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According to Forbes, 90% of all startups fail. As for those in the healthcare and social assistance field, only about 57% make it past five years. Meanwhile, in the medical technology sector, upwards of 75% of U.S.-based, early-stage medtech companies never find success, according to TTi Health Research & Economics.

Learn the top reasons why healthcare startups fail so you can be prepared for the challenges that lie ahead when running your healthcare business. Get the insights. 

1. Running Out of Cash

Mismanagement of funds or failure to raise enough capital is the most common reason for any business, not just healthcare startups, to fold. A CB Insights study found that 38% of unsuccessful startups ran out of cash or failed to raise new capital. The healthcare industry is especially tough. Managing cash flow is challenging because the sales cycle in healthcare is particularly long.

One area where medical businesses lose funds is putting too much money and effort into pilot programs. Many companies underestimate the amount of effort required to have a successful pilot. You want to put the right amount of resources into the program to gain traction and revenue without going overboard. There’s a fine balance needed.

One way to skip the pilot programs is to invest in a franchise. A Place At Home allows seniors to age safely in their homes. We’ve already gone through the trials and tribulations that come with healthcare startups, so you don’t have to. Instead, you’ll receive our proven blueprint for building your own in-home senior care business.

2. Not Enough Market Demand

In that same CB Insights study, research showed 35% of startups fail because there isn’t enough market demand for their products or services. Although a medical technology company can have multiple potential paths for its product or service, they typically start with the one that the founder or CEO is most experienced in. But, this path might not be where the highest demand is. So, you should perform extensive research and determine which direction provides the best market size, competitive landscape, and highest potential for patient adoption.

3. Product or Service Doesn’t Fit Workflows

All jobs in the healthcare field are essential, making their workflow vital to saving lives and treating patients. You might think your new technology will make their lives easier, lower costs, or improve patient outcomes, but the adoption period might turn them away from using it. Facilities and offices usually have a well-established workflow model; anything that disrupts it could come with pushback.

4. Flawed Business Model

The CB Insights study found that nearly a fifth of all startups failed because of a flawed business model. The most common reasons a business model fails are because their profits and losses don’t add up or its story doesn’t make sense. This basically means that the company built the product or service on incorrect assumptions about the consumer. Or in other words, there’s no real market for the product or service.

5. Regulatory or Legal Issues

The medical field comes with lots of hoops to jump through. Some startups try to skip the regulatory approval process and go directly to the consumer. For some companies, it’s worked. But it leaves you hoping your customers are okay paying out-of-pocket for your health service or product. While the process can seem lengthy and expensive to go through, receiving federal approval, in the end, might help your business thrive.

Healthcare Startups vs. Medical Franchising

Concerned one of these five reasons might be what brings down your new healthcare business? Consider franchising. There are several medical franchising routes, from at-home care to urgent care centers or physical therapy offices. While the initial investment costs are higher than possibly a startup, you know there is already a demand because the brand is thriving in other locations. The franchise provides a proven business model, allowing you to get up and running efficiently. Good franchises will walk you through all the licensing and regulation steps to start a medical business. They already know the ins and outs, so take advantage of it.

Benefits of Homecare Business Vs. Medical Business

Forget the hassle of dealing with insurance companies and stricter regulations of medical businesses. Instead, learn how to start a home health agency like A Place At Home. The overhead costs and startup costs are kept lower for several reasons.

First, you don’t have to hire medical providers like doctors, mid-level practitioners, or nurses. Caregivers provide our clients with exceptional homecare. This factor keeps your staffing costs lower. Then, your professional liability insurance is lower because you’re not providing medical services. Lastly, since you’re not providing physical or occupational therapy to your clients, you’ll need fewer supplies, keeping overhead costs lower. So, you can provide your community with compassionate, senior-focused, and customized in-home services.

Ready to jump into the homecare industry? Submit a franchise form to get started.

Considering joining the growing home care industry? We don’t blame you. Currently, the home care providers market is worth $120 billion in the U.S. That number is only expected to grow as an aging population looks to live in their homes as long as possible.

Federal, state, and local governments heavily regulate the industry. The regulations are to protect you and your patients. So, when starting a home health care business, one of the first things to do is get a home health care license. Here’s a look at the steps involved in how to get a home health care business license.

1. Choose Between Medical vs. Non-Medical

The type of services you provide could change the type of license you need and how you get it. For example, to offer medical services like medication administration, you’ll need to hire medical professionals before you begin the process of licensing. However, this comes with more liability for your business.

You could stick to non-medical services and provide companionship or other daily activity assistance. Some states will still require skilled medical professionals to be hired to meet the requirements for a license for non-medical home care agencies.

2. Find Out Your State Requirements

Whether you’re looking to offer medical services or operate as a non-medical home care provider, there are several steps to take before accepting clients. First, research what your state requires. Not all states require licenses for home care. CareAcademy finds three that don’t: Iowa, Massachusetts, and Michigan You can typically find these requirements on the Secretary of State’s website.

Depending on your state’s requirements, you’ll need to attend training, and state officials or an accrediting body will perform inspections. The process of getting your business license can take three to 18 months, depending on your state. Some states will provide you with a provisional license during the process. States with an increase in applications for home care licenses might take longer.

There are 18 states that require an inspection visit before receiving a provisional license for non-medical home care or home health care companies. Then, after that first inspection, follow-up inspections occur every so many years, again depending on the state.

