Can Owners Live in Their Assisted Living Facility with Residents?
Sep 10, 2024
This blog will discuss a unique topic: can the owner of a residential assisted living facility live in the same residence as the residents? If you have ever wondered about this, you've come to the perfect place. This question is more than just logistics; it also addresses the quality of care, legal implications, and the overall dynamic of the living environment.
Consider being both the manager and a resident in your own facility. It could provide unrivaled monitoring and a strong personal relationship with your residents. However, it can potentially create fundamental issues about privacy, borders, and regulatory compliance. We'll review the advantages and disadvantages to give you a clear picture of whether this unique living arrangement is right for you and your business.
Check out the video, too:
The Concept of a Live-In Caregiver
What is a Live-In Caregiver?
A live-in caregiver is someone who lives in an assisted living facility and is responsible for caring for the residents. In some situations, the facility owners may take on the role of live-in caregivers. This arrangement is especially viable and frequently practical in smaller, residential-style assisted living residences, where the caregiver may be available to the residents around the clock and provide personalized care and support.
Types of Facilities
Assisted living facilities generally fall into two main categories: residential care homes and commercial facilities. Residential care homes are smaller, resembling traditional houses, and are frequently run by an owner who lives on-site and acts as a caregiver. This type is preferred for its homelike environment and may be permitted by local zoning rules. On the other hand, commercial facilities are much larger, typically with 16 or more beds. In these circumstances, it is less possible for employees to reside on-site, which is frequently restricted by municipal restrictions.
Real-Life Example
I have personal experience with this model. The facility we purchased in Idaho was previously owned by a family who lived on the premises while operating it. Their hands-on approach allowed them to ensure high-quality care for their residents, and the owners' personal involvement created a warm and inviting atmosphere for the residents.
Zoning and Legal Considerations
Working with Local Authorities
Before deciding to move into an assisted living facility, you should contact the city's zoning and planning agencies and the local health agency. These agencies will provide advice on the precise regulations that must be followed. Obtaining this information allows you to ensure that the facility complies with all applicable laws and regulations, avoiding potential legal complications or being shut down.
Federal Regulations
According to federal law, individuals who are legally required to care for a family member residing in a care facility are prohibited from receiving Medicaid reimbursement for the services they provide. This means that if you are legally required to care for a family member in the facility, you cannot receive Medicaid compensation for the services you provide and may not be able to collect any money at all in this scenario.
Financial Implications
Reimbursement Models
Living in the facility has no adverse impact on your reimbursement model. This means that if a caregiver lives in the facility, your reimbursement amount will not be reduced. Some families may even be willing to pay a premium for the peace of mind provided by having a live-in caretaker. This arrangement could be viewed as a beneficial benefit for families, and they may be willing to pay more for this level of care. It's vital to highlight that Medicaid focuses on the quality of care delivered, not the caregiver's living arrangements. This underlines the significance of providing high-quality care regardless of the caregiver's current living situation.
Premium Pricing
Having a live-in caregiver can be a valuable asset for residential care facilities, enabling them to offer continuous care and oversight to their residents. This, in turn, permits the facilities to charge higher fees, particularly among private-pay residents who appreciate the assurance of round-the-clock support and attention.
Pros and Cons of Being a Live-In Caregiver
Pros
Living onsite at a facility allows you to have constant oversight, giving you a detailed picture of all activities and operations. This approach allows you to have more control over budgets, effectively manage staff schedules, and provide high-quality care to all residents or clients. Furthermore, by lowering staffing costs and charging higher rates for your services, you can see a significant increase in profitability.
Cons
Living on-site necessitates constant availability, which can quickly lead to fatigue. The tendency to micromanage all aspects of business might unintentionally create a stressful and hostile environment for personnel and residents.
Final Thoughts
Living in your residential assisted living facility as an owner and caregiver is a viable option with multiple potential benefits. However, it is important to fully understand and follow all local and federal requirements. Also, be prepared for the high degree of dedication and commitment that this duty requires.
For more resources, visit Assisted Living Investing and download our Business Plan Checklist to ensure you have a comprehensive plan in place to help you launch your assisted living business.
Need help figuring out where to start? Join the next Roadmap Challenge and build your launch plan with me.
Show full transcript 👇
Transcript
00:00:00
hey friend it's Brandon Gustafson welcome back to the channel in today's video we're going to be getting into the topic of can an owner of a residential assisted living facility actually live in the same house as your residence if you have ever wondered that make sure that you are sticking around for this
00:00:23
I'm Brandon Gustafson. I own and operate two assisted living facilities, and I created this channel to help people just like you learn the ins and outs of investing in assisted living. Welcome to Assisted Living Investing. Before we get into our topic today, which is can you, as the owner of an assisted living facility, actually live in the facility with your residents? I want to remind you to get over to the website, assistedlivinginvesting.net calculator, and I'll link that down here in the description below so you can get access to the free underwriting calculator.
00:00:53
that's going to help you on your investment journey. With that said, let's jump into the topic of today's video. Can you, as the owner of an assisted living facility, actually live in the facility with your residents? So what is that called, first off? What is it called when the owner lives in the facility? This is called a live-in caregiver.
00:01:11
So a living caregiver is a person that is actually living in the facility. This is very possible for you to do. Even as an owner, you're going to be able to do this and kind of live there at the facility and work through that process. I did a video on this about care homes. So make sure you watch that video.
