Turnover, Tiny Homes and New Technology: 2021 Predictions from 14 Home Care Executives

The U.S. home care industry is at an inflection point.

Prior to the COVID-19 pandemic, an increasing number of payers and health care providers began to recognize the value of non-medical home care, particularly when it comes to chronic disease management and preventative care. That recognition has grown even stronger in 2020, with home care often playing a leading role in emerging care delivery models, including hospital-at-home and SNF-at-home programs.

That momentum will continue in 2021, most home care executives believe. To stay relevant, though, agencies will need to embrace new technologies, invest in staffing and boldly go where no home care operator has gone before.

For a clearer picture of home care’s future, Home Health Care News asked 14 executives to look into their crystal balls and describe what lies ahead. You can read their predictions below, edited for length and clarity.

HHCN previously shared our executive forecast for the home health industry on Dec. 14.

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We all know that 2020 was unarguably one of the most difficult years in recent history. One aspect of the pandemic that influenced senior care is that aging in place as well as the demand for home care accelerated. And it will continue to accelerate in 2021. We predict that there will be a significant change in the mindset of seniors to favor aging at home instead of in congregate residences such as long-term care facilities, plus assisted living and independent living communities.

This influx of demand for home care will come with its own challenges, mainly the need for additional qualified staffing. As home care industry leaders, we need to ask ourselves, “How can we make caregiving a profession that will attract the ‘best’ talent in the coming years?” Regardless of the hardships that the pandemic caused, we need to view these challenges as potential opportunities in both business and in life.

— Mario D’Aquila, COO at Assisted Living Services Inc.

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Demand is running high for caregivers and senior homes. We believe we’ll see a wave of ingenuity and innovation in senior living solutions. We’ve seen the tiny home movement model on TV that’s popular with millennials; we think we might also see that with seniors as well to help combat the loneliness epidemic. The idea is that older adults have their own bedroom, bathroom and living space, but they’ll walk down a short path to join others for meals and engagement.

The tiny home park allows caregivers to operate more easily because the seniors are aggregated more so than they are in a traditional neighborhood home. This model allows seniors to maintain their independence but also offers much higher engagement with others.

Companies will try to bust that loneliness and isolation bubble we’re seeing so much of, which has only been escalated in 2020.

— J.J. Sorrenti, CEO of Best Life Brands

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Heading into 2021, the need for home care will drastically increase as a result of the COVID-19 crisis. Over the past year, it has become evident that in-home care is a much more attractive option for families looking to care for their aging relatives, without needing to place them in a restrictive or possibly unsafe nursing home or long-term care facility. They’ve learned that there is a huge difference between aging at home while being in your own community and aging in a facility where you have little to no control.

Individuals don’t want to put themselves or family members into a situation where they are restricted from their family. This lesson has been burned into the minds and psyches of people who are aging — and their search for non-medical home care and assistance with daily living activities is going to strengthen the home care industry in the coming years.

— David Savitsky, CEO of CareBuilders at Home

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Personal Care benefited from amazing positive awareness in 2020. I predict that there will be a divergence in 2021 — of agencies who stay the course, and those who capitalize on this awareness and press the advantage for greater utilization within the health care continuum and attention from payers.

I foresee this divergence also spreading to include agencies that innovate on how they recruit, retain, train and incentivize their caregivers, and those that continue to struggle with enough staff. I feel we will look back on this time as a watershed moment in home care, where we truly saw advancement in the industry. 2021 is the year to truly make that a reality.

— Jeff Wiberg, CEO of Family Resource Home Care

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While we can’t wait for 2020 to end, 2021 probably won’t be much different for the first half of the year. We are looking at 2021 being a bifurcated year. More of the same for at least the first quarter and probably most of the second quarter, but we should start to see some significant relief from the virus by late spring of next year as the vaccine hits our communities broadly. Nonetheless, we have to prepare ourselves for potential glitches in the role-out of the vaccine and that helping hospitals discharge COVID-positive patients may consume more of the year than we hope. We are continuing to stock up on PPE and hire and train aides for COVID cases, but it would be great to get to a point where we are throwing away PPE in 2021!

— John Bradshaw, CEO of Georgetown Home Care

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After a year like this one, where every business and employee has had to adapt, I expect 2021 to continue to drive innovations that bring care to the consumer, leverage new technology and increase our talent pools.

From hospital-at-home programs to home care agencies innovating their offerings, each will bring solutions that increase independence and the ability to live at home longer. Integrated solutions bringing care and support to the home will enable consumers to be more compliant with care plans and will enhance revenues.

