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CONVERSE COUNTY LONG-TERM CARE MARKET ANALYSIS Final Report (March 2014) Community Builders, Inc. www.consultCBI.com 873 Esterbrook Road [EMAIL REDACTED] Douglas, WY 82633 (307) 359-3311 ---PAGE BREAK--- Converse County Long-Term Care Market Analysis Page 4 of 60 E x e c u t i v e S u m m a r y The Converse County Board of County Commissioners and Memorial Hospital of Converse County retained Douglas-based Community Builders, Inc. (CBI) to help evaluate current and projected senior long-term care housing needs in Converse County, Wyoming. This market and financial feasibility study examines long-term care needs, market demand, growth potential and competition in Converse County, with special emphasis on the need for assisted living services in the county. An assisted living facility, by definition, is a group living arrangement providing help for residents with activities of daily living such as eating, bathing, using the bathroom, taking medicine, and getting to appointments as needed. Assisted living facility residents often live in their own room or apartment within a building or group of buildings and have some or all of their meals together. CBI worked with an Advisory Committee composed of representatives from Converse County, Memorial Hospital of Converse County and the communities of Glenrock and Douglas. The goals and general parameters of the project set by the Advisory Team were: To allow residents to age in their own communities rather than having to go outside of the community for long-term care To provide an affordable model with high quality of care To consider non-profit models for ownership and/or management of long-term care services CBI developed a public engagement process to evaluate the long-term care needs and desires of the Converse County community. Public and stakeholder input was obtained using a variety of methods. Additionally, CBI developed an objective market analysis, based on demographic trends, industry best practices, and government data. CBI has examined population and other demographic trends in Converse County and, more generally, east-central Wyoming. CBI has also analyzed existing and planned development of long-term care facilities in these areas. Existing long-term care facilities in Converse County include: Douglas Care Center LLC, a licensed nursing care facility Dream Catcher Adult Day Care, a licensed adult day care facility located in Douglas Ann's Best Care LLC, a licensed home health agency Currently, there are no licensed assisted living facilities, boarding homes, or hospice facilities in Converse County. A recent announcement by the Douglas Care Center indicates that the owners of that nursing home are now proposing to build a 30-unit assisted living facility on the same site as the existing nursing home in Douglas. Objective demographic observations include the following: There is a growing population of seniors age 65 or older ---PAGE BREAK--- Converse County Long-Term Care Market Analysis Page 5 of 60 Wyoming’s elderly population is the fastest growing segment of the state’s population People are living longer, but with more limitations in their abilities to perform activities of daily living (ADLs) The rural nature and low density of population in Wyoming makes it difficult to identify strong market demand anywhere (for any kind of services) Following this examination and analysis, CBI identified Converse County’s unmet needs for nursing home facilities, assisted living facilities, and memory care units. Those findings are summarized in the table below: Market Growth Forecast, by Market Area and Year DEMAND FOR NURSING HOME UNITS Market Area Primary Market Primary Market Secondary Market ALL AREAS Year Glenrock Area Douglas Area State of Wyoming United States Total 2012 25 -17 -148 -32,577 -32,717 2013 27 -15 10 -6,271 -6,249 2014 29 -13 169 20,034 20,220 2015 32 -10 327 46,340 46,688 2016 34 -8 486 72,645 73,157 2017 36 -6 644 98,951 99,625 DEMAND FOR ASSISTED LIVING FACILITY UNITS Market Area Primary Market Primary Market Secondary Market ALL AREAS Year Glenrock Area Douglas Area State of Wyoming United States Total 2012 15 24 272 148,392 148,704 2013 17 25 368 163,963 164,373 2014 18 27 463 179,534 180,042 2015 19 28 559 195,106 195,712 2016 20 29 654 210,677 211,381 2017 22 30 750 226,248 227,050 DEMAND FOR MEMORY CARE UNITS Market Area Primary Market Primary Market Secondary Market ALL AREAS Year Glenrock Area Douglas Area State of Wyoming United States Total 2012 14 -5 1,254 757,021 758,284 2013 15 -4 1,346 798,861 800,218 2014 16 -3 1,438 840,701 842,152 2015 18 -3 1,530 882,540 884,085 2016 19 -2 1,622 924,380 926,019 2017 20 -1 1,714 966,220 967,953 Based on these findings, it appears there may be a growing need for additional nursing home units and/or memory care units in Glenrock. Development of assisted living units is needed in both Glenrock and Douglas to meet current demand in Converse County. Given consumer ---PAGE BREAK--- Converse County Long-Term Care Market Analysis Page 6 of 60 preferences and operational efficiencies, the community should consider development of two assisted living facilities – one in Glenrock and one in Douglas. Those two facilities should be jointly managed. Additionally, in light of the community’s desire for high quality, and the County’s large percentage of low-income households, it may be necessary to engage local government involvement (to secure grant funding), as well as seek/develop a nonprofit operating company (to keep base rates as low as possible). If the Douglas Care Center moves forward with their proposal, this analysis should be revisited. It would be difficult for the Converse County market to adequately support two ALFs in Douglas. Further, if the goal is to meet the community’s strong desire for quality and affordability, a nonprofit model may need to be pursued. CBI estimates that the average base cost per resident could be reduced from a high of $3,817 using conventional debt service financing to construct and operate the facility, compared to a base cost of $2,412 with no debt service to be recovered. Finally, it should be noted that Douglas Care Center has already indicated that it will be pricing its base rates using the prevailing market costs of doing business in Douglas (and thus is not in a position to offer low-income subsidies), nor does it plan to develop an ALF in Glenrock. Accordingly, if the needs of those populations are to be met (including their desire to remain in their own community during their golden years), the community as a whole should carefully consider its alternatives.