Sunset Stories

Is Your Assisted Living Community For-Profit or Nonprofit? The Difference Matters to You.

Posted by Gayle Young on Oct 31, 2018 9:45:13 AM

Are residents of assisted living facilities forced to leave their homes when they run out of money? Are a facility’s policy decisions based on bottom-line financial results or what’s best for the residents? Answers to those questions could depend on whether the assisted living community is a for-profit or nonprofit organization.

Private, for-profit companies operate more than 80 percent of residential care facilities in the United States. The remaining facilities are either nonprofit or government-run organizations. When it comes to overall care quality, there are often meaningful contrasts between for-profit and not-for-profit assisted living communities. Knowing those differences can help you select the facility that best meets your or your loved one’s needs.

Large national chains or private equity investors own approximately 40 percent of for-profit assisted living facilities. As profit-driven organizations, those companies usually have return-on-revenue requirements that promote aggressive cost-cutting. Case in point: the five largest US chains maintain significantly lower staff-to-resident ratios than the national average. Also, it’s no coincidence that facilities which report the highest profit margins receive the most inferior quality ratings.

Just as declining quality and understaffing are significant problems among for-profit residential care facilities, unethical business practices are another growing concern. In recent years, the US Department of Justice has charged several residential care giants with fraud—for methods ranging from providing unnecessary services to billing for services that they never delivered.

Of course, nonprofit communities must also control their costs and conduct business ethically. However, spared from shareholder pressure to increase profits, not-for-profit organizations are free to innovate. As a result, nonprofits are driving change in assisted living—creating home-like, family atmospheres where residents are free to make personal choices every day.

As a nonprofit organization, Sunset can promise to provide our residents with necessary financial support in three distinctive ways. First, we will never ask anyone to leave Sunset or to go without care or services they need just because they have legitimately exhausted their funds. Second, to the extent that our funding allows, Sunset invites into our homes older adults who are without money, who are living in unsafe or unhealthy conditions, and who lack family to help them. Third, our Residents’ Assistance Fund pays for personal items that any resident cannot otherwise afford and that are necessary for their overall well-being.

Whether you’re considering a nonprofit or a for-profit assisted-living community, quality of care should be your primary benchmark. Be sure to do your research.

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Topics: Continuing Care Communities, Long-term Care, Nursing Homes, Residential Care, Senior Housing, Senior Living, Why Sunset?, The Nonprofit Difference, Assisted Living