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Private Duty Today
Welcome to Private Duty Today, the bi-weekly electronic newsletter for Private Duty Home Care Leaders from Leading Home Care ...a Tweed Jeffries company. In this issue, we bring you ideas, information, and insights to help you grow your Private Duty Home Care business.
Private Duty Today is a permission-based newsletter. It is only sent to our recent customers and those individuals who have requested it, or who have given permission for their address to be included on our list of subscribers.
I'm Jason Tweed, Director of Business Development for Leading Home Care, and Editor of Private Duty Today.
Private Duty Today is published every other Wednesday, and currently goes to over 6000 subscribers. |
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Practical, Proven Tips and Techniques
to Grow Your Private Duty Home Care Business
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Reflections on 2007
This is the last issue of Private Duty Today for 2007. We won't be publishing an issue between Christmas and New Year's, so allow me to take a quick second to wish you Happy Holidays.
New Year's Eve is actually my favorite holiday of the year. The powerful meaning behind Christmas sometimes gets lost in the commercialization. Easter and Thanksgiving have become increasingly about the food. Halloween just scares me. But New Year's Eve is my personal time.
There's about an hour and a half each New Year's Eve that has become cherished for me. The kids are in bed. My wife, usually tired from a long week of holiday cheer, is dozing on the couch with strict orders for me to wake her up 10 minutes before midnight. The house is quiet, just me and my cat.
I'm probably sitting in front of my laptop, or at my desk, and writing. I try to summarize the last year. I think about the good things that have happened. Personal tragedies we've overcome. I write down the things that we experienced that I didn't expect. Then I wrap up with personal and family accomplishments. These few pages of documents end an entire year surprisingly well. I haven't decided what to do with my New Year's memoir yet, maybe nothing. Maybe it's just for me.
My father and I spend time each year in a similar exercise for our business. It's usually a prelude to strategic planning; looking back at how our business has evolved during the past 12 months.
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Six Private Duty Trends for 2008
Introspective thought does not take the place of an organized strategic planning process, but it has tremendous value for business owners. What things have you witnessed in your business, with your customers, with the media and with your employees that will affect your business going forward?
I've identified six trends that will likely impact every single Private Duty company in America in 2008. Whether you're just starting out or have been delivering non-medical home care for 20 years, I think you'll agree that these six trends, assuming they hold true, will have a direct impact on your bottom line next year. |
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Increase Utilization of Geriatric Care Management
Seniors are more active now than ever. If your primary focus is on private pay home care, you should see a direct impact from Geriatric Care Managers working in your community. Over the past five years the number one obstacle was educating consumers about the value of Geriatric Care Management. I believe over the next few years the value won't be questioned, it will be which GCM company offers the most value to their clients.
Last year a family friend retired. He and his wife are in their early 60s, very active and very healthy. Within months of retirement they sold their home and moved into a retirement community in State College, Pennsylvania. I questioned Garrett about why they would make this move. He said "I know I'm getting older. I know the move was inevitable. It may be 20 years before I need all of the services this community offers, but when I need to live here it will be very difficult to make the move. I'd much rather make a major life change right now than wait until I'm in my 80s."
This was a big "a-ha" for me. It was the first time that I realized that seniors know they are getting old. It doesn't sneak up on anyone. Because of that, today's retirees are planning for old age and getting advice much sooner.
Whether you have a Geriatric Care Manager on staff or receive referrals from GCMs, an increase in utilization will have a direct impact on the growth of your home care services. |
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Technology Increases Efficiency
As much as GCM affects private pay home care, technological efficiency will increase the bottom line of companies who focus on Medicaid waiver and other governmental programs. The most significant difference between successful private pay companies and successful Medicaid waiver companies is this:
· Private pay is a low volume, high margin business
· Medicaid waiver is a low margin, high volume business.
While efficiency in office operations is important to profitability of private pay companies, it's absolutely critical to profitability of Medicaid waiver focused companies.
We are seeing across the board that as their waiver programs grow, efficiency is increasingly important, not only for sustained profitability but also for good relationships with the state Medicaid administrators.
In Pennsylvania there are 66 counties. At one time most counties had 6 to 10 providers to the Medicaid program each. Today we are seeing a handful of large companies that serve entire regions of the state. The company that manages my Medicaid program serves over one third of the state. They aren't the exclusive provider, so clients still have choices, however the total number of companies serving the Medicaid program has been consolidated.
