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In Focus
Mary Frances Mangum moved into Presentation from San Francisco's Laguna Honda Hospital, the largest city-run nursing home in the United States. Despite suffering from cataracts, glaucoma, organic brain disease, vascular disease and dementia, Mangum, now age 77, was able to transfer. She continues to be an avid reader, especially of old mysteries and biographies. She relies on the help of the In-Home Supportive Services program, which provides an aide in the morning and another in the afternoon. Although at first she resisted attending Presentation Adult Day Health, she currently participates in the program two days per week. These two elders are among 139 residents of the 92-unit publicly subsidized assisted living facility that a consortium of nonprofit organizations and advocacy groups for elders took 10 years to plan and have built. Across the country in Cambridge, Mass., low-income elders moved into 71 units at Neville Place in 2001, following a five-year effort by the Cambridge Housing Authority and the nonprofit Neville Community Partners, a consortium of housing and health groups. They joined to rehabilitate the historic building that houses the facility. Located in bustling West Cambridge, Neville Place includes expansive grounds, mature woodlands, community gardens and a public walking path that follows the perimeter of adjacent Fresh Pond. The senior-living campus will also soon include a skilled nursing facility. Presentation and Neville Place are two of five model assisted living facilities described in Affordable Assisted Living: Surveying the Possibilities by Jenny Scheutz, which was issued earlier this year by Volunteers of American and the Joint Center for Housing Studies at Harvard University. The study examines why providing affordable assisted living is "such a Herculean task" throughout the United States. The report elaborates, "Even in the private-pay market, assisted living is inherently a complicated, expensive and high-risk product. The combination of housing and extensive personal care services is unavoidably costly and operationally demanding. The hybrid nature of the product requires that providers have expertise in real estate development-management and healthcare-social service delivery." The dilemma, according to Scheutz, is that on the one hand lenders and investors in the private housing field face high risk if they enter the assisted living market while, on the other, those attracted to the affordable market confront fragmented funding sources, confusing regulatory oversight and an unstable political climate for supporting service-heavy housing. She also noted that the "fragmentation of funding drives up the already high cost of assisted living by adding more layers of complexity to the development process and requiring ongoing monitoring from various funders. A wide range of government agencies become involved in a single project, exposing projects to potentially conflicting regulations without one agency having clear responsibility." The report emphasizes that without an expansion of assisted living aimed at lower- and middle-income people, "virtually all seniors with [annual] incomes below $15,000 will be unable to afford private-pay assisted living." Furthermore, Scheutz estimates, many of those with incomes between $15,000 and $35,000 will be unable to move into private-pay units unless they either hold substantial assets they can liquidate or receive help from their families. "As a result, perhaps as many as two-thirds of senior households would require subsidies in order to afford assisted living," she states.
The federal government should modernize existing affordable housing stock -- much of which is very old and poorly designed for elders coping with disabilities -- add services that can help elders age in place for as long as possible, and reduce the financial risk that keeps many private lenders and investors from entering this market. Also, the Department of Housing and Urban Development (HUD) ought to allow flexibility in its programs to accommodate considerable variations in state policies. HUD and the Internal Revenue Service need to take steps to eliminate the uncertainty that project sponsors often face about whether they will secure approvals for assisted living projects. State governments, says the report, need to coordinate the administration of multiple funding streams for housing and services, develop more flexible regulation of facilities and accommodate the use of Medicaid funds for assisted living. One recommendation is for states to follow Florida's example by applying home- and community-based care waivers not only to individuals but also to assisted living projects. By assigning waivers to facilities, states would stabilize the continuation of service funding as long as residents meet appropriate income eligibility standards. Without this assurance, potential project sponsors worry that service support will fluctuate every time a new tenant moves in. Foundations, research and professional organizations "should facilitate conversations between project sponsors and government funders, provide technical and financial assistance to both sponsors and state agencies, collect and disseminate information about ongoing efforts, fund demonstration grants to test promising approaches, and sponsor and conduct additional research," the report says. Project sponsors have to recognize their strengths, such as developing tax credits, and form strategic partnerships that will build on their business acumen by adding, for example, a solid social-service delivery component. The study calls on sponsors to become more familiar with the regulatory environment, investigate possible funding sources, be aware of private-pay developments in assisted living, work with other project sponsors and develop reserves to handle funding gaps. "To date," Scheutz notes, "the response to the housing and healthcare needs of seniors has been a patchwork effort." Futhermore, she says that the next eight years -- before the boomers start turning age 65 in 2011 -- offer an opportunity to develop a more coherent approach "before the true test of our financial resources and commitment to our older citizens arrives." Affordable Assisted Living: Surveying the Possibilities is available online [PDF]. For more information about Presentation Senior Community, visit the community's website; to learn more about Neville Place, go to its website. The report also includes descriptions of, and contact information for, three other model projects for affordable assisted living.
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