave at some point throughout the day. These members only need help with basic tasks (the ALDs we mentioned above, on the bullet-point for “assisted living facilities”): cooking, cleaning, keeping their medication organized, staying above par when it comes to their personal hygiene, and so on.

FDDS: Facilities Serving People with Disabilities

FDDs help patients learn new skills and maintain their current skills. According to the Wisconsin Department of Health Services, an FDD:

  • Provides active treatment, ongoing evaluation, planning, 24-hour supervision, coordination, and integration of health or rehabilitative services to help each individual function at his/her greatest ability.

ICF: Intermediated Care Facility

As you can see, that’s a fairly high level of care that will likely require licensed medical professionals. Meanwhile, an Intermediate Care Facility (ICF) does exactly what it sounds like. It provides an intermediate level of care between basic and intensive. It’s just a step down from an FDD. From Highland Risk:

  • An ICF is typically regarded as a lower-level nursing care facility when compared to a skilled nursing facility, but its residents require more care and attention than those in a residential care facility for the elderly or an adult residential care facility.

As for funding, some pay private, some are taken care of through Social Security, but most of them are placed in an FDD, ICF, or lower, more basic facility for the developmentally disabled through government programs.

Bed rates are usually less than both senior care and nursing homes, and facilities for the high-functioning developmentally disabled, naturally, pay the least in comparison to the others.

  • Developmentally Disabled Care Facilities: Facilities Serving People With Developmental Disabilities (FDD), Intermediate Care Facility for Individuals with Intellectual Disabilities (ICF/IID), and other basic facilities for the high-functioning developmentally disabled. These facilities serve all types of people, not just seniors. Some members of Developmentally Disabled Care Facilities are high-functioning, so they have jobs that they go to during the day. Facilities like that, which care for people who need some help but not a lot, don’t make as much money as the others.

The Mentally Ill: Psychiatric Hospitals, Day Treatment Mental Health Facilities, Residential Mental Health Treatment Facilities for Adults or Children, and Separate Inpatient Units in a Hospital

When most people think about mental health facilities, they assume it’s something like One Flew Over the Cuckoo’s Nest. Less like a hospital and more like a prison: constantly on lockdown with  a variety of people suffering from severe, debilitating mental illness – and maybe you could even add electroshock therapy in there, for good measure.

High Demand for Psychiatric Hospitals

Of course, this couldn’t be further from the truth. In fact, only 6.2% of mental health facilities are full-out psychiatric hospitals, and psychiatric hospitals, in actuality, are nothing like the movies. (Sidenote: of that 6.2%, over half are privately owned).

The trend, over the past fifty years, has been to eliminate psychiatric hospitals in favor of outpatient care – and the data shows the demand for inpatient care is actually at an all-time high, with some patients struggling to even find a bed.

The National Association of State Mental Health Program Directors has this to say:

“The shortage of psychiatric inpatient beds has become a major national issue, with the lack of availability identified as a major issue by policy makers, states, mental health families, academics, and popular media. Many reports regarding these shortages start with the major decline in inpatient capacity in state psychiatric hospitals—a decrease of over 500,000 beds since the 1950s.”

Meanwhile, mental health problems in the US are on the rise: Gen Z is more likely than any other generation before it to suffer from serious mental health issues.

Outpatient Care Facilities: Day Treatment

Naturally, though, just like every other type of facility on this list, there are varying levels and demands of care. Most mental health facilities are day facilities. According to the National Mental Health Services survey, roughly 60.8% of facilities are outpatient, day treatment, or partial hospitalization facilities.

Thus, each of these facilities will have different bed rates and qualifications for licensing. Because of the high demand, psychiatric hospitals will have high bed rates, while others will have much lower bed rates.

Also, according to Mental Health America, fewer youth are insured for mental health treatment: “The proportion of youth with private insurance that did not cover mental or emotional difficulties nearly doubled, from 4.6 percent in 2012 to 8.1 percent in 2017.”

So, there’s a variety of payment methods for inpatient and outpatient mental health recipients: private, Medicare, and through a family insurance plan.

  • The Mentally Ill: Day Treatment Mental Health Facilities, Psychiatric Hospitals, Residential Mental Health Treatment Facilities for Adults or Children, and Separate Inpatient Units in a Hospital. Of these listed, psychiatric hospitals are the highest in demand. However, because of the rise of mental health issues across the country (along with care being socially destigmatized), all of them are viable options for your own assisted living facility.

The Brain Injured: Transitional Care and Nursing Homes

Assisted living facilities designed for those suffering from traumatic brain injury, spinal cord injury, and multiple trauma are typically labeled as “transitional care.”

Every year, an estimated 1.5 million people suffer from traumatic brain injury. Of that 1.5 million, 230,000 are hospitalized. That also means there are over 5.3 million people living with a permanent TBI-related disability. The demand for transitional care (and even occasional outpatient care) is, therefore, fairly high.

Also, pay can be collected in a number of ways. Some patients pay privately, some pay through Medicare (depending on the situation and length of stay), and others pay through auto insurance. Auto insurance can be difficult to collect on, so be warned.

  • The Brain Injured: Transitional Care and Nursing Homes.

Conclusion: The Different Types of Assisted Living Facilities

Over the years, “assisted living” has come to mean a lot of different things, so if you’re looking to start an assisted living facility, it can be difficult to gather research on the different types of assisted living facilities.

In this article, we clarified that confusion by focusing on the demographics that each facility serves:

  • Seniors
  • Dementia patients
  • The developmentally disabled
  • The mentally ill
  • The brain-injured (traumatic brain injury, spinal cord injury, etc)

You can quickly go through our list and find names for the type of facility that caters toward each group.

Anyway, we hope our data on the different types of assisted living facilities will help you narrow down your research.

If you have any questions, comments, or concerns, contact us today.