The impact of building management on daily life 

The feel of a community often comes down to the details, such as temperature and lighting. When these systems run smoothly, residents are more comfortable, and operators can better manage one of their largest expenses: facility operations. 

That’s why many operators use AI solutions to optimize efficiency and reduce waste. Tools like the TELS® Platform support preventive maintenance, real-time issue tracking, and faster work order resolution, helping ensure comfort and safety stay consistent. 

How AI enhances comfort and efficiency in senior living 

Artificial intelligence in senior care operations extends far beyond clinical applications; it’s becoming a cornerstone of how modern senior living communities operate. By turning building data into real-time insights, AI solutions help leaders create environments that are more comfortable and reliable every day. 

Energy optimization

AI-enabled energy management systems monitor HVAC, lighting, and water use to balance comfort with efficiency. Smart adjustments to temperature and ventilation keep residents comfortable while minimizing energy waste, helping communities achieve both sustainability goals and cost savings.

Preventative maintenance

Through predictive analytics, AI detects small shifts in equipment performance that signal potential issues before they become costly failures. This proactive insight allows maintenance teams to schedule service in advance, avoiding resident disruptions and reducing emergency calls. Over time, this approach builds a more stable operation, protecting asset life while reinforcing financial and operational consistency.

Communities actively using TELS® asset management features have experienced a 14% reduction in emergency service calls*, proof that proactive maintenance drives measurable results. 

Smart work order automation

AI can analyze incoming maintenance requests and prioritize them by urgency and safety impact. This helps ensure that high-priority issues, such as HVAC failures or water temperature variances, are addressed first, while routine tasks are efficiently scheduled. CMMS (Computerized Maintenance Management System) software like TELS Platform already helps teams streamline this process, reducing delays and improving overall responsiveness.

Robotic and automated cleaning systems

Automation in housekeeping is transforming the consistency and reliability of environmental services. AI-powered tools, including TELS® Housekeeping, help communities standardize daily cleaning tasks, balance staff workloads, and maintain high quality across every room and shift. Robotic vacuums and smart disinfection systems maintain high standards of cleanliness while easing the workload on staff, a major advantage amid ongoing labor shortages. The result is a safer, cleaner environment that boosts both resident satisfaction and staff morale. 

Together, these applications show how AI and automation tools quietly improve quality of life behind the scenes. When buildings run smoothly, residents feel the difference. A consistent sense of comfort and cleanliness, supported by dependable service, contributes to a more welcoming and dignified living experience. 

Benefits for staff and residents 

Automation frees staff from constant troubleshooting, giving them more time for meaningful engagement and proactive planning. Predictive insights help maintenance teams prevent small issues before they become disruptions; while housekeeping automation tools help ensure consistent cleanliness. 

For residents, these advancements translate into steady comfort, faster service, and a sense of reliability that builds trust. 

This blend of AI use in buildings operations and technology for seniors reinforces a simple truth: when systems run smoothly, people thrive. 

Challenges of adoption in senior living 

Even with clear benefits, implementing new technology in senior living takes thoughtful planning. Each challenge offers a chance to build a smarter foundation for the future. 

Aging infrastructure

Many communities rely on legacy systems that weren’t built for digital integration. Modernizing doesn’t require a complete overhaul; small, strategic upgrades make an immediate impact. Start by connecting key systems like HVAC or water management to tools such as TELS Platform for real-time monitoring and insight. 

Data accuracy and readiness

AI is only as reliable as the data behind it. Standardizing preventive maintenance, inspection tracking, and asset logs help communities strengthen their data foundation and generate more accurate, actionable insights. 

Cultural adoption and team confidence

Introducing new technology takes collaboration and trust. Engaging staff early helps teams see how automation supports their expertise. Celebrating small wins like fewer emergency calls and faster response time builds momentum and confidence. Over time, teams see how AI applications support their expertise and simplify daily operations. 

The future of AI in senior living communities 

Future trends in senior care point toward fully connected ecosystems. Senior living technology solutions will increasingly integrate energy management, housekeeping automation, and asset data into unified dashboards, giving leaders a complete picture of building performance and operational efficiency. 

With tools like TELS Platform and AI-driven analytics, communities can respond more effectively to everyday challenges by aligning operational data with real-time decision-making, improving both the resident experience and staff performance. 

The bottom line 

With smarter insights and stronger outcomes, the benefits of AI in senior living are becoming increasingly clear. Communities that adopt AI-driven building management today are creating a foundation for lasting comfort, efficiency, and resident satisfaction. 

