Points versus a la carte. Formal versus informal. Resident dining contracts vary among providers and are a “very challenging part” of the overall service package for senior living providers, according to a respondent to the May 2024 CFO Hotline survey by specialty investment bank Ziegler.
In a May survey of chief financial officers and other leaders “heavily weighted” toward not-for-profit continuing care retirement / life plan communities, Ziegler gathered feedback on dining contracts, including the types of meal plans offered, whether or not organizations tracked resident use of those plans, and community offerings and resident preferences related to different types of dining options.
The most common type of meal plan that participants offer is a declining balance meal plan (43%), followed by a fixed meal plan (23%). Other meal plan options offered included vouchers/points (13%) and a la cart and meal credits built into rent rates (5%).
Of the represented responding organizations that offer multiple forms of dining — formal, bistro and cafe, for example — the majority (70%) allow residents to use meal plans/points across all dining venues, whereas 23% do not permit this capability. The remainder (7%) said they use a different system, as prices vary between dining formats. Formal dining had a slight edge (51%) over informal dining (49%) in terms of preferences by residents.
Only 25% of respondents allow meal points to be used in other areas of the senior living community, such as a convenience store, bistro or hair salon, and 64% do not allow cross use of meal plan points.
Most participating organizations (73%) said that the majority of their residents spend their allotted meal credits, whereas 21% said that their residents tend to underspend on dining, and 6% overspend.
Most organizations (58%) said they have a “use it or lose it” approach to allotted meals or points, whereas 21% said they allow residents to roll over unused credits or meals — with limits, such as requirements to use those allotments within six months or capping rollovers at $50. Approximately 18% of responding organizations said they make exceptions to their “use it or lose it” policy for unforeseen circumstances, such as hospitalization.
Almost half (49%) of participating organizations said they track their residents’ meal plans by dollar amount used, whereas 34% track by meals consumed. The remainder of responding providers said they use a point system (10%), a combination of methods (3%) or do not track at all. Software platforms are used by most organizations (75%) to track meal plans, with 25% tracking in-house and 9% using a third-party vendor.
