Financial Stability in Changing Times
11/30/2009
Lately, it seems that you can't read the newspaper or watch the TV news without hearing about a business hitting hard times or having financial difficulty. While no organization should consider itself immune to hard times, we want to provide you with some information about Glenmeadow's fiscal well-being to ensure your ongoing confidence in us.
As a not-for-profit organization, we exist for only one reason: to fulfill our mission of providing premier senior services; nurturing the mind, body, and spirit of those we serve and employ. Glenmeadow has continued to fulfill this mission by meeting the needs and expectations of those we serve since our founding in 1884. That's over 125 years of service to older adults in greater Springfield.
The not-for-profit approach to aging services places emphasis on providing an atmosphere of fellowship and caring; on meeting the social, physical, and spiritual needs of the individual; and on helping people retain the dignity and quality of life they deserve throughout their retirement years. Our decisions are resident- and client-driven. Any surplus income goes into improving facilities or expanding services, not into quarterly returns for shareholders. The emphasis on caring and on placing the need of the individual above all else has become a Glenmeadow hallmark.
Our local board of volunteer directors and corporators provides oversight. One of the ways they ensure that our mission is carried out is by preparing a strategic plan and then monitoring its implementation. Glenmeadow staff members manage day-to-day operations by working from department-specific operation plans that directly tie to the organization's overall strategic plan. This system provides a balance between proactively identifying potential issues and opportunities, and being flexible enough to adapt to changing market conditions. The past year, for example, has presented many challenges, including declining real estate values, a volatile stock market, and increases in operational expenses. Glenmeadow's planning efforts have allowed the organization to maintain a strategic long-term view, identifying opportunities for potential expansion and positioning us for continued growth.
Glenmeadow is one of only six communities in Massachusetts, and 400 nationally, accredited by the Commission on Accreditation of Rehabilitation Facilities-Continuing Care Accreditation Commission (CARF-CCAC). This means we conform to proven business practices, and meet standards for employee training, information management, and continuous quality improvement planning. A significant portion of the review process targets adherence to financial benchmarks and management oversight. In fact, in September 2009, Fitch Ratings, an independent agency providing objective credit opinions for the world's securities markets, reaffirmed the rating on Glenmeadow's bonds at BBB+ with a stable outlook.
Our endowment, established by our founders, is one of our greatest strengths. Our investment strategy allows us to spend up to 4 percent of the endowment annually to subsidize operating expenses and support those who have outlived their assets. This is a tremendous advantage, so we work hard to increase the endowment and invest it well, so that we can continue to spend a portion of the interest wisely. During the past fiscal year, the financial markets experienced events of historic proportions. Across the board, market indices experienced double-digit losses. However, through diversification strategies, Glenmeadow's portfolio outperformed the general market.
Glenmeadow strives for transparency in reporting our financial standing and in providing access to information to all our stakeholders. Our disclosure statement, available upon request, includes a description of services, detailed pricing, audited financial information, and copies of our residency agreement and current annual report.
One of the most popular methods of financing independent retirement living is with a refundable entrance fee. (There is no entrance fee for assisted living at Glenmeadow.) Individuals pay a one-time refundable entrance fee when they move into Glenmeadow and then pay a monthly service fee. A refund of up to 90 percent (the specific amount is determined by which plan is selected) is made when they leave or die, as soon as the apartment is re-occupied. Independent apartments at Glenmeadow are generally filled within ninety days, and then a refund is made to the individual or estate.
Other, less common, options include life-care models or monthly rentals. Life-care communities promise to provide "care for life" and guarantee that monthly fees will not increase if the individual needs a higher level of care in the future. Given improved longevity rates, it is becoming harder for organizations to predict accurately and plan for the costs associated with this model.
Monthly rentals are an option most commonly offered by for-profit entities. There are no up-front fees, so the monthly fee residents pay must cover the services provided, as well as ongoing maintenance, capital improvements, and a profit for the owners or shareholders.
We hope this information is useful and will help you evaluate options for yourself or your loved ones. Our goal is to help you find the provider of care and services that is best for you, even if that is not Glenmeadow. Talk to family members and friends, meet with a financial advisor or elder-care attorney, or ask for a referral from your physician or other professionals. State and area agencies on aging also can be useful sources of information on care and services for older adults. After you gather information, follow your instincts.
We are happy to provide you with more detailed information on any of our offerings, or help you work through your options by listening and providing our expertise. You can reach us at 1-800-633-6313 or 1-413-567-7800. We look forward to the opportunity of serving you.
