Welltower owns about 95,000 senior-home units, from apartment-like “independent-living” dwellings to secure memory-care units. Its top rival, Ventas, owns about 68,000. Together, the two REITs own more senior-home units than the next nine biggest players combined, according to data from the American Seniors Housing Association.
Assisted-living businesses strive for operating profit margins of 20 to 30 percent — on par with software and pharmaceutical companies. Welltower touts its partnerships with operators who push margins even higher. In 2021, it removed Sunrise Senior Living as manager of six properties in California and replaced it with Oakmont Senior Living, which moved in more residents and raised rates by about 10 percent, increasing annual operating income from $600,000 to $14 million, according to a corporate filing.
When Welltower bought Balfour’s properties in 2019, it began holding regular calls with Balfour management geared toward reining in spending, several former managers said.
Balfour was allowed to continue spending on aesthetic renovations, even some that compromised resident safety. For example, executives insisted on placing an ottoman in the center of a common area though it caused frail residents to trip and fall, former managers said. And apartment doors in a memory-care facility were painted black though clinicians warned that some residents suffering from dementia would see them as black holes.
But Welltower pushed back when managers asked for more money to address growing problems with the quality of Balfour’s workforce. Former employees say they saw workers sleeping on the job, watching movies in the theater room and spending hours vaping in the kitchen. Some staffers felt uncomfortable administering certain drugs, such as vaginal suppositories, so they simply didn’t.
“They will just hire anyone who is willing to learn,” said Josie Charron, who worked as a medical technician at Lavender Farms until leaving in 2021 to become a journalist.
Advertisement
In a 2020 interview published on Balfour’s website, Schonbrun acknowledged that the company struggled with “painful personnel issues” as Balfour expanded to nine facilities.
“In some cases people deselected themselves, moved on to other opportunities,” Schonbrun said. “In other cases, we had to give them a nudge out the door and then reassure the people who stayed behind that the fundamentals of the culture were going to stay in place.”
Tell The Washington Post about your experience with assisted living
About 43 percent of assisted-living workers, excluding new hires, left their jobs in 2022, according to a survey by industry researcher Hospital & Healthcare Compensation Service. Workers say they can make more money at easier jobs in restaurants or retail. King Soopers, the grocery store across the street from Lavender Farms, paid higher wages than the senior home.
“When you see how much work you do at the end of the day and you get paid that amount? It’s insane,” said Culix Wibonele, a certified nursing assistant who earns $16 an hour at an assisted-living facility in Atlanta.
Some businesses offered pay raises of $1 or $2 an hour during the pandemic, but stopped short of boosting wages enough to make the jobs sustainable for most people, said Melissa Unger, executive director of SEIU Local 503 in Oregon. Residential-care aides, including those who work in assisted living, are 85 percent female and disproportionately people of color and immigrants, according to research aggregated by labor advocacy group PHI.
Matthews, who managed the memory-care wing in one of Balfour’s Denver facilities from 2016 through 2019, said three-quarters of her front-line staff relied on some form of government assistance.
How your state regulates assisted-living facilities
Welltower’s Mitra, on the other hand, has risen to become one of the highest-paid executives in the country. Last year, his pay package totaled $38 million, including equity grants that Mitra forfeits if Welltower does not hit certain growth targets in the next four years. That made him the 13th highest-paid CEO on the S&P 500 stock index, among those who have been in their jobs for at least two years, according to compensation researcher Equilar — close behind the heads of Netflix, American Express and Morgan Stanley.
Welltower’s board of directors defended the pay package in its annual proxy statement to investors, saying the company has outperformed rivals during Mitra’s tenure.
Advertisement
Mounting problems
Staub, a mother of three daughters who earned a private pilot’s license and started her own sewing business later in life, moved into Lavender Farms in 2019, after her husband died.
In the months before her death, problems were mounting at the facility. A King Soopers manager said she repeatedly called to report wandering seniors who did not know their names or where they lived. An administrator told state inspectors that installing an exit door alarm was “considered but not implemented.” An employee interviewed by inspectors said there was “only so much we can do” to keep track of residents.
Some Balfour residents probably should have been in a dedicated dementia facility, where doors are alarmed and often locked, former employees said. But the company allowed its sales and marketing team to assess new residents — sometimes without input from medical staff — and some were improperly assigned to the nearest empty bed, the former employees said.
In November 2021, Staub was transferred to a nursing home after falling and fracturing her pelvis. Two months later, Balfour encouraged Staub to return to Lavender Farms, agreeing to place her on a higher level of care with more frequent checks for $1,500 a month on top of standard monthly fees, which are currently advertised as starting at $6,800.
A nurse practitioner who assessed Staub at the time wrote that she “had a history of weakness and episodes of confusion” and should be monitored “throughout the night for sleep walking,” according to the Staub family lawsuit against Balfour, Schonbrun and the two night staffers. The case settled last month for an undisclosed amount.
After Staub’s body was discovered, a Lavender Farms manager called Staub’s daughter to say her mother had “hurt her ankle” and was being taken to the hospital, according to the legal complaint. The daughter learned of her mother’s death and nightlong ordeal only after “she arrived at the hospital and was asked to identify Mary Jo’s body under a blood-soaked sheet,” the lawsuit said.
In police interviews, the two caregivers tasked with monitoring residents that night said they had checked on Staub around midnight; she was spotted on surveillance cameras at 12:41 a.m.
Advertisement
However, they did not record any checks in Lavender Farms’ records. One of the women left the building shortly before midnight, security-camera footage shows. The other had previously been reported to management for sleeping during night shifts and letting resident calls go unanswered for hours, said a former employee who witnessed and reported this behavior but was not authorized to publicly discuss personnel matters.
Sarah Krus, a facility administrator, told police that Staub had instructed staff months earlier to reduce nightly checks to avoid waking her up, but she said the facility had no written record of the request.
Balfour administrators did not answer The Post’s questions about why no one came to open the doors; they told police the doors were locked at night in response to “numerous instances of homeless individuals and others on the property after hours.”
In their report on the incident, state inspectors said Lavender Farms had created “an immediate jeopardy risk of injury or death” to everyone who lived there. Regulators fined the facility $1,500 and required improvements to resident safety. Local authorities declined to bring criminal charges.
Balfour told state regulators it would reassess residents who were known to wander and initiate nightly sweeps of the building. A woman who had been locked outside for an hour the same night Staub died was moved out shortly afterward.
In May 2022, Colorado lawmakers passed new laws requiring stricter background checks for employees and minimum levels of experience for managers at assisted-living facilities. The new law — enacted after a spate of preventable deaths — also allowed regulators to impose stiffer fines, which had previously been capped at $2,000 per facility per year.
Meanwhile, Balfour executives quietly ordered security cameras to be permanently removed from Lavender Farms, according to a person who was briefed on the matter. The reason, the person said, was “to minimize liability.
Bookmarks