At Direct Supply, we’re committed to transforming innovation into practical solutions to help senior living teams run more smoothly with tools that support safer, more efficient, and more welcoming environments for residents and staff alike.  

The role of building operations in survey readiness 

Reliable building performance is essential for regulatory compliance and inspections. Building maintenance teams must manage HVAC performance as well as water temperatures and life safety systems, all of which are major focus areas during surveys. 

Alongside staffing and food, building operations represent one of the top three expenses in care environments. To control these costs while safeguarding compliance and safety, forward-thinking providers are adopting AI-driven tools that streamline operations and uncover new efficiencies. 

The TELS® Platform already helps providers schedule inspections, document work, and centralize compliance reporting, all key to maintaining survey readiness and safety. 

How AI supports compliance and safety in SNFs 

In skilled nursing, compliance and safety are non-negotiable. A single missed inspection or system failure can trigger citations in addition to disrupting care and jeopardizing trust. AI tools and automation technologies now offer maintenance and facility leaders a smarter way to stay ahead, turning reactive work into proactive protection. 

Proactive maintenance powered by predictive analytics 

AI tools can analyze equipment data from HVAC systems, boilers, pumps, and refrigeration units to detect subtle changes that often go unnoticed. By identifying at-risk assets before they fail, teams can schedule timely service and avoid emergency calls that strain both budgets and staffing. Predictive insights also extend asset life, helping communities make the most of every capital investment. 

Compliance-driven automation

Survey readiness depends on consistency, and automation helps ensure nothing slips through the cracks. AI can automatically prioritize safety-critical work orders, flag missed inspections and verify that documentation is complete before surveys. With tools like the TELS® Platform, communities maintain real-time visibility into equipment status and fire protection logs, along with temperature data, helping ensure every system meets regulatory standards year-round. 

AI-driven HVAC optimization at Sherbrooke Village delivered a 20–30% reduction in HVAC-related energy use and 15–25% overall utility savings, while improving indoor air quality and compliance with F-Tag 584 standards. This initiative demonstrates how predictive insights and automation can strengthen compliance in addition to comfort and safety; key outcomes every skilled nursing community strives to achieve. 

AI-driven asset lifecycle planning

Knowing when to repair versus replace is one of the toughest calls facility leaders face. AI simplifies the decision with data. This empowers leaders to align operational budgets with safety priorities and capital project goals. 

Across the country, communities using TELS Platform are seeing a measurable impact, from fewer emergency service calls and reduced survey deficiencies to stronger documentation and improved uptime. The result: stronger compliance and smoother operations that build confidence across your team and protect everyone in your community. 

Benefits for staff and residents 

The heart of every skilled nursing facility is its people, both those providing care and those receiving it. AI in healthcare operations is built to empower, not to disrupt, that essential connection. 

For maintenance and environmental services teams, AI takes on time-intensive monitoring, scheduling, and reporting. With less time spent on manual work, teams can turn their attention to advancing safety and operational excellence. Leaders gain visibility across multiple systems, enabling smarter decisions and fewer surprises. 

For residents, these improvements translate directly into comfort and security. Reliable building systems mean stable temperature and safe water quality. They also ensure a calm, consistent environment, all critical to quality of life. Preventive maintenance reduces downtime and eliminates the frustration of repeated disruptions. 

Together, these advancements create a powerful ripple effect: a more resilient care environment, lower operational stress, and greater confidence across the entire community. By combining human expertise with intelligent automation, skilled nursing teams are redefining what operational excellence looks like in senior care. 

Barriers to adoption 

Even with clear benefits, adopting new technology in skilled nursing takes thoughtful planning. Each challenge presents an opportunity to build a stronger, smarter foundation for the future. 

Aging infrastructure

Many communities rely on legacy systems that weren’t built for digital integration. Modernizing doesn’t have to mean full-scale replacement. Start with high-impact systems like HVAC or water management. Incremental upgrades create immediate operational wins and pave the way for broader integration. 

Data accuracy and readiness

AI is only as strong as the data behind it. Inconsistent or incomplete information limits insights, but the solution lies in consistency. Using the TELS® Platform for preventive maintenance, inspection tracking, and asset management helps standardize data collection, giving AI a reliable foundation for precise, actionable recommendations. 

Cultural adoption and team confidence

Building trust in new tools takes time. Involving maintenance leaders, frontline staff, and administrators early helps teams see how automation supports their expertise. Celebrating small wins like fewer emergency calls and faster repairs or stronger documentation builds momentum and confidence. Over time, teams recognize how AI applications amplify their impact, freeing them to focus on what matters most: resident well-being. 

