With finances so critical in a tenuous economic environment, every expenditure that a long-term care facility makes merits scrutiny. A provider’s solvency hinges upon every bill being paid, every revenue dollar accounted for and every vendor arrangement being as fiscally prudent as possible.
Therefore, questions are bound to arise about whether money spent on certain goods generates a sufficient return on investment. One such category is brain fitness programs.
While they are popular among residents and provide hours of entertainment, how do they positively impact the bottom line, if at all? System vendors respond the answer may not be quantifiable in hard dollars, but that the units can add to the coffers in indirect ways.
“Based on our experience, many customers actively market their dedicated brain fitness program as a high-value service to help attract and positively influence the purchase decision of prospective residents,” says Dan Michel, CEO of Dakim. “This can produce real financial benefits.”
With every community working hard to keep its census as high as possible in a fiercely competitive industry, marketing efforts for prospective residents are aimed squarely at the key decision-makers — families.
“Family members are seeking communities that offer the most valuable amenities to their parents and grandparents,” Michel explains. “A substantive wellness program with dedicated brain fitness as a key component is one of the most important. The days of senior living communities being able to convince prospects and their loved ones that bingo and trivia games constitute a real brain fitness program are over.”
For operators looking for a mathematical formula to determine ROI, Michel offers this maxim: His system costs $35 per resident, per year. Each new resident, on average, brings in $4,000 per month to the community, or roughly $50,000 a year.
“If actively marketing a dedicated brain health program brings in just one new resident, the return on investment is huge,” he says.
Meanwhile, Dennis Berkholtz, founder of the National Senior League Games, agrees that fun is a highly marketable commodity when it comes to brain fitness games and activities. In the past few years, Berkholtz has organized a national tournament for seniors who play the Nintendo Wii virtual bowling game and a national champion is crowned. Conducted each spring and fall, the league has seen a significant increase in teams, adding 71 from 31 communities this year alone.
Yet while the popularity of Wii bowling leagues continues to grow, Berkholtz says facilities often are not capitalizing on the potential monetary value of the virtual gaming program.
“They are missing out on using Wii bowling as a means to generate free publicity in their communities and using electronic gaming as a marketing tool,” he said. “There is a ton of PR value in a senior community competing in a national event, vying for a national championship.”
Berkholtz emphasizes that a facility team does not have to be in the championship game to make a compelling news story — just being in league is enough to rouse public interest. Getting a local reporter to cover a league meet and interview some of the participants is a public relations benefit that money just can’t buy, he notes.
News stories of league teams also should be promoted heavily on the facility’s website and in its newsletter, Berkholtz says.
“From a marketing standpoint, what better way to let potential residents and members of the community know that you are a forward-thinking organization?” he poses.
Pay for play
The NSL charges a fee for teams to participate — two 10-week national competitions for $150 per tournament and $300 a year to cover expenses. Berkholtz concedes that some facilities balk at the cost (“With limited budgets, I understand that.”) Still, for a small investment, the PR value far exceeds the cost, he maintains.
Just as important is commercial sponsorship for the Wii bowling league, which can provide facilities and their teams with valuable donated dollars and merchandise, Berkholtz reasons.
“With a little work from the marketing department, local sponsorship is available,” he says. “I don’t know many businesses — especially those that are patronized by residents — that wouldn’t support a local senior community and its team competing for a national Wii bowling league championship.”
Besides providing sponsorship dollars, community businesses also may get more directly involved by purchasing team bowling shirts, donating a flat-screen television or LCD sound system, providing funding for receptions after the games or even appointing a coach, Berkholtz notes.
A comprehensive wellness program that includes the proper balance of physical exercise and brain fitness also pays dividends to facilities in the form of healthier residents who live and stay longer, says Charles de Vilmorin, CEO of Linked Senior.
“Long-term care organizations are in the business of selling out the building,” he reminds. “When people stay longer, the occupancy rate stays high and the facility has less risk.”
Longer stays in higher-margin care settings yield the best returns, Michel added, pointing to a British Medical Journal study that monitored 1,810 adults in Stockholm age 75 and older over an 18-year period. The study found that those who stayed physically active, did not smoke and engaged in mentally stimulating activities lived an average of 5.4 years longer than their peers.
“At an average of $4,000 of revenue per resident, per month, that equates to $270,000 per resident,” Michel points out.
Resident satisfaction is another important factor that relates to financial health, de Vilmorin says, citing several studies that show a direct correlation between quality activities and high resident satisfaction.
“Perhaps more importantly, quality activities result in higher family member satisfaction,” he says. “There are two important customers to consider here: the residents and their families.”
Staff turnover also is linked to facility finances, so stabilizing the employee roster can provide a big economic lift. Technology-based activities have the ability to do that, de Vilmorin says.
“Technology-based activities have shown to increase staff satisfaction, keeping them happy and reducing staff turnover,” he explains. “We surveyed our clients and found that 77% of the people we serve would consider a facility that uses our services as a desirable place to work.”
Michel adds that “turn-key” brain fitness programs are more practical for encouraging staff involvement compared to programs that require hiring a professional to run it.
“Facilities should consider how much staff time the program will consume for training and involvement in user sessions,” he says. “If the program requires a ‘teacher’ to lead program ‘classes’ or if residents cannot use the program on their own, the program will detract staff from their normal responsibilities.”
Having a meaningful, image-differentiating service such as a dedicated brain fitness program is the best way for facilities to stand out among surrounding competition, Michel feels.
Besides getting local news coverage and promoting activities on websites and newsletters, he says facilities also should invite the public inside for wellness fairs and open house events to demonstrate their brain fitness activities.
“The best way to promote the value of a dedicated brain fitness program is to give prospective residents and their families a demonstration when they tour the community,” Michel says. “The overarching theme that prospects should take away from all marketing efforts from the tour is that ‘resident brain health matters here.’”
Survey says …
Dedicated brain health programs can give long-term care facilities a competitive advantage in the marketplace, create longer resident stays and generate higher resident, family and staff satisfaction levels. All of these benefits can have a positive impact on an organization’s bottom line.
Researchers have been investigating these factors for years. Some of their findings are:
Higher levels of activity are associated with longer retention in the assisted living setting.1
Engagement in activities delays functional decline.1
Higher resident satisfaction
Resident choice and autonomy also have a positive impact on satisfaction.2
Residents who exercised independent choices had more positive ratings of satisfaction.3
Residents who are involved in their care planning and day-to-day activities are healthier and happier.4
Freedom to live one’s own lifestyle was important to residents.5
Higher family satisfaction
Family members viewed activities and individualized care plans as critical areas of quality.6
77.1% of staff would prefer to work at a community with a high-tech brain fitness program.7
1 International Journal of Geriatric Psychiatry, June 23, 2008
2 Duncan-Myers and Huebner, 2000; Ball, Whittington and Perkins, 2000
3 Mitchell and Kemp, 2000.
4 Blair, 1994.
5 Ejaz, Schur and Fox, 2003
6 Hawes, Green, Wood and Woodsong, 1997
7 Linked Senior, 2012