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Episode 103: Lynne Katzmann

Juniper Communities founder Lynne Katzmann addresses ageism, changes in healthcare and Burning Man.


Lucas: Welcome to Bridge the Gap podcast with Josh and Lucas. We are at ASHA in California on a beautiful day and we have an amazing guest. We have Lynne Katzmann of Juniper Communities on the show today. Welcome. 

 

Lynne: Thank you. Thank you. I’m thrilled to be here.

 

Lucas: Yes, yes. And we’ve been talking about this for a while, so you’ve been on our bucket list to sit down with and you’ve been very gracious of your time. So there’s a couple of things we’re going to dive into today. Number one, a huge congratulations on you’re going to be inducted into the ASHA hall of fame.

 

Lynne:Amazing. It is a huge honor and I am overwhelmed by it, I have to say, yes. 

 

Lucas: And ASHA is a fantastic organization and they just started that a couple of years ago and we can’t wait to see that take place. And we’re going to talk about the way that you’ve gotten your start in the business and how you run the company. But before we dive into those specifics, give us your background because you’ve been in this business a little while.

 

Lynne: Just a little while.

 

Lucas: How did you get here?

 

Lynne: How did I get here? So I started Juniper 30…1988, so it’ll be 32 years. This year. Amazing to think about that. I was to actually 2, I was 32. I was 32, but I came to it in a very interesting way. So I’m a nerd. I’m a total policy wonk by background. And I did a doctorate in health economics at the London School of Economics and my dissertation was on the German sickness insurance system between 1883 and 1902. So let me explain to you why that’s important. So the Germans had a healthcare system that was employment-based, funded in part by employees and employers and worked very similarly, at least in general structure to what we have here. So when you look at national health systems, the Germans have a system, which is probably a good example for Americans.

 

So I studied its infancy and how it was organized. So there was relevance to what I studied to what I’m doing now. From there I was hired to go in to Oregon. I was hired to write a state health plan. Now this is 1981 ish. And in that period of time, nobody was talking about national health insurance in the US and there was a gentleman by the name of Don Clark who was planning to run for governor. He was the County Executive of Multnomah County, which is where Portland is located. And he had this notion that if you took the money that was dedicated to the county hospital that provided most of the care for people without money, and you took that money and you enrolled to used it to buy private health insurance, that you would have a system that provided a social leveler but also was cheaper and he needed to do that and it was going to be part of his platform for running for governor.

 

Anyway, I was hired as a team, part of a team of four people because of that background to do that and we developed a program which I’m proud to say initially was not well received by the medical establishment, but most of it’s been implemented in one way, shape or form since then, so it’s a great honor. I was at a dinner party, I was part of a group of advocates for the medically needy, do you know what the medically needy is. It’s a group of people who don’t qualify for Medicaid because of their income level. Just a little bit too wealthy for Medicaid and states have the option to expand their Medicaid program to cover them. And so I was part of a group that was trying to do that in Oregon and there were a number of wonderful individuals on that who were advocates for people without health insurance for people who needed more help in society.

 

One of them had a son who was coming to town with his new wife. They were not of the same age, but I was the right age. So I was invited to a dinner party. Anyway, to make a long story short, this individual’s grandfather on the other side of the family held a controlling interest in a public healthcare company, traded on the American stock exchange, and we hit it off. And the next day I was asked if I would move to New York to help him. And he worked, his grandfather owned the majority interest in the company and he was heading up the board of directors, would I worked directly with him to help increase the value of the company and to run it. So ok, 20-something being asked by this wonderful individual who happened to be a geologist to move across the country to help run a public healthcare company.

 

Big opportunity, nothing about long term care. Remember him about policy wonk who’s done HMO development, worked with Medicare beneficiaries and wrote a state health plan. So, you know, we’re talking very different. So I get to New York, long short, that company’s name was Metro Care. We had retirement communities in Florida and a number of skilled nursing buildings across the country. I learned the business very quickly and that company, we sold it two and a half years later after, by the way, starting one of the first, the largest PPO on the island of Puerto Rico. So we did a joint venture with Baxter Travenol, which at the time was the largest employer and began a PPO, which today I should tell you, is the largest managed care provider in Puerto Rico and has 40,000 members. Very profitable. Too bad I don’t still own it. Anyway, so we did that. We sold the company, we doubled the value, it was taken private, and after a short period of time and I left and formed Juniper. So that was the beginning.

