(Washington, DC) – U.S. Senator Ed Markey (D-MA) and U.S. Representative Pramila Jayapal (D-WA) today jointly introduced the Health Over Wealth Act (S. 4084/H.R.9156), a bill to place new requirements on private investment in the health care industry. Maggie Elehwany, Argentum Senior Vice President of Public Affairs, issued the following statement:
While we continue to analyze the Health Over Wealth Act and its full potential impact on senior living providers, Argentum is pleased that assisted living is no longer included in the definition of covered health care entities in the bill, after initially being included in the initial legislative draft.
This is significant because, while the legislation has little chance of passage in the closing weeks of the 118th Congress, it was critical that assisted living be exempted from the definition in the event that provisions of the bill are added to other legislation in this Congress or, as is likely, it is reintroduced in the next Congress.
Since the initial release of the discussion draft in April, Argentum has collaborated closely with Senator Markey and key members of the Senate Health Education Labor and Pensions (HELP) Committee. Together with our State Partner, the Massachusetts Assisted Living Association, we have met with Senator Markey’s staff and shared why assisted living should not be included with health care providers as defined in the legislation. We appreciate Senator Markey hearing our concerns and exempting assisted living from this bill.
Assisted living communities are fundamentally different from clinical health care settings, and in a comment letter Argentum submitted with the American Senior Housing Association prior to the bill’s introduction, we called assisted living to be removed from the definition of a “health care entity” for the following reasons:
- Assisted Living is a market driven, private pay residential living environment that, contrary to the health care entities outlined in the initial draft legislation, does not rely on Medicare, Medicaid, or commercial health insurance reimbursement;
- Private investment in assisted living is needed to meet rapidly growing demand; curtailing investment would result in critical access shortages for millions of seniors for decades to come and almost certainly make assisted living less affordable;
In June, the prestigious Journal of Health Affairs published an editorial (“Private Equity Investment In Assisted Living: Distinct Impacts And Policy Considerations”) on its policy blog Forefront by a team of academic researchers studying private equity investment in assisted living. The authors urged policymakers to pause and consider the unique structure, financing and history of assisted living before applying the same regulation as other healthcare sectors, stressing that it would be premature to assume that examples of private equity acquisitions in other healthcare sectors is directly applicable to assisted living. The authors also noted that there is no evidence to date that private capital investment in assisted living negatively impacts resident care.
According to the researchers, “the assisted living sector is in a time of change. High interest rates have made the economics of selling and renovating riskier and the demand for memory care and assisted living is increasing. At the same time, there has never been systematic federal investment in assisted living infrastructure; rather, this care setting exists solely because of private investment.
Private investment will be needed to meet the projected surge in demand for senior care. The most recent Senior Housing Outlook released in June found that, at current levels, there will be a shortage of some 550,000 senior living homes by 2030 and a $275 billion investment shortage that will grow to $1 trillion by 2040. To meet the projected needs over the next six years, development of new senior housing must accelerate to more than 3.5 times the current pace.
Argentum will continue to monitor the Health Over Wealth Act and similar legislation, and work with policymakers to ensure that efforts to limit private capital investment do not jeopardize the important investments needed to meet the needs of our aging population.
About Argentum
Argentum is the leading national association exclusively dedicated to supporting companies operating professionally managed, resident-centered senior living communities and the older adults and families they serve. Since 1990, Argentum has advocated for choice, independence, dignity, and quality of life for all older adults.
Argentum member companies operate senior living communities offering assisted living, independent living, continuing care, and memory care services. Along with its state partners, Argentum’s membership represents approximately 75 percent of the senior living industry—an industry with a national economic impact of nearly $250 billion and responsible for providing over 1.6 million jobs. For more information, visit www.argentum.org.
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