Operations Matter: For Seniors and For ROI

Sponsored by KeyBank

By Brian Heagler

The maturing seniors housing industry is facing a variety of challenges in operations, infrastructure, technology and staffing that need to be addressed. Their goal is to reduce the administrative burden on staff so they can focus on patient care.

Naveed Hakim, executive vice president and CFO of Plum Healthcare Group, shares the initiatives his organization has implemented focused on freeing up data to improve decision-making accuracy and speed so that their clinicians can prioritize patients. These investments are funded through operating cash-flow and a credit line from KeyBank.

Top focus areas:

•   System interoperability—The goal is breaking up silos for the freer flow of data, transparency, and building a common ecosystem to allow care planning at a higher level.

•   Digital maturity—Achieved when clinicians have easy access to insights and can easily make patient care decisions—as opposed to being buried in data reports. 

•   Clinical care—This has always been a strong point at Plum. As they move to a higher acuity, higher demand managed care world, they want to bring the same level of care to that faster-paced environment.

Plum started first with business process design. Once that was in place, data and technology were implemented to help integrate the process throughout the system. To measure ROI, Hakim looks at both shorter-term indicators—including occupancy rates, resident satisfaction, and re-hospitalization rates—and at how investments drive strategic differentiation and stronger partnerships with healthcare systems.

From a capital provider’s perspective, when looking at seniors housing opportunities, real estate and financial sponsorship is important but their focus is on the operators. They examine experience, track record and access to capital. Capital providers are discussing business processes and investments in technology, and looking at outcomes, particularly in the post-acute space.

To evaluate operational programs, it is critical to understand the impact of these investments, the timing, and when it’s expected to flow back into operating results. KeyBank, as a capital provider, must underwrite to existing cash flow and future cash flow, and we’re constrained in how we provide that capital, so understanding those dynamics is critical.

Regarding staffing, all capital providers, no matter where they are on the stack, are going to be interested in what operators are doing in this area. Operators shouldn’t be surprised if lenders ask questions around training and culture, and what they’re doing to attract and particularly retain quality employees.

Making smart investments in operations can streamline processes in a way that’s seamless for both clinicians and staff and patients or residents, improves overall care, and helps grow your business in a shifting marketplace.

This document is designed to provide general information only and is not comprehensive nor is it legal advice. In providing this information, neither KeyBank nor its affiliate are acting as your agent, broker, advisor, or fiduciary, or are offering any tax, accounting, or legal advice regarding these instruments or transactions. All credit, loan, and leasing products subject to credit approval. Key.com is a federally registered service mark of KeyCorp. KeyBank is Member FDIC.

Brian Heagler is KeyBank senior vice president, healthcare finance.

Learn more at www.key.com.

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