Ep. 73: 10 Early Trends from the 2022 Benchmarking Report

Todd Austin (00:08):

We’ll kick this off first with a little bit of backlog around today’s discussion and a little bit about the participation in the 2020 study. And so always good to understand, you know, the process of how we get the data. And then Tyler and I are going to be kind of highlighting some of the early trends. So a little bit about the benchmark study. So we gather industry trends from, you know, about 300 different statistic points plus, and we really help then benchmark and customized reports across the industry, whether that’s for your state and or corporation. So the, it, you know, data is really important to the industry. So once again, this includes findings from the 2022 survey, which is 2021 data. Currently this represents 500 or agency locations, but the data is early. And so as we unlock some of these trends and when you get the study here in a couple months these trends could slightly change, but we do feel like there’s a large enough sample size to put an early trend to them. With that being said let’s dive into trend one, Tyler. So the, the first thing that we noticed here you know, is really where recruitment and retention initiatives are. And probably no surprise to all of you that, you know, 45% of agencies are focused on recruitment and retention. You know, Tyler, as you dug into the data, what, what did you notice or find that you thought was unique?

Tyler Guthrie (01:48):

Well, we, we know that agencies are, are focused on retention right now. What what we were surprised to see is, is just how much that has increased year over year. So 45%, that’s up about 12.8% from last year and focusing a on, you know, referrals and expansion, you know, looking at some of these other categories these are all down. So referrals from partners is down 7.6%. And we, we know that you know, turnover is, you know, going to continue to be an issue. We’ll, we’ll get to, to that slide here in a bit. I know that ones, you know, on the edge of their seat to see what, what turnover is going to do year over year, but caregiver recruitment and retention looks like it’ll be a primary focus for for agencies in the year ahead.

Tyler Guthrie (02:40):

And as we reviewed some of the other, you know, growth opportunities that agencies mentioned and the survey it was interesting to see how they, they all, you know, really tied back to caregiver recruitment and intervention, the, the bulk majority of them did. So, and, and the other category we saw, you know, people submit, you know, hiring caregivers, you know, building company culture staffing enhancing training, and you know, developing their, their workforce, which can, can be subcategories of this caregiver, recruitment and retention, which I think is really just a Testament to how much agencies are really focused on recruitment and retention right now.

Todd Austin (03:23):

Yeah. And I think it’s key from the standpoint of, we know anytime there’s external pressures like we have in industry today you know, there’s going to be winners and losers. And so, you know, love seeing initiatives around company culture and, you know, really working towards a long term solution to your employment brand. And so, you know, kudos to all of those that are focusing on that now you know, we’re bullish on the fact that as, as pressures similar to this have hit other industries, those that have kind of pivoted and really focused on, you know, culture and employment brand for the winners on the other side of it. So, you know, part of the trend is also knowing, you know, how to solve the problem, or at least position yourself to solve the problem, you know, from a long term standpoint.

Todd Austin (04:08):

So I think that that was a great finding there. And you know, for those of you, you know, viewing into, I am not in a college dorm I am in a hotel room, so I know it does look a little bit like I am my college dorm, but that is not the fact I’m, I’m in a hotel room. So doing this on, on the go, let’s talk about trend number two, which everybody’s anticipating waiting for. So caregiver turnover, it, you know, stayed flat once again we’re 64% and that could flex wait a lot in the, you know, last couple weeks a percentage up or down, you know, likely two or three percentage points. So something to continue to watch, but as you are benchmarking yourself over the next couple days, and you are thinking about your initiative around caregiver turnover and building that employment brand, and then knowing where your caregiver turnover for the next couple days is very important. As we talk to some organizations that have seen phenomenal growth along with decreased turnover, which is really a perfect environment for, for growth in this, in this time. Tell what else did you notice?

Tyler Guthrie (05:21):

Well, I, I, one of the comment that this is a median number, this, this is an average, and you’ll, you’ll see, you know, throughout the study, if you’re familiar with our, you know, annual report that we do frequently use median. And the, the reason that we do that is just because we have, you know, a variety of, of agencies participating, you know, averages can, can and be, you know, thrown off a here or there. So we found that the median really gets us a, you know, true you know, representation of, of what’s going on in the industry. So just, just a little background on, on why, you know, that that’s median you know, we, we’ve seen a lot of you know, economic turmoil, you know, the great resignation, you know, COVID you know, other, you know, economic issues, impact turnover, but we’re sort of breathing a collective side of relief that that turnover has and jumped and, and spiked you know, any higher since it’s been something that’s been at the forefront of, of you know, the issues that home care agencies face right now.

