ABHOW Words Sharing Our Stories - Sitemason, Inc. · reflected on the many storms the company faced in the past, and those he somehow knew lay just beyond the horizon. Weathering

Continued on page 2

One day last July, former ABHOW Presi-dent Dr. Richard Ice was asked to sum up the challenges of running a senior

living and healthcare company in today’s increas-ingly complicated, competitive market.

“Tough,” Ice said emphatically. Then, smiling, he added, “Why do you think I retired?”

Weeks before ABHOW and other senior living providers across the nation learned that unprecedented Medicare cuts were on the way, Ice reflected on the many storms the company faced in the past, and those he somehow knew lay just beyond the horizon.

Weathering the StormMarina Orobinskaia, RN, takes a moment to chat with a resident at Judson Park.

VOLUME 13 • ISSUE 9 • SEPTEMBER 2011

Page 4 Affordable Housing Milestones

Page 6 Program Gives Hope to Local Youth

Page 9 Company Scores on Resident Stories

ABHOW WordsSharing Our Stories

ABHOW WordsSharing Our Stories SEPTEMBER 2011 2

Indeed, today the company faces one of its biggest storms yet in the form of an 11.1 percent reduction in Medicare reimbursements for residents receiving skilled nursing care. The Oct. 1 cuts will further test a company already buffeted the past few years by an ail-ing economy and falling home prices.

The man who succeeded Ice some 16 years ago says the cuts – much steeper than anyone expected – will

Weathering the Storm Continued from cover

sting, but they won’t change the company’s exacting standards on resident care and services.

“Fortunately, we’ve established efficient systems for the delivery of care and services and built reserves such that we can react to these cuts without lower-ing our standards,” says ABHOW President and CEO David Ferguson.

Still, Ferguson said some impact is sure to be felt at The Villages, ABHOW’s skilled nursing centers located among each of the company’s 11 continuing care com-munities. The challenge for skilled nursing adminis-trators and caregivers, he said, will be to find ways to provide the same level of care with fewer resources. It’s a task many of them have taken on before.

“The history of our business is we find ways to absorb these [government] cuts and still make it work,” Ferguson said. “But I do wonder why there’s never been an attitude of, ‘Let’s use a carrot to incentivize good providers.’”

It’s a question Joanne Handy has pondered as well. Handy, president and CEO of Aging Services of California (ASC), says the cuts unfairly target non-profit providers like ABHOW. The federal body that governs Medicare sought the cuts to recoup what it called ‘overpayments’ to providers who maximized billing codes for particular therapies.

“Nonprofits, to a very great extent, were not among the providers who were overusing those categories,” said Handy, whose organization advocates on behalf of California’s 400-plus nonprofit aging service and healthcare entities.

Continued on page 3

A nurse checks a resident’s temperature at ABHOW’s Judson Park in Des Moines, Wash.


“Medicare was aware of the loophole for some time and did not close it, and now it’s a year later and the many are paying for the sins of the few, quite frankly,” she said.

Industry leaders agree that for-profit providers will fare worse in the wake of the cuts, in general, than will nonprofits, primarily due to their corporate gover-nance, fiscal management and capital financing struc-ture. For-profit providers are more reliant on Medicare

billing than nonprofits – again, generally speaking – and over the past year or two, a growing number have taken advantage of Real Estate Investment Trusts (REITs) as a means of raising capital.

Essentially, REITs allow a senior living provider to sell a particular property to raise cash, and then lease back management of the business. Many of these providers were already dealing with rent escalators that came as part of the deal. Now they’ll have to contend with drastic skilled nursing cuts, too.

So what does this mean for California-based pro-viders – for- and nonprofit alike? About $485 million in 2012 alone, according to an analysis by Avalere Health, LLC. The national healthcare policy group estimates total losses of $79 billion over 10 years for providers nationwide. The study doesn’t address the human costs, which remain to be seen.

Alan G. Rosenbloom, president of the Alliance for Quality Nursing Home Care, which financed the Avalere study, said his group is confident that the cuts, over time, will “hurt our ability to admit, treat and return to home a rapidly increasing number of patients requiring intensive post-acute rehabilitation.”

It’s a concern echoed by Handy, who says, “I’ve never seen this type of cut before, ever. And the real-ity is, there are fewer and fewer places to go where

Medicare is paying the full cost of skilled nursing care oriented to rehab services.”

Here, too, ABHOW’s nonprofit status and

mission-based principles combine to offer continu-ing care residents some peace of mind, owed to the ABHOW Foundation’s assurance of benevolent support for those who lose their economic footing through no fault of their own.

