S2E8: How Are Home Care Businesses Evolving for Workers?
Home care agencies are vital in the care economy, providing essential services, employing workers, and informing government policies and industry practices. However, many have limited resources and face scrutiny as home care jobs remain low-paying with poor conditions.
In this episode, host Robert Espinoza talks to Kevin Smith, CEO of Best in Care, Inc. They discuss how home care agencies should operate in today’s environment, what it means to provide good jobs, and how to optimize government and businesses to improve home care.
Robert Espinoza: What would happen to families everywhere if more than 5 million direct care and childcare workers in this country were to vanish overnight? Welcome to Season 2 of A Question of Care, a podcast that explores this question through different viewpoints and topics. I'm your host, Robert Espinoza, a national expert and frequent speaker on aging, long-term care, and the workforce. In our final episode of season two, we'll be speaking with home care agency owner, Kevin Smith, to get his perspective as someone at the forefront of many of the issues we discussed in this season.
Kevin Smith: My name is Kevin Smith. I am the CEO and owner of Best of Care, which is a home care agency in Massachusetts.
Robert Espinoza: Kevin, I'm wondering if you can share with our listeners the history of Best of Care, and how did you become the CEO?
Kevin Smith: Sure, Best of Care is a family-owned and operated business. Company was started in 1981 by my father, Steven. I joined the company in 2007 right after I graduated from Providence College, and really had no idea what it was all about or what I would be doing. I've obviously stuck around, here I am today. And 17 plus years later, I am now running the company. I have done every job that you could possibly do here. I became the CEO in 2019, but had really sort of been the de facto leader of the company for years before that in terms of strategy, direction, operation, all those other big words that you can think of when it comes to leading a business. So, that's how I got here.
Robert Espinoza: Kevin, I'm especially interested in your perspective on what it takes to run a business in today's care work system. And I'm interested specifically in better understanding that intersection of public policy, labor market pressures, and business decisions. What's working with that current system for home care agencies and what's not working?
Kevin Smith: I think that the most effective organizations, or people who are tasked with leading those organizations, at minimum, have an understanding of the way that those three things that you mentioned, Robert, function together, coexist, whatever word you want to choose. I was lucky enough to have been involved in the trade association in Massachusetts called the Home Care Aide Council of Massachusetts for a very long time as a board member, as the President, and as an executive committee member. I was advocating. I was meeting with legislators. I was in constant communication. I was testifying. I was as involved as one can be in the strategy, agenda, and movement behind enhancing the work experience of caregivers here in Massachusetts.
So, broadly, I was keenly aware of all of the changes from a budgetary and legislative perspective that had a direct impact on the workforce at my company. If you can, like I said, at minimum, understand the forces at work that shape the caregiver experience wherever you live regionally, you can take that information and process it, analyze it, and implement strategies as a business owner based on that information. So, for example, if I know that the state is looking at increasing reimbursement rates for state-funded home care purchased from companies like ours, then we are strategically going to ramp up our efforts to deliver the services that are going to be subject to those reimbursement rates so that, when it does go final, we have built a headwind and momentum of service delivery that's, all of a sudden, going to get a huge bump in reimbursement that will trickle down in the form of pay rate increases to the workforce.
So, those are the direct sort of intersection, if you will, of labor market and its relationship to policy. The most effective companies and organizations are going to leverage those things in a reasoned and strategic manner to really sort of promote longevity of their business, and more importantly, retention of their workforce. When you keep people for a long time and continue to pay them more, that's not a bad recipe for success, and that has really been the driver of our approach to new hires, retaining existing hires and existing workforce, and continued promotion in both skill, pay rate, and total compensation experience at our company.
Robert Espinoza: Thank you for sharing that, and it's really interesting. I'm glad that you described these issues as the recipe for success because it feels as if home care workers are the key ingredient for that success. And you and I met several years ago when I was working at an organization that focused on improving jobs for home care workers. And I've heard you speak eloquently about these challenges, which are the focus in many ways, of this season of A Question of Care. What are some of the most profound lessons you've learned as a business owner about the home care system and about workers in particular over the years?
Kevin Smith: What is profound as well as surprising, and I'm gleaning this sort of anecdotal data point from an employee survey that we did in late 23 where, above all, what was most important to home care workers at Best of Care, beyond pay, was loyalty and dedication to their clients. And neck and neck with that was education, opportunities, training, which training always carries this really nebulous sort of attachment in the home care industry.