Tyler Guthrie (06:29):

So we’re we’re happy to see that

Todd Austin (06:32):

The next one we’re gonna talk about, you know, what would love to have people chat in what they believe, the number one recruitment sources for 2021, where did you find your caregivers? So where did you find most of your caregivers referrals? Was it Facebook? Was it friends and family? A lot of indeed. Okay. Yeah. Yeah. Well those, those that are saying in indeed are not alone. You know, it definitely dominated both the number one and number two spot with 90% of applicants coming through those, that specific source. And I know Tyler, like, there’s, there’s a lot to unpack here. So the study comes down, you know, we’re gonna wanna look at, you know, acquisition costs for caregivers through channels, you know, turnover through channels, but, you know, upfront, what did you notice on recruitment?

Tyler Guthrie (07:31):

Yeah. On, on recruitment you know, this was an interesting one, cuz Indeed’s always been, you know you know, top recruitment sort, but we, we saw a pretty significant jump in the percentage of people that said that it was their top source. So the actual report will show you know, the top five sources. So it, on the survey itself, agency owners had an opportunity to, to list their top five recruitment sources. And we, we took that data and analyzed it and you know, indeed was the clear you know, trend here that we were seeing is, you know, so you can see that, you know, 90% of, of agencies that you know, listed something in the first two options mentioned indeed, so that you know, that that’s a real trend there. And I we’ll add, you know, comment about these high volume and, and high turnover sources as we’ve looked into retention rates and, you know, acquisition costs of the different sources.

Tyler Guthrie (08:42):

We, we have noticed that you know, that some, some of the platforms like indeed do have you know, higher turnover rate than other sources, like word of mouth. So as you’re focusing on your recruitment strategy, I think that that’s something to be aware of that, you know, some of these sources like job boards can fill caregivers fast and they may be required to have, you know, some of the volume that you need in order to, to staff cases. But I would suggest not letting it become a distraction for focusing on your your reputation focusing on recruiting more caregivers through word of mouth or through, you know, other referral sources.

Todd Austin (09:33):

Yeah. Yeah. I think that’s a good call out. I think there’s, there’s two challenges that, you know, I would, I would throw out here, you know, is, you know, for everybody on the line, I hope you’re all, you know, taking notes or jotting a few things down. I know it’s recorded, but you’re probably thinking of a few bullet action items that you could, you could take. So the first one I would challenge everybody to is go and apply. So just, you can easily create a fake email address and go apply for a job at Amazon or, or, you know, door dash or Uber some of these recruitment sources and then go and apply for your own job and see what that experience looks like. It was very interesting. I was at home care 100 last week, which is a conference put on by the Lincoln group.

Todd Austin (10:19):

And David Beata from beta talked about that. He actually did this, he went and bought you know, five burner phones and he created fake email addresses and he applied for a handful of jobs internally at beta through this. And then he also did Amazon and Uber and the application process was extremely seamless for, for, you know, Amazon and Uber. And then his, you know, there were a lot of hoops and hurdles to jump through. So look at how your you know, getting applications and that experience starts from that process. So how you write the ad, how you display the ad, how you talk about your culture. So that’s, that’s really, you know, two things that I would say you should do from from today’s finance is, you know, apply for your own job, apply for some internal, and then also getting your caregiver turnover by recruitment source and, and measure that.

Todd Austin (11:23):

So that’s, that’s trend three you know very, very interesting and unique from the standpoint of, of indeed has grown and others have shrunk. Now the fourth one is also probably something that many of you can can verify today around, you know, what is happening with wages. And so, you know, we’ve, we’ve seen huge increase in you know, from caregivers to PCAs CNAs, or HHAs the starting wage to starting wage in 2021. So very interesting from the standpoint of, you know, really wages with inside here, excluding registered nurses, which likely you know, we, we can easily say probably not significant enough, you know, data to really compare care about RNs across the industry. I think we’ve all seen, you know, traveling nurse wages and a few few of those, you know, rise into the a hundred dollars an hour.

