Retirement Living News

September 2006

HEADLINES  (Click on headline to read story)

• AARP Announces 2006 List of Best Employers for 
  Workers Over 50
• Employers Rethinking Conventional Approaches 
  to Employee Retirement
• MetLife Study Finds Retirement is More a "State" Than a "Date"
• New Television Network for Retirees is Launched
• Consumer Reports' Analysis Finds Care is Better 
  at Not-For-Profit Nursing Homes
• New Report Sheds Light on How Assisted Living Properties 
  Charge for Care

Archive of Past Issues                          New Retirement Communities

NEWS STORIES

AARP Announces 2006 List of Best Employers for Workers Over 50 

AARP reports that enlightened employers are making strategic business decisions in addressing the needs of an aging workforce by increasingly providing flexible work arrangements that accommodate the schedules of the employees and their families. This year's winners in the Best Employer search include Volkswagen of America, Inc., Hoffmann-La Roche Inc., Principal Financial Group, and Busch Entertainment Corporation. The innovations they are making appear to be paying big dividends in improving productivity and morale, and in boosting retention rates. 

For example, Volkswagen, based in Auburn Hills, Mich., ranked #6 in the AARP search. It offers some of its full and part-time employees flex time, compressed work schedules, job sharing and telecommuting. Some employees phase into retirement with part-time work. The auto manufacturer gives its retirees work opportunities, offering temporary work assignments, consulting work, and telecommuting, in addition to part-time work. 

The top finisher this year in the annual search -- now in its sixth year -- is Mercy Health System of Janesville, Wis., a system with 63 facilities, including three hospitals, over 50 outpatient clinics, post-acute care, nursing care and other facilities throughout southern Wisconsin and northern Illinois. 

The not-for-profit organization also offers numerous flexible options including weekend-only work, nursing "float" options (work at different facilities and or departments), work-at-home opportunities, "seasonal work" programs that allows staffers to go on leave for extended periods while maintaining benefit eligibility, and on-call assignments that involve a limited number of hours per month that can be expanded and/or contracted based on the employee's availability. 

In addition to Mercy Health System, the remaining top 10 finishers are #2, Lee Memorial Health System of Fort Myers, Fla.; #3, Bon Secours Richmond Health System of Richmond, Va.; #4, Leesburg Regional Medical Center and The Villages Regional Hospital in Leesburg, Fla.; #5, Yale-New Haven Hospital in New Haven, Conn.; #6, Volkswagen of America in Auburn Hills, Mich.; #7, Massachusetts Institute of Technology in Cambridge, Mass.; #8, Oakwood Healthcare System, Inc. in Dearborn, Mich.; #9, First Horizon National Corporation in Memphis, Tenn., and #10, Hoffmann-La Roche Inc. in Nutley, N.J. 

Each year AARP invites employers to apply for the Best Employer designation by submitting an application describing their exemplary practices toward 50 plus workers. Key areas of consideration are: recruiting practices, opportunities for training, education and career development; workplace accommodations; alternative work options, such as flexible scheduling, job sharing, and phased retirement; employee health and pension benefits; retiree benefits, and age diversity of the workforce. For a list of the 50 top employers, click here. 
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Employers Rethinking Conventional Approaches 
to Employee Retirement

Last month we reported on The Merrill Lynch New Retirement Study from the standpoint of the individual. It revealed that many people are actually working in retirement or have taken steps for a new retirement career. However, most employers are not on track to prepare for this phenomenon. 

The Merrill Lynch study, conducted by Harris Interactive, builds on the findings of the 2005 Merrill Lynch New Retirement Survey, which discovered that 76 percent of all baby boomers had no intention of seeking a "traditional" retirement. The scope of people surveyed in the 2006 study was expanded considerably to include feedback from U.S. companies as well as a broad spectrum of individuals.

Multiple generations report cycling in and out of work and pursuing a new career in later life as the retirement ideal. This part of the study shows that companies need to be aware of this new concept of retirement in order to prepare for the new work force realities. 

The study sheds a revealing light on this changing model of retirement and the potential for a growing gap between employers and employees. It's the first of its kind - offering a comprehensive look into the retirement landscape from both sides of the coin. 