What does that even mean, training? Does it mean a supervisor going into a client's home with you on day one, and then every 90 days thereafter, to see how you're doing? Is it on-the-spot training from someone taking a phone call when you're in a moment of panic or crisis and sort of walking you through a difficult situation? Or is it what you're doing on your phone after work to complete your modules and complete your required…? It's all those things, quite honestly, and that was a really sort of powerful takeaway for us that, yes, it's important to pay top dollar. Of course, it is. That's how you attract, that's how you retain. But knowing that we could give our caregivers enough education, training, resources, support, all sort of in this one bucket, let's put it all in there, that is what breeds job security in the home care industry. It really does.
If you can equip a caregiver with a competitive rate of pay, the schedule that they want, and ongoing access to whatever amount and topic of training and resource, from an educational standpoint, that is what engenders job security because you're taking better care of clients who are incredibly acute now chronic; issues, perpetual deconditioning, challenging living environments, histories of mental health, substance abuse, behavioral. The more we can give our staff the tools that they need to take better care of people, the longer those people can stay at home. And when they are at home, our caregivers are going to work. There is no work-from-home. You're going into someone's home, and if they're not there, you're not getting paid.
Robert Espinoza: I'm glad you referenced training and education, Kevin, because most experts in the sector do cite those two as critical dimensions of job quality, and we know what happens when workers are not properly trained, they don't deliver the care that people deserve. I'm curious, from your vantage point as a business owner, what are some of the specific workforce needs that you currently have within your agency?
Kevin Smith: One thing that comes to mind that's really prevalent and sort of priority one right now is rural or less dense areas where people need care. And Massachusetts is no different than any other state. You have pockets of density, and then you travel a few miles and it gets really thin. And how do you bring home care to areas where people who deliver home care don't live? It's a tricky question, and we have tried to solve it in any number of ways by giving one or two employees a town, or a big swath of geography, and say, “Any client that comes into the Best of Care ecosystem in this area, in these zip codes, they're all yours.
You know where you're going every day, you're going to be driving that same route.” That works until a caregiver's car breaks down because you're putting a ton of miles on it. And even if you're paying a really competitive pay rate, that pay rate only takes you so far when it comes to a huge bill for auto repair, or something like that. So, we have this critical unmet demand of solo agers or super dependent agers in these pockets of rurality that we know that there's opportunity to meet them and provide them with excellent care. We're trying to figure out how to do it. And it sounds really like a simple problem, but there really are not simple solutions to that.
And what it all boils down to, the through line of this conversation, or many of your others, will be reimbursement. If we can pay people enough to make that job compelling and worthwhile for their time, travel, and commitment, they will do it. We know that. But the only lever that can make that possible is reimbursement. And I'm sorry to say, but a lot of those people living independently in these rural areas, they're not your private pay market, Robert. They are not paying out of pocket. They are leveraging Medicaid, and the Medicaid reimbursement rates are what they are. Regionally, they vary, some places they seem incredibly high or low, but that's all relative to cost of living, minimum wage, and other market influences. So, that's a huge challenge.
Beyond that, we need more people. There are finite pools of caregivers in this country. And although I say they are finite, we can't really count them because it's so hard to keep track because this industry is woefully underserved in terms of being able to track just how many people actually do this work. But we just need more people. We need to find people from adjacent industries, from other backgrounds, and encourage them to dip their toe in a home care career in exchange for meaningful work, competitive pay, and potential to upskill. We can give you all the training you need, we can pay you enough, we just need to find you and sort of wrap our arms around you to bring you into this industry.
Robert Espinoza: I appreciate you drawing attention to the human beings that take these jobs and really make our economy and this sector function. I've often found that some of my most profound experiences in this sector have been when people share their stories, when we hear both the challenges and the solutions that are needed to really improve home care. And I'm wondering, as you reflect on your own career and your personal life, are there any stories that really illustrate the importance of care workers?
Kevin Smith: We are lucky enough to have delivered service to thousands and thousands of people for more than four decades, and we have employed thousands and thousands of people. What sticks out more than any one big thing are the little handwritten notes from clients who maybe just passed away, and adult children, spouse, send a little piece of stationery in with a final payment or something that just says, “I don't know how to get this to Mary who was my wife's home health aide, but if you can let her know that her presence every day in our home during the last few weeks, especially of my wife's life, meant everything to me and my family.”
Those are the things that resonate more to me than any one client or anything because it's that small act of human connection being acknowledged in the ancient form of handwriting, no less, where someone just takes a minute to put that thing in an envelope and stamp it and send it in and hope that the right people see it and that the word gets back to the caregiver who they don't even know the caregiver's last name or where they live. They’re just hoping, kind of message in a bottle style, that it gets there. And those little acts, I can't tell you how many of those we've received over the years, those are always kind of the most profound.