00:01:28
but in that model you are probably going to be the living caregiver as the owner and so it's very possible for you to be able to to do this as as the owner of a facility what i have found though is i've done a little bit of research on this is you're gonna be able to do this at the care home level like we talked about you're also going to be able to do this at a residential level but when you start getting into that commercial style of a facility 16 plus beds 20 plus beds
00:01:55
somewhere in there, you're kind of pushing the line. You're probably not going to be able to live in the facility. I also don't know that you'd want to live in that type of a facility, but in those lower classes, because they kind of have that residential feel to them and the zoning process of it is going to be conducive to you being a live-in caregiver.
00:02:15
The facility we purchased in Idaho, I was talking to the seller before we bought it, and she had mentioned to me that for a couple of years, she and her family actually lived at the facility while they were running it as a care home, and they were able to kind of do that. So just a real-life example there for you, it is possible for you to do this. And it was her, her husband, and she had a few kids.
00:02:35
that were also there at the facility on a regular basis. So it's not just you as the owner of doing that. You can do this as a family as well, which is kind of fun and exciting to think about. But before you dive into that, you want to make sure that you are working as well with the city zoning planning with your local municipality to make sure that you are not, and probably the health department as well, just to make sure you're not crossing any bounds that should not be crossed.
00:03:01
as you go through the process of starting and operating your care home or assisted living facility so you can be successful and not get dinged significantly or get shut down even which we definitely don't want to happen for you as you're running your assisted living facility now the next question is it going to impact your reimbursement model if you are living in the facility the answer to that is no actually some people might pay a premium for there to be a living caregiver
00:03:26
the facility whether that's you or a staff member that's doing it because then they know for sure somebody is going to be there all the time to help out their family member when they need assistance so you actually might be able to charge a premium from a Medicaid perspective I've done several videos on Medicaid make sure you go and watch one of those for a better education on what that looks like but as you're getting to that with Medicaid also not going to impact your reimbursement model
00:03:51
because they are more concerned with the amount of cares and the quality of care that you are providing to your residents than who's in the facility. They just want to make sure that there is proper coverage for it. So it's not going to impact your reimbursement model at all as you're going through the process of starting your assisted living facility. If anything, it's going to allow you to charge higher rates to your private pay residents.
00:04:12
with that said there is a caveat there and that is if you have family members your own family members living in the facility or a family member of the living caregiver if that's not you living in the facility and this is because there's actually a federal law here
00:04:27
And what it states is that reimbursements cannot be made for services performed by persons who are legally required to care for the individual. You as a family member, you are legally required to care for your family member and help them through the process. So you cannot be reimbursed for that. It's a federal law, so you need to be very careful with that.
00:04:50
Now, I know that despite that being a federal law, there are some groups that are trying to push that if you're providing excessive care or things like that, that you should still be reimbursed for the work that you're doing. And I would agree with that. There are different kind of advocacy groups as well that you might be able to find and join if that's something that you are trying to implement.
00:05:09
in your facility where you're working and caring for family members. So just want to make you aware of that. You can probably find some of that online as well as you go through that process. Let's get into the pros and some of the pros and cons here of operating an assisted living facility with you as the owner, that's the living caregiver.
00:05:26
Number one is it's going to allow you to know exactly what is going on at the facility all of the time, which is great. Especially if, be honest with yourself, if you like to micromanage and you need to know what's going on, this is probably one of the best opportunities for you to do that in the assisted living space. You're going to be able to kind of see what's going on.
00:05:45
at the facility and really hone in on exactly what is going on all the time, which can be a really good thing. It can be a bad thing. We'll talk about that here in the cons list as well, but it could help you out and just knowing exactly what's going on. And the second thing that I want to state is you're going to have more control, especially over things like your expenses,
00:06:04
You're going to have more control over how and when staff are working as well. And you're going to have a little more control over the amount of care that is being provided to the residents. All of those things are going to help you in being more profitable. You're going to be able to reduce your expenses. You're going to increase the care that you're providing. You need to make sure you properly document this and go about it the right way. But doing that is going to allow you to charge higher prices as well.
00:06:29
And so those two things combined is going to increase your gap of profitability, which is one of the things that you are here doing your assisted living facility for, which is a nice thing. Now the cons of doing this is you're not gonna have any kind of a break. You're gonna have to be there all the time and it can be exhausting for this. So you need to just be aware that that's something that you're gonna have to be playing with as you go through this as a living caregiver, as the owner. It's gonna be really hard for you to break away
00:06:58
from doing all of the work. So you need to be aware of that. Number two, and we talked about this as a positive, but it can also be a negative in that you might fall into this trap of micromanaging and wanting and needing to micromanage and know everything that's going on and making sure everything is just right. And doing that can be a real turnoff sometimes for your residents or your other staff and make it hard for you to operate the facility the way that you need to or that you would like to in a successful manner.
00:07:27
Let's recap what we've been talking about here in today's video. First off, we've been talking a lot about here, can you as the owner be a live-in caregiver for your house? And yes, you absolutely can. Not a problem. You want to make sure that you're talking to the state governing body for assisted living. Make sure that you're compliant with their rules and regulations. Same with the city.
00:07:48
local municipality your city zoning and planning make sure you're not going to break any rules there that you're following that process but you can do this it's not going to impact your reimbursement model and we went through a few different pros and cons as well as we got into this topic of can you as the owner of the assisted living facility actually live there
00:08:07
If you'd like to learn more about this, get over to assistedlivinginvesting.net. We're here to help you through the process, kind of coach you through it. And you can also get access to our free underwriting calculator. We'll also link that down below in the video description. Does residential assisted living sound interesting to you, but you don't know how to get started? At Assisted Living Investing, we're here to help you through the process start to finish. Thanks for watching and have a great day.
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