• Companies are not completely in the dark, and while they recognize the shift toward the desire to work in retirement, they are more likely to assume that employees want to work a regular part-time schedule than to cycle between periods of work and leisure. They also have not responded to individuals' overwhelming desire to pursue a completely new line of work in their "new retirement." 
• Highly skilled professionals are the most valued and most at risk for a shortage. However, many companies are not responding to this threat. Only one in four employers said that they are on track with preparing for the boomer outflow from the workforce and almost one-third (31 percent) say they have not thought much about it. Employers who have taken steps to prepare for future labor shortages focus on recruitment, but tend to focus on younger workers, not recruitment and retention of older, skilled workers.
• Concerns over the increasing cost of benefit programs rank as the most pressing human resource and benefits issue that employers are facing. Well over half (65 percent) of the companies surveyed considered this a very serious issue - almost 10 times as many as those companies that considered retaining older workers as a serious problem (7 percent). 
• The bottom line - competitive and economic pressures continue to be the primary driving factors behind corporate benefit decisions and greatly outweigh concerns about work force shortages. Until personnel shortages hit the bottom line, there is little impetus for action. Forty percent of the companies surveyed reported that the wave of retiring boomers retiring is not an important priority at the HR level or at the senior management level.
• The common denominator. Like their employees, most companies do not believe that the majority of workers are well prepared for retirement. While the new retirement is on most company radar screens, the challenges that it brings have not been adequately addressed. 

As individuals continue to reject traditional retirement and the wave of people seeking "retirement careers" comes crashing in, some companies have already begun to embrace the changes ahead. Those leading the pack realize first and foremost the importance of attracting and retaining older and talented workers.

One of the most notable findings of the Merrill Lynch New Retirement Study is that awareness, recognition, understanding and a willingness to address the issues head-on is what is necessary for companies to manage boomer outflow and to be prepared for the next generation of "career retirees." 

"The pioneers on the employment front are those companies that have already realized that the 'new retirement' is here," said Cynthia Hayes, head of Employer Plan Solutions at Merrill Lynch. "By permitting telecommuting and more flexible schedules, providing coaching and mentoring services, as well as offering increased access to health insurance, these companies have demonstrated that they are already thinking about the new approaches they can take to leverage a very valuable work force segment that still has the desire to work."
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MetLife Study Finds Retirement is More a "State" Than a "Date"

Older workers today are changing the concept of retirement as they live longer and work well past traditional retirement age - some even returning to the workforce after they "retire" and/or opting for "portfolios" of paid and volunteer positions, according a MetLife Mature Market Institute® study, Living Longer, Working Longer: The Changing Landscape of the Aging Workforce, conducted by David DeLong & Associates, Inc. and Zogby International. Unlike other industry studies which have offered predictions of the aging Baby Boomers' retirement expectations, the MetLife study examines the actual work experiences of employees age 55-70.

The study found that 78% of respondents age 55-59 are working or looking for work, as are 60% of 60-65 year-olds and 37% of 66-70 year-olds. Across all three age groups, roughly 15% of workers have actually accepted retirement benefits from a previous employer, and then chose to return to work (or are seeking work). These employees, who have become known as the "Working Retired," represent 11% of 55-59 year-olds, 16% of 60-65 year-olds and 19% of 66-70 year-olds.

Employee motives for returning to and/or remaining in the workplace differ significantly by age. Among workers age 55-59, economic incentives take precedence, with 72% of citing "need income to live on" as a primary reason for working. Economic incentives were also the number one motive cited by 60-65 year-olds (60%), followed by a desire to "stay active and engaged" (54%) and "do meaningful work" (43%). Among 66-70 year-olds, however, 72% of employees cited the desire to "stay active and engaged" as a primary reason to work, followed by "the opportunity to do meaningful work" (47%) and "social interaction with colleagues" (42%). 

The MetLife study found that retirement isn't necessarily defined by an employee's age or work status. When asked what retirement means, one-fourth indicated "freedom from the demands of work" followed by another quarter who said "more control over one's personal time." 

