Have you ever wondered why financial health matters so much in senior living communities? It’s more than just numbers — it’s the backbone of exceptional care and services. The financial health of an operator’s community directly affects its ability to provide quality care and services to residents.
As the CEO of Intrex, I’ve witnessed firsthand the transformative impact of advanced fall detection technology on senior living communities. The intersection of resident safety and financial sustainability has never been more critical, and tech solutions are reshaping the industry landscape.
Getting real about NOI: Why it matters for senior living communities
So, what’s the big deal with net operating income, or NOI? Simply put, it’s the gap between what a senior living community earns and what it spends. Think of it as the bottom line for understanding a community’s financial health. Improving NOI is vital for keeping the community stable, attracting investors and securing long-term success.
In fact, many senior living operators are turning to innovative tech solutions to enhance both resident care and operational efficiency. Falls detection devices can contribute to improved NOI by optimizing staff member allocation, reducing emergency response times,] and providing data-driven insights for better resource management.
According to an industry study reported by McKnight’s Senior Living, “Across assisted living communities and skilled nursing facilities, the annual direct cost of all falls was $380,000 per location. For providers with 20 or more locations, the average cost was $712,000.” That finding means that a 20-community operator could face a staggering $7.6 million in falls-related costs annually.
Those numbers not only highlight the financial strain on operators but also underscore the human cost: residents suffering injuries, or worse. By focusing on improving NOI through falls prevention strategies and other operational efficiencies, communities can create a win-win scenario: better financial health and improved resident safety.
The cost of falls in senior living communities
When it comes to falls among older adults, the financial impact is enormous and often overlooked. The Centers for Disease Control and Prevention reports that about $754 million is spent annually on fatal falls alone. And when you factor in the medical costs for serious injuries, the total skyrockets to a staggering $50 billion each year. Medicare covers $29 billion of this amount, with $12 billion coming from private insurance or out-of-pocket payments and Medicaid contributing $9 billion.
But there’s more to the story than dollars and cents. Falls have far-reaching effects that extend beyond the obvious medical expenses:
- Health concerns: Injuries from falls can lead to ongoing medical issues. For example, a resident who can’t exercise due to an injury may experience muscle mass loss, which in turn increases their risk of future falls.
- Loss of confidence: A fall can seriously affect an older adult’s confidence, making the individual more apprehensive about moving around. This fear can increase the likelihood of future falls. A device such as the Rythmos wearable, however, can help restore confidence by providing reassurance that help is just a button press away.
- Loss of independence: Injuries such as fractures, traumatic brain injuries or soft tissue damage can make it difficult for residents to perform everyday tasks. For instance, a fractured shoulder might limit arm and hand mobility, making bathing challenging. This loss of independence can be both emotionally taxing and financially burdensome.
- Impact on mental health: The aftermath of a fall can bring about a range of psychological challenges. Older adults often experience anxiety due to the fear of falling again, as well as depression from losing their independence. Cognitive decline, difficulties with concentration, emotional instability and coping with pain can further complicate those issues. Guilt about needing more assistance or about the fall itself can add to the emotional strain.
To address those multifaceted issues and enhance financial stability, senior living communities increasingly are turning to advanced technology solutions. By investing in falls detection systems and other smart tech, operators can significantly reduce the costs associated with emergency responses and ongoing medical care.
Improved response times and efficient resource management not only help mitigate the health effects — such as loss of confidence and independence — but also streamline operations. This approach leads to increased resident satisfaction, better care outcomes and, ultimately, a stronger NOI. By leveraging technology to address both the direct and indirect effects of falls, senior living communities can achieve a more balanced and financially sustainable model.
The financial benefits of falls detection wearable devices
Investing in falls detection wearable devices offer senior living operators a multitude of financial benefits that directly affect NOI:
1. Reduced medical costs and liability
- Immediate response to falls: According to the National Council on Aging, falls among older adults result in more than 800,000 hospitalizations annually, primarily due to head injuries and hip fractures. Falls detection wearables provide real-time alerts, allowing staff members to respond promptly and reduce the severity of injuries. Quick intervention can prevent complications, lower medical expenses and reduce the likelihood of costly hospitalizations.
- Lower liability insurance premiums: By demonstrating a commitment to resident safety through the use of advanced falls detection technology, communities can negotiate lower liability insurance premiums.
2. Increased operational efficiency
- Optimized staff response: Falls detection devices help staff members respond more efficiently to emergencies by providing precise location data and immediate alerts. This optimization reduces the time and resources spent on each incident, allowing employees to focus on other critical tasks. As one study on remote patient monitoring found, “monitoring technology can be beneficial to both older adults needing help with daily living and their care providers.”
- Resource allocation: Data from falls detection wearables enables better staff scheduling and resource allocation by identifying peak activity times and high-risk areas, ensuring that resources are used effectively. Research suggests sensor-based technology has the capacity to monitor older adults’ daily activities, falls, nocturnal restlessness and eating behavior, thereby allowing care staff to allocate their time more efficiently, alleviating stress and enabling them to focus on providing personalized care and emotional support to residents.
3. Enhanced resident satisfaction and occupancy rates
- Improved safety and security: The enhanced safety provided by falls detection wearables increases resident satisfaction, leading to higher occupancy rates and lower turnover. Satisfied residents are more likely to stay longer, recommend the community to others, and contribute to a stable revenue stream. A study released earlier this year by the National Investment Center for Seniors Housing & Care and NORC at the University of Chicago shows that older adults living in senior housing, where such technology is more prevalent, tend to have better health outcomes than those who remain in their own homes. They are less vulnerable to illness and accidents, receive more healthcare at home and live slightly longer.
- Family reassurance: Families are reassured knowing their loved ones are protected by state-of-the-art technology, fostering trust and confidence in the community. This positive perception can attract new residents and enhance a community’s reputation. The integration of advanced fall detection and monitoring technology in senior living also means that older adults are less likely to need hospitalization for issues such as injuries, hip fractures, wounds, chronic obstructive pulmonary disease, dehydration or urinary tract infections. This comprehensive approach to remote patient monitoring not only enhances resident well-being but also provides peace of mind for families.
Case study: The Rythmos impact at Teal Shores
The implementation of Rythmos at Teal Shores, a Volante Senior Living community, provides a case study of the financial benefits of fall detection wearable devices. Within just one month, Teal Shores experienced:
- 80% faster response times: Response times to falls and emergencies were improved, leading to better health outcomes and reduced medical costs.
- 4 falls automatically detected: Proactive detection and intervention prevented potential injuries and costly treatments.
- $21,068 in estimated cost savings: Significant savings were realized through the prevention of falls and optimized staff member response.
- 50% improvement in caregiver coordination and support: The community experienced a 50% improvement in caregiver coordination and support, which refers to the enhanced ability of caregivers to work together seamlessly, share critical information efficiently and respond more effectively to residents’ needs. This improvement helps in managing care more effectively and ensures that all caregivers are well-informed and aligned in their approach to resident care.
As this case study makes clear, integrating falls detection wearable devices into senior living communities doesn’t just make residents safer; it also enhances NOI. By reducing medical costs, optimizing operational efficiency and increasing resident satisfaction, those advanced technologies provide substantial financial benefits while also improving the quality of care.
Ted Tzirimis is the CEO of Intrex, manufacturer of Rythmos, a wearable tech solution for senior safety. Tzirimis’ background in senior care spans more than two decades and includes roles at The Medical Team. He champions advancements in technology that can help older adults to age gracefully and preserve their independence.
The opinions expressed in each McKnight’s Senior Living marketplace column are those of the author and are not necessarily those of McKnight’s Senior Living.
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