And those are always the ones that get shared with the company-wide admins and leaders that are like, “Make sure you take a look at this really great note.” And those little shout-outs and those little moments of recognition are really what this industry is about because so many of the caregivers are in really thankless, and sometimes, faceless roles in their day-to-day.
Robert Espinoza: Kevin, I want to get your thoughts on some of the challenges that are facing home care workers through your perspective as a business owner. You mentioned this struggle that many agencies are having with recruiting and retaining home care workers.
In fact, there's recent research showing that. in the next 10 years, long-term care employers will need to fill more than 9 million job openings in direct care, and some of those are job openings that are created because people retire or because new jobs are created, but some of them are also because home care workers find that the wages within this sector aren't high enough, and they are finding employment in McDonald's, or Macy's, or other industries.
Why are wages so low in this sector, and how would you address this challenge at Best of Care? How do you address this challenge?
Kevin Smith: Wages are so low because most home care organizations are totally controlled by the rate of reimbursement. If you're only getting paid $20 per hour by the payer source, what are you supposed to do? That piece of it is often lost on readers, listeners, contributors, analytical minds of this space who think that there is seemingly no overhead for companies like ours, when, in reality, it's all overhead and it's all payroll. All we do is process payroll for human service delivery, and the margin or the return on that is almost entirely dictated by your rate of reimbursement.
There's no other revenue stream that we're drawing on here. And so, going back to my example, if you're being paid $20 per hour, there's only so much you can pay a caregiver. You need to be able to make a little bit more than that to keep this thing going, and keep it afloat, and build, and add.
That wage pressure, the tale is old as time. We've been talking about it forever. That is where the drumbeat really needs to strengthen from an advocacy standpoint and from a mission standpoint, that pay rates are the direct function of reimbursement. And so, yeah, that's why they're so low. And turnover will go down when you pay people more.
Robert Espinoza: Absolutely. In fact, there is research showing that states that invest less in Medicaid often have some of the worst quality jobs in home care. So that relationship between our public financing and job quality is enormous. Kevin, in this season of A Question of Care, we're asking all of our guests to imagine for us what our society would look like if there were no care workers. And I'm curious, from your perspective, how do you think society would change if there were no home care workers?
Kevin Smith: COVID-19, go back. We don't want to do it, but go back. It was miraculous what home care workers did, but there were moments where we could not source home care workers, not because they weren't willing to work, but because they were on the shelf, quarantined after being sick, or having COVID, or being exposed by a kid or a family member. And what we saw play out was sort of what you would expect if there were no care workers, people who relied on critical daily, sometimes hourly 24/7 care couldn't be at home alone, and they went to hospitals, and hospitals are not equipped.
The state of affairs in the hospital and healthcare system, brick and mortar, in 2024 is ill-equipped to handle a massive influx of people coming in to receive emergency or care related to chronic conditions due to a lack of resources or care at home. the system would collapse, quite frankly. Nursing homes couldn't sustain it. Hospitals not going to sustain it. Sniffs, rehabs, all the places in the continuum… You can't just quickly build more brick-and-mortar communities to sustain an influx of people who can no longer be at home because there are no home care workers.
So, we all know what the answer is. The answer is utter and total collapse is really what would happen. And honestly, you just mentioned that we need 9 million jobs in the future to support the aging trajectory of our country. That's insane. Trying to think about where we are now and 9 million jobs, it's not that far of a parallel to what happens if there are no care workers versus, “hey, we need 9 million.” The situation is bad.
Robert Espinoza: It is a grim picture, indeed, And I'm wondering if we can shift our conversation to discuss the types of interventions and solutions we need to avoid that catastrophe. You mentioned that in 2018 you were elected president of the Home Care Aide Council of Massachusetts, which has long advocated for important policy reforms in home care. What were some of those policy issues?
Kevin Smith: So much of that work centered on, basically, a public awareness campaign around how little home care aides were paid and how little home care agencies were reimbursed, Which, again, common thread of our conversation today. but what we were able to do very, very effectively, for really the first time ever in my experience working in that association and with elected officials, was make very clear just how much it cost the average agency to deliver one hour of care. and show on a pie chart just how tiny -- listeners, I’m making a really tiny gesture with my fingers -- that pie chart of profit category looks like.
And to show people that the total compensation package relative to the reimbursement leaves nothing, and with a razor, razor thin margin, coupled with a growing wait list of home care consumers who are literally waiting to get service from the provider network. That's where the rubber had to meet the road, and that was the compelling sort of use case that we were really able to provide to open some eyes and unlock some thinking and some minds. And we did a ton of that through the very, very powerful testimony of caregivers.