I predict this innovation will come from two approaches. One, strategic partnerships will help optimize the consumer experience and reduce redundancies. Second, technological solutions that help manage a consumer’s ongoing care and anticipate changes in health proactively.

My final prediction: We will experience new candidate pools for positions across the health care continuum. Those companies with strong training programs will be able to differentiate themselves and will see faster growth. By retooling workers from other service industries into meaningful, needed roles in health care, home care especially may see dramatic improvements in staffing and quality.

— Emma Dickison, CEO of Home Helpers

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In 2021, providing home care is going to be harder but the quality of care will be much better. It’ll be harder since COVID-19 isn’t going away, but it’ll also drive improvement in care quality through better infection control, faster restaffing when a caregiver reports flu-like symptoms and other innovations that pay dividends into the future. This means the bar to operate becomes higher. Home care companies will have to invest more in technology and tools to deliver the new level of expectation — likely leading towards further consolidation in the industry

— Seth Sternberg, co-founder and CEO of Honor

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2021 will be all about people and technology. Every industry webinar talks about the need to create an engaged and empowered workforce. It’s no longer a talking point — industry survival depends on it. Every company without a specialized caregiver engagement focus will lose. Business models that address caregiver wages will win.

This year has demonstrated more than ever the need for “touchless” strategies to serve the customer and the employees. Virtual onboarding and virtual visits will become the baseline. Stakeholders will expect real-time interventions.

— Andrea Cohen, co-founder and CEO of HouseWorkers

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COVID has been a catalyst for a major shift in how we serve seniors. 2021’s opportunity lies in more data, analytics and partnerships. Isolation is fatal! Providers need to start moving their models away from high-touch-only, to high-touch and high-tech. There is tremendous opportunity to connect to value-based opportunities, which require more analytics to provide better care across integrated delivery systems and prove efficacy. High-tech augments high-touch and intelligently and thoughtfully supports our ability to address workforce demands, cost, and meet the growing need for effective whole-person community-based options.

— Joel Theisen, CEO of Lifesprk

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In 2021, as we transition out of the COVID-19 pandemic into a normal way of life, we will begin to see the marriage between the “old way” of how traditional home care was done with the “new way,” including technology-process integration. As home care agencies are looking to stay ahead, we will see a major shift toward telehealth services over traditional aide services while we look to continue placing an emphasis on keeping patients both healthy and happy in the comfort of their own homes. 2020 has taught home care clients the necessity of including a tech component within their homes. As patients have become more comfortable with this change, we will continue to see an increasing number of seniors seek out home care technology alongside an aide as part of their home care solution.

— Josh Klein, CEO of Royal Care and Emerest

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After an unprecedented year in 2020, home care needs to stay the course on its momentum prior to the pandemic and the tailwinds after. The desire for seniors to age in their home has increased even more since the pandemic, and the best news is that the health care system is supporting that as well. Home care agencies must look to data-driven outcome strategies to help families understand their loved one’s ability to age safely in their home. Agencies who embrace partnerships and technology solutions will enable this to happen. 2021 offers a bright future for those agencies that adapt to a value-based care environment.

— Peter Ross, CEO and co-founder of Senior Helpers

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In 2020, we asked, “Who or what is essential?” Our caregivers were heroes before 2020, but the year brought their heroics into the spotlight. The goal in 2021 and beyond is to never forget this fact. As more and more baby boomers become senior citizens, they will require companionship and assistance at home or at a facility, not just clinical care. We must focus on recruiting and retaining by attracting new caregivers and welcoming back the heroes sidelined due to the pandemic. We will also need all in the non-medical care industry to embrace existing and emerging technological services, such as those designed to connect receivers with loved ones or doctors. We saw tremendous success among our own receivers and expect the efficiency and quality of these systems to improve and grow in popularity in 2021.

— Howard Algeo, director of business development and training at Seniors Helping Seniors

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In 2021, I think the home care industry will see proof that the private equity groups that are consolidating the industry are creating huge competitive advantages over smaller independently-owned businesses and franchisees. Any home care agency that operates in a top-20 market and is under $15 million in revenue in their local market will continue to struggle in caregiver recruiting, online marketing and operational efficiency. Our industry is just starting to see what can happen when you scale a business nationally, with geographic concentration of caregivers, clients and referral sources in local markets.

