The history of the family-owned ProHealth Home Health & Hospice tracks with the history of U.S. health care.
Based in Birmingham, Alabama, ProHealth is specifically on its third generation of family ownership. Its CEO, David Lester, joined the company in 2015, over 50 years after his grandparents bought their first nursing home in the ‘60s.
For a long time, nursing homes were the focus of the business.
Lester and other ProHealth leaders took note of care shifting to the home, and decided to invest in that trend.
“We thought it would be a good way to capture Medicare revenues since Medicare has been in the habit of cutting reimbursement across all service lines for some time now,” Lester told Home Health Care News. “It was a way to keep the nursing homes patients, if you will. We could continue to provide therapy and nursing when they were discharged home. When I came back in, we started three home health agencies up off the ground, got Medicare certified at the end of December of 2015 and have been growing ever since then.”
Today, ProHealth has seven home health branches, four hospice branches and two skilled nursing facilities. Between home health and hospice, the company serves an average of about 1,200 patients per month.
Nearly three-quarters of ProHealth’s revenue split is traditional Medicare. The rest — about 28% — is primarily Medicare Advantage with some commercial insurance sprinkled in.
As a small provider, Lester has seen a great opportunity to capitalize on the consolidation of the home health industry.
“When Encompass came in and bought Alacare, when Aveanna came in and bought Comfort Care, we found there’s a lot of clinical staff and sales staff who have no interest in working for national companies where decisions are made states away,” Lester said. “We’ve had a really good track record of bringing in very solid talent from those established Alabama-based companies when they sold out to national companies.”
Still, like most home health providers, staffing remains challenging for the company.
In an environment where word of mouth used to be a bankable process for finding new staff, ProHealth has had to actively seek out nurses and other caregiver positions because of the discrepancy in supply and demand.
“Our Birmingham location alone could be twice the size it is right now if we could find enough nurses to staff the referrals that are coming in,” Lester said. “Up until two years ago, we primarily relied on word-of-mouth recruiting. The folks working for us would talk to the people they know from nursing school or with people who they worked with at other home health agencies. Then, two years ago, we brought in a recruiting team and we’ve got two folks in house right now that spend 100% of their time trying to identify and bring in additional nurses.”
ProHealth has experienced promising growth numbers over the last year.
In less than a year, the company launched home health branches in Huntsville, Tuscaloosa and Auburn. Like the generations before him, Lester has had to adjust the company’s growth strategy with the times.
“Huntsville has exceeded our expectations in growth,” he said. “We were in Tuscaloosa under COVID waivers from March 2020 until the end of 2021. We had a very healthy census there, but when those waivers expired, we had to fold that staff back to Birmingham, so we’re in the process of capitalizing on the goodwill that we previously built there.”
The Auburn location is a month old and has taken over a majority of the company’s time and efforts.
Once all three newer branches are profitable, Lester said the company will look to expand in a handful of other markets in the state, as well as contiguous states like Georgia, Mississippi, Florida and Tennessee.
“We recognize our size and we don’t need to be jumping states just because a good opportunity presents itself,” Lester said. “Looking at border markets in each of those states is something that we’ve been actively doing for the past year and a half or so.”