Investment Banker Becomes CEO of ‘Unicorn’ Home Care Company

Stowell Associates is not a large home care company, but it is a unique one—so unique that its new co-owner and CEO calls it a “unicorn.”

Chip Measells and a group of private investors recently purchased Stowell from co-founders Phyllis Brostoff and Valerie Stefanich for an undisclosed price, and Measells has stepped into the role of president and CEO.

Measells started his career in investment banking before buying an adult day care business, to which he added home health, home care and rehab. After selling that company, he started investment banking firm Wyatt Matas in 2003. That Charlottesville, Virginia-based company specialized in home care transactions, so Measells saw the inner workings of a variety of companies. As a result, he had a clear idea of what he was looking for when he decided to leave the “transactional” grind of banking and get back into operations.

However, the process was not easy.

“I…looked at a ton of [home care] companies and couldn’t find the right fit culturally or size-wise, and nothing that was differentiated,” he told Home Health Care News. “So, I thought I was looking for a unicorn and turned my attention elsewhere.”

But leaders at Stowell Associates read one of Measell’s white papers and reached out to him, and the pieces fell into place for the acquisition. Milwaukee-based Stowell was the right size, with a modest service area limited to the Wisconsin city and its environs. It also has a private-pay business model that blends home care with care management services, and a culture that highly values individual caregivers.

Now, Measells and his wife are relocating to Milwaukee (pictured above), and he is executing on a strategy to bring additional sophistication and scale to Stowell.

Beyond concierge care

Stowell Associates began in 1983 as a care management company, but Brostoff and Stefanich found they were referring out a lot of patients for home care. They began offering those services as well. Today, about half of Stowell clients are just getting care management and the other half are receiving blended home care and management, Measells said.

Other companies in the home care space also claim to offer “care management,” but Stowell’s offering is much more robust than is typical, he emphasized.

“Think of a spectrum of care management,” he said. “One end is concierge [services], making sure clients have all things they need in the home, and a lot of times that’s not really done by a professional care manager, it’s just somebody in the office. There’s a lot of that out there.”

Stowell, by contrast, does much more “heavy lifting,” he said. Usually the care management begins with an acute event, and Stowell helps the patient stabilize the immediate situation, then interfaces with all the players involved in the case, including the hospital, physicians, rehabilitation providers and pharmacy. In addition, the company addresses underlying issues such as ensuring that the patient’s home environment is safe and that social supports are in place—and its home care offering can come into play, for clients who need this level of assistance.

Both registered nurses and master’s degree-level social workers are employed as the company’s care managers, and they also have supervision over Stowell’s in-home caregivers. Because care managers are also on the frontlines working with clients, this structure creates more immediate oversight and support for caregivers than trying to manage them from the office, Measells said, adding that this is one reason for a turnover rate of 27.5%. That’s 75% lower than the industry average of about 66%, according to Measells. Stowell also keeps its clients for about 32 months on average, compared to the industry standard of 10 months.

Reforms under the 2010 Affordable Care Act have increased the need for care coordination among providers, so care management has become an increasingly attractive capability not only for clients but referral sources looking for a home care partner. Yet, other home care companies have not emulated the Stowell approach for a few reasons, in Measell’s opinion.

Stowell began on the care management side, so it had built up that infrastructure before adding the home care piece; if companies try to add care management to existing home care services, they tend to opt for the easier light-touch concierge approach that does not require such robust capabilities. Then, they sometimes essentially give away those services rather than charging appropriately for them.

“[Stowell’s founders] approached it from a standpoint of, what we do as care managers is valuable and the family is going to pay for it,” Measells said.

The current billing rate is about $30 an hour, though that can vary depending on factors such as whether it’s a weekend. At that rate, the company can afford to pay its workforce well. Though he declined to quote a specific caregiver pay rate, Measells said it is 30% to 40% above the market, and Stowell also offers health insurance and benefits such as a 401k match.

Next steps

Having officially taken the reins at Stowell Associates in December, Measells has begun to enact an expansion plan.

One key component is investing in technology. Stowell already has an effective care management platform, Measells said, but it needs an upgrade to become more mobile-friendly and integrated into scheduling software.

He also plans to invest in business intelligence, pointing to the rich trove of data that the company has from its decades in operation. Now, that information can be crunched to improve workflows and for predictive analytics.

Expanding the service area is also a goal, starting around Milwaukee. Stowell is embedded on the city’s east and north sides, and now it is in the process of opening an office for the western suburbs of Brookfield and Waukesha. That is already staffed and will open in May, Measells said. There are also plans to open an office in Mount Pleasant, about 30 miles south of downtown Milwaukee. The timeline is to have that one fully staffed by August or September.

Then, plans are to keep growing branch locations throughout Wisconsin, Measells said.

Stowell faces some of the same challenges as other home companies in achieving scale, including tight labor markets and a caregiver shortage. But Measells points to the higher pay rate that Stowell offers, as well as its differentiated business model, as crucial advantages.

“So many small companies are all saying they do the same thing, and to the families it all looks the same—we all look the same,” he said. “Really trying to find a differentiator so that you can charge a premium and pay caregivers more is hard to do…which is what I really valued in Stowell.”

Written by Tim Mullaney

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Tim Mullaney on Email
Tim Mullaney
If he’s not in the newsroom, Tim likes to be on the tennis court or traveling to a new destination. Recent highlights include Sri Lanka and Iceland.

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