Disrupt—Honor President Nita Sommers Says Transformational Change Coming to Home Care

In 2015, Honor announced a $20 million fundraising round led by high-profile venture capital firm Andreessen Horowitz—making it clear that Silicon Valley-style disruption could be coming to the home care sector. But while it has continued to attract investor interest, Honor has had its share of challenges to surmount, from changing its employment model to learning the ropes of client acquisition.

These types of challenges have sunk some other VC-backed home care startups, but Honor is still growing and is now in California, Texas and New Mexico. However, it has shifted its model since its earliest days, putting more focus on building partnerships, in which it shares its technology platform and operational expertise with existing home care providers, senior living communities, care systems and payors, in locations across the country. Last November, the company formally announced the Honor Partner Network.

In the latest episode of Disrupt, Honor President Nita Sommers speaks about the company’s evolving model, whether home care can be “Uberized” by matching clients and caregivers through technology, the emerging opportunities in Medicare Advantage, and her background—which includes earning degrees from Harvard and Stanford and stints at two other health care startups that have gone through initial public offerings.

Subscribe to Disrupt via Apple Podcasts, Google Play Music, SoundCloud or your favorite podcast app. Below are some highlights from the conversation with Sommers, edited for length and clarity:

With its emphasis on partnerships, is Honor in a gray zone between being a care provider and tech vendor?

I think that’s the correct way [of thinking about it]. I think we increasingly see ourselves as a growth platform for a lot of other folks working the space, in the sense that it’s not just the tech, it’s a combination of the tech and the operational expertise that we can bring to bear.

As you can imagine, a part of what we do is just, literally, I have teams of people fully dedicated to caregiver recruiting across all of our markets. So that’s an operational capability that we have that sits on top of what our technology can do, and that’s incredibly valuable. And, yes, we can essentially give partners access to those capabilities, so that they don’t have to worry about those aspects of the business and they can focus on things they do incredibly well. So for example, developing deep relationships in their community and spending a lot of time [on] care management capabilities with their client. So that’s really where we’ve evolved a fair amount.

The value of that is we can start to manage caregivers in an even better way, because we’re managing so many more caregivers in a market. At scale like that, you can think about doing really different things in terms of training, because all of a sudden you’re training huge amounts of people. You can think about really different things around professional development and career pathing … If we write one device integration and we can just push that out to all the partners that are using our technical backend, that’s the stuff that can start to drive transformational change, because we’re just reaching a lot caregivers [and] more clients more quickly through that model, than if we were solely working through our own teams in every single marketplace.

On Medicare Advantage plans being able to offer non-skilled in-home care benefits, and why Honor’s focus on tech and partnerships should appeal to these payors: 

This is a great example of why we think there needs to be network building in this space, and technology enablement. Because if you think about it from a payor perspective, in every other part of what they manage—pharmacy, dental, medical—there’s existing, easy places to interact with the system, and they know what they’re getting, and they know the quality standards, and their structure, and there’s data that can come back to them to show the value of what’s happening. Obviously, that’s been improving and there’s still some areas to work on. But this whole space has been incredibly hard for them to work with, to date, even though I think there’s eagerness and desire to understand what is the value of non-medical home care and how can it impact cost of care and how should they reimburse that relative to the traditional things like facilities.

I think there’s going to be growing interest from that entire market to really experiment and test and gather all the data points they need to really figure out where this is going to fit within coverage benefits. We already are seeing that interest today and have some pilot relationships that we’ve started to help with that exploration.

On how, despite changes to its business model, Honor is still unique from other large home care providers:

I think the big difference is that a lot of them are, frankly, franchisors that have a series of franchisees that they have some control over but not a ton, in terms of how they operate … there’s very few places where you can say people 100% follow the same recruitment, hiring standards, the exact same performance management protocol, so that you 100% know when you get something, what it’s going to be. That level of consistent standard around service level agreement is pretty unique about what we can do at a national level over time.

The biggest other thing is because we’re fully integrated in what we do, our caregivers all use our technologies and applications, it really opens your eyes up to a bunch of things that we can start to do that are very, very different.

For example, I was talking with a payor the other day, where they’re like, it would be great to understand and capture tons more information from the home. That becomes very easy for a company like us, because everyone’s using our apps and we can standardize the things that they collect and the information that’s there. We’ll announce soon that we’re doing a really interesting integration with a number of the in-home devices. That’s the kind of thing that we’re built and cut out to do, given the kind of company we are, that starts to fundamentally change the way we think about non-medical home care, as not just, I provide caregiving. It’s, I actually fully capture and integrate the home care service with all the things that they need.

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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