When I first received waiver services I was the 6th person in my county, and about the 60th statewide. I believe, today there are over 1200 users. As waiver services expand so does the expense of administration and case management. Companies that reduce this expense are going to be viewed in a much more favorable light.
Rick Morey of HomeTrak, a company that produces scheduling software for Private Duty, has said "Technology doesn't prevent you from hiring office staff, it permits you to grow more before hiring additional staff as necessary."
Technology will make these and other processes more efficient.
· Case Management
· Care Planning and Documentation
· Scheduling
· Billing
· Timekeeping and Payroll
· Direct sales
When utilizing new technology in your business, focus on this factor. Will the technology allow me to be more productive with the same level of staff support? Highly efficient companies are capable of far more growth. Increased profitability and profit margin is simply a byproduct. |
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New Competitors with More Business Savvy
Years ago I spoke to one or two people each week who were interested in starting a non-medical home care company. Many of these were caregivers, nurses, social workers and other people who have a passion for caring. I still get these calls, though many are from a new group of people.
You see, some of you are making wheelbarrows full of cash. For others of you, cash is delivered in dump trucks. Whenever business savvy entrepreneurs see wheelbarrows and dump trucks full of cash, they tend to follow them and find out where they're going.
Today I get four to six calls per week and well over half of them are people who've already made profits in other fields. They understand marketing. They understand office operations. They understand human resources. They have initials like MBA, CPA and JD after their name. And they're coming with one goal in mind, to compete for those dump trucks!
The skills that you've obtained over the past 15 to 20 years are native to these people.
I still believe that the companies who get the dump trucks instead of the wheelbarrows are the ones who have a blend of business savvy and a passion for caring. Whether you have the savvy and develop the passion, or have the passion and develop the savvy, you must have a balance of both. |
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Increasing Regulations Makes It Harder for Start Ups
In the past five years we've seen licensure increase from a handful of states to well over half. I predict that in the next five years virtually every state will regulate non-medical home care to some degree.
The problem is, the states aren't very good at licensure. Several states, most notably in the Southeast, have actually put a freeze on new licenses.
Licensure and regulation is a craft that state governments develop over time. In states that have a longer history, such as New Jersey and Florida, we've seen a relaxation of regulation because they understand that the need is so strong and growing so rapidly that they don't want to inhibit quality companies from growth. Remember, licensure and regulation is designed to eliminate bad companies, not to inhibit good ones.
The challenges with new licensure requirements are it's harder to start a new company. For those of you already in business for decades, this is a scary prospect. On the one hand you have fewer fly-by-night companies to contend with. On the other hand your business model may become less profitable as it gets bogged down by bureaucracy.
States need to realize that they need to protect their citizens without inhibiting business growth. The only way they realize this is when home care associations and individual home care companies advocate for themselves.
Census data tells us that the number of seniors should increase steadily through 2030. In the next 23 years, medical advancements could extend this increase even further. It's reasonable to expect that baby boomers will still be alive when the second baby-boom, those born in the 70s, hits retirement age. If this happens, 2030 will be merely a bump in the road for home care.
If the number of startups is slowed, and the quality companies are not inhibited, this means tremendous growth for individual companies serving our population.
The trend doesn't indicate unbridled growth in 2008, the trend I expect is a dramatic increase in lobbying as licensure and regulation take hold. |
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No More Warm Bodies
I've written several articles on the value of recruiting quality over quantity. Frankly, every time I do I get Private Duty Home Care owners sending me e-mails telling me I'm wrong. They tell me that people are replaceable. They tell me recruiting more people, faster, is critical to their growth.
I'm going to be blunt... you're wrong... and I can prove it!
Virtually every week the evening news features a story about the economic impact of our aging population. Fewer workers will be supporting more retirees at a higher level of personal comfort than ever before. We want our parents to have the best health care money can buy, but for many of us it's our money buying their health care.
Right after that is another story about how immigration reform could threaten the service oriented workforce. While the rules about immigration for work purposes may be relaxed, enforcement of the rules should tighten.
How do these two news stories affect the private duty industry, and what does this have to do with "no more warm bodies"? ... Excellent question, my friend.
Many of you have a large number of first and second generation immigrant Americans on your workforce. If the trend holds true in 2008 there will be many companies competing for those workers. Textile factories, farms, warehouses and other industries who used to be comfortable hiring "undocumented" workers are going to be much less comfortable. They're going to pay more money and start recruiting side by side with companies like yours.
Unfortunately, people won't stop growing old just because your workforce has become more difficult to find and more expensive to keep. So you better be prepared.
