SHANGHAI — In a senior-living facility in south Shanghai, a volunteer leads a dozen people in singing and moving their bodies to the rhythms of a song.
It’s not an unusual activity for a senior-care centerin the United States. But such specialized housing for the elderly is not widespread in China. And even more unusual, it’s run by a Seattle-based company.
The facility, in the Xuhui district of Shanghai, is one of three senior-living facilities in China owned and operated by Cascade Healthcare, which is part of the Seattle-based international health-care business Columbia Pacific Management.
Columbia Pacific was founded by Dan Baty, who also co-founded the Emeritus chain of senior-living facilities in the U.S., which was sold last year.
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Cascade Healthcare is one of the first U.S. companies to open senior-living facilities in China. Other U.S. firms testing the market include New York City-based Fortress Investment Group and Seattle-based Merrill Gardens. All provide various levels of care.
Facing a rapidly aging population and inadequate infrastructure to meet the projected needs, the Chinese government a few years ago began cutting red tape and costs in an effort to get foreign companies with expertise in the field to open senior-care facilities in the country.
Fortress Investment worked with a Chinese partner to open a residential facility in Shanghai for 200 seniors in 2012. It plans to build another facility nearby that can house 1,500 and has established a home-care business that cares for 8,000 seniors in Shanghai.
Merrill Gardens, along with local Chinese partners, is renovating one hotel in Shanghai and another in Beijing into senior-living buildings. It’s also constructing senior-living facilities in the cities of Harbin, Suzhou and Yantai.
“China presents tremendous opportunities for companies that have the bandwidth to hang in there and watch it all come together,” said Barbara Nopen, chief operating officer of Merrill Gardens China.
At the same time, “We really have a lot of work to do to educate a country about why it’s a good lifestyle for them,” she said.
About 132 million people in China — 9.4 percent of the population — are 65 or older, estimates William Lavely, University of Washington professor of international studies and sociology, citing United Nations projections.
The U.N. estimates that figure will increase to 195 million, or 13.2 percent of China’s population, in 2025; and 332 million, or 22.7 percent, by 2050.
That upward trajectory is similar to the one in the U.S., which has its own growing aging population.
In 2013, about 45 million people in the U.S., or 14.1 percent of the population, were 65 or older, according to the U.S. Census Bureau. That number is expected to rise to 64 million, or 18.5 percent, in 2025; and 84 million, or 21.1 percent, in 2050, according to the U.N.
But it’s the sheer numbers in China, combined with the facts that the country’s economy is still developing and that it doesn’t yet have a strong system of long-term elder care, that is driving the need for outside involvement.
“There’s a realization by the central government that aging is a huge problem but the problem is not really here yet,” Lavely said. “The crush is coming over the next two to three decades. They have time to prepare institutionally for this.”
One way the government is doing so, he said, is by looking to foreign companies that know about elder care to come in not only to fill the gap, but to share their managerial models and technologies.
The Chinese “may consider this a good way to upgrade their expertise on this and maybe spur some homegrown competition in this field,” Lavely said.
The opportunities for U.S. companies going into the field in China are big, with a rapidly urbanizing population, a growing middle class, and health-care reforms that are slowly relaxing rules that make it hard for doctors to work at more than one facility — usually government-run public hospitals.
“When you look at the emerging middle class, India and China leap to the forefront,” said Baty, whose company is also planning hospitals in the cities of Wuxi and Changzhou after the Chinese government said it would allow fully foreign-owned companies to open hospitals in some areas.
But the challenges are big as well.
Cascade Healthcare opened its first senior-living facility — the one in Shanghai’s Xuhui district — in October 2012.
It opened its second in Beijing in August 2013, and its third in the Pudong area of Shanghai in February last year.
While the 70-bed Xuhui facility is about 70 percent occupied and breaking even, the Beijing facility (with 122 beds) and the other one in Shanghai (78 beds) are only about 25 to 30 percent filled.
“We didn’t expect a rush of people to move in,” Baty said. “We understand that it was going to take time for the concept to take hold. This is brand new.”
One challenge is figuring out pricing.
Rooms at Cascade’s Xuhui facility run from about $1,000 to $4,000 a month, which includes meals and snacks, laundry and basic nursing care. Services on top of that cost extra.
The average resident ends up paying about $2,000 a month. Those prices mean the facility caters largely to the upper middle class.
There’s also a lack of geriatrics-trained health professionals.
And there’s a big cultural hurdle.
Traditionally, Chinese society has emphasized that families — especially daughters-in-law — take care of elderly parents and grandparents. The aged who were sent to institutions were usually those who were widowed or had no children to support them.
But as China’s middle class expands and more women enter the workforce, that cultural expectation is changing.
China’s one-child policy has also put pressure on the family-based care system, since looking after elderly family members often now falls onto the shoulders of one child, who is likely working full time and raising a family.
It’s still a painful decision to send an elderly parent to a senior home, said Bee Lan Tan, who heads Columbia Pacific’s health-care operations in China.
“Usually, when they send their parents here, it’s because they have no choice,” Tan said. “They need the facilities because they’re all working and are not able to cope.”
But there’s less stigma attached now, and “if it’s need-based, to reduce the stress on the family and help them to cope,” there’s more readiness by the elderly to live in senior-care facilities, she said.
That was the case with Weizhang Li, a retired textile engineer in Shanghai who has two sons and a daughter.
Still alert and enthusiastic at 86, he said he came to the Cascade Healthcare center at Xuhui because he understands his children “have their own families and are very busy.”
Besides, he added, he enjoys the atmosphere and the activities at Cascade, such as tai chi and calligraphy in the morning and singing and watching movies in the afternoon.
“Everyone is friendly,” he said. “They take care of you. They say: ‘Have you eaten?’ ”
Baty is counting on several shifts in China over the next few years, with cultural attitudes becoming more accepting toward sending the elderly to senior-living facilities, a rise in family incomes, and more flexibility for health-care workers to choose to practice at private facilities such as senior-care homes.
“When that happens, you can’t start from scratch,” Baty said. “You’ve got to have the infrastructure in place.”