The future of AI in skilled nursing facilities 

AI in senior care is advancing rapidly, and skilled nursing is uniquely positioned to benefit. Soon, AI-driven automation will unify insights from across the operation. This will connect the physical environment with staffing patterns and resident outcomes to enable faster, more informed decisions. 

Emerging innovations like robotic cleaning, automated housekeeping tools, smart disinfection, and integrated HVAC controls are already changing the way communities manage cleanliness and air quality. Tools like TELS® Housekeeping now bring these same advantages to environmental services which help simplify scheduling, track quality, and ensure every room meets consistent standards across shifts. These technologies lighten staff workload while strengthening compliance and resident safety. 

At Direct Supply, we’re focused on bridging innovation with practicality, delivering AI solutions and survey-ready tools that help care teams stay compliant and future-focused. The goal is clear: enable safer environments, stronger operations, and better outcomes for every resident. 

The bottom line 

With fewer emergencies and stronger compliance outcomes, the benefits of AI in senior care operations are becoming increasingly clear. Skilled nursing communities adopting AI-driven building management today are setting the stage for a future of greater safety and operational resilience.  

As innovation continues to advance, leaders who explore these tools now will be best positioned to improve outcomes, extend asset life, and deliver exceptional care environments. 

A senior living bistro is your community’s welcome mat

Create a space that works as hard as your team. With one set of equipment, your bistro can start the day as a cozy coffee bar and seamlessly transition into a wine bar or pub by evening. This adaptability maximizes your investment and keeps your community engaged.

Infuse personality with thoughtful design details. Rustic finishes like natural wood and brick add warmth and longevity, while evening themes — from sports décor to speakeasy style — invite gatherings. Use zoning strategies to define café, lounge, and bar areas. Pair flexible furniture with lighting shifts to guide residents and guests intuitively, from morning coffee to evening connections.

Key considerations when planning a senior living bistro in your community

1. Versatile layout and design

Design your bistro to adapt throughout the day. With one set of equipment, the space can transition from a cozy coffee bar in the morning to a wine bar or pub in the evening. This day-to-night flexibility maximizes your investment and increases engagement.

Infuse personality and visual interest with: 

• Pub atmosphere: Local sports décor or speakeasy themes invite evening gatherings. 

• Rustic touches: Natural materials like wood and brick bring warmth and longevity. 

• Consider zoning: Create distinct café, lounge, and bar areas with flexible furniture or lighting shifts. These subtle cues guide residents and guests to intuitively enjoy the space at different times of day — from morning coffee to evening gatherings. 

For inspiration, look to current senior dining trends or local landmarks to create a distinctive and inviting space.

2. Strategic location and accessibility

A bistro’s placement influences its success. Prioritize convenience and visibility to boost use and satisfaction:

• Outdoor connection: Position near patios or courtyards to encourage fresh-air dining and indoor-outdoor flow. 
• Central access: Locate near reception or staff hubs to simplify staffing, support residents with mobility challenges, and streamline service. 
• Community integration: Offer limited public access to nearby offices or medical campuses to generate ancillary revenue and reinforce your community as a neighborhood asset. 

3. Expand dining program flexibility with bistro equipment 

Modern bistro dining boosts your senior living foodservice with compact, efficient tools. Think beyond the kitchen:

• Ventless ovens and soup warmers allow for warm meals without full kitchen installs
• Grab-and-go refrigeration, POS systems, and menu boards improve service speed and convenience
• POS integration: Connect to your main kitchen’s point-of-sale system to offer made-to-order items without duplicating equipment.
• Digital menus: Electronic boards replace handwritten signs for effortless updates—perfect for weekly specials or themed events. 
• Barista-level coffee: Invest in high-quality machines or partner with a recognized brand to elevate the coffee experience and drive beverage revenue.

Balance variety and simplicity. A concise menu of three to five signature sandwiches, two soup options, and rotating pastries keeps costs manageable while satisfying diverse tastes.

4. Strengthen community ties and drive visibility

A bistro is more than a place to eat; it’s a hub for social programming. Encourage your life enrichment team to host: 

• Coffee chats: Themed discussions (current events, travel memories, creative writing) that foster connection. 

• Book clubs: Pair with light refreshments and comfortable seating for a relaxed literary setting. 

• Game nights: Card games, board games, or trivia nights encourage friendly competition and laughter. 

• Craft workshops: Small-group sessions such as cookie decorating, tasting flights, or wine-and-cheese pairings. 

These programs support both social and cognitive engagement, reinforcing resident well-being and enhancing the perceived value of your community. 

