Opportunities for Housing and Healthcare

4 min read

The National Council on Aging reports that 10,000 people will enroll in Medicare EVERY day over the next ten years. America is aging – and I’m guessing this is not a surprise to our readers – everyone in the affordable housing business has probably seen dozens of articles and presentations about the current and future housing, healthcare and personal finance needs of the baby boomers.

I think this dynamic makes it an exciting time to be an affordable housing professional. We are going to be forced to innovate and explore new scalable funding and delivery models to meet this demand. Here are some solutions I am excited about and a major long-term challenge we must be sure not to overlook.

Solutions for Tomorrow
Much of the cost of aging is now or will be borne by federal, state and local governments through the Medicare and Medicaid programs. Affordable housing professionals know that one of the most effective health care interventions available is safe, universally designed, service enriched affordable housing. Unfortunately, today neither the traditional housing nor the health care system typically pays for interventions based on prevention but this could be changing with the advent of social impact financings, also known as social impact bonds (“SIBs”). These Pay for Success (“P4S”) contracts focus on outcomes while imposing accountability for results on the service provider. The model is currently being piloted to address chronic homelessness and prison recidivism, but I believe that it can be taken to scale to finance the delivery of services in age-restricted affordable housing next.

I think another interesting opportunity to assist in the delivery of services to affordable housing communities is for owners to actively facilitate and foster their local “Village Movement”. “Villages” are member driven, grass-roots, volunteer non-profit organizations that help coordinate access to vetted affordable services for seniors to help them age in place. These volunteer organizations can supplement your own services and even create new markets for your properties and services.

Looking Forward Twenty Years
I assume that the creative professionals in our industry will come up with short and medium-term solutions to address the demographic needs of our aging society – but I am concerned about what happens afterwards. As we know, the baby-boom is followed by the baby-bust (i.e. a much smaller Generation X).

As we develop new product today to address the boomers, how will we be sure we don’t have a glut of functionally obsolete housing in the future. Will we have the foresight to design housing and infrastructure for seniors today that can then be adapted for the demographic needs of the next generation? Does our public policy environment even allow for future adaptation? For example, housing developed now with LIHTC will be deed-restricted as affordable senior housing for generations to come. Many of the services we provide for the frail elderly in our affordable senior communities can be transferred to other younger populations with similar needs. For example, the housing and healthcare needs of individuals with Alzheimer’s and those on the Autism Spectrum or with traumatic brain injuries are surprisingly similar but I fear that the way many QAPs and regulatory agreements are written it will be very difficult down the road for these properties to meet the needs of non-elderly populations even though they may actually be in the best position to deliver critical and necessary services. As an industry, we should try to be creative and aggressive in solving the housing needs of seniors– but we should do so with our eyes on the future. Let’s not just solve this generation’s housing challenges without getting cracking on the next one too!