Building a 7-Figure Private Pay Home Care Business

Building a 7-Figure Private Pay Home Care Business

00:00:07 –> 00:00:38
Erin Cahill: Welcome to CareSmartz360 on Air Podcast, a home care Podcast. I’m Erin Cahill, an account executive at Caresmartz. As the home care business booms many businesses are seeking to start and make it a seven-figure private pay home care business but the question is where to begin to shed light on this I have invited a distinguished guest with us someone who has been a driving force in the Home Care industry for over two decades. Please join me in welcoming Julio Briones CEO of Briones Consulting Group. Julio thank you for being here

00:00:39 –> 00:00:42
Julio Briones: Thank you so much for having me Erin, a pleasure to be here.

00:00:43 –> 00:01:06
Erin Cahill: Having been in the industry for over two decades you already know starting a home care business isn’t easy on top of that growing it into a seven-figure business is far more challenging. So in your opinion what key factors should Home Care businesses consider when shaping their understanding of the ideal client and how does this understanding impact the overall success of the business?

00:01:07 –> 00:02:35
Julio Briones: All right so to put it simply you’re absolutely right it is not an easy venture to come into the Home Care space especially the private pay Home Care space. So if you know when somebody’s looking to get started I always do recommend this the first thing you need to do is know where you’re getting started I don’t care if you’re a mom and pop I don’t care if you’re doing franchising you have to understand who your client is and where to find them. So let’s let me do this by an example because it if you don’t know where to begin you’re never going to get anywhere quickly um so typically typically speaking I have seen over the course of uh years that I’ve been working with home care agencies will range uh and how fast they get to success used to be the standard was about somewhere between 6 and 9 months before they started seeing any sort of traction and especially if we were talking about boots on the ground Business Development and sales, okay. It’s not hard a lot of agencies they do what I call the shotgun approach you know where they just go into an area they say hey this looks like as good places I need to open up I’m going to go out and start just visiting every facility in my area if you understand three simple things okay it will save you months of you know going around and blindly visiting facilities.

00:02:36 –> 00:03:54
Julio Briones: Number one you have to understand that you need three elements to find a successful client they have to be old enough, right age group. So if we’re talking about the Medicaid space 65 is that magic number. Not that they need help at 65 but they become eligible for certain benefits right around that age including Home Care and things of that nature and there you know because of the income differences a lot of times younger you know people are a little bit younger and they start finding themselves needing help then. When we’re talking about the private pay because a lot of it comes out of their own pocket and they retire they’re counting on funds that let’s be realistic if an 80-year-old day and their 40 years ago was planning for retirement they didn’t think they would love to see 8085 okay. The average lifespan in America was a lot lower than they figured they retired by 65 dead by 7072 and now people are living longer. So understanding that your average 65-year-old is not going to actively look for help from a private pay agency so that’s one thing, age.

00:03:55 –> 00:05:08
Julio Briones: The next thing is you have to understand where demographically people live all right. So if I am looking for private pay I am not going to go into you know areas that are generally more rundown and poorer. I’m going to go out into the suburbs. I’m going to go into places that have higher income. So a good metric is to understand the general median household income in your particular County and you want to find the areas that are on average 40% above the median household income. these places will give you the added benefit of having people that make enough money to successfully be able to afford your services and the other big key is they don’t make so much money that they can afford to stop working and take care of Mom and Dad themselves. so it’s that real fine line that perfect Zone that you need to find in there and 40% in most areas puts you right around where you need to be.

00:05:09 –> 00:05:28
Julio Briones: Alright some places, let say some exceptions to this rule would be certain parts of the southeast of the country we’re talking about like Louisiana, Alabama, Mississippi. There the numbers are a little bit different not we’re not talking about greatly varied there.

00:05:29 –> 00:07:14
Julio Briones: In the third thing uh that people need to understand when trying to look for what’s their ideal client is what are the illnesses or injuries common to their area affecting the elderly all right. So the way my company does this when we do these analyses for people is we take we start with the hospitals, we take a look at where in the areas in the county that they’re trying to open they have people with the highest likelihood and we’ll do this demographic analysis where we’ll look for people over the age of 75 we’ll look for households with PE at least one person who’s 65 or older in there we’ll take a look at the median household income and then we’ll start looking from that area depending if it’s an urban or a suburban area we’ll start looking for anywhere from 4 miles to 6 miles away from the centres of these zones, okay. Because what we’re looking for is a hospital and most people in the city in urban areas will live four miles away from a hospital most people in the suburbs will live about 6 and a half miles away from a hospital you know from the furthest hospital and everything varying from thereby understanding where your hospitals are you can easily go into CMS duck off and you can start looking up what conditions are treated at that hospital most commonly and you can also figure out what ZIP codes these hospitals are discharging patients to.

