James M. Berklan

While many sectors of the nation debate whether, and how, they could ever raise entry level wages to $15 per hour, it’s a non-factor for nursing home operator Illuminate HC.

Why aim so low, its leaders figure.

The pay rate is $17 per hour for certified nursing aides at the rapidly growing operator.

When last we checked on the eager turnaround specialists, they had only nine facilities and were intent on solving long-term care’s employee turnover problem. The $17 wage, which went into effect last fall, has made a distinct mark, though initial commotion from taking over so many distressed buildings initially inflated the churn.

“It was good, certainly, for morale,” founder and CEO Yair Zuckerman told me while he was en route to new acquisitions in Michigan and Ohio on Wednesday. Starting with castoff HCR ManorCare facilities last year, he and his crew will have 24 total by the end of the week, including three more buildings in Western Michigan and six former Genesis Healthcare facilities in Western Ohio they take control of Thursday (August 1).

“The thought behind the wage increase was it would allow us to start getting selective. And it was important for them to see even before the turnaround could get successful we’re investing in the team.”

Zuckerman said the company’s goal is to offset the higher wages by lowering other costs with higher quality care. 

While the high CNA wage admittedly caused some frustration — among better educated nurses, for example — it also created unexpected waves of competition.

“People working in social services or the kitchen are saying, ‘I want to be a CNA,’” Zuckerman explains. “Whereas before a lot of people said, ‘I’m making the same money with a mop or a skillet,’ now they’re saying, ‘That’s hard work, but maybe it’s worth my getting certified.’”

Frontline workers “make or break” a facility, he believes. “We put them on a pedestal. If these people do a great job, we’ll have a quality building. Now we’re beating the Whole Foods and Walmarts and Targets. We’re getting a different breed, so to speak.”

A nursing home operator getting to be selective about which aides it hires? All but unheard of. Now, “borderline” employees who might have been left in place are changed out more often.

Zuckerman admits the company has taken a few lumps over the past year. It tried centralizing some HR functions, for example, and surveyors couldn’t get at what they wanted fast enough. Company officials hoped a “rookie” in the state would be cut some slack, but that wasn’t the case.

There also were initial promises about quicker response times to residents. But sometimes well-intended actions, such as calls to the pharmacy trying to get the resident help that are then put on hold, made it impossible.

They’ve also learned, for example, that money doesn’t solve everything with employees. That’s why they now either have in place or are working on perks such as tuition reimbursement and career ladders. And those envious upper-level nurses? Creative bonuses or other case-by-case considerations may be in store for them.

Star ratings are nudging up, but that’s a slow process when starting “behind the 8-ball” with so many new facilities, Zuckerman explains. Lookback windows will tamp down ratings for a while, but “there’s no question” that in five years 4- and 5-star ratings will light up Illuminate facility scorecards, he confidently says.

Right now, one of his biggest challenges is getting sleep. Unlike many long-term care leaders who have work issues that keep them awake at night, Zuckerman has his fifth child, a baby girl born this week, to disturb his sleep cycles.

Then there’s also the midnight parties. Yes, parties. And midnight.

Zuckerman and members of his executive team visit workers on all shifts and make a fuss over them, especially the night shifts. Employees at the newly acquired buildings this week can expect to see him and others walking — and working — the halls.

“We’re shaking hands, giving gifts and swag,” Zuckerman beams. “It’s been very moving. It’s about motivating them and saying thank you, and raising the proverbial flag.”

I’m not sure what color the flag would be, but it sure isn’t white, and isn’t that a beautiful thought.

Follow Executive Editor James M. Berklan @JimBerklan.