Today there is an estimated 6.5 million seniors needing assistance with their daily activities and this number is expected to double by 2020 as the graying of America occurs. In addition, as cited in an AARP survey, approximately 89% of seniors want to age in their own homes for as long as possible. These two primary factors make home care, according to Forbes, a top franchise opportunity today and down the road.
Also contributing to the positive outlook for the home care franchise industry is the potential effect that future federal funding cuts can have on Medicare and Medicaid programs for traditional nursing home living as well as the overall lower cost in providing home care to those who don’t require the comprehensive assistance that skilled nursing homes offer. Not only are the expenditures lower to care for seniors at home, the litigation risks and the subsequent insurance costs can also be lower particularly for franchises that only offer non-medical care.
Home care franchisees and their workers provide essential non-medical and/or skilled medical services to seniors, including companionship; meal preparation and feeding; accompaniment to doctor’s visits, etc.; housekeeping, respite care; therapy services; and medication reminders and administering; among others. The U.S. home health care industry as a whole, according to First Research, is comprised of about 30,000 establishments made up of single-location companies and branches of multi-location companies, with combined annual revenue of about $70 billion. Revenue for the home care industry is expected to rise as part of the larger elder care market, which is estimated to grow to about $400 billion by 2018.
In addition, by 2025, the Bureau of Labor Statistics predicts job growth of 70% for home health and personal aides. That means recruiting 1.2 million new professionals (RNs) and para-professionals (personal care aides, home health aides and nursing assistants) to meet the needs of this growing industry. As we discussed in an earlier article, in order to recruit committed and skilled employees it’s critical that home care jobs are competitive, and offer good wages, benefits and working conditions.
Opening a Franchise
When setting up a franchise, each city and state has its own insurance and licensure requirements for home and senior care businesses so it’s important for the franchise owner to be familiar with his or her area’s specific requirements. Initial investments for opening a home care franchise, according to an article published online at Franchise Direct, include the franchise fee, training expenses (such as travel and living expenses, not the actual training courses), marketing costs, and more. Typically, home and senior care franchises tend to cost less than franchises in some industries because of being a primarily mobile-based field, says Franchise Direct. The real estate requirements are usually not as high, either. There are also ongoing fees involved including the royalty fee for continued use of the use of the franchisor’s trademarks and patented processes.
The capacity to network – to get referral sources – is key in a franchise’s success, coupled with the support of the franchisor, which typically assists in helping a business get off the ground. Having the right staff is critical, too – individuals committed to helping others in a field that offers a rewarding experience.
Manchester Specialty Programs assists home care franchisees and franchisors with their insurance requirements. As specialists in insuring the home care industry, we provide a comprehensive portfolio of coverages for new and established franchisees, including General Liability, Professional Liability, Workers’ Compensation, Management Liability, Cyber Liability and Non-Owned & Hired Auto insurance, among other key coverages. For more information about our business and insurance lines, you or your local agent/broker may contact us at 855.972.9399.
Source: Franchise Direct