As both operators and consultants in post-acute care, long-term care, and senior living we often hear the term “silver tsunami.” Sometimes it is used as a justification to build new senior living communities in markets without adequate demand, or as a hope for future success in times of operational challenge.
Indeed, there will be a large wave of population aging into senior services in rapid succession. However, waiting for this wave is not a strong strategy. Here’s why:It is still quite a ways off shore.
The baby boomers who make up the silver tsunami were born between 1946 and 1964 which means that baby boomers are between 54 and 74 years old today. It will be 2029 by the time all baby boomers are 65.The wave is longer than taller. The baby boomers were born in an 18-year spread starting in 1946—the end of World War II—and ending in 1964, the year the Civil Rights Act was passed.
Think about this: the oldest baby boomers are sometimes parents to the youngest baby boomers. The trending of this population shows an elongated increase, not a sharp spike.Seniors are still riding the waves. When Medicare was started the year after the baby boom era completed in 1965, the average life expectancy was around 70 years; today, it is almost 80.
People are living longer, are healthier, and are even surfing (and enjoying many other sports and activities!) well into their older years. Longer life expectancy and good health delays entering senior living.Baby boomers rode another wave already — economic success. Baby boomers are one of the most financially successful generations in history. This economic security delays entry into senior living for several reasons including the ability to stay at home longer with in-home support and a desire to preserve resources for a longer life expectancy.The good news?
The baby boomers will arrive in our communities, they will need the care we provide, and we will be ready to care for them. Until then, providers should focus on the following:
- Build smart: Be realistic about current demand for senior living today and for the next 15 years. When looking to build or acquire, be sure to complete detailed demand and feasibility studies that use realistic data and assumptions. And, believe what the numbers are telling you. Aggressively seek market share: The market will grow, but for the next several years, occupancy will be found through market share, not market growth. Be aggressive in sales and marketing to ensure that you are the premier choice for seniors already needing care.
- Perfect operations: When occupancy is low, there is no room for error in operations. Make sure operations are high quality and efficient — in line with or better than local and national averages.
- Listen to the waves: The seniors we serve tomorrow will be different than those we serve today, and they will want different and more personalized services. As David Friend of BDO’s Center for Healthcare Excellence & Innovation once said, “We are waiting for more people to want horses and by the time they arrive, they will want cars.” Moreover, other demographic trends such as the growing diversity of the senior population will be important factors to consider.
- Don’t forget about the undertow: In addition to focusing on baby boomers’ senior living needs that are years away, focus on the baby boomers’ exodus from the healthcare workforce years earlier. Concentrate on ways to recruit caregivers to our field and keep them engaged.
Erin Shvetzoff Hennessey is the CEO at Health Dimensions Group.