New Ceo Spells New Possibilities For Brookdale Senior Living

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Early Thursday, Brookdale Senior Living (NYSE: BKD) named Nick Stengle as its new CEO, filling a vacancy left open since former CEO Cindy Baier stepped down in April.

Stengle, who is taking the reins at the nation’s largest senior living operator on Oct. 6, previously worked as president and COO of hospice, palliative care and home health company Gentiva, which provides services at 550 locations in 38 states. He also previously worked as executive vice president and COO at Sunrise Senior Living, not to mention stints in the private equity and hospitality sectors.

In other words, it’s hard to envision a resume more tailor-made for a top executive job in senior living, given the need for financial and operational acumen within a model that blends health care and hospitality.

That background suggests Stengle could be well-suited to lead the company down several paths, and I’m assuming – given the shareholder pressure that Brookdale has been under – that his first priorities will be on whatever action he can take to drive earnings as quickly as possible. But zooming out to look at the big picture, I think it’s particularly notable that Brookdale chose a leader from the home health and hospice world to lead the company. While the senior living operator sold the remaining part of its home health and hospice business to HCA in 2023, the operator’s leaders have said the company seeks to integrate into a continuum of care driven by value-based models.

A cornerstone of the company’s effort in that regard is HealthPlus, a program that gives residents more care coordination and preventive care that includes vaccines and wellness visits. By the end of 2025, Brookdale expects to have grown the program to almost 200 communities.

I have yet to actually speak with Stengle or Brookdale about what this move means for the company, and neither he nor other leaders at the company were available for an interview as of Oct. 2. But putting the pieces together on my own, I think this brings forth some tantalizing possibilities for the future of the senior living operator.

In this members-only SHN+ Update, I analyze Brookdale’s CEO choice and offer the following takeaways:

• How Stengle’s career might indicate why Brookdale chose him for the CEO role
• Why Brookdale is leaning into value-based care through its HealthPlus program
• What could come next for the nation’s largest operator now that it has a new leader

Stengle’s background mixes senior living and long-term care

Looking over Stengle’s career thus far, I believe I can guess why Brookdale chose him as its next top leader.

According to his LinkedIn profile, he spent 11 years in the U.S. Air Force, leaving in 2009. In 2013, he joined Marriott, where he helped the hospitality provider manage global operations. In 2018, he joined private equity company TPG Capital and worked on its portfolio operations team, and two years later, he was EVP and COO at Kindred at Home, the nation’s largest home health provider. Humana (NYSE: HUM) acquired that company in 2021 for $5.7 billion, and Stengle joined Sunrise Senior Living as COO around the same time.

After working as COO at Sunrise for about a year, Stengle took the same role at Gentiva after Humana sold a 60% stake in the company’s hospice and personal care divisions to Clayton, Dubilier & Rice (CDR) for $2.8 billion. CDR later rebranded those assets under the Gentiva banner. After spending two years as Gentiva’s COO, Stengle also became the company’s president.

Under his leadership, Gentiva established and expanded its Advanced Illness Management (AIM) palliative care model, which is meant to provide care for people who are seriously ill, including people who are not expected to recover but are also not yet eligible for hospice, according to SHN sister site Hospice News.

The program was also designed to circumvent the need to work directly with Medicare or other payers and fill a gap that exists due to limited reimbursement.

“There’s truly a need in this palliative space, sort of this gap between restorative care and end-of-life care where the patient and their family typically are not quite ready to begin discussing end of life,” Stengle said during the Home Care 100 conference in 2024. “Palliative can sometimes help bridge that gap that actually exists. So we as a company sat back and contemplated what is a path to achieve this, to fill this void as a company in a sustainable fashion.”

Gentiva built that model by creating partnerships with companies that have Medicare Advantage contracts, like physician groups.

“These are large physician groups that haven’t built their own risk-bearing entities, where they are at risk for a subset of their Medicare population where they get a capitated rate,” Stengle said. “We identify in partnership with them through a risk stratification tool … and we will help provide care and coordination with that physician group in the patient’s home.”

He added that “in effect, we created a reimbursement structure of our own.”

“We’re not charging Medicare for a visit. We’re doing as many visits as we feel are needed for that patient,” Stengle said during the conference. “We’re providing the overlay of RNs, social workers, and none of that’s reimbursed directly from Medicare. We’re able to provide that patient better care, better quality of life, and as a result, a lower total cost of medical expenses of which we get a share.”