00:07:15 –> 00:07:51
Julio Briones: So now we have our Trifecta we have people old enough we have people who can afford the service and we have people who are sick or injured enough so that we can start to Target the private pay clients. And that’s really the big part of uh figuring out you know where your ideal client is. The other parts of it are understanding where the facilities are in relation to the clients and the other big one is being well capitalised enough to have your business survive moving forward.

00:07:52 –> 00:08:07
Erin Cahill: Thanks Julio that’s really helpfulsome actionable takeaways there I appreciate that. How do well-established internal systems and standard operating procedures contribute to the success of a private pay Home Care Agency?

00:08:08 –> 00:09:24
Julio Briones: Well if we’re talking about how you’re going to run a business,all right so my background being in you know having worked in franchising and in with private pay mom and pop agencies you know and privately owned as well as with um companies that are run or owned and operated by VCS. It really comes down to the same thing no matter what category you’re looking at if you understand what needs to be done and you make every position in your business including yours um dis disposable meaning that I can literally have anybody come in as long as they have the right the right basic personality understanding and skill set and I can replace any position in my business it makes my business scalable and it makes my business easier to sell easier for me to have the really we all go into business not to be chained to a desk unless your goal was to create a pay high-paying job for yourself you’re in business as an investment you are in your business you know for retirement planning and you are in your business because you are looking for Freedom so that’s what you need you have to have systems in place.

00:09:25 –> 00:10:35
Julio Briones: You have to have clearly written SOPs and you know it’s not as difficult as people think take any task take your biggest task Business Development. Let’s break it down into the smaller elements and let’s say you know handling an intake, all right so great. How do you handle an intake and you just write down step by step everything you normally do write down the scripts if that’s something you need and you need to ultimately take away people’s ability to think for lack of a better way to put it and that is your SOP. If I can hand this blindly to somebody and have them be able to understand what I do they can repeat the same process gives me Freedom gives me the ability to grow my staff quickly gives me the ability to open multiple locations and this is really what makes for example franchises and large corporate entities so successful they create a model and then they just repeat and repeat and repeat and there’s really nothing stopping even even the most humble mom and pop agency from doing the same thing.

00:09:25 –> 00:10:50
Erin Cahill: Yeah that makes sense. In your opinion how does a deep understanding of the home health value-based purchasing model directly influence the growth trajectory of private pay agencies and what specific outcomes can businesses expect to see?

00:10:51 –> 00:11:50
Julio Briones: Well in general whether you know whether we’re talking about you know value-based purchasing or if we’re talking about private pay, the entire concept and the intent of CMS it still stands the same. People need better care and they need it in a more affordable way so you know with the rising, with the trend of Rising minimum wage across the country and then you have certain States like uh for example New York New Jersey um California and a couple of other states across the country that have an increased minimum wage specifically for those in the caregiving space. You know now that means that prices are going up people expect more value for their dollar so you know this is one of the things that CMS is trying to implement with you know the value-based um sorry value-based purchasing model.

00:11:51 –> 00:12:55
Julio Briones: They want these agencies to be able to give more for their money you know um while their rates aren’t going up their expectation are because the expectations of the end user have to go up PE it’s no more uh it’s not as simple anymore as I’m going to send you a caregiver who’s going to sit there on their phone playing on Facebook or playing mobile games all day they want to see that you’re actually caring for this and because the standard is going up in the government payer Source model that means private pay must follow suit there’s no justification for you know a client to remain with a private pay agency if they’re not maintaining any higher standard than the government pay the agency and quite frankly you know if I was somebody who had had the money to afford private pay I would rather just con hire an attorney an estate planner or elder law attorney works on my spend down and get put on Medicaid if the standard is the same.