Case study: Foulk Living bistro remodel 

Foulk’s dining room before & after renovation

In 2024, Life Care Services partnered with Direct Supply Aptura to remodel the Foulk Living bistro in Wilmington, DE. The goal was to create a vibrant, multi-purpose lounge that aligned with LCS’s hospitality-focused vision. 

Changes made: Bold artwork, lively fabrics, and a modular layout allowed the space to shift from morning coffee shop to evening wine bar. A large bar with a big-screen TV now anchors the area for casual lunches, happy hours, and game nights. 

Results: The redesign of Foulk’s bistro earned a bronze American Society of Interior Design award in the specialty category. Resident satisfaction scores rose by 25 percent, and occupancy neared 100 percent within six months of opening. ³ Families returned more often, and staff reported higher morale thanks to the efficient, welcoming environment. 

Foulk’s bistro after renovation

Budgeting and ROI considerations 

When budgeting your bistro project, include costs for:

• Professional service fees and required permits (architects, engineers, designers)
• Equipment purchases or lease (coffee machines, ovens, display cases)
• Furniture, fixtures, and décor
• Technology (POS system, digital signage)
• Staff training and program development

Estimate a return on investment by projecting beverage and snack sales, catering for events, and potential public-access revenue. Most communities see payback on a modest bistro remodel within a reasonable timeframe, through increased occupancy and ancillary income. 

The bottom line

Bistros offer more than coffee. They create connections, boost resident satisfaction, and elevate your community’s marketability. When designed for adaptability, strategic placement, and efficient operations, they become high-impact spaces that support resident engagement, census growth, and positive brand reputation. 

Ready to transform your community? Contact Direct Supply’s senior living design experts today to plan a bistro that delivers lasting value, enhances daily life, and sets your community apart. 

 “As of 2025, we are housing our most vulnerable senior population, in facilities of which 60% are over 30 years old. The aging infrastructure of these communities, compounded by an increase in more impactful weather situations (forest fires, flooding, hurricanes, tornadoes or ice storms), has seen a rise in government mandates requiring facility upgrades. The safety and security of elders is critical; the challenge becomes how we plan, execute and pay for required and necessary improvements.”

Understanding the regulatory landscape 

Regulations often follow crises like hurricanes, floods, wildfires, and ice storms that expose vulnerabilities in aging facilities. After Hurricane Irma, Florida’s mandate for 96 hours of backup generator power for skilled nursing facilities became a blueprint now echoed in other states. Likewise, new assisted living facility regulations are emerging nationwide, aimed at fortifying disaster preparedness and ensuring uninterrupted resident care. 

The realities of implementation 

1. Underestimated costs & capital expenditure

Many state legislators undervalue the true scope of capital expenditure needed for compliance. California initially projected $20,000–$50,000 per facility for emergency power, but actual costs frequently approach $200,000–$500,000 when factoring in engineering, permitting, and installation of multiple backup generators.

2. Supply chain constraints

When thousands of communities race to meet new backup generator regulations, demand outstrips supply. Equipment shortages and labor scarcity delay projects, undermining both compliance and disaster preparedness efforts. 

3. Tight timelines & permitting

Regulatory compliance timelines often don’t align with providers’ maintenance and capital-expenditure schedules, which typically allow only 12–18 months to comply. That window is insufficient for a multi-phase rollout, site surveys, design, permitting, and commissioning, creating a compressed schedule that elevates risk and can lead to costly fines.

Funding challenges & Medicaid reimbursement 

Most mandates arrive without dedicated funding, leaving operators to shoulder the financial burden. Only a handful of states, California among them, integrate certain capital expenditure into their Medicaid reimbursement models. Even there, providers must navigate complex Medicaid reimbursement rates that vary by facility size, acuity level, and service mix. For the majority of communities, securing grants, loans, or alternative financing becomes essential to move projects forward. 

How Direct Supply is responding and what we can do to help 

Operators face significant challenges balancing mandated upgrades with daily operations, especially when resources are limited. Direct Supply provides scalable expertise, including: 

Managing supply chains to deliver essential equipment promptly.

Our TELS™ Building Management platform, combined with a 25,000-technician nationwide field services network, coordinates installation, commissioning, and compliance verification from site survey to final inspection, shrinking the window from mandate to operation.

Preparing for ongoing regulatory evolution 

Regulatory mandates will continue to proliferate, and extend beyond skilled nursing into assisted living, memory care, and beyond. Robust risk management and proactive regulatory compliance strategies are no longer optional; they are essential pillars of operational excellence. 