So I had a background in long term care. I knew something about operations and something about finance and wanted to make a difference. I believed that we could do that, that people needed to look at our industry differently, that we needed to look at aging differently, and I’ve been very influenced by a philosophy which simply doing well by doing good. And it’s about double bottom line. And now people talk about the triple bottom line and even the quadruple bottom line. But it’s about saying that you gotta make money, but you have to be careful and caring about what you produce and how it impacts people. And I live by that. I’ve always lived by that. That’s always been the value that the values that have under pinned everything we’ve done at Juniper. It’s our foundation and it served me very well. So I can tell you a lot more about how that played out in terms of financing Juniper and how it’s built our culture. But that’s enough of a start. Don’t you think?

 

Lucas: We want to dive into that. But I know my buddy over here has got some classes about…

 

Josh: So I’m just fascinated first, thank you for sharing. I think a lot of people don’t get to hear that background. I’ve heard you speak a number of times, so I appreciate you sharing that with us and with our listeners. But let’s talk a little bit and start the journey of Juniper because I can only imagine in like a 30-year history of a company that you had this vision, you started Juniper. How has the mission and the company evolved over these years? Like where you started from to where you are now, kinda hit the high point.

 

Lynne: Sure. So, you know, in 1988, assisted living really wasn’t a product type, nor was standalone memory care by the way. So basically the world was sniffs, skilled nursing. And so when Juniper started, and that’s what I knew. I knew how to run nursing homes. I knew how to finance nursing homes and that was our original start. So Juniper started with a skilled portfolio. We essentially we’re a private REIT so we were not operating directly at that point in time. We were buying properties that were undermanaged. You can figure out what that means, that were inexpensive that we could put our equity into, lever up. Our operating strategy was to lease them on a triple net basis, just like the REITs due to qualified operators, regional operators that had small portfolios that could turn the buildings. The goal was that they would pay us rent, but because the property, the value of the property was low, they would be able to, with their improvements, accrue enough cash to buy the properties from us.

And they did. We bought a portfolio in 1990 and we sold it in 1994 and did very well for investors and the operators bought it from us. So that all worked well. In the mid nineties, assisted living was coming into its home and assisted living concepts. As you may recall, when public in 1994 and it was a very interesting new product type. We bought some buildings and converted those buildings to assisted living and then decided that probably there would be a new product type and that we should build from the ground up. So we designed a number of buildings. They essentially fell into two categories, stand alone memory care. We did one of the first small house models and I’m happy to talk more about that. That was very exciting. We didn’t call it that at the time, but we did that and I’m very proud of that effort.

 

We also designed and built some fairly upscale assisted living communities and those were fun because those were also built to lead prototype standards. So, interesting. You go back, now we’re talking 1990s, mid 1990s, we all think green all the time, but green wasn’t the thing that point in time. So one of my colleagues at Juniper he said, Lynne, we take care of people. We need to take care of the environment. I said, right. Isn’t this enough? And shouldn’t probably talk about that publicly, but that’s what I said and I said but I’m gain if you’ll take the lead. And so he went out and he researched the city of Austin green building standards and then the city of Denver did it. And anyway, we built our first two buildings to those standards and then came lead and lead had a prototype program before there was silver, gold, etc.

(12:04):

There was a prototype program and our building in Chatham was built to those prototype standards.

 

Josh: Wow. So can you tell me, I was fascinated and intrigued to hear more about the small house model because it, it seems like that is still something that, you know, people are trying to sometimes figure out a little bit, but I’m sure at that point in time that was something no one was doing, especially not freestanding memory care at that point.

 

Lynne: It was there were not many of those built at the time.

 

Josh: So what does that model about?

 

Lynne: So that model is not a cottage model. So, you know, there are a couple of different ways of looking at small house models. In some cases, like the green house model is probably one that most people are familiar with. They are standalone buildings and often grouped as a number of standalone buildings on a property and they have a group of residents 10 to 14 typically that are in each household and staff that are there.

