How FirstLight Turned Employee-Assistance Programs into a Major Revenue Driver

FirstLight Home Care’s 2019 success was a catalyst for lofty 2020 aspirations. One of the major drivers of last year’s prosperity was employee-assistance programs (EAPs).

EAPs are specially designed employee benefit packages offered by certain employers. Over the past few years, they’ve more frequently included caregiver benefits, prompting home-based care agencies to take notice.

Some examples: Starbucks (Nasdaq: SBUX) and Best Buy (NYSE: BBY) began offering caregiver help to their employees through Care.com.

Although home care agencies keyed in on the opportunity to offer services through larger companies via EAPs, many have struggled to make a real dent in the market.

In 2019, however, FirstLight found a way — and then some. About one-third of the company’s revenue last year was linked to national alliances and EAPs, CEO Jeff Bevis told Home Health Care News in January.

Headquartered in Cincinnati, the in-home care franchise company has more than 170 franchised locations, with plans to move into 45 to 50 more markets this year. It also plans to double down on its EAP strategy, Bevis said.

If home care agencies wanted to offer their services to an employer for EAPs 15 years ago, they were forced to find partnerships at individual company locations through HR departments to make any headway. Now, EAP partnerships are much more advanced, Kerri Pendley, FirstLight’s executive director of health care strategy, told HHCN.

“Over the years, that has definitely evolved. The No. 1 [reason] for that is just because of the demand for child and adult care,” Pendley said. “Employers have definitely seen the need for that [care] and the astonishing statistics around the volume of work that is missed and the amount of dollars this costs companies.”

According to a 2018 Harvard Business School study, a significant amount of employees are hindered by personal caregiving responsibilities. About 32% of surveyed employees said they had voluntarily left a job due to caregiving responsibilities, with another 80% claiming that their caregiving duties affected their productivity at work.

While FirstLight did not unveil its EAP partnerships, several Fortune 500 companies are among the employers the franchiser is providing services for, according to its leadership.

Some large companies elect to handle EAPs in-house, but others turn to third-party entities that provide these programs. Those entities include Cascade Centers Inc., Curalinc Healthcare, BHS, Health Advocate and Wellworks For You, among others.

FirstLight currently has 11 different relationships with EAP partners, with three of them accounting for most of the revenue.

That’s because the relationship “models” — as Pendley put it — vary from partner to partner.

In some models, for instance, FirstLight enters into an agreement with a company to essentially become a part of its database. When there is an emergency and an employee needs backup care, FirstLight is an eligible option to provide that care, which the employee would search for on a company website.

The model that is more advantageous for FirstLight, though, is notably different.

“The other one that we’ve seen, which has definitely been the more beneficial one — as far as being able to track the revenue that comes from it — would be those true direct-referral models,” Pendley said. “[The ones] where we’re able to contract with them. We have routine calls with our account manager, ensuring that they have all of our continuous updated lists and information about our locations. And then we are directly receiving the referrals from that employee-assistance program for backup care.”

Even if the employee uses a private-pay option based on a company referral, FirstLight is still able to track that it came from the partnership, usually because there’s been a specific code assigned to that company the employee will use.

FirstLight focused on large partners in 2019, and it paid off for them. Moving forward, its goal is to maintain those larger partners while readying itself for any others that may enter the market; and continue to search for potential partners at a more local level as well.

“We put a lot of focus on [the larger companies], which is where you see that we now have 11 [partnerships] versus what we had in years prior,” Pendley said. “[We’ll also] be working with our individual franchise owners on a local approach for EAP programs.”

One of the things that can be tough in EAP partnerships is timing. The employees looking for help through their EAP options are most likely seeking care with a sense of urgency.

“So for example, you’ll get these [requests] and they’ll need the service that day,” Pendley said. “You have to have a model set up where you can accommodate [that] — doing your assessment and getting your service started all within a very quick turnaround. Generally it’s because whatever [care] plan they had in place has fallen through.”

For FirstLight, the perk from these occasionally hectic encounters is that they can often lead to longer term relationships with the patients who needed the franchiser’s services on a short-term basis.

The company’s national alliance department focuses on researching and then developing these relationships. It was so successful in 2019 that FirstLight is adding to the department so it can continue on its current trajectory.

EAPs themselves are also likely to expand. According to the U.S Bureau of Labor Statistics, 54% of employees had access to quality of life benefits as of 2016. That number is likely going to continue to rise.

“Major employers are leveraging this benefit for their health benefits packages for employees and immediate family,” Bevis said. “It’s to help people stay on the job. That is really starting to boom.”

The quality-of-life investment on the employer’s end is a way for larger companies to gain an edge in recruiting and prove how invested they are in employees as not just workers, but people.

“Now that we have way more statistical outcomes to report, I absolutely think you’re going to see companies investing in employee benefits like backup care and child care, and even pet care — you’re even seeing that get covered,” Pendley said. “I think that you’re going to see more of these large third-party companies that will manage them approaching and continuing to expand those services for companies.”

Dr. Sally Spencer-Thomas, a psychologist with a focus in mental health who has paired with multiple EAPs in the past, told HHCN the same.

“Employee assistance programs provide a kind of psychological safety safety net for the employees,” Spencer-Thomas said. “I’m thrilled with this idea of a caregiver benefit. So many families are stressed with their caregiving responsibilities, and this gives them some flexibility. I think it’s a great innovation for EAPs.”

In the end, the key to succeeding in these partnerships is the same as succeeding in any other facet of the home health business: the quality of care.

“It’s still like with anything in our service industry: You’re as good as the quality of services that you provide,” Pendley said. “So a lot of it is the relationship, because once you’ve proven to be a really stellar service provider, then generally it will generate more business for you, regardless of what type of account it is.”