Direct Supply stands ready to partner with your community, helping you transform regulatory requirements into cost-effective, resilience-building initiatives. By aligning project planning with reimbursement insights, capital funding pathways, and industry best practices, we ensure compliance becomes a strategic advantage rather than an obstacle. 

As staffing challenges and operational pressures continue to impact Senior Living, many communities are turning to robotics to bridge gaps, boost efficiency, and elevate resident experiences. But without a clear plan, even the best technology can fall flat.

We created “7 Strategies for Implementing Robotics in Senior Living” as a practical, expert-driven guide to help you unlock meaningful ROI from your robotics investment.

From identifying high-impact use cases to redesigning workflows and engaging residents, this guide lays out actionable steps to ensure successful implementation, staff buy-in, and measurable outcomes.

Common cleaning challenges in senior living communities

Verified performance with floor care robotics

Near-time floor care cleaning metrics with SoftBank Robotics Connect

Both devices integrate with SoftBank Robotics Connect—an analytics dashboard that delivers on-demand performance metrics, including:

• Coverage area (sq. ft. cleaned)
• Cleaning frequency by zone
• Route performance and missed runs
• Autonomous runtime and battery usage
• Assist logs and resolution speed

This level of visibility allows facility managers to confidently answer, “What got cleaned today, where, and when?”—with data to back it up.

Elevate confidence, boost compliance

Automated, time-stamped cleaning logs and proactive staff notifications help communities:

• Prove compliance for infection control and regulatory surveys
• Provide visible reassurance to families and prospects
• Adjust protocols quickly in response to seasonal illness or outbreak
• Recognize when a robot needs support to minimize cleaning lapses
• Ensure equipment is being used consistently to maximize the value of their investment

This is more than a technological upgrade—it’s a proactive, confidence-building strategy with measurable savings.

Labor optimization and measurable ROI

Offloading repetitive cleaning to automation reduces strain on staff and drives efficiency. In one 120,000 sq. ft. community, implementing floor care automation saved 42 labor hours weekly—with no compromise to cleanliness.

Case studies: Proven results in robotic cleaning for senior living

Why combine Whiz and S50 Pro for robotic cleaning?

Together, they deliver:

• Comprehensive cleaning across all flooring types with one integrated solution
• Near-time performance insights via dashboard and SMS alerts
• Fixed monthly costs that simplify budgeting and reduce operational unpredictability

Smarter cleaning starts here

Proof of clean is more than a metric—it’s a mindset. With autonomous floor care, communities can strengthen compliance, improve operations, and enhance the resident experience with confidence.

• Strengthen compliance with verifiable cleaning logs
• Reduce staff burden and increase consistency
• Reassure residents and families with visibly clean spaces
• Gain operational visibility with actionable insights

Fee-for-service vs. value-based care: what’s driving the shift?

A fundamental change is underway in how skilled nursing providers are reimbursed for care. The industry is moving away from volume-based payments and toward models that prioritize value. 

Historically, the fee-for-service model dominated care delivery. Under this structure, providers were paid based on the number and type of services delivered, regardless of patient outcomes. While straightforward to administer, this model created incentives for higher utilization, not necessarily better care, and often overlooked the quality or effectiveness of services provided. 

Value-based care turns that model on its head. It ties reimbursement to performance metrics such as improved recovery rates, fewer hospital readmissions, and overall cost efficiency. By aligning payment with patient outcomes, value-based care encourages a more coordinated, proactive approach to treatment—aiming to deliver better results while reducing the total cost of care. 

“CMS has been testing and driving us towards more value-based care payment models for many years. By tying payment and incentives to population health metrics and outcomes, CMS expects these alignments to reduce healthcare costs. ”

How Medicare Advantage and Medicaid value-based payments affect senior living operators

With the majority of skilled nursing revenue derived from Medicare and Medicaid, any policy change in these programs sends ripples through the industry. Today, more than half of Medicare beneficiaries are enrolled in Medicare Advantage plans, a key driver of value-based care. Simultaneously, state-developed Medicaid value-based payment programs are increasingly shaping reimbursement for Skilled Nursing Facilities, further complicating Medicare and Medicaid payment strategies. These programs require enhanced care coordination, improved clinical outcomes, and often involve lower per-day reimbursement rates. 

This poses challenges for providers already operating with narrow margins. However, it also presents a powerful opportunity: operators that demonstrate measurable success in delivering quality outcomes can stand apart and secure stronger payer relationships. 