 

We decided that that was not an a very, well we did and at the time, we didn’t think that that would be efficient. So what we did is we built four houses that are connected. And that have public space in the middle. And that model, those buildings still exist. We still operate them. They’d been great and I would build them again. So what happens is you’ve got four houses, they have 14 people living in each, but they’re all interconnected. So they’re standalone, they’re separate. You have community in each of those. And yet your staffing is manageable. Providing food is manageable. You can provide activities because the staff can be shared when you have a cottage model. That’s not the case we found in when we did, so that was the genesis of our small house model four 14 person houses that were linked by common space, which was in the middle and it was extremely effective.

 

Josh: Fascinating. So somewhere in there, I think I heard you all went from a REIT model to developing. And was it at that same point that you decided you were going to start operating your own communities? Okay. 

 

Lynne: Thank you for pointing me back to where I should have been at the beginning. So we went from skilled to assisted living. We went from acquiring to redeveloping existing buildings to new construction about the same time. So we did the development work. So we formed a company that did that and we realized a couple of years later that it was more and more difficult as our portfolio grew, defined operators who were in line with our vision and that would work with us in the way we needed to work. And so at that point, we formed our we took the development company and expanded it to having operating base, and by 2000 we operated all of our buildings. So yes, we went from a financial model to a combination of owner operator. We’ve since sold a couple of our properties to a REIT. We operate those and we actually are doing some management work as well. So we’ve come the full spectrum from sniff to memory care. We now have IL and a campus model CCRC and we’ve gone from being a financial model to owner-operator and operating our entire portfolio.

 

Josh: I can only imagine the growing pains through those years.

 

Lynne: You know, at the time, every challenge has not only a solution but an opportunity associated with it. And so at the time we formed our operating company, we couldn’t find enough operators. And so we really believe that we could do it well. But yes, there’s tons of, you know, it’s their business cycles and we’ve dealt with them. We’ve had ups and downs. You know, one of the things you should know is that my core team, many of them have been with me, not the full 30 years. There are a couple who have, but the majority of my core leadership team have been with the company at least 15 years, the majority of them over two decades. So we’ve grown up together, we’ve learned together and we’re different people who have learned how to collaborate and, and everything that we are as due to them. They are really great.

 

Lucas: Yeah. And so you kind of answered what my next question was going to be, but that’s such a remarkable thing. And I think that you find that in this industry, and you’ve probably seen it over the years. Why do you think that people stay in this industry for so long and are so loyal to this commitment to care?

 

Lynne: You know, I think people have, people have purpose, need purpose. And I think that our industry offers individuals a means to not only work and make a livelihood, but to do so with purpose. And I think for those people who need purpose and have a deep sense of personal mission to serve, it’s a great industry. It’s really a great industry. I think one of the things that’s really been great at Juniper is that we’re a small company. We’re flexible, we’re innovative, and so people could learn new things. So they have an opportunity to grow as the company grew, not only in size and in terms of what did, but we’re very flexible. If you’re a finance person, you want to do some ops, we’ll find a way to make that happen. And we’ve done that in many different situations, so people have growth opportunities.

 

Josh: So Lynne, switching gears a little bit here, but so you’re known as an innovator in the industry. You’re known as someone that is going to get it done. You’re going to find a way to get it done. Can you just explain to us a little bit about what’s next? What are you working on now that you feel like is going to be something that is not only gonna help Juniper grow, but help the industry to serve as an example?

 

Lynne: Yeah, so let me talk about, I talked about the green stuff, right? So we were somewhat ahead of our time. So I was really naive about it. I thought if he did green, you had to do everything green. I think I’ve aged a little bit. I’ve grown wiser with that aging process and I don’t believe that you do have to do everything in order to make a difference. As in green. You can recycle, you can compost, you can do local stuff, you can do energy efficient lighting, but you don’t have to do everything to say you’re green. It’s a process. It’s a journey. I think at Juniper, our second major place where we innovated is in care model. So care model is how you deliver care and service to your residents. When the Affordable Care Act was put into effect, which was in 20, well it was voted in in 2010 in March of 2010.