Todd Austin (12:23):

But you know, inflation was 7% and wages outpaced inflation. And as you think about this trend, you know, the one thing I noticed Tyler was when the study comes out, we’ll have, we’ll do an analysis on how much did rates increase. And, you know, those rates with the pressures of wages should definitely outpace, you know, wage increases. So if you haven’t increased what you, you know, charge per hour or for your services, definitely something to think about now as you’re entering into the new year and new contracts are coming with clients, that’s one thing we’ll have to watch going into this, but, you know wages did outpaces inflation this year. That’s something I know. So what about you to,

Tyler Guthrie (13:13):

Yeah, I did take a peak at, at some of the billing rates to look at at how those increased and in some areas we, we did see that increase by about $3. So you can see there’s, you know, a bit of a margin there. And I’ll get into that little bit later in, in some of the other trends, but yeah.

Todd Austin (13:32):

Any, any surprise here from anybody? I’m sure many of you saw, you know, what, what you’re paying did, did your wages increase more or less than 9%? Once again, love to see, get a pulse from it from everybody on the line today and chat. So quick, quick pulse check care, you know, did you increase wages more or less than nine? You could just say more or less once again, you know, these, these wages are aggregated across the industry. So, you know, that’s why we always look at a percentage is it’s probably more applicable to how we would see wage increases

Tyler Guthrie (14:09):

In the actual report. Once that’s released we will be able to break this down more by geographic region, and we know that wages are, are different, you know, all across the nation. So as the, the study comes out, I encourage everyone to look at that to see how your rates compare to others that are that nearby.

Todd Austin (14:32):

Great, great kind of early trend and confirmation. Many of you are saying, saying more you know, probably in, in today’s trend, you know, it’s more about the percentage of change than actually, you know, starting wage you know, listed there because we’ll always compare a starting wage versus wages in a specific geographic area in this specific trend. So very, very interesting. So, so many of you’re chatting in that yeah, you are seeing wage increases more. So, so confirmation that there is this pressure in the same sense, you know, are you seeing rate increases at the same pace of wages or are we just seeing this affect margins and a lot of things to unpack there around P and L and performance and margins. So kind of one of the last trends, you know, to talk about is you know, learning and how we’re doing learning.

Todd Austin (15:31):

And historically, this has been a great mechanism for retention to provide caregivers, an opportunity to upskill themselves, whether that’s getting certified in specific categories to allow for them to earn additional wage increases. And so one of the trends that we noticed was jump in how training was being administered with, with a blended learning approach first and then online only. And so we’re seeing online training grow, blended learning, grow, and in person decrease, which I’m sure as many of us would all imagine with COVID and press of getting people in an office, much easier to do training virtually than it is in person, but still a lot of value in getting people connected. At the same time, that’s something that I kind of looked year over year at kind of kick it to you, Tyler, for what, what you felt was increased there.

Tyler Guthrie (16:33):

Yeah. One of the things that I looked back at when I saw these survey results is you know, a few years ago when, when we were starting COVID we, we surveyed agencies and 46% of them were saying that they were adding, you know, online training during the pandemic. And so we’re, we’re seeing you know, a continuation of that agencies are hanging on to online training and and in, in person training and, you know, the results of that are, are positive. We, we know that, you know, every you know, caregiver is, is different and online training is, is easier to, so it’s it’s, you know, important that you know, you’re providing courses that are you’re going to match the needs of your caregivers. And having a blended learning approach is, you know, one of the best ways to, to do that. And, you know, also allows you to you know, more effectively train your, your caregivers since everyone learns in a little bit different way and some different topics, you know, lend themselves more to in-person learning and some are, are easily approach to an online method.

Todd Austin (17:52):

Yeah. And that probably leads us into the next trend. Right. which I know you’ll, you’ll unpack, you know, there’s always a lot of questions around what, what should be trained on. And historically, this is where differentiation is created both in unemployment of providing specialty learning path source certificates for caregivers to upscale, but, you know, trend six, your time

Tyler Guthrie (18:15):

That that’s right. And little background into this question and how this was asked, we, we ask about, you know, general training topics. And then we ask a separate question around specialty training topics and the specialty to training topics you see here, you know, such as dementia care or Alzheimer’s care. These are, are highlighted and they have a, you know, an asterisk asterisk care. And we we’ve seen an increase in other percentage of agencies reporting that they’re focusing on specialty care. And as Todd said, you know, this can be a, you know, critical way to differentiate your agency. You know, it can allow you to charge more per hour, which can allow you to pay more so that you can increase caregiver attention. It’s also a way to improve your referrals. If you’re an agency that’s, you know, focused on, on a specific type of care, a referral source is gonna be much more likely to you know, provide a referral for, you know, that needs that, that particular type of care. And it’s, it’s also a way to, to improve retention. So some interesting takeaways here from the the different types of training that agencies are reporting they’re, they’re performing.