Driving clinical outcomes through strategic procurement in value-based care

In today’s value-based care environment, procurement has become a strategic lever for better outcomes. Senior Living providers are selecting products and services that go beyond cost savings to support clinical workflows and operational efficiency. 

Intentional technology designed to augment and streamline clinical workflows are increasingly being adopted. For example, upgrading to DS smart® brings automation, faster vitals capture and more accurate data—enabling better clinical decisions. Similarly, pac-IQ® streamlines referral workflows, allowing providers to allocate time towards improving the resident experience and ensuring more informed care transitions. These strategic investments give clinical staff real time back to focus and resident care and lessen practice variability that leads to improved accuracy, both known to contribute to better outcomes, all while reducing the total cost of care. 

“These new trends that you’re seeing at the federal level and at the state level with regard to payment incentives on the value-based care side are going to dictate a lot of the behavior that our customers have when it comes to purchasing and procuring services.”

The future of value-based care in senior living: lowering the total cost of care

The momentum behind value-based care is growing—and it is here to stay. With bipartisan support and proven results from early programs, it’s becoming the foundation for how care is measured, delivered, and reimbursed across senior care. 

As these models expand across the continuum of care, operators who embrace them today are better positioned for long-term success. By focusing on improving clinical outcomes and managing the total cost of care, forward-thinking providers can gain a competitive edge while delivering greater value to residents and payers alike. 

Direct Supply is committed to helping senior living providers succeed in this evolving landscape. From helping improve outcomes to controlling costs, we’re here to support your mission every step of the way. 

Frequently asked questions about value-based care in senior living  

What is the difference between fee-for-service and value-based care? 

Fee-for-service reimburses providers based on the quantity of services delivered, such as appointments, procedures, or tests. Value-based care, on the other hand, links reimbursement to patient outcomes—rewarding providers for improving clinical outcomes, reducing hospital readmissions, and enhancing recovery rates. 

How does value-based care affect senior living providers across the continuum of care? 

Value-based care impacts every level of the senior living continuum—from assisted living to skilled nursing—by prioritizing outcomes, efficiency, and coordination. Providers must demonstrate measurable improvements in resident health and reduce unnecessary hospitalizations to secure favorable reimbursements and payer relationships. 

What role do Medicare Advantage plans play in value-based care? 

Medicare Advantage plans are a major driver of value-based care adoption. With over half of Medicare beneficiaries enrolled in these plans, they emphasize quality metrics, care coordination, and cost control. This directly affects how senior living operators are reimbursed under Medicare and Medicaid programs. 

How can procurement support better clinical outcomes in value-based care models? 

Strategic procurement in senior living involves selecting products that enhance resident health and operational efficiency. From vital signs monitors to infection control systems, these purchases can reduce avoidable hospitalizations and support compliance—ultimately improving outcomes and lowering the total cost of care. 

The current challenge

Medicaid remains the primary funding source for more than 70% of residents in skilled nursing communities and plays a vital role in supporting services across assisted living, home care, and other long-term care settings. But as Congress debates significant funding cuts to the Medicaid program, they are focusing on provider tax provisions that could deliver serious funding reductions to America’s seniors and their caregivers.

 For providers already delivering care below cost, that kind of reduction directly threatens financial stability, care continuity, and the dedicated teams who support residents every day.

How value-based care and private payers are shaping senior living

Beyond direct cuts, care funding is increasingly flowing through Medicaid managed care and Medicare Advantage plans, shifting oversight from public entities to private insurers. While these models offer flexibility, they often prioritize cost containment in ways that do not always align with the realities of delivering high quality care. This shift toward private payers and value-based care models in healthcare places additional financial and operational pressure on senior living providers, especially in the wake of Medicaid cuts. Many communities are grappling with the impact of Medicaid cuts, which have compounded longstanding challenges tied to senior living Medicaid funding and reimbursement.

As this shift continues, strong partnerships with private payers are becoming more critical. Providers are being asked to demonstrate how their outcomes, innovations, and services create measurable value, improving resident well-being, supporting care teams, and helping payers achieve efficiency goals.

Innovation and technology as a response to Medicaid and Medicare cuts 

There is growing recognition among payers that innovation can drive better outcomes and lower costs. Simple solutions—like anti-rollback devices for wheelchairs—can help prevent injuries and avoid costly hospitalizations, benefiting both residents and the bottom line. In the face of federal cuts to Medicaid and Medicare, innovation becomes not just beneficial, but essential. For skilled nursing communities, technology can bridge the gap caused by declining reimbursement and cutting Medicaid funding initiatives.

