Starting a Small Assisted Living Facility: Business, Regulatory, and Ethical Considerations
Opening an assisted living facility, even on a small or moderate scale, involves a great many complex and very pressing considerations. The health needs of the individuals that will be served, the size of the market in which the facility will be operating and the amount of competition in this market, and a host of other environmental and internal factors must be accounted for and controlled during the planning and initial implementation of the plan for a business of this sort. Successful operation of an assisted living facility, of course, requires ongoing assessment and planning in all of these areas, as well, but it is in the startup phase of the business that such considerations are of utmost importance. Not only is this the phase of business with the steepest learning curve for entrepreneurs, but the initial planning will also provide the tone and foundation of the organization for years to come.
This paper will examine the business, regulatory, and ethical considerations that must be taken into account when starting a small assisted living facility. Some of these issues will be common to all sorts of business ventures, while others will be highly specific to the proposed assisted living facility. By examining the business needs, the specifics of government involvement and regulation of the facility and businesses in general, and the overall social ethicality of such a business venture, a comprehensive understanding of the level of planning and resources necessary for a successful assisted living facility can be developed.
Many of the largest considerations that will be included in the actual operation of the assisted living facility as a business are typical expenses and considerations for all businesses, large and small. Property -- a place in which to house the business -- is one of the largest expenses and most important considerations for most businesses, and an assisted living facility is no exception. Not only is the location of the property important, as the business would need to be located in a place that was both easily accessible for visiting family and to facilitate easy shopping and other neighborhood amenities for residents, but the quality of the building and its level of maintenance and a variety of other property issues must be considered. The decisions of whether attempting to purchase property or lease it from a current land/building owner is another important decision, and can be affected and influenced by several other considerations, including the amount of start-up capital, the long-term goals of the business, and the availability and affordability of property.
Labor is another expense typical of almost any business, and of great importance in an assisted living facility as well. A variety of different staffing needs will have to be met at an assisted living facility, including basic support staff as well as nursing and medical staff. Varying degrees of expense will be incurred by the different types of employees that will need to be hired to make the assisted living facility a successful business operation, and the proper balance between staffing needs and expenditure capabilities will need to be assessed.
The external business environment facing the proposed facility would also need to be examined before an adequate and detailed business plan could be developed. Demographics are a key concern to many businesses, and assisted living facilities cater to a very specific set of individuals. Ensuring that there is a substantial enough demand for the services of the assisted living facility that is not being met by current similar operations is necessary before choosing a location for the business, or a special offering (pricing differentiation, product/quality differentiation) will have to clearly exist in order for the business to be viable. A proper analysis in this regard should also include an assessment of future changes to the market size and other factors that could have an impact on the proposed facility's ability to remain a profitable and successful enterprise, meaning the current changes in demographics and other trends will have to be measured and projected into the future.
Just as there are business concerns that are common to almost all businesses, there are certain regulations and other means of government involvement that all businesses must account for. Ensuring that the proper licenses to conduct business are obtained, proper records of revenue and expenditures are kept for tax purposes, and if investors are a part of the financing for the venture making sure that certain procedures are followed are things that any startup venture must look into. For an assisted living facility, however, there are also a great many specific laws and regulations that must be followed, licenses that must be obtained, etc.
Obviously, one of the key areas of concern for federal, state, and local governmental bodies when it comes to assisted living facilities is the health and safety of the residents of these facilities (NCAL 2011). A variety of different health codes and other regulations exist concerning the appropriate nurse-to-resident and staff-to-resident ratios that can be maintained, the cleanliness of the facilities and procedures that must be followed to maintain cleanliness standards, ensuring that adequate medical equipment and expertise is on hand to cover certain specific ailments and incidents, and many other issues specific to maintaining the health and wellness of residents at these institutions (NCAL 2011). These regulations are enforced with varying degrees of stringency depending n the type of regulation and the specific region/state where the facility is located, and regulations themselves can also vary from locality to locality, but horrific abuses by certain institutions have led to tighter regulations and growing enforcement of these regulations by the government.
There are also many other regulations that do not have to do directly with the health and safety of residents at the assisted living facility, some of which other businesses must also deal with and some of which are unique to assisted care facilities. Standard labor laws would apply to the support staff at an assisted living facility, while nurses and physicians often work under different regulations with certain amounts of off-time required. These regulations can be set both by governmental bodies as well as professional organizations and unions, meaning the administrator must ensure proper information is obtained from a variety of sources (NCAL 2011).
Just as there are many regulatory issues that are specific to assisted living facilities as well as certain regulations that are common to all businesses, there are some highly specific ethical considerations that must be accounted for in planning an assisted living facility business in addition to the basic issues of general business ethics. Making sure that all functions and transactions take place in a very open and honest manner is something that all businesses should ensure as a means of remaining fully ethical; customers should know what they are paying for, know how much they are paying for it, and get everything that they paid for. This is a rater simplistic example of the type of standard business ethics that must be employed when running any business, and there are much greater complexities in other ethical considerations that are more specific to assisted living facilities.
The fact that assisted living facilities provide health and quality-of-life improving care to residents often in the end stages of their life presents many different ethical considerations and complications. One of these complications is found in the basic cognitive functioning of these residents, which can vary widely from resident to resident and can even change for specific residents depending on their ailments (Powers 2005). Determining the level of intervention, direction, and advising that each resident needs in a way that balances capabilities and free will with the need to keep residents healthy and safe is one of…