Jeffrey Leer, CEO of AlerisLife, which includes Five Star Senior Living, is excited about this moment in the senior living field. He sees a wealth of opportunities for operators to build on the impact that operators make, taking advantage of an evolution of services and new tools – including sophisticated technology – to help residents lead richer lives and “to extend their golden years.”
Leer, who previously served as chief financial officer of AlerisLife, also sees an array of challenges, including a need for the industry to better tell its story. Leer shared with Senior Living Executive his view on the state of the industry, important trends for 2025, and how Five Star Senior Living, which has communities in 28 states, is embracing new, innovative ways of serving their residents and making their staff feel valued and fulfilled.
SLE: With 2024 behind us, what do you think were the most notable developments of the year for the senior living field?
JL: For me, 2024 was the year the industry realized that customer preference has moved to a “choice-based” model, where you pay for what you consume. The one-size-fits-all model is no longer effective!
It also became clear how important it is to provide well-being and wellness services. Physical and mental health are both critical for our residents, and this represents an opportunity. Research shows that more than a third of adults aged 50-80 report loneliness and isolation, and senior living communities are the ideal place to create a socially active, welcoming environment.
Using the latest research around happiness and programming that fosters emotional and mental health, Five Star Senior Living has built a culture of well-being for both our residents and our team members, including mental health services and personalized apps. We’re even enhancing our community environments with a new signature scent called “Home,” and we’re looking into ways to incorporate music as an essential part of the resident experience.
SLE: As we transition into 2025, what are the trends that are driving the industry into the new year?
JL: Between an aging population and their desire for an engaging lifestyle, demand remains strong for the senior living experience. I think that, increasingly, potential customers are spending more time evaluating options than they did before. The industry has to be much more cognizant of its value proposition and its competition not just from other senior living operators, but the service providers that deliver capabilities to age in place at home.
Moreover, as customers spend additional time evaluating their options, we’re seeing a higher number of older, less mentally acute residents moving into our communities. We have to position senior living as a way to slow the aging process and present it as an option for seniors looking to extend their golden years.
SLE: What most excites you about the field right now?
JL: The opportunities are endless. We have an aging population that allows us to make an even greater positive impact on the lives of more people each and every day. We’re seeing an evolution in services offered, and investments in technology are growing to take advantage of capabilities such as AI, which can help identify potential physical health risks before they surface. Moreover, we’re offering complementary programs that are laser-focused on delivering quality services to address the specific needs of the elderly. For example, we’ve partnered with Fox Rehabilitation Services to deliver quality physical therapy and fitness to residents within our communities. This allows them to reap the benefits of physical wellness without the time and expense of visiting separate facilities.
SLE: What most concerns you? What are the biggest challenges that operators are facing?
JL: The senior living industry needs to brand itself as a value-added service provider. Too many customers and their families focus on the needs-based offering rather than value-based capabilities that enhance independence for older adults. For example, at Five Star, we provide well-being and wellness programming that addresses the emotional, physical, intellectual and communal pillars of wellness to help our residents live their best lives.
With the growing senior demographic in the United States and the influence that comes with that growth, we anticipate that there will be increased scrutiny of the senior living space at both the state and federal levels. The industry has an opportunity to work with government to better define what senior living provides for older adults. Currently, it’s too often co-mingled with health care services like hospitals and skilled nursing, which are complementary to what senior living provides, but only part of the lived experience for older adults. Government needs to be pragmatic, prudent and supportive of operators so they can deliver quality without overly burdensome regulation.
SLE: Are there areas where you think the industry most needs to improve?
JL: We have to focus not only on service capabilities for our residents, but also on initiatives that support the team members providing those services. Our industry benchmark suggests that a high proportion of team members face one of four negative social determinants of health: social isolation, homelessness, food insecurity, or financial insecurity, with some suffering from more than one, in combination. These hardships diminish the ability of team members to focus on providing the best possible experience to our customers.
Happy team members means happy residents, so it’s critical that we help employees address the negative social determinants of health in their lives. At Five Star, for instance, we ensure that every worker at our communities gets a free shift meal through our Nourish You initiative, and we’ve seen how that benefit and other have improved both team member happiness and employee retention. That means better care and services for our residents, which directly benefits our customer value proposition.
SLE: Are there evolving best practices that have become most important to serving residents? How is Five Star incorporating these?
JL: Resident surveys have consistently shown that those who come to our communities are looking for more than just a place to live and receive care; they’re looking for both quality of life and positive experiences. The industry is moving to incorporate aspects of the hospitality industry model, a trend that’s long overdue. To accommodate resident desires, we’ve expanded offerings, including more comprehensive physical therapy, and customized social activities across our service lines. Our independent living community members can experience a more expansive and vibrant lifestyle, and residents with dementia and other cognitive conditions are also able to lead richer lives. We’re laser-focused on addressing well-being holistically, incorporating initiatives that address Emotional, Physical, Intellectual, and Community needs. (We refer to this programming as EPIC internally.)
Finally, we’ve worked hard to do something fundamental: listen. It’s a best practice in our organization to spend time hearing and internalizing what our residents and their families have to say. Our surveys and listening sessions have driven a number of new initiatives, and we’re working to find new ways to improve the insights derived from resident and family communication.
SLE: How about best practices in attracting, managing, rewarding and retaining staff?
JL: Clearly, it’s in our business’ best interest to reduce hardship for our employees. So how do we do that within our core competencies? I issued this challenge to our leadership team, and together we developed a multipoint strategy to improve employee well-being, including training, an enhanced 401k plan (Future You) and Nourish You, which I mentioned earlier – a guaranteed meal every shift for every team member. Our goal is to continue building a culture that emphasizes kindness, transparency and accountability.
I want to focus on Nourish You for a moment, as it’s one of the most tangible of our employee initiatives. Launched in February of 2024, Nourish You made perfect sense for our industry – each of our communities has a commercial kitchen and a culinary staff, so preparing a meal for each team member can be accomplished at minimal expense. We predicted an adoption rate of around 75%, but today, 90% of team members make use of Nourish You.
As a result, we’ve witnessed a complete turnaround in our employee metrics – for the better.
In the first year of rolling out these initiatives, we saw a 10% reduction in frontline worker turnover. Moreover, as of September 2024, less than 10% of our positions are vacant, a standout metric in our habitually understaffed industry. And this has allowed us to expand offerings to our residents.
SLE: The growing shortage in the availability of senior housing is getting a lot of attention. Are there positive trends in this area that stand out to you? What needs to happen for the industry to make serious inroads in this area?
JL: I believe the “shortage” is strongly connected to affordability. We need to be more nimble in providing service capabilities that allow residents to pay for what they consume, rather than just offering one-size-fits-all options. This will allow more people to customize their senior living experience further, choosing a program that’s affordable and that provides the resident with the value they seek.
SLE: Anything else you’d like to add?
JL: We are on the cusp of a transformation in the senior living industry, and at Five Star, we’re optimistic, reinvesting in capabilities for team members and service delivery for residents. Our industry as a whole provides tremendous benefits to older adults and their families, and we have an obligation to shed light on how much positive impact we make on people’s lives each and every day. We have a story to tell, and we can’t wait to share more.
