Andy Smith (Brookdale)

Some might not consider Brookdale Senior Living’s current strategy sexy, the company president and CEO said Thursday, but the country’s largest senior living provider may turn up the heat in 2018.

For now, the Brentwood, TN-based company plans to try to “unlock the organic growth that’s built into our platform,” Andy Smith told those attending the Jefferies 2016 Healthcare Conference in New York.

“We’re going to be focused on the basics, which is execution, execution, execution,” he said. “That’s the primary place where our energy is going to be directed, which is simply working on the revenue side of the equation through increasing occupancy and the rate that we charge as well as tightly controlling expenses, and we think we have a fair bit of room to curtail our general and administrative costs as we move forward into 2017.”

The company, where possible, will try to reduce and ultimately eliminate the 10% rate differential that exists between former Emeritus properties and Brookdale properties, Smith said. The two companies merged in 2014. And Brookdale’s new analytical capabilities enable it to segment markets and adjust rates as needed, Smith said.

The company is targeting $25 million in general and administrative savings by automating, simplifying or eliminating some processes, Chief Financial Officer Cindy Baier said. By changing from paper to electronic paychecks, for instance, the company has saved $500,000, she said.

The provider also is aiming for an occupancy increase from its current 86% or 87% to 91% or 92%, Baier said.

“Our strategy may be straightforward and not terribly sexy, but there’s a lot of cash flow to be generated from our platform organically, and we consider that to be pretty sexy,” Smith said.

A small part of the company currently is focused on building growth vehicles for 2018 and beyond, however, he said.

At that time in the future, “if we were looking for growth in addition to our organic growth that is just sitting there waiting to be unlocked, there are a lot of ways that we can do that,” Smith said. Options include developing or acquiring properties in desired markets or expanding services offered to residents, he added.

Adding new service lines is “a non-capital-intensive way to grow revenue and net operating income,” Smith said. “Generally speaking, what we’ve done in the past is add services that our residents are already getting; they simply happen to be getting them from someone else. That’s how we started in the outpatient therapy business, that’s how we got into home health, that’s why we have a growing presence in hospice.”