As he lists the reasons that ABHOW will weather the coming storm on Oct. 1 – size, strength, and structure among them – Ferguson pauses to reflect on the wisdom of his predecessor, Ice, who once com-pared ABHOW to a large ship fully capable of sus-taining its momentum.

“His words remind me that ABHOW and our residents have faced many storms over the years, and were it not for our momentum, we might easily have been blown off course,” says Ferguson. “Together, we’ll keep moving forward.”

Weathering the Storm Continued from page 2

“Together, we’ll keep moving forward.”– David Ferguson, ABHOW President and CEO


Affordable Housing Milestones

Continued on page 5

With new developments like Valley Vista in San Ramon, Calif., ABHOW is proving that affordable housing can be as appealing as it is functional.

Ancel Romero didn’t recognize the resident who approached him at an ABHOW affordable housing com-munity’s recent grand opening, but the man remembered him. And he wanted to say, “Thank you.”

As they talked, Romero, the company’s senior vice president for affordable housing, realized the man was a family friend he’d known years before. The man had been wealthy when Romero knew him, but his for-tunes had turned. He was living in his niece’s garage when he applied, and was accepted, into the ABHOW community. Having an appealing and comfortable place to live, he said, was something he thought he might never have again.

Romero, who today oversees 27 communities, has heard such accounts time and time again.

“It is the stories that keep me going,” he says.

Indeed, it is such stories that keep ABHOW going. ABHOW can be proud of the quality of its continuing care retirement communities that serve those who can af-ford a graceful lifestyle and the availability of assisted liv-ing, skilled nursing, and in many CCRCs, memory care and support. But the company is equally proud of the secure and well-tended housing provided through the affordable housing program to people 62 and older who make less than 50 percent of an area’s median income.

The CCRCs and the affordable housing communi-ties are two wings that carry ABHOW’s mission to pro-vide seniors with quality housing in safe communities.

“When we talk about enhancing the independence, security and well-being of older persons, that doesn’t say anything about having to be affluent,” Romero said. “There’s a huge need [for affordable housing] that hap-pens to jibe very much with our core identity.”

While ABHOW’s mission links its retirement com-munities and affordable housing communities, their funding is very much separate. CCRC residents pay for care and services through an entrance and monthly service fee. Affordable housing communities are sub-


Affordable Housing Milestones Continued from page 4

sidized by federal, state and local funding, and invest-ments by corporations seeking low-income housing tax credits.

The various government agencies and investors align with ABHOW’s principle that the funding be-hind affordable housing communities be transparent. Romero says revenues from ABHOW’s continuing care retirement communities do not support affordable housing “in any way, shape or form.”

Meanwhile, the sources that do subsidize affordable housing, primarily the U.S. Department of Housing and Urban Development and local redevelopment agencies, are slashing funding in response to federal and state budget cuts even as a weak national economy increases the need.

“There are threats from all over. It’s a perfect storm,” Romero says.

The need for more affordable housing for seniors is apparent with the opening of each new afford-able senior community. In April, ABHOW opened Valley Vista, a 105-home apartment community in San Ramon, Calif. It filled quickly and has 365 people on its waiting list. In May, ABHOW opened Salishan Gardens, a 55-apartment community in Tacoma, Wash. Again, the apartments filled with another 250 people on a waiting list.

The need is great and getting greater. Members of the baby-boom generation are entering their retire-ment years just as the bursting of the housing bubble and a faltering economy have cut into their assets and income.

ABHOW is responding. In the past decade, its af-fordable housing communities have grown from 12 to 27. ABHOW now offers 2,000 apartments for low-income and disabled seniors. The number will grow, Romero says, as ABHOW builds new communities or takes over the management of existing ones.

Dianne Spaulding, executive director of Non-Profit Housing Association of Northern California, says the nation’s demographics show the coming of what’s been called a “silver tsunami” of retirees, many of whom will need housing assistance. She credits ABHOW’s efforts to meet the coming wave.

“We need to be prepared for that, and to keep people housed in a stable and respectable manner,” Spaulding says. “ABHOW, in that regard, was way ahead of its time.”

Spaulding added that she could see ABHOW be-ing “a group that many affordable housing developers could look to for best practices.”

Many of ABHOW’s affordable housing commu-nities include unexpected amenities. Most include bistro areas for coffee and conversation and vans to take residents to doctors and shopping. The ABHOW Foundation’s annual charity golf tournament helps cover the cost of other services and amenities.

Spaudling says ABHOW does more than provide shelter for seniors in need – it provides quality of life.

“ABHOW knows how to provide what we call ‘ser-vice-enriched housing,’” she says. “You can’t just house people. You need to provide a whole experience and surround them with the support services they need in order to age in place with dignity and grace.”