 

Most people were very worried about the individual mandate and being forced to have health insurance. But what was really interesting is within that law was a small criteria that hospitals were going to be measured based on the number of people who were readmitted within 30 days for certain diagnosis called hospital readmission penalties. And that has fundamentally changed the operating paradigm within the healthcare sector across the board. Could go into that in more detail. But my point is, is that we looked at that and we said, okay, our world is going to change. How are we going to be a part of it? What is it with our residents that will need to change? There was something that was talked about as part of that process called care transitions and care transitions through essentially managing someone’s transfer from one place of care, one provider to another.

And what the government said was, Hey, we think that where things go wrong is in that transition. So we want everybody to do it better. We realized at Juniper that if that was one of the goals, we should take a look at it. And when we did, we understood that what goes on in senior housing is essentially managing care transitions anyway. So we do assessments, we monitor them. When someone goes to a hospital, we have to know what kind of meds they’re on. We have to set up the follow-up appointments. We were doing everything that was associated with care transitions already. And at Juniper, we were doing a couple of other things, things like consistent assignments we were using interact. And what consistent assignments are is just making sure that the same caregiver is working with the same residents on a consistent basis. Why?

 

Because they get to know them. And why is that important? Because they can see when something changes and it’s that change, acknowledging the change and then intervening quickly, which means that in many cases you can avoid the need for higher acuity care. And that’s what saves money. And that’s what care transitions does. So we had all of that in our system and we simply began to talk about it. And at about the same time, we went electronic, we made a decision to have an electronic operating platform. So all of our data was accessible. So what we were doing to manage those care transitions was to print data, real time data about a resident and we put it in a little plastic envelope, your health information from Juniper and we would send it when they went to a doctor or hospital or another level of care, it was hugely successful and we realized that we could share that information among greater number of providers.

 

So all of the providers, ancillary providers who are onsite: pharmacy, rehab, home care, we said, okay guys, you need to enter data into our systems so that we can make that accessible for folks. And frankly that was the beginning of what we call “connect for life”, which is the next major innovation that we are well known for and that’s an integrated care model. What that says is that we understand that people, particularly elders with or older adults with chronic illness need a lot of attention and why do they need attention? Because they need to make sure their meds are correct. They need to have proper nutrition, they need exercise and somebody needs to monitor that all those things are happening. Because if those things happening, the chance of them falling or missing a med and having an incident and ending up in a hospital is smaller.

 

So that was the beginning of connect for life electronic health record. We then added what we call a medical concierge, which is a navigator and began to talk about the program. We knew we had something, our length of stay was longer. It was very exciting. We were just really energized by what we were able to do and how important we thought it could be. So we asked Ann Tomlinson to do a third party review evaluation of our program and she found that our hospitalization rate was half of a similar profile population living in the community. So connect for life was our second major innovation. We’re now working on a theater program and musical theater program and what’s coming next is going to be a new model of community based programming.

 

Josh: Fascinating. So I want to just chase a little bit of a rabbit here. But not derail the conversation. But we have a very wide diverse audience of providers of operators. And I think about, you know, the listeners that might be part of regional platforms, the large national platforms and then we have friends and listeners that we get a lot of feedback of that are one community, two or three. I think they’re feeling very crunched and overwhelmed in this future as our industry is changing. Is there a spot, is there a place for these, what we sometimes refer to is small owner operators or mom and pop type communities where they can still be relevant and impact in their neighborhoods, in their communities, the quality of care and these care transitions and do some of the cool and exciting things that Juniper is leading the way on implement some of that. Or do you see that this is going to where you have to have such an economy of scale to be able to do those kinds of things?

 

Lynne: Well, you know, I think partnership is very important and I think, can you do it alone in all cases? No. But can you be part of other, as small a group of other small operators coming together? I think the answer is yes. So I am very positive about a future, but it’s not a future shaped in the same. It’s not going to look and act the same way it does today. People have to change. They have to view collaboration differently. Instead of seeing people as competitors, we need to work together to provide services and kind of divvy it up. So I do see a future for people. You need to think there are a couple of things that are really critical. Mindset is critical. We live in a rapidly changing environment. You know, I have been talking about that for a long time. It’s not just technology, it’s the affordable care act. It’s changing how we operate. We’re an outcomes oriented business now. It, you know, fee for service medicine is about how much you can do because every service you do, you get paid for it. Now it’s, we don’t work on that basis. It’s not how many services you provide. It’s what is it done and prove your outcome. That requires a different mindset. It’s a very different way of doing business.