Who better to talk about their experience in their day-to-day and how hard the work is and then say what they get paid than a caregiver who is talking about not only do they work for Best of Care, but they also work for two other companies? And when they finish up with me at 3:00 P.M., they're going to a nursing home, and they're working a 3 to 11. And, oh, by the way, they have two children at home, and they're a single parent.
You need that sort of first hand experience and testimony. And our coalition and our trade association, I think, did a really, really powerful job of putting a voice of the caregiver in front of the legislative ask, and sort of camouflaging the ownership of the companies from that. And put a human being in front of that with a voice who can share their experience, and you've got a recipe for, I think, just something that is interesting, and impactful, informative. And at the end of the day, it resonated to the extent that we were able to secure historic rate increases on key services like home health aid, which is a very, very widely purchased service here through Medicaid. And immediately, we gave out, historically, large pay rate increases to the caregivers.
Robert Espinoza: I'm glad that you referenced earlier the importance of training in this workforce. And I'm curious, as you think about the kinds of workforce development initiatives or programs that you've implemented at Best of Care, what are some of the interventions that are really about advancing the skills and the career opportunities for your staff?
Kevin Smith: For the last few years, when we have a new hire, if they don't have this credential, we immediately offer to put them through an internal home health aide training program. We have a long-standing partnership with CareAcademy, which is an education platform in this space, well known, and we use their online home health aide training program to take someone who has maybe some experience, but no credential, and certify them as a home health aide at the end of their 75-hour training, which is a combination of online and in-person credentialing. They're getting paid to be trained, which is nice.
They are able to work on assignments that don't require that credential while they are being trained. And then once they are trained in the ink tries on that certificate, they get a different rate of pay, and they're now able to take any case that comes to Best of Care. It's a pretty attractive program so that, if people want to go out and get a home health aide certification, why not do it at the place that wants to pay you to do it and give you a job immediately?
Robert Espinoza: That's terrific, and congratulations on those. Kevin, I want to ask you one last question. If you could wave a magic wand and implement one big change that would support home care workers and their employers, what would it be?
Kevin Smith: I'm gonna go with an answer that I don't think anyone's heard me say it before, but it's something that I think would be incredibly meaningful. If there were ever a way that the leaders, thought leaders, experts, think tankers, people with brains much bigger and smarter than my own, could create a way to offer salaries to home care workers predicated on X number of hours per week with some margin for the usual home care uncertainty; client death, client refusal, client not at home, other, and reimburse appropriately, the retention of caregivers in this space would skyrocket.
The ability to attract and recruit new people into this space is consistently undercut by the fact that we have to tell people, “The hours are variable. Please know that we can give you 40 hours a week, no problem, we can do that tomorrow, but if Mrs. Smith goes to the hospital, you might be down to 32 hours a week until we can get you to 40.” Even if that only takes us a couple of minutes, the human brain is such that it might say, “I don't know. I've got kids, I have a mortgage, I can't live on 32 hours even if it's just for one week out of the month.” That's the difference between me paying rent or paying a bill. Permanent salaried roles in this industry would turn things upside down in terms of who you could recruit, and attract, and appeal to, from a labor audience perspective.
Robert Espinoza: Kevin repeatedly mentioned the challenge of inadequate reimbursement rates under Medicaid, and It's an essential factor in how care is delivered. Medicaid is the largest public payer of long term care in this country, and it reimburses home care agencies and others in health and long term care for their services. Yet, research has long shown that Medicaid significantly underpays these agencies, forcing many of them to operate on tight margins and disinvest in quality care for clients and good jobs for workers.
We will never transform the home care we receive in this country or any long term care until we overhaul how the system is publicly financed. At the same time, workforce advocates have been correct in pointing out that home care agencies, nursing homes, and others in long term care are not always transparent about how public funding covers their operating costs. This concern is especially valid for franchises in multiple states and long-term care providers that private equity firms have purchased and now operate.
Do they need more public money, or do they need stricter controls for how they compensate CEOs and vendors in their communities? Are they striving for profit over quality on the backs of families who need quality care and workers who deserve financial security? We do not know for sure. This is the dilemma frustrating many of us. How do we finance a system where some operators do right and need more dollars and others need more oversight and stronger controls? Altruism and corruption coexist in our economy, and our laws must address both.
Thank you to my guest, Kevin Smith, and to you, our listeners. If you enjoyed this episode of A Question of Care, please share it on your social channels and stay tuned for future episodes. This podcast was produced by me, Robert Espinoza, in partnership with Modry Media. Please make sure to rate and review the podcast wherever you're listening.