Todd Austin (19:37):

Yeah. And I think as, as the study comes out, the, the thing to watch once again, that we’ve, you know, every year we look at is obviously the training is, is a huge differentiator in the market but also the number of hours for both orientation and ongoing. So there, there’s a huge gap between those that provide eight hours of orientation and 12 hours of ongoing and the revenue per caregiver, it’s about $5,000 more if you provide eight hours or more of, you know, on boarding training. So, you know, you’re, you’re obviously certifying them, putting them maybe through you know, a caregiver certification series. And then the ongoing education is about three, $3,000 more. So for caregivers that you provide 12 or more hours, they generate $3,000 more in revenue. So the data, holy supports a learning ladder and continuing education inside the space. And we’ve just gotta make sure that that flows through to the P and L on the revenue side, around once they’re certified, you know, what does that, what case does that qualify them to take? And at what rate is that specific caregiver’s skillset matched up for? So that’s a trend I would say to watch as the study comes out is, you know, did that disparity between, you know, a lot of training versus no training grow in the revenue per caregiver.

Tyler Guthrie (21:07):

Great. Moving on to this next trend we’re seeing a, a slight bump in median revenue despite, you know, a lot of the challenges that we’ve seen, you know, both economic and, and pandemic related. You know, over the past few years, we, we are seeing revenue continue to climb. So it’s about a 3.6% bump and looked into, you know, what client growth rate was since we’ve been seeing client growth rate rate slowly decrease over the years you know, about a percent each year this year looks like we’re ending up somewhere around 4.3% for, for client growth rate. And so that, that’s, that’s something to, to, to be aware of here that that growth rate has slowed a little bit. I think this is somewhat, you know, also caused by a lot of the con consolidation that has happened an agency that, you know, consolidate and it grows is going to have a, you know, a little bit lower growth rate than a smaller agency that is you know, starting out with, you know, five clients and then, you know, adding five more by the end of the year.

Tyler Guthrie (22:23):

So that can explain, you know, some of the, the declining growth rate, but Todd, you know, takeaways here from what you saw with meeting revenue.

Todd Austin (22:34):

Yeah. Yeah. I, I think you know, from an industry perspective, we’re, you know, over the last five years, we’ve still grown 20%, you know, so very representation of the, you know, hospital or acute move to post acute. And so the home is here to, to stay which is, which is great for all of us, right? We’re all in a prime position. Now we’ve gotta position our, our, you know, brand to attract, you know, the employment to continue to fill cases. So I think that’s, that’s the one thing the industry is still growing 20% over the last five years, very positive grow, and we can continue to kind of work through all of the challenges that are pressing at different times, which, which will present different opportunities.

Tyler Guthrie (23:22):

So jumping here ahead to trend number eight we saw a spike in, in client turnover rates. So we, you know, we hoped that we’d get away with, you know, a, you know, more flat line here, but like we did with caregiver turnover, but we are seeing a spike here, at least in the initial data for client turnover rates that jumped up to 76% and you know, a quicker view of the formula that’s used to calculate that it’s the same as the caregiver turnover formula that we’re using. So we’re looking at the total number of separations or clients that are we’re stopping services and dividing that by the average number of clients. So for the period that we’re met, you know, in this case, all of 20, 21 the number of clients at the beginning of the year plus the number of clients at the end of the year divided by two to get the average. And that’s what’s giving us this meeting client turnover rate a, a bit of a surprise to see you know, numbers of this high, but it’s something that we’re going to keep an eye on.

Todd Austin (24:26):

Yeah. And I think you know, Greg asked a question, you know, too, around how much, how much of the growth, so the median revenue growth was, was due to price increases could, could be we’ll have to unpack that as we kind of finalize this study to look at what, what was the growth rate historically, you know, we’ve been yeah. In the single digit percentages as, as a per agency growth rate. But with, with the trend around you know, client turnover does pose the question around, you know, did, did we actually grow, or did we grow a census, did grow, you know, per hour, you know, where did that growth come from? So we’ll, we’ll have to do something in addition to this, to unpack that once the survey survey is completed. But one thing for everybody to probably measure internally is, is what is that lifetime value of a client?

