Making home-based care a one-stop shop for services is a common theme in the industry.
What started out as a very segmented industry is becoming more integrated, as larger companies acquire smaller ones in hopes to have more pieces of the care continuum puzzle in house.
That’s the focus for Home Care for the 21st Century, a Florida-based home care provider and franchiser that has helped open over 8,000 home health and hospice agencies throughout the country.
“Home care actually started out, and still is today to a high degree, very segmented,” Lori McCauley, vice president of franchise development at Home Care for the 21st Century, told Home Health Care News during the 2022 Franchise Forum. “The majority of the agencies only offer one service, and they all kind of stay within their wheelhouse. In the last two years, you’re starting to see a ton of acquisitions from large organizations, and they are trying to create a one-stop shop. Taking that to the franchise world is the focus [for our company].”
Home Care for the 21st Century offers personal home care, private-duty skilled care, hospice and other services at 30 of its own offices across the country.
McCauley said the specialization of health care in the U.S. has actually helped the home-based care industry. As care becomes more specialized, wait times to get patients discharged from the hospital have been cut, meaning people can get to the home quicker.
“They’re coming straight home, and with that, you have opportunities to help families out sooner rather than later,” McCauley said. “We’re also seeing outpatient rehab, which means that we’re discharging quicker and going through the patient population a lot quicker than we used to a few years ago.”
Other recent changes to the industry that McCauley and her organization have noticed recently have been the need for technology to advance in the home, rising costs of care and the “huge influx” of Medicare Advantage plans.
The switch to Medicare Advantage has seemed sudden for some who are figuring out the market dynamics.
“A lot of people don’t understand how that affects them,” McCauley said. “A few years ago, the majority of families were on traditional Medicare, and almost every single skilled nursing facility, physician and hospital takes traditional Medicare. But they do not necessarily take Medicare Advantage plans. Now you have to find who is in my network – and sometimes it’s not with the physician you want to work with. So you have to be more selective.”
Higher costs and lower reimbursement rates are an issue industry-wide. That’s one of the reasons why leaders at Home Care for the 21st Century are passionate about diversifying their business portfolio.
“Having multiple revenue streams is key,” John Dapello, CEO of Home Care for the 21st Century, told HHCN during the Franchise Forum. “We can’t just rely on one [stream]; we have to really be able to service a patient, regardless of their medical condition. In addition to that, whatever service that they need in the home when it comes to medical-orientated services, we have to be able to do it.”
Differences between Medicare Advantage and traditional Medicare, or even private pay, aren’t the only factor on the organization’s radar.
There are worries in home-based care, McCauley said, that there could be a cost ceiling.
“Overall, we’re seeing higher costs to deliver care and lower reimbursement,” McCauley said. “Are we creating a ceiling on health care? If you think about what it cost for private duty specifically, in the last 10 years it was always the same: $22 to $27 an hour. Then you paid your staff $12 to $14 an hour. There are some markets right now where we’re seeing $40 to $45 an hour, paying staff 20 to $25 an hour. Which we’ve never seen in the last 10 years.”
A key to becoming more efficient in the home care space is working smarter, not harder. Technology will play a role in that, McCauley said.
“We currently are working with artificial intelligence, machine learning, activity monitoring and wearables within the home,” McCauley said. “What that does is it actually creates an environment where we can detect a change in behavior that actually will determine whether or not there’s a change in condition. The goal really is to create a preventative medicine approach rather than reactive.”
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