Program Gives Hope to Los Gatos Youth

The Terraces of Los Gatos now employs six teenagers from TeenForce, a Silicon Valley nonprofit.

Continued on page 7

Alex Candalla is always looking for ways that his Los Gatos, Calif., continuing care retirement commu-nity can reach beyond its walls and do some good – for young people in particular.

Candalla, executive director at The Terraces of Los Gatos, says he has long dreamed of being able to help teenagers in foster care.

“I had read and heard about the challenges these young people meet when they age out of the system,” Candalla says. When he received a phone call from John Hogan, founder and CEO of TeenForce, Candalla knew he had found a way to execute his vision.

For Hogan, it was merely business as usual. He was simply calling Candalla to in-quire about employing teens at the ABHOW community. Up until that point, the Silicon Valley nonprofit TeenForce had been equipping young peo-ple ages 13 to 20 with work readiness train-ing, skills development and job placement.

Candalla explained his interest in the foster care system and made his case: He would employ teens from TeenForce if he could build a foster youth jobs program.

“We want to reach out to these teenagers and pro-vide them with training, a place to work and valuable experiences they can use in later years,” Candalla says. “We care about mentoring our employees and nurtur-ing their careers in the health care field, and this is a great way to serve and connect with our community.”

The Terraces of Los Gatos and TeenForce imme-diately joined forces with EMQ Families and Silicon Valley Children’s Fund for help in identifying and sup-porting foster youth.

After extensive training, The Terraces of Los Gatos now employs six teenagers in various departments – five


Jobs Program Gives Hope to Los Gatos Youth Continued from page 6

of the teens were formerly in foster care. The group has logged nearly 800 hours since starting their jobs in May.

Despite often tumul-tuous home lives and everyday challenges like transportation, Hogan says that the program has been a great success so far. “We’ve seen ups and downs for the kids, but we’ve been able to keep work as a constant and positive thing for them,” he says.

Elizabeth Larios, 18, says she feels much more inde-pendent since starting her wait staff job at the commu-nity in May. “I’m most proud of my attitude change,” Larios says. “I think I’m learning self-control.”

Candalla says that he has seen significant changes in all the teens’ demeanor and confidence.

“They are developing etiquette and skills for this work environment,” he says. “I really am delighted. There really isn’t another program out there like this.”

He hopes that his relationship with TeenForce will inspire other ABHOW communities to get involved,

especially given how nicely the program aligns with the company’s program of social accountability.

“Welfare systems seem to focus on youth safety and staying in school,” Candalla says. “Having a first job is a rite of passage, and what we are trying to do is to provide them a positive work experience, and the self-es-teem and relationships that are established through working here.”

To learn more about ABHOW’s commit-ment to social accountability or to view the 2010 Social Accountability Report, go to: www.abhow.com/accountability.

Alex Candalla is the longtime executive director of The Terraces of Los Gatos in Los Gatos, Calif.

“We care about mentoring our employees and nurturing their careers in the health care field, and this is a great way to serve

and connect with our community.”– Alex Candalla, executive director, The Terraces of Los Gatos


Memories of My One-Room Schoolhouse By Betty Bue, Rosewood

Betty Bue makes her home at Rosewood in Bakersfield, Calif.

My little one-room country schoolhouse still sits in the field down beside the modern elementary school that serves Madison, N.H.

Now this little school, which is over 150 years old, is being restored to its original form. It is painted red instead of the yellow I remember when I was a student there from 1928 to 1933. It is also a national landmark. At one time this schoolhouse was one of several such country schools in the rural town of Madison. My mother taught eight grades there in 1922. At this time, the school had been moved from its original site north of the corner to its spot by the three-room junior high/high school that occupied the space next door.

There were blackboards around two sides of the schoolroom, and world maps that pulled down from the walls over the blackboards. The boys and girls each had separate bathrooms at the back of the school, and win-dows graced one side of the building looking out over the playground. The teacher sat up front at her desk where she could keep a keen eye on her 25 students or so. No running allowed. The American flag was up front as well as a picture of George Washington. Every a.m. we saluted the flag and said the Lord’s Prayer. Part of the space up front had narrow blackboards, and there were two doors leading into the school through cloakrooms, where we went if we misbehaved. A wood stove heated the school — it was situated up front, and a metal stovepipe from the stove ran across the ceiling to an outside vent. One wintry day, the stovepipe fell down causing a lot of excitement and lots of dust — we were delighted with our unexpected day off from school.

Our desks were the old school desks and each stu-dent had his own desk — they were arranged in rows from front to back with a narrow aisle inbetween the rows. We stood in these narrow rows when we did exercises to a record on the phonograph. I hated these exercises, as I tended to bump my desk during the process — maybe that’s why I still hate exercise today!