— Jim Kimzey, CEO and founder of Tender Rose Dementia Care Specialists

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Home care has long been an underappreciated element of health care. The vital role it has played during COVID-19 reminded the industry — and society — of the value of providing quality in-home care to keep vulnerable populations safe. In 2021, I predict that home care will ride this momentum by supporting managed care organizations to reduce overcrowding in hospitals and extend their ambulatory care management bandwidth while lowering costs. I predict an increase in Medicare Advantage plans that offer home care as a supplemental benefit. Because of the compelling data and positive outcomes that demonstrate the holistic benefits that home care provides to its members and the plans, it’s a no-brainer to meet this demand similar to what we witnessed in the past with outpatient physical therapy (PT) and hospice care.

— Ryan Iwamoto, president of 24 Hour Home Care

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‘We’re Not Providing a Luxury Service’: No-Nonsense Home Care Model Helps CareBuilders Grow Amid Economic Downturn

CareBuilders at Home — the non-medical home care division of ATC Healthcare — has announced a strategic growth plan across the U.S.

The Lake Success, New York-based franchise currently has 13 locations. It is targeting to add more in Michigan, Illinois, Texas, Pennsylvania, New Jersey and California, specifically in the Bay Area.

The vast majority of the company’s revenue comes from its private-pay home care line. Generally, its offerings include those related to activities of daily living (ADLs), such as errand support, light housekeeping, medication compliance and other services.

CareBuilders at Home decided to grow amid the ongoing public health crisis because of the increasing demand for home care. Additionally, the target locations are all places that have the demographics that will be in need of in-home care services moving forward, CEO David Savitsky told Home Health Care News.

“We think that those areas are particularly good areas for us to be in because we feel that there are a lot of cities that have large populations — and large populations of people who are aging in place,” Savitsky said.

The company is also looking forward to eventually expanding to Florida, Arizona and elsewhere in California in the future. First, though, the franchiser is looking for the right franchisees.

CareBuilders at Home takes care of the full back-office needs for each of its franchisees, which differentiates it from some of its competitors, according to the company. One of its main appeals is allowing the franchise owners to focus on growing their own businesses and meeting client needs.

Those back-office functions include client credit checks, invoicing, payroll for health care associates and receivables.

The company does business with a few payers, but the vast majority is private pay. That’s an intentional strategy due to the relatively straightforward relationship between provider and client, Savitsky noted.

Historically, the home care space as a whole has been mostly built on private-pay relationships.

In 2019, for example, 67.5% of home care agency revenue came from private pay, according to the 2020 Home Care Benchmarking Study by market research and education firm Home Care Pulse. The next closest revenue sources were long-term care insurance and veterans assistance, at 11.4% and 3.6%, respectively.

In 2018, 72.1% of home care agency revenue came from private-pay sources, according to Home Care Pulse.

“Our primary means of having our services paid for is through private pay, and we think that is a good place to be,” Savitsky said. “Because we think the majority of home care that’s going to be delivered will be through private pay because there are no gatekeepers. There are no restrictions.”

Private-pay home care restrictions and state licensure requirements vary by state, but it is true that they have less to abide by than, say, Medicaid or Medicare providers.

While out-of-pocket costs are less reliable during a recession, Savitsky isn’t worried.

Business has been good for CareBuilders at Home during the COVID-19 crisis, and its leaders don’t think that it’ll be affected much by the economic downturn.

“I think that there’s no such thing as a business that’s totally recession proof,” Savitsky said. “But I would say that we’re a very recession-resilient business. Our offices have continued to thrive during COVID-19. We’ve continued to bring new people into the business — and it’s larger today than it was six months ago.

Several other in-home care franchise companies have also achieved solid growth during the last few months.

Home Instead Senior Care, for instance, hit an organizational high-water mark in January in terms of revenue and hours of care provided, CEO Jeff Huber recently told HHCN. After initial COVID-19 disruption, it then saw even stronger business numbers in July.

That steady success is mostly due to the practicality and importance of in-home care, Savitsky added.

“We’re not providing a luxury service,” he said. “We’re providing services that allow someone to live at home.”

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In-Home Care Agencies May Look to Cut Costs by Scrapping Brick-and-Mortar Offices

The COVID-19 crisis has raised a complicated question for home-based care executives as they plan for the year ahead: Is the cost of having a brick-and-mortar office location still worth it?

Traditionally, home health and home care operators have maintained a corporate headquarters or local office as a place where administrative staff can come into work on a daily basis and where caregivers in the field can occasionally mingle with peers.

But as the cost of COVID-19 mounts, many agencies are beginning to weigh the possibility of going fully remote, as leasing real estate often comes with a steep price tag. For some, though, the thought of going completely remote feels like a logistical nightmare.

