THOMCO, headquartered in Kennesaw, Georgia, is a program administrator that offers 25 national target programs. Greg founded the company in the late 1970s after working for Marsh and McLennan. Monica has been with the firm for 20 years and worked for Travelers and Prudential prior to joining THOMCO.
THOMCO has been offering its Senior Living program for 15 years. The program is available on a national basis, and offers all lines of coverages, with the exception of D&O and EPLI.
Annie George (AG): Give us a little background on how you entered this space.
Greg Thompson (GT): “We got into the industry quite deliberately. We like to identify industries with a growth pattern from which we can benefit and learn. In the 1990s we looked at both the demographic and social trends that would affect senior living. You have two-career families unable to take care of their parents when they could no longer care for themselves. A parent would either have to stay in a residential facility because both offspring were working, or alternatively hire home health care. We identified that the combination of two-career families and the demographic bubble – the baby boomers aging – would result in senior living being one of the fastest-growing industries in America in the next 20 years. We wanted to be a player in this field. And true to form it has grown quite a bit and will continue to do so.”
Monica Clark (MC): “Our appetite is Independent Living, Assisted Living, Alzheimer’s Care, and Continuing Care Retirement Community (CCRC) – a campus-style setting where you have independent living, assisted living, and senior living all in one location. CCRCs revolve around the concept of aging in place, where someone comes to live at an independent living facility, progresses to assisted living, and eventually moves to skilled care as needed.”
AG: What changes are you seeing in the industry?
MC: “Ten years ago you saw significant growth and construction in the industry. This has subsided somewhat due to the economy and lending issues. But we do anticipate that lending will open a little bit more, and as the senior living population increases the demand for new communities will increase accordingly.
“Also, in the past we saw seniors decide at a slightly earlier age to move into independent living before they had a need for assistance with activities of daily living such as grooming, eating, bathing, and ambulating. Since seniors have had a difficult time selling their home or selling it at the price they need, we don't see occupancy as high in independent living as we do in assisted living. What we're finding now is that people are moving into senior living on a need-to basis because the seniors need assistance with their activities of daily living.”
GT: “People are also working longer and going into senior living later in life, creating wealth to pay for the associated expenses. You’re also seeing people making more renovations at their homes to accommodate senior living needs. At some point, though, you can no longer live at home without the right staff such as home health care, and you move into assisted living.
“This increase in assisted living is putting pressure on the senior living industry. You’re getting more infirmed people, and the more debilitated your population is the more likely you’ll have claims. Most of these claims come from falls, and you have many more of these falls occurring in assisted living facilities than independent living.
“Another trend we’re seeing is that some facilities are keeping assisted living residents longer than they should as opposed to moving them to skilled care. Some of the banks lending to these operations impose covenants in their loans requiring the facility to maintain a certain level of occupancy. In order to avoid breaking the covenant and with independent living occupancy down, more infirmed residents are staying for longer periods at these facilities. With this, you’ll also see more claims.”
MC: “In addition, baby boomers who’ve been making the decisions or part of the decision on behalf of their parents who are currently in senior housing will base their future decisions based on the experience of the parents. They don’t want to move their parents from one community to another. They want them to stay in one community and age in place, putting more pressure on the facilities.”
GT: “We believe that with a rise in claims and increased acuity, risk management will become more important. If claims are bad enough, long enough, insurance rates will go up and become a major issue within this industry. At THOMCO, we’re becoming a lot more active in providing risk management techniques with our customers to help mitigate their liability.”
AG: What type of risk management techniques do you recommend?
MC: “One of the first things most communities need to do is to manage expectations. When someone brings their parent to a senior living community for the very first time, a facility has to do a good job communicating with the family. Explain "this is what may happen...mom may fall. You probably don't expect this to happen even though this was happening at home, which is why she is here. Managing a family's expectations is key.
“Having a fall program in place is essential. Also, make sure if the facility provides memory care to Alzheimer’s residents that they have some type of elopement program with proper security in place. Documentation is also critical. Everything that occurs needs to be documented, including the care and services being provided to the resident, along with appropriate communication to the family.
“What’s more, some facilities are asking families to share in the risk. The senior community is under a great deal of pressure from families to keep parents where they are because they’re happy and not move them to a facility that handles patients with higher acuity levels. The facility may have communicated with the family that the resident is falling a lot and he/she needs to move to another facility. We are often seeing families signing a contract acknowledging the risk and agreeing to share in it. This helps to mitigate the claim, and makes it harder for the family to pursue a large liability suit.”
GT: “We also have THOMCO University, a risk management resource exclusive to our senior living customers. We provide a library of well over 75 different topics for free that are unique to senior living. There are also 50 topics for in-servicing. Each community is required by the state to do in-servicing staff training each year. The system provides certificates indicating that the facility has provided the staff training; topics include medication administration, elder abuse, etc. Additionally, the system provides continuing education for different staff levels – RNs, administrations, CNAs.
MC: “We have a strategic partnership with Senior Risk, which performs clinical surveys at facilities at no additional cost to THOMCO clients. They will review the administering of medication, evaluate resident care and the risk of falls and elopement – issues that are specific to the industry. Senior Risk will also provide a clinical risk management assessment, reviewing a facility’s records and operational procedures and provide solutions to help mitigate or prevent losses and provide better care to residents. In some cases, a mock trial will be performed to illustrate what goes on if a loss results in a lawsuit that goes to court. There’s a judge, jury, and witnesses. It’s eye-awakening.”
THOMCO’s senior living program is written through an A-rated insurance carrier, and is available to appointed agents. To learn more about the program, the risk management available, and THOMCO University, feel free to contact Monica Clark at 888.514.3167, or via email at monica.clark@thomcoins.com. Also, visit the THOMCO website.