At Direct Supply, we’re seeing increasing engagement from private payers interested in smart equipment, home-based technology and streamlined formularies that reduce rehospitalizations and enhance safety. These conversations present a critical opportunity to help build a more resilient, sustainable system for senior living.

 “Are we incentivizing and motivating for the outcomes we desire? In my 30 years of experience, CMS has missed the mark. Prioritizing regulatory compliance and overly complex, and underfunded reimbursement mechanisms make it difficult for providers, and CMS, to achieve more. Value-based care, aligns incentives to desired outcomes and reduces cost of healthcare, but it won’t work if regulatory oversight doesn’t change, or is too late to protect providers. 

Incentivizing for outcomes, not process, and re-working regulations can motivate stakeholders to connect actions to the right things—the right outcomes, the right care, the right types of things we’re trying to do—those things don’t have to be mutually exclusive. They can work in tandem together, and we can get good outcomes and still save money.“

Senior care advocacy in the wake of Medicaid cuts  

The debate over Medicaid isn’t just about funding—it’s about the future of care. Any reduction in Medicaid, whether labeled a provider tax adjustment, block grant or rate shift, ultimately translates to fewer resources for those who need them most. Senior care advocacy has never been more urgent. Reductions in federal funding for Medicaid threaten long-term stability, particularly for communities reliant on long term care Medicaid reimbursements.

That’s why Direct Supply continues to advocate for the providers we serve, making sure their voices are heard at every level. Through targeted, intentional efforts, we’re helping to spotlight the true impact of policy decisions—and fighting to protect the future of senior living. Read about our advocacy efforts.

How Direct Supply is responding and what we can do to help 

1. Advocacy efforts to address Medicaid and Medicare cuts

Our Government Relations team is focused on protecting providers from the real-world impacts of cuts to Medicaid and Medicare by championing smart, sustainable policy. They are leading proactive, focused efforts to ensure the needs of senior living providers remain front and center as key policy and funding decisions are made in Washington. We’re fighting for what’s right—and making sure our customers’ voices are heard when it matters most.

2. Supporting senior living providers with cost-saving solutions

Every day, our teams are showing up with purpose—helping customers focus on what matters most. We work side-by-side with senior living providers to deliver affordable, high-quality solutions that offset the rising cost of assisted living and equipment.

3. Investing in technology to offset the cost of senior living

From AI-powered monitoring to predictive analytics, we help customers manage the cost of senior living while aligning with emerging value based care models in healthcare. These innovations are helping providers lower their cost to serve, allowing more dollars to be reinvested into care and operations.

4. Leading change by partnering with Medicaid stakeholders

As senior living Medicaid models evolve, Direct Supply remains at the forefront—educating, adapting, and collaborating with emerging Medicaid stakeholders to shape sustainable care strategies.

“But if there is a dollar less flowing into nursing home care or hospital care for America’s seniors, that’s a big, big problem.

And we’re going to stand up and not only say no, but we’re going to try to make it a political point for the constituents of these policymakers—let them know that these voters are not going to take it anymore.”

Frequently asked questions about senior care and Medicaid cuts

What is the cost of assisted living with Medicaid in 2025?

The cost of assisted living continues to rise, and with Medicaid funding cuts in 2025, fewer options may be fully covered without out-of-pocket expenses. Coverage also varies significantly by state, as each state’s Medicaid program operates under different eligibility rules and reimbursement structures. Many states now utilize Medicaid waiver programs, which may only cover a limited number of participants or services within assisted living communities. Additionally, even when Medicaid provides some support, families often still face expenses for room and board, personal care, or enhanced service packages. It’s crucial to consult your state’s Medicaid office or a local senior living advisor to understand your specific options.

How do Medicaid cuts affect senior care providers?

Cuts reduce reimbursements, forcing senior care providers to find efficiencies or scale back services—potentially impacting care quality. In some cases, facilities may limit the number of Medicaid residents they accept or delay investments in staffing and infrastructure. This can place additional strain on caregivers and hinder the delivery of personalized, timely support that residents need.

What is the impact of federal funding cuts to Medicaid?

Federal cuts to Medicaid jeopardize access to care for vulnerable seniors, particularly in skilled nursing and long-term care facilities. These reductions may lead to facility closures in underserved areas and reduced availability of critical services. Over time, this can widen health disparities and limit families’ choices when seeking appropriate senior living environments for their loved ones.

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Why are Mergers & Acquisitions becoming so common?