Among the Working Retired - i.e., employees who are receiving retirement benefits and subsequently returned to work - the quest for meaning is one of the major forces drawing them back into the workplace. "Becoming self-employed or starting a business" was another common reason for taking retirement benefits.

While aging workers crave autonomy and flexibility, financial necessity is driving many older employees to work, whether on a part-time, full-time or self-employed basis. A significant portion (18%) of Baby Boom workers age 55-59 report that they expect to have no access to retirement benefits (e.g., pension, 401(k), SEP) when they stop working and are likely to feel compelled to work well past traditional retirement age. About 14% of workers age 60-65 and 10% of workers age 66-70 expect to receive nothing but Social Security when they finally stop working. 

"Retirement experts have been predicting for years the serious repercussions that will arise as Baby Boomers' lack of retirement assets collides with their increased longevity to create widespread economic hardship. The rational solution - to continue working full-time beyond traditional retirement age - is at odds with many Boomers' interests, values and priorities for their retirement," notes Sandra Timmermann, Ed.D., gerontologist and director of the Met Life Mature Market Institute. 

Among the other key survey findings: 

• Help Not Always Wanted: In addition to the financial pressures, many aging workers face an additional barrier to workplace fulfillment: the perception of age bias. When asked about unsuccessful job searches, older workers most frequently gave reasons suggesting or implying "age bias." 
• Part-Time Preferred as Workers Age: Of those still in the workplace, about 76% of 55-59 year-olds work more than 35 hours a week, and only 39% of 66-70 year-olds work that much. Nearly four in 10 (39%) of those age 66-70 are working fewer than 20 hours a week. Among those seeking work in this age group, 56% wanted less than 20 hours per week. 
• Portfolio Work: Some older workers in the survey talked of their lives as taking on a "portfolio quality" - a mix of part-time work for pay, volunteer work, and travel, along with more time for hobbies and family. Supporting this portfolio metaphor, 25% of survey respondents across all age groups currently earn income from more than one job. 
• Staying Put: Stereotypes to the contrary, only 15% of 66-70 year-olds moved to warmer climates once they started receiving retirement benefits, while 21% of 60-65 year-olds and 28% of 55-59 year-olds chose to relocate. Among employees who had access to retirement benefits when they were younger, relocation rates are somewhat higher. 

The MetLife Living Longer, Working Longer study was conducted during the first quarter of 2006. The survey polled 2,719 respondents between the ages of 55-70. To supplement the survey data, a small sample of additional interviews were conducted with people who fit the survey profile, as well as with company managers responsible for workforce diversity and experts in recruiting older workers. 

The MetLife Mature Market Institute is MetLife's information and policy resource center on issues related to aging, retirement, long-term care and the mature market.
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New Television Network for Retirees is Launched

On September 5 a new television network called Retirement Living TV began providing four hours a day (noon to 4 p.m.) of programming for retirees in the Northeast and Mid-Atlantic region over CN8, The Comcast Network (http://www.cn8.tv). The new network for seniors is the brainchild of John Erickson, founder and CEO of Erickson Retirement Communities, based in Catonsville, Md. He hopes to build enough programming to have a 24-hour stand-alone station then move to the Internet and other technology such as podcasts. 

The Erickson name will not be associated with the network in order to keep it independent. The current contract with CN8 allows Erickson to air programs through December 2008. CN8 reaches more than 9 million Comcast cable homes from Maine to Washington D.C. 

Some of the shows to be included are: 

• Healthline -- a 30-minute program hosted by Kevin Soden, M.D., that informs viewers about the tools they need to take better control of their own health care. 
• The Daily Apple -- a one-hour, magazine-style program that explores important wellness issues facing the senior population today. 
• The Art of Living - a program that will travel around the country to focus on documenting the activities of seniors where they live, featuring ordinary people, and celebrities in their extraordinary environments or jobs. 
• The Prudent Advisor - a financial show about money issues facing retirees. 
• The Informed Citizen - a show that will provide viewers with the information they want and need to make their choices in the upcoming midterm elections. It will also focus on specific congressional issues on aging that affect their lives…such as Medicare, prescription drugs and social security. 
• The Voice -- an interview-based talk show that discusses social issues important to older Americans. 

