Patients and families continue to look increasingly to home care — versus a nursing home or rehabilitation facility — as an option for long-term caregiving. The National Association for Home Care & Hospice (NAHC) calls home care a “cost-effective service for individuals recuperating from a hospital stay…” adding that these individuals are often people who are unable to fully care for themselves. The elderly very often fall into this category. As the need for home health care increases across the nation, we are bound to see tremendous Home Healthcare Franchise Growth.
As reported by Home Health News earlier this year, according to the 2015 report compiled by FranchiseKnowHow, LLC and FranchiseGrade.com, the number of home care franchise locations increased by 47% between 2010 and 2013. FranchiseGrade.com CEO Jeff Lefler states that this growth is not only indicative of the number of franchisees, but also franchise systems that are becoming increasingly popular.
A Look at the Senior Care Industry Overall
As we are all aware, the U.S. population is aging. In fact, by 2050 the senior population is projected to reach 88.5 million, which is well over twice the number of seniors in America just 15 short years ago. Simply put, the increase in the elderly population has and will continue to necessitate more senior healthcare options and providers.
When the senior care industry began to pick up steam in the early 1960’s, there were only a little over 1,000 providers within the U.S. More recently, data shows that there are more than 17,000 providers of home healthcare to 7.6 million individuals, providing a range of services including temporary illness, disabilities, assistance with daily living and terminal disease. As of this year, these providers earn a combined annual revenue of $57.6 billion, up from 38.3 billion in 2003.
An Opportunity for Healthcare Entrepreneurs
Home care franchise owner Richard Ueberfluss recently expressed to Small Business Trends in an exclusive interview that he believes this is only the beginning of home healthcare growth. He notes that home care is the fastest-growing business in the franchise industry. He notes that it’s mainly former healthcare veterans that seem to be heading many of today’s home healthcare outfits. In the insurance and risk management business, we find that these franchise operations need health care experience and a business background to be most successful.
High Revenue Opportunity
According to a Forbes.com article published in May of last year, senior living industry research firm Home Care Pulse found that median franchise home-health revenue was nearly $2 million at the time. Franchise owners were found to have brought in significantly more revenue than their independent counterparts, which means that these franchisors and franchisees had a resource advantage over their competition.
The franchise owned by Ueberfluss, Assisting Hands, provides a model in which owners can benefit from as many as five revenue streams:
- Providing private duty healthcare (non-medical, in-home care).
- Providing skilled home healthcare workers (such as nurses).
- Case management (assisting clients with healthcare management).
- Medical staffing (i.e. helping local hospitals in need of extra nurses).
- Providing medical and non-medical equipment not covered by Medicare (i.e. a raised shower chair).
Home Care is Not Exclusive to Seniors
Home healthcare business opportunities are limitless, and not at all exclusive to only elderly clients. Take the story of Rick Collett for instance; as reported by Entreprenuer.com, after a serious car accident nearly took his life and he required months of home care himself, he was inspired and ended up pursuing a master’s degree in healthcare administration. Eventually he became a business owner and now manages his own home healthcare business.
Home care is becoming widely accepted as a practicable alternative to lengthy hospital stays in many cases, for adults of any age, such as Collett. This is especially true now, since new Medicare mandates charge fines against hospitals if patients are readmitted within 30 days of their previous stay.
At Manchester Specialty Programs, we understand the inherent risks that come with the broad spectrum of services delivered by home care franchisors and their franchisees. We have underwritten home health care, hospice and medical staffing firms for over three decades. We have a deep knowledge of the risks that these firms face in their daily operations.
We pride ourselves on our ability to match account to an insurance carrier that will best fit their needs. For more information on the insurance coverages needed to operate a home care franchise, and to find out more about our operation and all our specialty insurance programs, please visit our franchise page. You or your local insurance broker can also give us a call today at 855-972-9399.