Our corporate philosophy about recruitment, selection, and retention has always been clear, even if not universally accepted. In 2007 we put our philosophy to the test. We developed a new caregiver selection technology based on behavioral testing. This technology allows private duty companies to screen applicants and improve interviewing. It helps identify applicants with an increased likelihood of hostility, a high level of integrity, and identifies individuals with strong dependability. Furthermore, it can flag individuals who are potentially abusive on three different scales.
David Goodman, CEO of Companion Connection Senior Care, was interviewed for the current issue of Entrepreneur Magazine. "Entrepreneurs should focus on behavioral tests for caregiving employees to ensure better placements." He was speaking specifically of our technology.
Your people are your inventory. In the near future you're going to be required to provide care for more seniors utilizing a tightening workforce. The only way you're going to be able to succeed is by reducing turnover, improving job satisfaction for caregivers, and improving overall quality of care. Caregiver recruitment, selection, training and retention are going to be critically important in 2008 and beyond. |
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Salespeople Become Part of Our Industry
Over the past decade we've seen salespeople become integral on the certified side of home care. Private duty owners, particularly those with strong business skills, are recognizing the value of well-trained salespeople.
Many people call to inquire about consulting complaining that their revenues have flattened. Some of them experience this anecdotal story. I tell them "When you started your business you climbed up on the roof of your building with a megaphone and shouted 'We do home care!' and people came." They came not because of your incredible sales and marketing technique, they came because they needed your service. Now you've grown to $2,000,000 a year and your voice is hoarse. It's time to make a change to your sales and marketing program.
Sometimes this means sales and marketing planning with a consulting firm such as ours. Other times recruiting and hiring sales talent. Regardless of how you grow your business one thing is consistent. You must have the sales and marketing process. You see, your business is only going to be able to grow to the maximum capacity of your salesperson or your marketing efforts. For many private duty owners the owner or a trusted employee developed relationships with key referral sources. However, now you're working 25 hours a day, eight days a week and your business has plateaued because you've run out of time. You'd like to hire some help, but every time you've tried they haven't worked out. So, you call me!
Focus on developing a process in 2008 and then hire the right people to implement that process. (By the way, it's easier to recruit good people when you have a good sales and marketing process.)
We help companies in two ways. Ever since Medicare started allowing you to utilize sales staff rather than "community education" we've been teaching companies how to develop a good sales and marketing process. While we've worked with many more certified agencies, the planning can also be applied to non-medical home care.
The second way we will help is in 2008 Leading Home Care will be launching a certification program for private duty salespeople. Hiring a private duty salesperson, or sending your current marketing person to the sales training, will have profound effects on their ability to operate within the sales process. Ideally you should have a marketing director, a sales director, a fleet of company cars, and a bunch of well-dressed, highly effective salespeople. But let's take it one step at a time. Take your first salesperson, get them a new suit, and get them certified! Give them the skills they need to do the job you hired them to do. |
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Best Wishes for a Prosperous 2008
I'm excited! The great part is that if even some of the trends I predict hold true, 2008 is going to be one of the most exciting years in non-medical home care. I'm looking forward to working with you, developing our new products and services, and serving the industry with higher technology, better practices, and personal guidance.
Private Duty Today will be back in three weeks, January 2.
Here's Wishing You a Happy and Prosperous New Year! |
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Begin the New Year with a New Approach to Hiring Caregivers
By Diane West
Do you spend an inordinate amount of time looking for great caregivers, only to be disappointed that so few are what you're looking for? How do you find the best caregivers? What tools can you use to find caregivers that are honest, hard-working, and compassionate? This is a dilemma that almost every owner faces. We have found that employers have the most success with employee referrals and their own employment web sites. Great, you've gotten what looks like a promising stack of resumes. Now, how do you proceed?
You make the initial phone call to talk with the applicant and schedule an on-site interview. Then you ask you the standard questions and have them fill out the necessary paperwork. Why not go one step further and have them complete a pre-employment assessment? It only takes 25-30 minutes and can give you a tremendous hiring advantage over your competitors. This test can be administered online or on paper.
What is this pre-employment assessment and how do we get it, you ask? We have the answer, The Private Duty Caregiver Pre-employment Assessment can be purchased through Private Duty Today. This assessment will give you immediate feedback in key task areas. If there are red flags, the assessments will also generate questions that will allow you to discuss these issues and learn more about the applicants and their skills.
Why not start the New Year with a better way to hire your caregivers? Contact Diane West at 502/339-0653 or Diane@leadinghomecare.com to find out more about our pre-employment assessment. | |
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