Health care, senior care and with it, in home care are of the fastest growing industries. With the next twenty plus years predicting the continuation of record numbers of baby boomers reaching 65, it is no secret to why there’s a surge in demand and support for these services. Life expectancy is also rising. While Baby Boomer facts are again creating attractive business opportunities for many, there are still considerations to starting a home care business.
Children of today’s seniors are living busier lives compared to their parents when at their age, and providing that care becomes more difficult to manage. Finding reliable, trained and trustworthy caregivers becomes the new challenge for these families. And for those seeking a promising business to start, you’ll find many by aligning yourself with the healthcare industry that focuses on serving the families who need help in their home.
Considerations to starting a home care business
Today we take a look at 8 important considerations to starting a home care business before prematurely jumping into this booming industry:
Experience & Personality
Each of the following questions pose important rhetorical questions and considerations of your background and personality. If a specific skill is not a strength, that doesn’t necessarily mean you can’t or shouldn’t do the business. It changes the focus to hiring the right people to fulfill the roles that require the missing skills :
- Have you worked in the healthcare industry?
- Are you familiar with medical terms in the industry?
- Do you truly have a heart to help and care for others?
- Are you a natural leader?
- Can you manage a staff of employees?
- Are you business minded?
Each state has different licensing requirements. Some states are tightly regulated where others are not. Make sure you know and understand differences between medical home health care vs non-medical home care. Licensing requirements vary by each state and many times by the county statutes where the agency will operate. Because license requirements and the process to obtain them will vary as well, be sure to build plenty of time into the time line of opening doors for qualifying, applying for and receiving the respective licenses.
Serving strictly rural areas with populations less that 40K people can prove to be a tougher fight to attracting clientele numbers needed to be profitable long term. It’s not impossible, many small agencies are doing just fine at it. The amount an agency can grow is limited by how far geographically they are willing serve and the population density of those markets.
- Where are you going to open your business?
- What’s the population and how many of the residents are in the 65+ age bracket?
- Is it a growing population in your area or are people moving out as they retire?
- How spread out is the markets’ population geographically? The amount of time it takes for a caregiver to commute to a client’s home makes a big difference in staff recruiting and retention. Length of time to get to client’s homes and finding local caregivers close enough to provide services to them are of consideration here.
Sole Proprietorship, S-Corp, C-Corp, LLC; Which entity is best for a home care agency? This is extremely important because it involves liability and asset protection as well as tax implications. Consult with a CPA and attorney to determine what will be best for the agency and you personally. Every individual’s tax and financial situation is different so the entity that is best for a friend or neighbor may not be the best for you.
Selecting the proper business entity is critical and so is what protects the entity from financial liability: namely insurance. Each state differs with insurance types and levels, however as a rule of thumb for business in general – make sure the policy includes business general liability, officer and employee indemnity, workers compensation coverage, a bonding policy at the minimum. Consult an attorney, CPA and insurance broker to determine what the best suited coverage and state requirements entail.
Hiring & Training
An agency’s staff is the product. Success or failure of a home care agency can be determined in part on caregiver/staff actions (or ineptness/inaction). Like it or not, staff quality will reflect in the company’s name and reputation so it pays to be careful and selective with hiring. Additionally, once hiring starts it should never stop. What kind of training will be given to staff to help them to do the job they’re hired for?
This is a people business so networking and connecting with others in and out of the health care industry is necessary. Becoming the agency at the top of peoples minds when it comes to home care services requires marketing. Without marketing, your company won’t survive. For those who are naturals at marketing – terrific! Focus on marketing and hire out the next topics role. To those who find marketing a foreign language – hire staff who IS good at it.
Plan to operate your business as smooth each day as possible. That doesn’t happen by chance, it happens with purpose, planning and operations systems put into place before beginning operations. To carry out consistent service requires thinking through every aspect of daily operations and staff duties. Having a defined set of Policies & Procedures in advance of daily operations will assist with smooth operations from the start (although regular tweaking will likely be necessary). We offer a Caregiver’s Policy & Procedure manual that will reduce the time investment of starting a manual from scratch.
Even with your P&P manual though, challenges will still occur. After all the home care business is about serving people, provided by people.
The considerations to starting a home care business discussed today provides a running start to the due diligence but it does not cover every single aspect. A more in depth guide on starting your home care business may well be worth the small investment of the book at www.homecarehowto.com