Brookdale gets a per-member, per-month cut for every HealthPlus resident who also is enrolled in a Medicare Advantage (MA) plan with a payer that Brookdale has a partnership with. HealthPlus and Gentiva’s programs are similar in that they both are meant to provide better care, a better quality of life and lower medical expenses while keeping residents from needing to visit the hospital or emergency department.

It’s not hard for me to imagine Stengle’s expertise proving valuable as Brookdale continues to expand and evolve that program for an incoming generation of older adults and further integrate into the broader care continuum through value-based care.

In 2023, my colleague Tim Mullaney speculated that “payviders” like Optum will seek to exert more control over how care and services are delivered in senior housing settings, making them a logical suitor for a company like Brookdale.

To be clear, I know of no discussions involving a Brookdale sale, let alone one to Optum, and this is all speculation. But I think Stengle’s knowledge of at-home care could be helpful should such a deal ever come to pass – or perhaps more precisely, if Brookdale is interested in becoming a more attractive acquisition target to payviders. Regardless of whether the intention is to attract potential buyers down the line, I think a strategy rooted in value-based care, that positions Brookdale as a strong partner for both upstream and downstream providers, is a sensible direction for the company.

The case for a value-based strategy

Brookdale’s leaders have said time and time again that HealthPlus is among their biggest priorities as a company. The senior living operator has repeatedly cited data showing that communities that have deployed HealthPlus have as much as an 80% reduction in resident urgent care visits and a 66% reduction in hospitalizations.

Earlier this week before announcing Stengle’s hiring, CFO Dawn Kussow noted that the senior living operator has plans to extend HealthPlus to nearly 200 communities by the end of this year. 

Brookdale is all the while seeking to differentiate itself from its peers as a senior living operator that is a “leader in value-based care,” according to its most recent earnings presentation for investors. Among its goals ahead is to maximize that differentiation through programs like HealthPlus and EngagementPlus, a service meant to help residents build faster friendships and live in a way that reflects their interests.

Looking at the company’s unit mix, it’s easy to see why it’s chasing value-based care and preventive wellness services. As of the time of the company’s most recent annual report, Brookdale’s units were weighted about 70% in favor of needs-based assisted living and memory care. Those units “have a higher move-in age of nearly two years [and] position the company for greater upside based on the baby boomer demographic in 2025 and future years,” the annual report reads, contrasting the move-in age with independent living.

Interestingly, I also noticed in the annual report that Brookdale is piloting “the expansion of our private-duty services business to serve those living outside of our communities.” Brookdale offers these services, such as companionship and assistance with grooming and mobility, through its Brookdale at Home agency.

So, while the company has shed its Medicare-certified home health and hospice business, it makes sense that the company is still interested in private-duty home care. This type of care allows Brookdale to leverage its expertise in delivering these types of services, but presumably to a lower-acuity segment of the population still living in their single-family homes. Meanwhile, the company can continue to concentrate on higher-needs residents in its senior living communities.

I could see the vision being for a future in which people increasingly stay at home even as they develop more complex needs, enabled by traditional home health and emerging models such as hospital-at-home, as well as private-duty care. Already, there is discussion in the home health sector about the need for greater integration between Medicare-certified agencies and personal home care providers, in order to deliver wraparound services that keep people out of the hospital and deliver for value-based model and managed care payers.

In this scenario, Brookdale might not deliver the skilled home health but can tap into its senior living expertise to become a preferred private-duty provider, and then also would be a major player as people finally do move into assisted living or memory care communities. Given Brookdale’s scale, I imagine that some of the nation’s largest managed care payers would be interested in working with the company in this type of arrangement.

Although speaking of scale, Stengle also steps into the CEO role as the operator continues to shrink in size. Earlier this week, Kussow outlined plans to downsize the company’s portfolio to 550 communities. Given the company’s struggles with performance in some of its current communities, I believe it will continue efforts to concentrate its strengths by offloading underperformers in the months ahead under Stengle’s leadership, and obviously a portfolio of 500-plus senior living communities still would make Brookdale the sector’s largest provider.

Over the last few years, I’ve written about Brookdale’s years-long saga from a senior living behemoth with more than 1,100 communities to one that is nearly half as big today. With Stengle’s hiring, I think the company is stepping into a new era, one that is increasingly defined by its health care offerings and in defining its role within the evolving U.S. health care system.

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