Ryan Iwamoto co-founded 24 Hour Home Care 12 years ago, right in the middle of the country’s last major recession. Now, Iwamoto and his company find themselves operating through another economic downturn, with this one caused by the COVID-19 crisis.
Los Angeles-based 24 Hour Home Care is an independent, non-medical home care provider with 20 locations spanning California, Arizona and Texas. It employs over 10,000 caregivers and has been one of the fastest-growing companies in the U.S. for the past several years, according to Inc. Magazine.
Despite a lengthy list of challenges over the years, the home care company has managed to thrive. It has mostly grown organically since launching, though these days, it’s becoming more of an M&A player as well.
Iwamoto, who serves as the president of the company, credits 24 Hour Home Care’s success to its people — which he calls its “secret sauce.”
To learn more about that secret sauce and how 24 Hour Home Care has thrived in forming partnerships with Medicare Advantage (MA) plans, hospitals and other health care providers, Home Health Care News sat down with Iwamoto for a recent episode of Disrupt.
Highlights from HHCN’s conversation with Iwamoto are below, edited for length and clarity. Subscribe to Disrupt via Apple Podcasts, Google Play Music, SoundCloud or your favorite podcast app.
HHCN: 24 Hour Home Care has been recognized as one of the fastest-growing home care companies for eight years in a row. How have you managed to do that, year over year?
Iwamoto: When we started 24 Hour Home Care, we wanted to combine the professionalism of a large company with the personalization of a mom-and-pop business. And when we were thinking about what company did this well, in any industry, there weren’t really many that came to mind. But there was one: Trader Joe’s.
Everyone loves Trader Joe’s. They did an amazing job of being your grocery store, even though there aren’t many Trader Joe’s across the country. The store in your neighborhood, you probably identify that one as “your Trader Joe’s.” And their motto was brilliant, too, right? They’re not the cheapest. They’re not your 99-cent grocery store. They’re also not your Whole Foods. But they did a really good job of offering quality products at competitive prices.
Most importantly, the people that you deal with are their secret sauce. The people are super engaged, helpful, motivated and seem to be happy to work at Trader Joe’s. That was something we really wanted to emulate at 24 Hour Home Care. We wanted to be the Trader Joe’s of home care.
Is that the magic bullet that you think made 24 Hour Home Care successful — its people?
Absolutely, just like Trader Joe’s. It’s our people.
We actually have a motto here at 24 Hour Home Care, which is “Care and Compete.” Every employee has to have a little bit of both to work here, a dedication to caring and a sense of competition.
On the care side, you have to care for what we call the four C’s: your clients, your caregivers, your colleagues and, of course, the community. On the competition side, to be frank, we are a mission-driven company, but we are for-profit. So, you have to be able to compete.
This is not just competing in the traditional sense of competing with your industry competitors, but also competing with yourself to be a better version of yourself every day. I like to say those two values are the two threads that are interwoven to make the fabric of our culture.
Do you think you’d be able to launch in the same way you did 12 years ago?
To be honest, probably not. As everyone knows, home care is not easy. When I started the company with David [Allerby], I was 26. It was during the heart of the recession.
The one thing we didn’t have on our side is experience. But the one thing that we did have on our side is just this blind ambition. We really didn’t know any better. But we kept pushing forward. We would fail a few times, but “fail forward” and keep adapting to our circumstances.
And I think that’s what’s helped create the mentality that we have today, that with any challenge comes an opportunity. With COVID-19, I think we’ve seen the same thing. You just have to find that opportunity to rise above it. Once you get more established and more experience, I think you get a little bit more set in your ways, maybe more resistant to change.
It would be a lot harder going into home care with a little bit more experience now.
Most of your business comes from private pay, but you’ve also invested heavily in Medicare Advantage (MA). Why did you see that as an opportunity for growth, and how is that effort going?
We’re extremely bullish on MA. And one of the things that I love to see is the needle starting to move for our health systems — people seeing the benefit and value of home care. Medicare Advantage adding home care as a supplemental benefit a couple years ago, I think, was a huge leap forward.
As a company, we were truly honored to be able to work with some of the plans like Anthem Inc. (NYSE: ANTM) to help create a home care benefit.
Right now, MA is not a significant portion of our revenue. But being a part of this mission to show the value of home care is why we do it. Five to 10 years down the line, to see this as your standard insurance and Medicare benefit — that’s what keeps me going every day.
If you think about it, Medicare was established in the 1960s. For a while, outpatient physical therapy (PT) wasn’t a Medicare benefit at all. Then programs were put together, pilots were made to show the benefit of outpatient PT. Then in the late 60s, it was added. Hospice didn’t become a Medicare benefit until the 1980s. It was several years down the line before people really saw the value in it.
But people put programs and pilots together to show the value of hospice. Now today, people think differently. It’s just assumed as a benefit. I’m very confident home care will follow suit. We’re already seeing it start to happen with MA. I’m excited to be able to help pioneer this for the industry.
In terms of the presidential election, how are you looking at it from a home care perspective?
We’ve gone through three presidents — George W. Bush, Barack Obama and Donald Trump.
I think that with every election, there’s going to be some change, of course. And there’s also going to be change that you’re just not going to have any control over.
For me, I try not to get so bogged down thinking of what may or may not [happen]. Where my mind goes with any of this, whether it’s the election, crisis or change, is ‘with change comes opportunity.” You just have to find it.
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