Innovation requires the ability to accept change. So you need to be able to accommodate a changing environment to be able to look at it positively and to be solution oriented. And I believe you have to be willing as a small operator just as we’ve done with perennial consortium to acknowledge that you don’t have the scale and that you can’t do it alone and to find others who are like minded, hopefully high quality and we’ll work together with you.

 

Lucas: I have so many questions I’m going to try to distill. We can go so many different things. So you have been around in the boom of the 90s when the industry really started to change and shift into assisted living, independent living. So we just turned the corner now into a new decade, 2020. 2020 to 2030 I think is what I’ve been seeing and reading and I think everybody knows it’s going to be a wild ride. The demographics, what do you think are some going to be some of the biggest shifts and changes over the next decade in our industry?

 

Lynne: I think what, I think they’re going to be several physical plant, physical plant that worked the legacy physical plant and I had many of those buildings either have to be substantially renovated or they’re not going to be viable into the future. I think people are looking for larger apartments, personal living spaces where they can afford them or not is a different story, but you know, the old 300 square feet – not going to cut it in the future. The new consumer wants something else. Public spaces, how those are used, how flexible they are, what they’re used for, who uses them will change. So physical plant I see is changing dramatically. Care – I do believe that some of the…we will be an important part of the care continuum, which we’ve not been in senior housing in the past. I think we can do the chronic care management, which people acknowledge as being important, but they haven’t seen us as being part of the solution.

 

I think that will change. I think that’s going to come into its own. I’d like to think that we are in control of our own destiny. That’s why I’m forming perennial and doing Medicare advantage because I think we have to control the healthcare dollar in order to show people what we can do. There are many other ways of playing in Medicare advantage, but I think for our industry, that’s the critical component. So care is the second piece. And I think the third is programming. You know, I’m a boomer. I’m not quite ready to move into my buildings, but when, and if I do, I want to live in the community. I don’t want to live in a segregated outpost at the end of town. I want to be where there are people and not just the occasional brownie troop that comes in and sings and dances.

 

I want to take aquatic fitness classes with other people from the community. I want to go to a gym, which doesn’t just have people that look like me and I want to be able to do work with them. I want to be part of a theater program. I’m a nerd, so I want education. And I want it to be really cool education. I don’t want it to be somebody talking about current events. So the program model will shift and I believe it’s going to move to a model which integrates the programs that exist in the community today with those that we run in our communities. So instead of doing everything for our residents and occasionally inviting someone from the outside, we’re going to have to shift that model. So programming has to change. A physical plant has to change the way we deliver care and service has to change. And frankly, the way we message has to change. And I think all of those are huge, huge buckets in and of themselves and going to be challenging for all of us. But I think if we come together and approach them in a positive manner, in a collaborative solution oriented manner, we can make the headway we need to make.

 

Josh: What, what takeaways? Right. Well, thank you for sharing that. And I know your time is very limited, but we’ve got to wrap it up with a couple of things. You’re a self proclaimed nerd. You’ve said that. We did not say that. You said that. And we know you work hard, but we also know you play hard. Right? And you’ve done, yeah. So we’ve heard you’ve done some pretty cool things, not only yourself but with your communities, your residents, andthe things. Give us some highlights.

 

Lynne: Okay. You want to talk about Burning Man? I know, I know. I know.

 

Lucas: The reason why we want to talk about is ‘cause we want to go with you.

Lynne: I’d love it if you came. So we went to Burning Man a couple of years ago and it started because I gave a Nick talk and I was talking about ageism and how we needed to address ageism as one of the root causes of what I think our problems are in our society. Anyway, not go in there at the end of the speech you have to have some that call to action. So I thought, okay, what am I going to do? And then I thought, well what if we were to do something totally unexpected? And a colleague of mine, we were driving in Colorado and it was about the time Burning Man happened the year before.