Surprisingly seamless

While Addus HomeCare Corporation (Nasdaq: ADUS) still wants to get its employees back together in its 185 locations, leadership acknowledged during the company’s recent second-quarter earnings call that the switch to a near-100% remote workplace was done with relative ease.

“There’s been some benefits that we’ve all obviously learned from being remote that maybe we can take into the future,” Dirk Allison, president and CEO of the Frisco, Texas-based home health, hospice and personal care services provider, said.

Specifically, Allison mentioned cutting down on travel time as a perk of going fully remote.

For agencies with less financial flexibility, getting rid of the brick-and-mortar office seems like an efficient way to reduce costs.

In the Washington, D.C., area, for example, office space costs $595 per square foot, on average, according to Statista. In Pittsburgh, it costs $140 per square foot, on average.

The telehealth boom has already forced on-the-ground workers to deliver care differently. It’s doubtful that trend is going away, Mark Kulik, managing director of M&A advisory firm The Braff Group, told Home Health Care News.

“The situation has forced people to have more open minds about how to do business and how to provide care,” Kulik said. “From an expense perspective, economically, it makes all the sense in the world to not have offices dotting the landscape.”

Apart from having a central hub for workers, the conventional wisdom in home-based care was that agencies needed to have local visibility and be on as many corners in a given area as possible. The goal: to win referrals and build relationships within the community.

Remote work and COVID-19 have changed that.

To some extent, that evolution was already taking place beforehand, Kulik said.

Generally speaking, having a physical office means keeping it secure and stocked with supplies. Accomplishing that could mean hiring additional employees, something that’s not always easy to do in a normally tight labor market.

“Everywhere you have an office, you have to have someone there responsible for the office and staff, and it’s [generally] hard to find staff,” Kulik said. “Beyond just the economics of the facility and related expenses — copy machines, phone systems, utility bills and other repair costs — it’s also the challenge of finding that quality staff. And maybe that allows you to have [fewer] open positions because you’ve been able to consolidate your operations.”

By the numbers: working remotely

Market research and education firm Home Care Pulse analyzed remote-work trends in its 2020 Home Care Benchmarking Study, released in June.

In response to the public health emergency, about 67% of home care agencies that participated in the study said they shifted sales and marketing functions to remote status. Another 72% and 51% said they shifted team meetings and payroll to remote status.

Many agencies similarly shifted office-based tasks like caregiver interviews, caregiver training and scheduling to remote status, the Benchmarking Study found.

Less than 10% of the agencies that participated in the study said they had staff working remotely prior to the COVID-19 virus.

Now, more than half said they’ll likely continue working remotely even after the virus goes away.

A smaller footprint

If home-based care operators believe they should keep brick-and-mortar offices, they’ll have to make a compelling case as to why.

That’ll be difficult to do if months of remote work went relatively smoothly.

“I think what we’ll find is that the more progressive companies and agencies will begin to adopt a smaller footprint,” Kulik said. “Especially if the lease is coming up, it will really put the issue front and center: Do we renew our lease for next three or five years or do we just go ahead [remotely]?”

The only problem is that each state’s licensing requirements are different.

For example, in Pennsylvania, a home health agency has to have an office within one hour or 60 miles of the patient’s home. Agencies looking to downsize in states such as those will obviously have less flexibility.

In some states, home care companies are bound by the same restrictions.

In a state like Michigan, however, there are no such rules — at least for home health agencies.

“Technically, you’re able to provide care for the entire state via one office,” Kulik said.

Office perks and remote drawbacks

For all of the cost savings that remote work has to offer, there are plenty of home-based care executives who still believe in the power of the office.

“I think that a brick-and-mortar office is very important,” David Savitsky, the CEO of CareBuilders at Home, told HHCN. “[For one thing], recruiting is a constant thing — we’re always recruiting and always talking to people who want to work in the home care business. And I don’t think there’s really any substitute for having someone sitting down across the desk from you and having a conversation with them.”

CareBuilders at Home — the home division of ATC Healthcare — is a national network of private-duty home care agencies. It’s currently targeting a growth plan that would bring the brand into Michigan, Illinois, Texas, Pennsylvania and New Jersey, along with parts of California.

Savitsky plans to open up new offices in the locations CareBuilders at Home is expanding into.

“When it comes to caregiver interviews, you’re sitting across the desk from someone who wants to be a caregiver, and you get a sense of whether or not they are a caring person,” Savitsky said. “Are they that person who is going to make a good impression on a client? That’s so important because it’s not just a matter of capability when it comes to home care.”

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