Building an Edge: SNF Operators Innovate Through Establishing Specialty Services, Public-Private Partnerships

Against the backdrop of economic and staffing challenges still facing the nursing home sector, operators are seeking business innovations that are community-centered and that expand their health care offerings through unique public-private partnerships and financial arrangements.

The innovations include transition into a nonprofit model, creative ways to use state and federal dollars, and addition of care options previously missing from communities.

ICare Health Network, for one, has been establishing its “edge” with behavioral health offerings and working with the state of Connecticut to take on “difficult to place residents” – prison inmates – that need SNF services, Chris Wright, CEO of iCare told Skilled Nursing News.

Along with Jay Moskowitz, CEO of Vivage Senior Living, and Erik Howard, executive managing director of business development and marketing for Capital Funding Group, Wright discussed SNF innovation at SNN’s RETHINK event last week.

Moskowitz said Vivage has also used partnerships and unique financing opportunities to cultivate value and improve the organizations’s prospects. The company merged with Beecan Health in Colorado to offer combined services between the two companies, with a new addition being funded by a city sales tax and USDA loan.

Vivage’s merger decision was largely about enhancing access in existing states, Moskowitz said, and making certain services, including dialysis, widely available in different markets.

Meanwhile, the innovations at CFG centered on creating a nonprofit model to help fund its workforce programs. CFG’s founder, Jack Dwyer, launched nonprofit Dwyer Workforce Development (DWD), Howard said. The 60-facility operation in Texas, purchased from a private equity partner, takes all the profits from these facilities and injects them into training facilities.

“This is CFG’s and Jack Dwyer’s give back to the industry. We’re going to continue to open these centers around the country to flood the market with CNAs for you all and for the industry to hopefully alleviate the burden that obviously we’re all seeing,” said Howard.

In 2022, DWD trained about 300 CNAs in Baltimore, Md. and has since then opened in Austin, Texas, where they’ll train 1,700 CNAs this year, along with 100 in Florida. In total, the nonprofit will add about 2,500 CNAs to the markets this year and bear “100% of the cost,” Howard said.

Unique partnerships

And in order to resolve some big problems of the moment, more public-private partnerships will need to happen, Howard said. These partnerships can be useful for staffing solutions if operators and their partners can find ways to get prospective staff interested in the space, and maybe pursue a long-term career in nursing.

For its part, Dwyer Workforce Development, in concert with operating partners across the country, aims to train certified nursing assistants (CNAs) and educate a population that may be unaware of a career trajectory towards becoming a registered nurse (RN) or other clinical positions within the nursing home, Howard said.

Looking ahead, DWD is in discussion with the state of Florida for a joint venture, and Texas to expand the program through community college involvement, Howard said.

“We’re using all the profits that we generate through our operations to fund this business,” said Howard. “One of the things that we do is once those folks graduate through the CNA program, they typically will then go into the workforce in that community and generally work with a skilled nursing provider in that area.”

Dwyer also supplements transportation, housing costs, and childcare, as well as provide a caseworker to be an advocate for that employee.

“If that CNA stays with the facility for a year and has a good track record in terms of their employment, then we will pay for them to become a registered nurse and pay for all of that college,” added Howard.

SNF operators have been putting out feelers for other unique partnership opportunities – for iCare it’s been with unions, who have become unlikely partners in efforts to recruit and retain staff.

The operator pays into a training fund with the union, where a CNA can apply for a scholarship and receive mentorship certification, said Wright.

“The training fund would do the training for the CNA, if they were eligible, and give them a mentorship certification. The training fund would reimburse us our placement costs for that staff. And then that mentor would actually shadow about the CNA for five days,” said Wright.

Top areas for innovation

In terms of financing innovation, Vivage has been working on a new SNF building in Colorado – using the Greenhouse model – funded by a 1% city sales tax and a USDA loan, along with a small bank commercial loan, Moskowitz said.

The rural building will be a nonprofit owned by the city and managed by Vivage. The company will be manager and consultant for the building, and have the licensure to operate – the team has been working on this partnership for three years.

Moreover, partnering with financial lenders that understand the business is crucial for operators as well, those that are going to be there for the long term and come up with innovative financing solutions to help lower costs and generate more free cash flow, Howard added.

“You can identify yourself as a problem solver for your state or your hospital partners,” said Wright. “Opportunities are out there just in scale, working with other providers … we can be more competitive and more innovative.”

And other areas ripe for innovation in the years ahead, Moskowitz and Wright both said these include technology and establishing oneself with a specialty service within the skilled nursing space, especially within the context of rebuilding the staff pipeline.

Innovation, Moskowitz added, also lies with really understanding what the residents need and shifting to meet that need over time.

Within the context of the proposed minimum staffing mandate, however, Wright said the the industry has done its share.

​​”We’ve added a lot more staff for in-house recruiting, new software products to be able to automatically see the applicant and contact them. I don’t know how much more innovative we can be,” Wright said.