Todd Austin (25:23):

And if turnover is up and there’s you know, suppression on being able to acquire caregivers, but the lifetime value of a client is down, it’s a really, really hard mix of metrics on the business. And so we’ve gotta, we’ve gotta balance those two together to make sure that lifetime value of a client grows knowing that you know, it’s harder to track caregivers and wages are up, so we’ll, we’ll continue to watch this, but for yourselves, go and look at what your lifetime value for client is and see how that compares year over year. Very, very important as we roll into the next couple months as we UN unleash and, and let go of some more internal data. But trend eight, I would say is maybe one of the biggest surprises that I noticed in this year’s early findings of the data

Tyler Guthrie (26:16):

Trend number nine, as we, we wrap up our, you know, top 10 trends here from the initial data is with remission tracking. This is another one I was a little surprised to see and reason that we, we ask this question around readmissions is because of the importance of home care agencies asking and, and tracking this this rate so that we can you know, track outcomes and you know, a seat at, at the table with, you know, these other healthcare agencies that are, that are tracking outcomes. We, we saw a little bit of a decrease so far in the day for agencies that are tracking readmissions. Last year, it was about 22% this year around 18%. And we saw a slight decrease in the median re readmission rate that agencies are reporting. I believe that’s down from about, you know, 3.4% to 3%. So there are you know, good outcomes to report here. It’s just something that we need to be tracking a little bit further.

Todd Austin (27:22):

Yeah, yeah. And so I, I think, I think there’s two things, and I know we’ve got some advocates on the line here, you know, this, this, this is so important, you know, so if, if you’re scheduling or your EMR, you know, doesn’t have this capability, you need to be a voice of change with them, and we need to start, you know, really tracking this metric. You know, I see a lot of items in the chat around you know advocates for, you know wage increases probably, you know, from some of your government payer sources or insurance payer sources. The easiest way to have this conversation is, you know, purely through readmissions data because that how our sister industry there are compared through star rating. So client satisfaction and, you know, affecting the, you know, readmission or readmit of the patient into the hospital.

Todd Austin (28:19):

So these are two very critical things that we’ve gotta really improve as an industry. And I know others will likely harp on this over the next three days. So if you are, I, I see it in the chat, you know, a few few people saying not all software you know, has this capability that needs to be a feature request that you all go and vote on or, or submit to your customer success to in, because this will be really important for us as an industry to continue to stay on top of the continuum and be part of the, you know, movement to, you know care at home.

Tyler Guthrie (29:02):

It it’s really something that can set you apart as an agency, and you help you, you know, increase for referrals as, as well, if you can speak to the actual outcomes that you’re providing. So jump into our last trend here. These are the top five client marketing sources. So we, we see, you know, clients and, and word of mouth which is included here has increased east a little bit. Last year it was a brown 20%. So up about 4% of a six per 16% increase in terms of, of percentages. And you know, takeaway here is that we, we can’t really understate the importance of building your reputation both from a client growth standpoint and from a caregiver recruitment standpoint the, you know, benefits of that are, are huge. Another, a trend that we’re seeing, you know, when comparing to past studies is, is the increase in the amount of agencies reporting that they’re using PPC or, or paper click Google ads as a top source. So that’s up to 9.6% this year. And SEO have, has gone down a little bit. SEO was our number two spot the previous year. So PPC something that you may wanna take a look at and focus on so you can increase your, your paid acquisition.

Todd Austin (30:37):

Yeah, yeah. And one, once again we’ve got a balance cost, right? So the easiest way, and the most efficient way, you know, to grow is absolutely through, you know, word of mouth and referral sources. It’s historically been one of the lowest client acquisition costs. And so, you know, as we’re seeing wage pressure, right, we we’ve got balance that in our margins through gaining efficiency in other places. And so this, this is a good trend. This is a really good trend that we’re scaling efficiently from a customer acquisition cost. So, you know, real, real quick, once again, interested to know how many of you are, you know, tracking your on a regular basis, your customer acquisition costs. And you can just say, yeah, tracking no tracking, but very, very important. When we think about the game of, if we’ve gotta pay more, we’ve gotta reduce cost somewhere else. And typically we can gain that efficiency from AC addition of clients. So very important to measure what is your client acquisition cost or, or C as, but, but good trend on the industry overall, that this is an efficient way to scale.