While the environment surrounding home care continues to evolve, the services being delivered largely remain the same.
That’s why Tribute Home Care’s CEO, John Sneath, has largely focused on perfecting the wheel rather than reinventing it.
Tribute was founded in 2012, as the brainchild of Sneath, who served as president and COO of HouseWorks for nearly a decade. The company operates in Massachusetts, Maryland, Illinois and Northern Virginia.
Sneath believes that one of the biggest components of delivering quality care is the caregivers. At Tribute, making sure that the company is able to recruit and retain efficient caregivers is paramount. The company has spent the years building an enviable employee benefits page, and compensating caregivers at rate higher than others in the markets it serves.
Sneath recently joined Home Health Care News for its latest episode of the Disrupt podcast. During the conversation, he also explained why Tribute is doubling down on its private-pay business model, how the company is working to improve the customer experience and how he has seen caregivers change over the years.
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HHCN: Within your private-pay model, how do you manage volatility if a few clients happen to leave the company at the same time?
Sneath: The way we’re managing it, and I think we’re probably late to the game here, is that we’re making sure that every market has a full-time dedicated salesperson.
For years, we’ve been wrestling with that, and really relying on the director of our marketplace to also do the sales work, thinking that the quality of our service would sort of speak for itself, and create enough word of mouth, but the marketplace is competitive enough. We’ve seen this volatility enough that we want to try and smooth the waves. By having dedicated salespeople, we’re able to generate a more consistent flow of leads, so when those drops happen, it’s not quite as shocking and hard to overcome.
You’ve been in the business a long time. What do you think has changed the most in home care, since you entered it?
Overall, service quality has improved, I think competitiveness has driven that. Agencies seem to be – from everything we can tell – better at hiring, using better systems. Prices and wages since we started have basically increased. That’s been very good for caregivers, not great for customers, but as it turns out, I think we were all leaving money on the table. I think people that need home care are willing to pay more than we used to think. There are much larger entities than there were when we started, and those are getting better and better at scaling, although not so much at scaling de novo, more through acquisitions.
I would say, [in terms of] the fundamental service itself, nobody’s really come up with a game-changing or disruptive kind of approach to the service. It’s still very much about the caregiver, very much about the service, and leadership. I don’t see that changing anytime soon.
What are your main priorities for 2024, or even 2025? What are things that you think Tribute needs to get better at?
One very big priority this year is to take another look at our brand, and how we talk about our brand with the language we use, and then make sure that the brand is showing up at each critical touch point. We have a working group that focuses on this all the time, which we convened a couple of months ago.
How do we take a first call? What do we want that experience to be like? How do we respond to an inquiry? How do we do the assessment when we go into the home? What’s the start of care like, when problems arise? How are we resolving those? At each of those places, where the customers are likely to assess how things are going, we want to make sure that’s a very Tribute experience. More and more, we want tribute to stand for something. It’s hard to brand what we do. We’re not selling widgets, and it’s not something you can touch or taste, so it’s hard to brand. It’s all about language, so trying to get that language right.
Secondly, volume growth, particularly in our two newest markets. We grew at about 15% last year in volume, and we’re looking to do a little bit better than that this year. Part of that is the sales force I talked about, making sure that in a niche market, we’ve got a head of sales. In fact, we’re hiring a head of sales for the company as well.
Third is caregiver quality. Always focusing on making sure that we’re offering caregivers the right kind of professional development and support so they can get better at what they’re doing. Making sure we’re hiring enough people. That’s always our biggest problem, and probably always will be. Leadership and professional development at all levels, we want to develop leaders from within as much as possible, particularly leaders that can run markets. We’ve got a program that does that. That’s our focus for the rest of the year.
What will be the biggest challenges? What’s going to keep you from achieving those goals, if anything?
The number of caregivers, for sure. We get about 1,300 applicants, system wide, a month. We end up hiring 19 or 20, there are probably five to 10 that we’re not hiring because either we’re focused on the wrong thing, or we just miss something. We’re trying to bring an objective assessment into the process. We can get better at defining exactly the qualities that drive success and then how to find those.
We also simultaneously work on turnover and that fluctuates between 45% and 55% in spite of everything we do. But we’d like to keep bringing that down. That’ll be a big challenge. As you mentioned, smoothing out the growth curve, reducing the big swings that we see. Then leadership, making sure we’ve got the right leaders in the right place moving us forward, particularly in revenue growth.
Do you think growth in the future will mostly come from organic or inorganic means? In other words, do you see any acquisitions in your future?
Some of the people I talked to, almost all of them in fact, have done acquisitions over the years, we haven’t.
I suppose the reason is the culture of our business, the quality of the service, is so critical we just can’t sort of see our way how that would work. We really haven’t looked at that too seriously. We might at some point, but I would imagine five years from now it’ll be the same story.
We’re growing internally, and maybe we’ve added another market to start from scratch. It takes expertise to be good at acquisitions, and it’s just not our expertise. We don’t have any experience doing that, and I worry about the distraction and the challenges associated with that.
You’re pretty certain that you want to go even deeper with private pay. When did you make that decision, especially given that so many other providers are diversifying? Did you see an opportunity almost to zag?
No, it’s been that way from the beginning. It even goes back to when I started an adult daycare business in my 30s. I wanted to focus on private-pay, particularly because I like the idea that if we can provide a great service, then we can charge for a great service. If we can charge a premium, we can pay the people that do the service, and pay them fairly and offer the kinds of benefits that people want. That’s been the case at Tribute.
We’re typically $2 to $3 higher than anybody else in the marketplace. That’s been critical to our ability to attract great caregivers, and offer them the kind of pay and benefits that everybody’s looking for. We have a program called Tribute Secure, which about a quarter of our caregivers are in. It salaries caregivers, so they get paid, whether they’re on a client or not. That’s actually not that costly, but there are costs associated with investing in that and setting that up, so I just liked the flexibility that private pay gives us at the end of the day.
Have you noticed any behavioral changes among caregivers? Do they want things now that they may not have wanted five to 10 to 15 years ago?
PTO would be one. Way back at HouseWorks, we didn’t offer PTO. We didn’t offer it when we started Tribute.
We sort of started with health insurance, in addition to wage, and we realized, and through survey work and talking to caregivers, how valuable the paid time off was. This typically gets somebody who’s working full-time hours about two weeks of paid time off a year. Many of our caregivers are per diem, so they can take other time off unpaid, but that’s a benefit that had we thought more about it, we would have gotten to where we are sooner. People work really hard at Tribute and they deserve time off. We want to give it to them and not have it be a financial burden. We added 401(k) match two years ago, and that’s been well received. One of the indications, for us, that people are making a living wage is if they’re able to save money. A good chunk of our caregivers are in that 401(k), and that number is climbing.
What’s a prediction that you have, over the next five years, for the home care industry at large?
I think there will continue to be more consolidation and focus on revenue growth. From a competitive standpoint, what excites me about that is to some extent it’s at the expense of quality. Our experience is when we have had strong competitors, and they’ve been purchased by a big company doing roll ups – we tend to not hear about those agencies after they’ve been purchased. By and large, these roll ups have hurt quality, but that’s given us an opportunity.
I think the diversification happening with the payer mix will continue to happen, because private pay is really hard.
I don’t see the caregiver situation changing much, unless we do something about immigration, and for sure, we should be actively working to increase immigration for caregivers.
We think a lot about what would disrupt the service delivery model, and we come up short there. That’s why we just keep focusing on the very basics of the service. I think for the foreseeable future, it’s going be all about the caregiver. That’s what clients want, and that’s the most important aspect of the service. We got to just keep working on getting that better and better.
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