 

Before I gave that talk and NPR was talking about Burning Man and she said, I really want to go. And I said, well, I’ll go with you. And it started from there. So that became the ask. I invited anyone who wanted to come to Burning Man from the industry to join us. We did have a couple who took us up on it, but fewer than I had hoped. Juniper organized and paid for our Burning Man excursion. We joined a camp, our camp’s name was “Aging Insurrection.” We ran programs for the community. We had just under 30 people in our, that ranged in age from 26 to 88. So it was great. So I’m happy to share pictures. They would be, you know, Burning Man’s hugely incredible environment. But it’s tough. So it’s a giving society, so there’s no money involved and it’s a huge social experiment.

 

So 75,000 people come together and learn to get along. And so you know, to see old people and young people come together there was wonderful, to see the older adults in our group, one of whom happened to be my mother just blossom in this really unlikely environment. So you know it’s hot, there’s dust dorms, they are naked people. There’s all kinds of things going on. But it was just marvelous to see how people really blossom when there’s an environment where they can socialize, where it’s acceptable and where they can be themselves. So Burning Man was the best.

Josh: We will be waiting on an invitation. So it just takes a lot of planning.

 

Lynne: Will you guys do the planning?

 

Josh: We will help. But you’re a pro, you’re a seasoned pro now you’ve got to lead the charge.

 

Lynne: My team is seasoned pros.

 

Lucas: You want to go with the tour guide to something like that? Well so maybe the future of intergenerational and senior living is a model that we can adapt from the experiment at Burning Man. 

 

Josh: It sounds like we can learn a few things. Yes, absolutely. And I’m sure you did. So thank you for sharing that with us. That’s amazing.

 

Lucas:  Lynne, an amazing career that is far from finished and you are being inducted into the ASHA Hall of Fame. Talk to us about what that’s going to be like.

 

Lynne: You know there are so many worthy people in this industry. There are so many interesting, energetic, creative, capable, experienced successful people in this industry. I’m just overwhelmed that they’ve asked me or they’ve offered me this honor. So you know, there’s a part of me that is extremely grateful and honored and humbled by it. And I guess humbled is a key word here because I think there’s so many others who are equally deserving. So I’m very excited to do it. I want to tell you something. My son who is 25, is in the industry and my son will be introducing me and inducting me tomorrow so for me it’s a total life cycle event.

 

Josh: Get the Kleenex is ready, right?

 

Lynne: Yeah. Well I don’t know about that. Hopefully everybody will be laughing, but you know, when you have been in the industry as long as I have, legacy is really important. If you’re kind of person that I am. So it’s not just leaving a legacy to the next generation, but it’s doing something of import that benefits the people we serve. And that’s what it’s all about. So I’m honored and you know, I hope I can live up to it.

 

Josh: Oh, what an amazing honor. So deserving and thank you for giving back. Thank you for putting a mark on our industry and our space. Thank you for spending time with us and being so candid and transparent. I know our listeners are going to love this and they’re probably gonna be sending us a lot of feedback and asking a lot of questions. So don’t be surprised if we’re asking you some more questions.

 

Lynne: I’m excited.

 

Lucas: Absolutely. I mean, you, you’re the kind of person, you’ve probably been on countless boards. You’ve, you’ve helped ASHA, you’ve helped NIC, you’ve probably helped every organization and be a part of kind of the tide that rises all boats in the industry. You really appreciate what you’re very kind. 

 

Lynne: That’s a, that’s a huge compliment and I’m deeply grateful to you for having me be part of your show and for your life’s words.

 

Lucas: Thank you so much. Well, it’s the truth. And so we’ll make sure that we connect with Juniper in the show notes and ways to connect with you and your organization. Go to BTGvoice.com for all the information about our social media sites and connect with us there. And thank you for listening to another great episode of Bridge the Gap.

Thank you to our supporting partners NRC Health, OneDay, TIS, Morrison Living, Argentum, Solinity, and The Bridge Group Construction. 

Episode 103: Lynne Katzmann