Labor Analytics Dictate Home-Based Care Growth Strategies

As staffing shortages squeeze the home-based care industry, operators are now using labor intelligence to map their growth.

Company leaders seek out areas where they can pay workers competitively, or where they have a pre-existing foothold in hiring pipelines, when growing their businesses, according to leaders at Home Health Care News’ Capital+Strategy event this year.

“We likely won’t even enter a market unless we can be about at the 75th percentile or better on compensation,” Aaron Marcum, co-founder of Riverside Home Care, said on a panel.

Market analysis strategies

Marcum also considers the geographic classification of a potential market, weighing the differences between urban and rural settings. Smaller rural markets demand the availability of Medicare patients and other diversified payer sources, while urban markets can usually support single-payer sources and private-pay workforces, said Aaron Marcum, co-founder of Riverside Home Care.

Fort Collins, Colorado-based Riverside offers personal home care, companionship and respite care and specialized care for clients with Alzheimer’s and dementia, among other services.

“You have to diversify in those rural markets. A single payer source is not super viable,” Marcum said. “We have found in larger markets, we can lead more with single-payer source and find more of those private-pay workforce individuals.”

For providers, it is crucial to tailor their operating strategy to each individual market, Marcum added. Providers cannot always expect state data to apply to local markets — especially for rural communities. Marcum pays special attention to local market dynamics two or three months before an acquisition, so that the company can understand referral networks and key community relationships, Marcum said.

“Suburban Colorado is different from rural Colorado, and you can’t apply the same rules when you’re looking at those markets,” he added.

Expansion requirements

Some providers’ first requirement for expansion is a foothold in the area. That’s what Steven Gonzalez, president and CEO of HealthView Home Health & Hospice, said in the panel. The executive focuses on density in the L.A. County area, he said on the panel, which is a sufficient size to allow HealthView to become a large company through density alone.

“When we look at expansions into new counties, we try to be close enough to some of our pre-existing operations to latch on to that before we make an acquisition,” Gonzalez said. “We typically will make an assisted living acquisition first, and then do surrounding services. And so typically that comes with the workforce.”

HealthView Home Health & Hospice offers home health, hospice and palliative care services in multiple Southern California locations.

Gonzalez said that HealthView will typically make an assisted living acquisition, then opt for surrounding service lines to fold in the existing workforce so that “there’s the integration piece of our culture and integrating leaders into the acquisition,” he said.

Competitive edge and partnerships

Culture is HealthView’s competitive edge, Gonzalez said, given that the Californian staffing market is highly competitive, with inflating wages.

Local institutional partnerships can also help build workforces beyond acquisitions. Gonzalez added that beyond direct recruiting, HealthView does B2B recruiting, including a partnership with the nursing school Chamberlain University. HealthView provides clinician hours to build the pipeline for areas the company seeks to expand into, he said.

Providers that fail to meet the unique needs of their local markets may find themselves unable to recruit competitively and be disconnected from community relationships driving referrals.

“It really is so dependent upon that local market… you’ve got to look at every market locally and say, ‘Okay, what service lines make the most sense? Where can we pay?’” Marcum said. “If you can’t offer that in a market, then maybe you shouldn’t be doing it.”

MK Manoylov is a Senior Reporter at Home Health Care News. Their work has appeared in publications including WebMD, Business Insider and LiveScience, in addition to governmental reports from the U.S. Department of the Treasury. MK earned a master's degree in journalism in the Science, Health and Environmental Reporting (SHERP) from New York University.