Non-Profit vs. For Profit Assisted Living for Persons with Dementia / Alzheimer’s Disease

The Bottom Line

Numerous studies have shown that non-profit assisted living residences provide better care than for-profit residences. This includes nursing homes and memory-care communities. Click here and here for links to the various studies. Study after study that was decades long has demonstrated that when a private equity firm or corporation takes over elder care the quality of care declines. Private, for-profit enterprises are motivated first and foremost by making money, and lowering staff levels while scaling back resources. This is a means of cutting costs to maximize profits. For-profits tend to have lower staffing levels and more reports of bad indicators like hospitalizations, residents being restrained or given antipsychotic drugs to calm them, and bedsores.

This can be disheartening news if your loved one needs a home that offers round-the-clock care because most nursing homes are for-profit. About 80 percent of assisted living communities are for-profit, and about half of all those are part of a larger corporate chain. Out of the largest 45 assisted living residences, 44 of them are for-profit. Currently, the Evangelical Lutheran Good Samaritan Society has 268 residences across the country and is the largest non-profit corporation that has senior residential care facilities. The other residential care for-profit corporations are:

– Brookdale Senior Living, Inc.
– Genesis HealthCare
– HCR ManorCare
– Holiday Retirement
– Golden Living

Finding a high-quality assisted living or memory care community for your loved one that is unique takes due diligence. While it’s true that in general studies detail how non-profits are better than for-profits. Remember that there are bad non-profits and good for-profits, and knowing the difference is a matter of taking time and making the effort to find the best environment. This can all be done through investigating, visiting, and asking lots of questions. See below for important questions to ask.

What’s the Difference Between Non-Profit and For-Profit Assisted Living?

While the average monthly cost to the resident does not differ for non-profit vs. for-profit homes, there are other significant differences. For-profit means the assisted living facility, nursing home, or memory care community is beholden to shareholders, an owner, or a corporation. More simply: for-profit enterprises must make money. The current average cost of assisted living, in both for-profits and nonprofits, is approximately $5,500 monthly and memory care costs more.

Non-profits, on the other hand, are not motivated to make as much money as possible. The money paid goes back into the facility itself because while all communities tasked with caring for elders must follow state regulations, non-profits operate under further guidelines specifically mandating that no profits go to individuals at the top. The money you pay goes back into the organization. Non-profits must submit paperwork to the IRS including annual revenue, business structure, and a detailed explanation of how they serve the public good.

Non-profits are often operated under a mission statement, which you should ask to see if you are looking for a home for your loved one. These tend to be ethnic- or religious-based organizations, though that does not mean they exclusively cater to people who are members of their particular ethnicity or church. It may mean, however, that activities are structured around their affiliation. A religious non-profit assisted living residence, for instance, may hold regular prayer groups or bible studies.

If you choose a non-profit, be sure your loved one’s beliefs and preferences align with the mission of the residence.

Why the Difference in Care?

It is estimated that 82% of facilities are for-profit and out of those about half are part of a large corporation. Out of the largest 45 assisted living providers, they are all for profit except for one. With money being the priority, the human element becomes less important as your loved one becomes a number rather than a patient. This is a generalization but has proven to be true. If a corporation is money-motivated the care a patient receives will lessen. There can be great options in assisted living communities that are both for-profit and non-profit. In the end, the communities vision and philosophy of patient treatment are what makes the difference. This is evident in the behavior of the staff and how patients are cared for.

The goal of a for-profit assisted living community is to maximize its profits. That means they need to fill as many beds as possible. That profit motive means seeking out as many customers as possible. This doesn’t guarantee care will suffer. The corporation may be operating with a much larger budget, but it’s simply a fact that by having more residents they will receive less attention from staff.

Non-profits, on the other hand, do not necessarily want as many residents as possible; they want the right number. They need to balance making enough money to stay afloat while prioritizing patient care. Another upside of choosing a non-profit is that families know that they are benefiting from financial stability. A good way to gauge this is by checking to see if there are enough bodies in beds and if the facility runs smoothly with adequate care for every resident. In general, because these facilities are not owned and run by large corporations, everything is done on a smaller scale. That means that they are smaller communities with more focus on their goals of patient treatment and management. The obvious difference is that there is normally more staff available for patients. Additionally, a smaller setting has the added benefit of a more home-like atmosphere. This leads to less potential depression through feeling isolated. Patients can form relationships that can make this transition smoother with their caregivers and other patients. In environments with fewer people, patients can get to know each other better.

How To Choose a Memory Care Community?

You must do your homework. Become a detective and investigate all your options. The best sources of information are the staff members themselves. Remember that for-profit organizations will claim they can offer a better quality of patient care. Non-profits can convey that they are the best option because they have fewer residents and subsequently a smaller patient-to-employee ratio. Specific questions to ask are:

– How long have you been working here? High turnover is a bad sign.

– How many residents do you work with? A good ratio is between six and eight residents per staff member, though they can probably handle 10 to 12 patients at nighttime.

– What’s the average response time if a resident needs assistance? Ten minutes is standard.

Spend time at any residence you’re considering, and visit at different points throughout the day. Join activities to see how patients are engaging mentally and physically. Eat a meal there.

Additionally, nursing homes have strict rules and regulations. They are overseen by the state and federal governments. In each state, there is an office for the aging or ombudsman office. Besides being a community resource that can provide assistance and referrals for transportation, meals, and local contacts. In these offices, they also receive complaints made from patients or their families against care facilities. Remember, part of the investigation process is to see what is said negatively about the homes you are interested in. The most commonly reported grievances are:

– Slow response time when a resident needs help. The most common cause of this is that the facility does not have enough staff for the number of residents they care for and understaffing is a problem.

– Low-quality meals that are made to stretch the food budget as far as possible creating less variety, flavor, and nutrition.

– Seclusion of residents because of improper staffing. If staff does not have enough time with each resident, it can lead your loved one to feel lonely and depressed.

Ultimately, if you choose a for-profit community, ask its office about the corporate structure. Do not let them dodge this question. It is important to know whether the owner has a financial stake in other companies that provide “goods and services” to the residence. If so, that’s a red flag that might indicate scamming. Nursing home operators have been caught overpaying their other companies while the care of residents declined.

Assisted living placement services can help. Or they can simply steer families to assisted living residences with whom they have a referral partnership. There are good and bad placement services and often it comes down to the specific employee assisting. Do not hesitate to use free assisted living placement services and be discerning if they are not providing adequate assistance. Do not hesitate to leave one behind and find a new one so you find the best assisted living option for your loved one.