Cantata, a Chicago-area senior housing and care provider, is achieving success with its Take2 home care model, increasing margins even as clients are paying less for services.
Take2 was piloted in 2014, rolled out on a wider scale in 2016, and now serves about 60 people after a record month for new sign-ups in March, Cantata CEO John Larson said last week at the LeadingAge Illinois annual meeting and expo near Chicago. Cantata is a not-for-profit organization that offers an array of senior services; its campus-based housing, located about 15 miles southwest of downtown Chicago, includes independent living, assisted living and enhanced care.
About five years ago, Cantata’s board decided to move away from bricks-and-mortar expansion and focus on community-based care. Cantata then took a hard look at private duty home care, where the organization saw a pressing need for innovation to answer several alarming challenges, Larson said.
The cost of personal care is already steep for consumers, and rates are only going up as tightening labor markets and changing laws increase costs for providers. At the same time, turnover is rampant in home care and a worker shortage is set to get worse as the baby boomer generation ages.
Looking for a way to address these issues, Cantata found inspiration in a company based in Northern Wisconsin, which provides in-home care for people who are developmentally disabled. Take2 was created by adapting that model.
Take2 is a neighborhood-based system, in which caregivers drive around a designated area for the duration of their shifts, dropping in on clients to provide services in short bursts of about 20 minutes. Some of these drop-ins are scheduled and others are done on-demand, as clients have needs that arise and they alert the Take2 staff.
Currently, the service area is roughly six square miles around the Cantata campus. The organization has two people handling the program logistics and six to eight roving caregivers. They work regularly scheduled shifts, around the clock.
Take2 provides a wide array of services, including bathing and dressing assistance, light housekeeping, medication reminders, home maintenance and pet care. It does not provide companion care, given that the caregivers come in to perform specific tasks and then leave, moving on to the next house.
At the outset, the Cantata team had some doubts about the model. For instance, some people feared that clients would constantly be calling for help, and caregivers would be frantically trying to field requests and get from house to house.
“Our team said, it’ll be like a video game,” Larson said.
Those fears did not come to pass. In fact, clients request on-demand services infrequently, and the care team has been able to keep visits brief while maintaining 95% customer satisfaction and good health outcomes. For instance, as of October 2016, with 125 clients served, there had been only three falls with injury and two 30-day hospital readmissions.
There is a learning curve, however. Explaining the system and setting client expectations are important.
“We rarely if ever say, you’ll have a bath at 9:30,” Larson said. “We say … you’ll get hygiene in the morning.”
Similarly, there was skepticism about helping people with toileting on a schedule, but that has also not been a stumbling block. It is not unusual to have a toileting schedule in an assisted living setting, Larson noted.
This is not “Cadillac” care, he emphasized, but most clients are happy to receive “Chevy” care—that is, care that is reliable and meets their needs, at a lower price point. The lower rates are sustainable because caregivers are working more efficiently, not sitting with clients for extended periods of time.
“We mimic live-in care for about $180 a day, [and] our average rate is about $52 [a day],” Larson said.
The national average cost of private duty care is $23 an hour versus an average of $10 an hour for Take2, with tasks converted to an estimated hourly equivalent. On its billing statements, Take2 includes a comparison of its charges versus what the client would be paying in a more typical private duty arrangement.
At the same time, Cantata is paying the Take2 workers about $2 more an hour than its traditional caregivers, and Take2 team leads get even higher wages. These pay rates help with retention and so does the stability of the job, Larson said. Unlike in traditional arrangements, losing a client does not mean losing work or getting a new schedule. Take2 workers simply show up every day or night for their shifts, caring for the clients in the neighborhood; customers come on and off the rolls but the ratio is about 11 to one every caregiver.
From the operator perspective, paying for shift work eliminates the headache of having to account for overtime. Workers drive Take2 vehicles, not their own cars, so tracking mileage and gas reimbursement is not an issue.
Take2 is now turing a profit, although Larson declined to share the average margin with Home Health Care News, saying that he wanted to collect more data first. Cantata is making a better margin on the Take2 model than on traditional hourly care, which it also offers, he noted. Some clients are mixed—for instance, receiving four hours of sustained caregiving during the day then shifting to Take2 at night.
The margin for Take2 increases as client volume increases because there aren’t significant additional costs built in, with the neighborhood caregivers are already in place, Larson also stressed.
Going forward, he sees the need for more robust technology to support Take2’s expansion. More predictive analytics is a priority, to drive more proactive care and to handle more complex logistics as neighborhoods expand and client rolls grow. Cantata is in discussions with other senior care providers to scale up Take2 and has invited providers from outside Chicago to come and see the model in action.
Larson is enthusiastic about its potential for the future.
“I don’t know the limit of what this model could do,” he said.
Written by Tim Mullaney