00:12:56 –> 00:13:53
Julio Briones: I paying for something privately because I want better quality I want better outcomes for myself or for my loved one and that’s really the driving force. Now the only logical conclusion of all of this is going to be that the expectations from these clients are going to be very high as the further we move along and those agencies that want to remain at the bottom on the level of care to where they’re just pretty much you for lack of a better way to put it Brokers of warm body in a pulse. You know they’re going to have to keep their price competitively low they’re not really going to um compete at the higher level and many of the private pay agencies that want to operate in the most simplistic terms will have to learn to manage their business at the same efficiency and with the lower margins as most Medicaid agencies do.

00:13:54 –> 00:14:05
Erin Cahill: How crucial is it for Home Care businesses to stay abreast of industry trends like we’re talking about and how can this proactive adaptation positively shape long-term success?

00:14:06 –> 00:15:09
Julio Briones: Well if you know if you’re not learning you’re dying that’s that’s really what it comes yeah you have to you have to learn you have to adapt you have to know what what’s coming along you know there’s advancements in technology there’s advancements in methodology there’s you know if if we look back um just preco with compared to now the methods that we use today in order to recruit and retain caregiving staff they’ve changed dramatically. The methods that that we’re implementing that we’re adding in at least those that are on The Cutting Edge of things with uh with AI with uh all the regulations that come with that all the concerns with HIPPA and everything else um all of these Trends in the industry that are up and coming you have to learn to understand so you can figure out which ones actually work for you as an independent business owner and then you have to see which are you going to be able to or have the capacity to adapt and unfold into your business all to provide the client the better experience.

00:15:10 –> 00:15:44
Julio Briones: If I can recruit faster I can weed out bad caregivers if I can do that I’m going to improve the overall quality of my service offering. If I understand technology maybe I can Implement Care Management or case management and again improving the outcomes of my individual clients. People don’t mind paying for things in the private pay space people don’t mind you know if they see their tax dollars being used eff efficiently and effectively and the best way you can guarantee that is by being well-informed.

00:15:45 –> 00:15:58
Erin Cahill: Absolutely! Here’s a big one how does overcoming the fear of failure contribute to the SE success of Home Care businesses and can you share instances where accepting the art of failing quickly has been a transformative Factor?

00:15:59 –> 00:16:51
Julio Briones: Well, yeah the art of failing quickly is something actually that we’ve embraced many many years ago as a as me personally and then as a model that I teach to my clients. The fact is we should never feel fear failure we need to embrace it we need to embrace it all as a learning experience. Every action you take that moves you forward even if you didn’t succeed the way you expected it you never start over you’re always starting with that experience that brought you to this next step and if you learn if you fail, learn, understand, grow and keep trying you’re going to see these incremental minor failures you know I Big Air quotes around the failure you know they’re all learning experiences.

00:16:52 –> 00:17:45
Julio Briones: Look if you know if you want to succeed in life, in general, I don’t care if you’re trying to start a home care business or if you’re trying to lose 20 pounds you know you still have to have the same thing you have to be able to commit to something and that’s your goals you know you have to have certain values. What is important enough for you to continue to move forward so that you can achieve your goal you have to understand your assets and your liabilities your personal as well as your professional ones and I’m not talking about the stuff that goes in the book you know when you’re doing your taxes I’m talking about your own personal assets and your person personal liabilities what is it that you’re good at what is it that you’re afraid of what do you need to learn, you know what do we have to put in place or change about ourselves to encourage that growth to encourage that forward movement in our life in our business okay.

00:17:46 –> 00:18:35
Julio Briones: And then the final element of all of this is we have to be able to create measurable steps what KPIs what outcomes, what Milestones, what smaller goals are you working towards even if it takes a number of tries, in order for you to get to that next level and the formula for it is not hard. Pick what you’re going to do figure out what you’re good at figure out what you’re not good at and take even if it’s the smallest step but take action every single day. Every movement you make needs to bring you a step closer towards your end goal and that’s the art of failing quickly. Understanding it recognizing it, learning from it, moving on you can’t let it you and you can’t let it stop you from getting to where you want to be.

00:18:36 –> 00:18:54
Erin Cahill: Absolutely, thank you Julio for sharing your invaluable insights on building a seven figure private pay home care business. I hope all our audiences also found it very useful I know I did until next time this is Erin Cahill signing off from CareSmartz360 on Air, a home care Podcast. Thank you.

00:18:55 –> 00:18:56
Julio Briones: Thank you thank you for having me.