‘Everybody Is Facing This Problem’: Staffing Struggles Force In-Home Care Providers to Turn Away Business

Home-based care providers appear to have reached a dangerous growth plateau. Unfortunately, I expect that it’s going to be a difficult one to overcome.

After several years of steady growth, demand for in-home care has exploded during the COVID-19 pandemic, with non-medical home care operators and skilled home health providers both so busy they’ve had to turn away new cases.

“Our denied referrals have increased from half of all new cases to a record 64% in the tri-state area of Pennsylvania, Delaware and New Jersey, which is our largest coverage area,” David Totaro, the chief government affairs officer of Moorestown, New Jersey-based Bayada Home Health Care, recently explained. “We today are declining nearly two out of every three new home care cases due to a shortage of available caregivers.”

It’s not just the nonprofit Bayada. Despite the skyrocketing demand, a shortage of qualified workers across all skill levels and disciplines has put most organizations in a similar position.

“I think everybody is facing this problem,” Darby Anderson, chief strategy officer at Addus HomeCare Corporation (Nasdaq: ADUS) and vice chairman of the Partnership for Medicaid Home-Based Care (PMHC), told me in June. “There certainly are regional pockets of ‘very, very difficult,’ though. New York state, for example, is really difficult to recruit in right now. From our [PMHC] members and lots of folks I talk to in the industry, they all say it’s the biggest challenge.”

Home Health Care News recently teamed up with Axxess to explore just how dire the staffing situation really is, surveying more than 750 in-home care professionals between July 21 and Aug. 6. I found the results of the joint effort startling, even as somebody who follows the home-based care space closely.

Nearly three-quarters of all survey respondents said they’ve had to turn patients and clients away because of staffing shortages. Additionally, respondents reported substantial labor shortages among nurses, home health aides and rehab staff alike.

Contextually, Totaro’s comments and the HHCN-Axxess survey come during an unprecedented public health crisis — one that will eventually go away. With that in mind, some may have a “this too shall pass” attitude toward the in-home care staffing woes.

But here’s the issue with that, in my view: While demand for in-home care reached record-high levels in 2020 and 2021, the COVID-19 pandemic is merely a sneak peek of much longer-term trends tied to America’s aging population.

Overall, the population of adults 65 and older in the U.S. is projected to double by 2060. At the same time, the number of individuals 85 and older is expected to nearly triple.

In other words, home-based care providers are just starting to feel the pressure of America’s “silver tsunami,” but they’re nowhere close to its full impact.

When statistics like these were thrown around two years ago at home-based care industry events and investor presentations, I felt a sense of enthusiasm in the air, with operators excited about the immense opportunities ahead. After the pandemic exposed just how thin the in-home care workforce actually is, I now sense far more anxiety.

Handcuffed by staffing shortages

It’s not just the silver tsunami driving up the demand for in-home care.

While the worst of the pandemic will pass, some of the health care trends it triggered will become permanent. That includes hospital-at-home models and other innovative programs designed to shift care away from brick-and-mortar settings.

As of Sept. 14, 71 health systems and 165 hospitals in 33 states have been approved by the U.S. Centers for Medicare & Medicaid Services (CMS) to provide hospital-level care in the home under a special temporary waiver.

As these efforts become more widespread, they will require home care and home health support to operationalize.

“Adoption of [the hospital-at-home concept] happened faster in other developed countries like Canada, Australia and so forth, but the acceleration of the model in the U.S. market has recently picked up amid COVID because of the [government] initiative,” Kaustubh Savant, senior industry analyst of health care and life sciences at consulting firm Frost & Sullivan, recently told HHCN.

On top of that, in-home care providers are more frequently becoming the referral destination of choice for hospitals and physicians.

Moving forward, too, there’s a good chance home health and home care agencies will be needed to care for a completely different population: healthy non-senior adults who prefer to recover in the home.

“Originally developed for the elderly and Medicare population, home-based care — including house calls with lab draws and ER- and hospital-level care — has been expanded to working adults as well,” a Sept. 15 Harvard Business Review article reads. “Over two decades of research has proven that a model of care called hospital-at-home is safe and effective, with lower rates of complications and lower costs.”

Even after COVID-19, self-insured large employers should cover in-home care programs with proven results, the article argues.

Finding solutions

Staffing shortages are typically caused by difficulties in both recruiting and retaining in-home care professionals. To solve for the second point, many organizations have started to invest in technology that helps identify when workers are likely to leave.

In August, Honor revealed that it had purchased Home Instead, creating an organization that will represent more than $2.1 billion in home care services revenue, according to the companies. While the deal’s financial terms certainly had to be right for Home Instead, I’ve heard the move was equally about Honor’s technology and proven success in keeping its “Care Pros” happy.

“It became immediately apparent to us that Honor puts the care professional really at the center of their business model, which really resonates with our philosophy and approach from Day 1,” Home Instead CEO Jeff Huber told HHCN after the deal was announced.

Meanwhile, Amedisys Inc. (Nasdaq: AMED) has spent the past few years beefing up its predictive-analytics game to solve for workforce challenges. Today, the Baton Rouge, Louisiana-based provider has insights into 36 different key “risk drivers” for all Amedisys employees, tailored to each individual based on role, tenure and other factors.

“We challenged ourselves and said, ‘You know, if we know why people are leaving, then we should be able to take that information and do something more proactive with it,’” Amedisys Chief HR Officer Sharon Brunecz told me in May. “If we see when a clinician is at-risk [of leaving], can we intervene to change the outcome, to reduce turnover?”

Retention is undoubtedly important, but in order to meet future demand, home-base care providers will have to improve on the recruiting front as well.

In the Axxess-HHCN survey, 19% of respondents said retention was the greatest staffing challenge. In comparison, 62% said recruitment was the top difficulty.

So far, in-home care employers struggling with recruitment have turned to compensation increases and sign-on bonuses.

But it’s clear that throwing money at the problem won’t be enough.

On a larger scale, the U.S. simply needs to ramp up the production of in-home care professionals — and several other types of health care professionals, for that matter.

“[The] production of health care workers requires a dynamic plan that lays out the numbers and types of health care workers needed to address population health priorities, such as access to primary care, behavioral health care, oral health care, geriatric and long-term care, and maternal care,” a Sept. 15 Health Affairs article states. “These are fields in which there are chronic shortages of health professionals, despite being areas in which our society has the greatest need.”

To help encourage more nursing students to enter home-based care LHC Group Inc. (Nasdaq: LHCG) has made major investments in the University of Louisiana at Lafayette’s College of Nursing and Allied Health Professions.

On a federal level, the Administration for Community Living (ACL) has been working to establish a “caregiver Peace Corps,” a government program meant to mobilize volunteers to specifically serve America’s aging population.

It’s time to accelerate these and other efforts.