For more information about accessing the network, visit http://www.rl.tv. Enter your Zip code and you'll be instructed on to how to find the correct channel.
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Consumer Reports' Analysis Finds Care is Better 
at Not-For-Profit Nursing Homes

An investigation and analysis of nursing homes by Consumer Reports has found that not-for-profit homes generally provide better care than for-profit homes, and that independently run nursing homes appear to provide better care than those that are owned by chains. This conclusion is based on an analysis of the three most recent state inspection reports for 16,000 nursing homes across the U.S. The study also examined staffing levels and so-called quality indicators, such as how many residents develop pressure sores when they have no risk factors for them. 

An article in the September 2006 issue of Consumer Reports titled "Nursing Homes: Business As Usual" says that since 1987 when Congress passed a landmark law meant to improve nursing home care, poor care is still all too common, especially at nursing homes run by for-profit chains, which is now the dominant force in the industry. Although the law provided for monetary penalties that could be imposed by states and the federal government, that hasn't meant that fines are collected. In fact, last year the federal Office of the Inspector General found that the Centers for Medicare & Medicaid Services (CMS) did not take all the required steps to collect 94 percent of past-due penalties. 

The CMS has the authority to disqualify a home from the Medicare and Medicaid programs, cutting off federal funds. But that remedy, the most drastic in the agency's arsenal, is used less frequently than in the past. In 1998, the number of terminations peaked at 51; in 2005 there were only 8. 

Consumer Reports has put together the Nursing Home Quality Monitor which lists facilities in each state that rank in the best or worst 10 percent on at least two of their three dimensions of quality. 
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New Report Sheds Light on How Assisted Living 
Properties Charge for Care

Until the recent publication of the "2006 Overview of Assisted Living," a major research initiative jointly undertaken by five organizations serving this market, there was no representative, national study of how assisted living properties charge for care in support of activities of daily living (ADL). In the early days of the assisted living industry, most properties had an all-inclusive rate, but by the mid-1990s many properties started to implement tiered levels of care above a base level of care. 

The research report is a collaborative effort of American Association of Homes and Services for the Aging (AAHSA), Assisted Living Federation of America (ALFA), American Seniors Housing Association (ASHA), National Center for Assisted Living (NCAL), and the National Investment Center for the Seniors Housing & Care Industry (NIC) 

Using a sample of over 1,000 properties, the report provides a close look at how assisted living properties charge for their care. While there are some differences depending upon whether the property is freestanding or part of a combined property or CCRC, the overall breakdown is fairly consistent across the types of properties, except for freestanding dementia care properties: 

Properties Offering One All Inclusive Rate - 22% 
Properties Offering A La Carte Care for Fees - 16% 
Properties with Tiered Pricing Above Base Rate - 51% 
Properties Charging by the Hour or Other Time - 3% 
Properties with Other Types of Plans - 8% 

While the tiered levels of pricing represent slightly more than half of all assisted living properties, properties offering one all-inclusive rate represent just over 1 out of every 5 assisted living properties. However, in freestanding dementia care properties, those offering an all-inclusive rate for care represent 56% of all payment plans. 

Among the data revealed in this study: 

• Community Type and Unit Mix -- 32% of responding communities are freestanding assisted living; 24%, assisted living and dementia; 17%, continuing care retirement communities; 13%, combination assisted and independent living; 8%, combination assisted living and nursing facility; and 5%, freestanding dementia. 
• Occupancy -- Median occupancy in freestanding assisted living is 95 percent. 
• Resident Demographics and Activities of Daily Living (ADL) Needs -- The median age of female residents is 87, the median age of males is 85. Residents' median annual income is $15,668. Average ADLs: 2 
• Services -- 97% of freestanding assisted living communities provide three meals per day in basic rates; and 40% provide assistance with ADLs in basic rates, while 60 percent provide assistance with extra charge. 
• Staffing -- The median number of full-time-equivalent employees at responding communities is 25.

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