We were taught to study independently and used workbooks with green covers a lot to keep us busy while the teacher was busy with the younger children. As we got up into the higher grades, the teacher would ask me to help out with the first and second graders — I felt resentful doing this — I didn’t like being sepa-rated from my classmates in the back of the room.

We studied geography one year and history the next year as fifth and sixth graders — this system worked very well and we were well prepared for seventh grade when we moved to the larger school next door.

After a larger elementary school was established in town, maybe in the early ’60’s, our schoolhouse was used by the library — my mother was the librarian in town until she passed away in 1969. I don’t know when the schoolhouse was moved to its present location — it still looks a little lonesome to me sitting down in the field to the west of the larger school, without any chil-dren marching in and out of its doors.

I’m glad it still exists today!


ABHOW team members put their care, commitment and compassion for seniors on full display every day.

Now they can give behind the scenes, too, thanks to a new payroll deduction program offered through the ABHOW Foundation.

The program is a simple, powerful tool through which team members make regular, tax-exempt con-tributions directly from their paycheck. Team mem-bers elect how much, and how often to donate. They can start – and stop – a payroll deduction at any time, and even dictate which community endowment, memorial fund and special project will benefit from their donation.

The ABHOW Foundation developed the program this summer at the urging of team members concerned about the impact of a prolonged economic recession on residents and the company. It officially launched in mid-August, weeks before an un-precedented 11.1 percent Medicare reimbursement cut was slated to take effect. Donations will help the Foundation sustain benevolent care for CCRC residents and ensure quality-of-life amenities for resi-dents in affordable housing.

That the idea for the program came from team members is something ABHOW Foundation President Joe Anderson calls “proof of what makes ABHOW exceptional.”

“It’s so inspiring to see our team members work as hard as they do, and at the end of the day, say, ‘I want to do more,’” says Anderson. “All it takes is a modest amount – any amount, really – to make a substantial impact in the lives of ABHOW residents.”

Just two weeks into the program, nine team mem-bers had already signed on, Anderson says. And given the number of calls Foundation staffers are fielding, that number is likely just the beginning of something much greater.

ABHOW team members can enroll for payroll deduction via an automated form on the company’s in-tranet site. For questions, email Lynette Giannotti with the ABHOW Foundation at [email protected].

Payroll Deduction Offers New Way to Serve


ABHOW, National and State Websites: ABHOW: abhow.com LeadingAge: leadingage.org Aging Services of Arizona: agingservicesofaz.orgAging Services of California: aging.orgAging Services of Washington: agingwa.org

“American Baptist Homes of the West, as an expression of Christian mission, seeks to enhance the independence, well-being

and security of older people through the provision of housing, health care and supportive services.”

Published by the Strategic Planning and Communications Department Kay Kallander, Senior Vice President e-mail [email protected]

6120 Stoneridge Mall Rd. 3rd Floor Pleasanton, CA 94588 phone: 1-925-924-7150 toll-free: 1-800-222-2469 fax: 1-925-924-7232

Sign Up for ABHOW E-News

at abhow.com

Awards Recognize the Power of Resident StoriesABHOW residents are some of the

most interesting people on the planet. Sharing their stories has been a privi-lege and a joy for more than 60 years.

Each month, the stories jump from the pages of ABHOW Words – tales of remarkable achievements, everyday journeys, surprising passions, and inspiring legacies. And once again, those stories are drawing at-tention and praise on a national stage.

For the second consecutive year, the company is be-ing recognized by the National Mature Media Awards. The annual competition stands as the largest awards program recognizing the best in communications and marketing for adults 50 years of age and older.

This year, ABHOW, together with longtime com-munications partner Signal Hill, won four awards for writing and one for photography. Each award-winning story explores the impact of resident involvement on ABHOW’s senior living communities, as told by the men and women who are making a difference in their

community and living life on their own terms.

“These sto-ries don’t define our residents, they illuminate them,” says Kay Kallander, senior vice president for strategic planning. “For ABHOW, shar-ing our stories is a fundamental way of conveying the company’s goals and missions. And who better to tell that story than the people who make their home and their life with us?”

The win isn’t the only measure of success derived from these stories, Kallander said. Signal Hill’s com-munications, branding and public relations work has helped position ABHOW nationally as a trusted leader in the field, elevating the company’s innovative ap-proach to optimal aging and lifelong well-being.

The story “Communities Model Green Living” won top honors at this year’s National Mature Media Awards.

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ABHOW Words Sharing Our Stories - Sitemason, Inc. · reflected on the many storms the company faced in the past, and those he somehow knew lay just beyond the horizon. Weathering