According to the McKnight 2024 Outlook, nearly 40% of Skilled Nursing owners and executives believe they will sell some or all of their senior living portfolio in 2024. There are a number of reasons leading to these healthcare mergers and acquisitions within Skilled Nursing:

1. High inflation
2. Unstable Medicare and Medicaid reimbursements
3. Increased labor costs
4. Stagnant incoming revenue
5. High interest rate pressure

As inflation costs increase worldwide, many providers have struggled to gain a foothold financially. Even before inflation rose, it was difficult for smaller providers to manage procurement, labor costs and new regulations. Now they must do so while grappling with higher prices. This has led to smaller organizations merging with larger ones to absorb their financial burden. 

With our expertise, healthcare facilities can consolidate their supply chains, ensuring consistent product quality and availability across all locations. Direct Supply DSSI offers valuable support in managing increased demand, optimizing inventory, and reducing costs. Our data-driven insights and analytics provide a clear view of procurement activities, helping to identify opportunities for savings and efficiency improvements. By working with us, healthcare providers can focus on integrating their operations and delivering excellent resident care, knowing their procurement needs are in expert hands.

M&A trends continue to emerge as the senior living industry recovers from the COVID-19 pandemic. DSSI is here to help your organization establish efficient procedures in your procurement activity.

Mergers and Acquisitions: What problems can DSSI help with?

One large struggle is figuring out how to handle procurement. This struggle is especially evident when your team hasn’t had a designated procurement professional in the past. For most mid-sized organizations, managing vendors and establishing a procurement strategy are tasks that fall by the wayside. 

When merging or acquiring new companies or assets, there may be inconsistencies in supply chain management. This can lead to potential disruptions in product availability and quality. Coordinating inventory across multiple locations becomes more difficult, and managing increased demand can strain existing resources. Additionally, aligning the procurement strategies of merging entities can be challenging, as each organization may have different practices and vendor relationships. 

As your organization gets larger, these questions within procurement become necessary to answer to establish financial success. Saving time, cost reduction, and risk management become areas of interest. Getting your arms around what strategic procurement looks like in healthcare and senior living is priority one. And luckily, DSSI has a wealth of experience helping folks navigate that transition.

Our decades of experience in supply chain management helps our customers in the healthcare industry save money. We can help manage suppliers, improve contract management and develop a cost effective strategy that works for your business. 

When should DSSI get involved in the M&A process?

Early communication is key. One benefit of working with DSSI is the industry expertise established over the last 30+ years. Our procurement data from so many successful partnerships helps us to make informed decisions. The DSSI team is here to support your growth and success, and we can add significant value throughout the M&A process and beyond. 

The DSSI procurement strategy is built on supporting your relationships with your suppliers. We will support your communication with your supply chain throughout the process. We will implement a procurement system to give you the control that you’re looking for. Products and services your organization requires will be purchased from visible, trusted suppliers

The DSSI spend management consulting team will also support your expanding internal procurement team. The system establishes standardized purchasing processes and provides an opportunity for your organization to instill confidence. It can also aid in quickly acclimating the team members you have also acquired through the acquisition or merger. Your procurement department will be our close partner, working with us on supplier negotiating, inventory management, and ensuring compliance with your plans for your procurement operation.

How can healthcare providers leverage DSSI when acquiring new buildings?

Buildings are being shuffled like cards in a hand of poker and they’re changing owners rapidly. There’s an opportunity to leverage DSSI technology and industry expertise to establish a healthcare procurement strategy.

Establishing a data-driven strategy will reduce the time you need for procurement management, even in the short term. Whether that’s relationships with vendors or analyzing your spend to find opportunity for savings, or just less time managing the requests and approvals that are necessary for large purchases, all of those burdens can be lessened with a system like DSSI.

What are the benefits of partnering with DSSI?

There is a large list of benefits to the DSSI procurement solution in general. With respect to customers undergoing mergers and acquisitions in particular, one really stands out. Real-time visibility into the spend-down that’s happening in your buildings can be crucial to identifying opportunities for cost reduction. 

As a new owner, one challenge is the lack of long-standing personal relationships with your new employees. You’re trusting that they’re acting in your best interests, but you may be operating on blind faith. Working with DSSI ensures that a second eye is watching your new employees and helping them learn how you do business.

With DSSI, you can reduce risk, remove time consuming tasks and a wide range of other helpful benefits. You can see everything from the orders that are being placed, including your approvals on those orders. You can see how well your new buildings are complying to your existing contracts. If employees are ordering off contracts with vendors you have not approved, you’ll know.

Direct Supply DSSI allows you to be an active manager because it gives you visibility into data you would need. It’s better than being reactive based on the financial reporting that you would otherwise produce routinely. Protect your bottom line with DSSI.