The Value of Client Longevity... And HOW to Create Value That Will Catapult You into LIVING THE DREAM...

 In the business of private duty home care, the organization leader’s dream is to achieve stable growth and work flow (preferably at 1000 hours/wk or above). In the dream, they sleep peacefully through the night – unafraid of phone calls from caregivers or clients with problems. They waltz casually into the office - knowing that things will be humming along with the efficiency of a well-oiled machine. They meet confidently with prospective clients - describing with pride the level of care they know they can provide and exactly how they will do it. They review their financials with certainty – knowing what they should expect… and when. Their spouses greet them at the door each evening with kisses and cocktails! Their children are well behaved geniuses who mine Bitcoin! They…. Okay, I may have gotten carried away there at the end… but in the dream, they do get to GO ON VACATION.

If you’re reading this with stars in your eyes, there are a couple things you should know.

1.       The above scenario is not just a dream. It is actually possible, and people, just like you, DO live it.

2.       The above scenario is not achieved randomly, or by the sheer number of hours you spend working. It is part of a strategic plan.

3.       All aspects of that strategic plan (and the DREAM!) hinge on your caregivers’ abilities. Because THEY are the true daily face of your organization.

Let’s talk about one small but powerful number that MUST be tracked to reach the dream: Client average length of service. This is just how long, on average, a client remains a customer. Let’s start the discussion with a simple calculation. Say your average length of service is 6 months per client. That is, about 6 months in, your clients are: leaving for another agency because of quality complaints, going out to the hospital for infection, injury, or illness, needing higher levels of care than you can provide, or passing away (for a full discussion of why home care organizations LOSE clients READ THIS).

Just for sake of the math, let’s say your average weekly utilization hours/client is 20 hrs/client/week and you have 25 clients (coming out to 500 hrs/week). If you’re bringing in $12/hr after you pay your caregivers, then per client, overall, you’re making about $5760 over the course of their time with your organization. Now increase that average length of service time by JUST 2 MONTHS. You’re up almost $2,000, without ANY additional investment. Now multiply that by your total number of clients. $50,000. Let me say that again. 50 THOUSAND DOLLARS… with NO additional investment, AFTER your caregivers have been paid… IN 2 MONTHS. And then another $50,000… for every 2 months you can increase your average client length of service. So, if you keep them an extra 4 months you have $100,000, 6 months $150,000, and so on… all with the same clients. And, of course, all the while, you now have greater time and resources to go out and ADD clients to your organization, which means this number begins to grow exponentially.

Beyond the obvious financial benefit retaining the revenue of each client for a longer period of time, there are other considerations and impacts to the health of the organization. Longer average length of service helps to drive down the average cost of client acquisition (an important metric in and of itself). In addition, having reliable client hours helps to keep consistency in the caregiver pool, as caregivers who can rely on regular hours stop looking for other work - and stay with your organization. More consistent caregiver pools lead to greater ease of scheduling, increased predictability of daily operations, and clearer long term growth strategy (and of course, cyclically, keeps clients happier and with your organization longer). If this were a musical, now would be the time I burst into song about the great circle of business life!

So, HOW do you increase your average client length of service? WHAT is the first step? If you want to keep your clients longer, you have to keep them safer, healthier, and happier and THAT is all about the QUALITY OF YOUR CAREGIVERS…. And the QUALITY of your caregivers is ALL ABOUT the QUALITY OF THEIR TRAINING. And QUALITY TRAINING is all about CONSISTENT, STRATEGIC, EASILY ACCESSIBLE, ONGOING, QUALITY INSTRUCTION. So… if you think you’re saving yourself money by trying to figure it out yourself… there’s a good chance you’re losing tens of thousands, hundreds of thousands… and perhaps eventually MILLIONS of dollars.

Don’t do that. There is a BETTER way. And it’s SO SIMPLE…. It’s like living a dream.

Want to know more about high quality training solutions, and if they could work for your organization? Reach out to the author at emilia.bourland@aipctherapy.com or 469-998-1245.

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