More than a dozen states require home health care agencies to file a Certificate of Need before applying for a business license. This certificate helps state authorities monitor the supply of providers in the health care market. It evaluates the local demand before allowing a new facility or agency to open. Apply for your certificate of need first, before your license, just in case you need to reconsider your territory.

A benefit to owning an A Place At Home franchise is our market research. We know what areas and territories a home care agency can thrive in. All our base franchise unit territories have 40,000 qualified senior residents.

3. Create a Business Plan

For some license registrations, you’ll include a business plan. Generally, it’s good to have one completed before you finalize your business setup anyway. Your business plan will outline core business activities and how you plan to achieve goals. These documents include an executive summary, products, and services offered, a market analysis, marketing strategy, financial planning, financial projections, and a budget.

4. Register Your Business With the State

Before you move on to getting your license for your non-medical home care agency, register with your state through the Secretary of State and the State Department of Revenue Services. Typically, this step is as easy as filing your business name with the state and local governments.

5. Set Up an Office

Secure an office space for your business. You’ll need locked cabinets to store client and company records. In addition, most license applications will require you to include a copy of your lease.

Only a small executive suite is necessary when you become an A Place At Home franchise owner. It allows you to perform private, professional interviews with your care staff members.

6. Follow State Training Requirements

Study the mandated training for you and your employees. The requirements vary by state. Ensure it’s all completed fully before applying for a home health care license. Most states require everyone have CPR/AED training, even if you’re a non-medical home care agency. Caregivers have specific training requirements to follow.

7. Apply For Your Home Health Care License

Finally! Once you’ve completed all the previous steps, you have made it to the end of our guide on how to get your home health care business license. You can submit your license application. Fill out all the necessary forms and provide the proper materials to your state to receive your licensing.

FAQs on How to Get a Home Health Care Business License

Still have questions after reading through the guide? Here are some frequently asked questions surrounding the licensure process:

• How much will it cost?
  Like most other things, this varies by state. Fees can either be a flat rate or based on the number of employees. For example, a Texas home and community support services agency license costs $2,625.

• How often do I have to renew?
  This is another state-by-state regulation, but it can also depend on how much you want to pay to extend your license. States typically require a renewal annually or every two or three years. The more you pay at one time, the longer the license period is.

• Do I still apply for a license if I buy into a franchise?
  While you’re paying to join a trusted brand, you still have to follow the rules and regulations of your state for home care agencies. So, yes, you still have to go through the steps of how to get a home health care business license and pay for it, even when you’re affiliated with a franchise system.

Let A Place At Home Guide You Through the Process

Instead of worrying about navigating how to get a home health care business license by yourself, let us help you at A Place At Home. By becoming an owner with us, you’ll receive not only licensure guidance but also a step-by-step process on how to start a home health agency. You’ll follow our five-step CARE track to gain the tools you’ll need for success. You can capitalize on multiple revenue streams — all while being backed by a reputable national brand that people recognize. Those opportunities include care coordination, finding senior living alternatives, and staffing services.

Don’t sweat the small steps. Let A Place At Home lead you to open your own home care agency. Submit a franchise form to get started.

The demand for home care has skyrocketed since the pandemic, with no signs of slowing down. See current home care industry trends taking on the post-pandemic world.

1. Growing Demand For Home Health Care

More seniors require some long-term care. The Economic Policy Institute (EPI) finds that 70% of people who reach 65 years of age will need long-term care. Furthermore, the number of people in that age group will be 44% greater, or 25 million people, by 2040.

On top of that, people are looking to stay in their homes for as long as possible. AARP notes that more than 80% of adults prefer to live in their homes instead of nursing homes or other institutional settings. So that’s making families turn to home health care agencies to care for their aging loved ones. Dustin Distefano, CEO of home care franchise A Place At Home, talked with CareAcademy about this issue. He’s seeing assisted living and memory care communities that used to have waiting lists are now at 70% to 80% occupancy, while home care agencies have waiting lists.

2. Caregiver Shortage to Continue

The number of caregivers in the U.S. doesn’t meet the growing demand for home health care services. In June, American Health Care Association (AHCA) and its National Center for Assisted Living (NCAL) found that 73% of nursing homes are concerned they’ll have to close due to staffing issues. That same report shows that more than half of nursing homes are limiting the number of residents due to staffing woes. This is leading families to turn to home health care agencies for help.

Unfortunately, experts say the lack of caregivers will continue as a home care industry trend over the next year. According to EPI, 1 million additional home health care workers are needed by 2029 to meet the growing demand for home health care.

Reports show that pay and training are the primary areas that employers should address to encourage more people to enter the field. In 2021, the Bureau of Labor Statistics reported that the median annual wage for home health aides was $29,430 a year. That comes to $14.14 an hour if the aides work 40-hour weeks. Workers say they want more training opportunities to earn a better wage and perform more specialized skills to help their clients.

It’s essential for business owners in this industry to address this trend and what their employees are asking for if they want to retain staff.

3. Need for Companionship Care Rising

More than one-third of adults at least 45 years or older feel lonely, according to a National Academies of Sciences, Engineering, and Medicine (NASEM) report. Loneliness comes with several health risks, including dementia and an increased risk of heart disease or stroke. It’s also associated with higher depression, anxiety, and suicide rates. Hence, many families are turning to companionship care to ensure their loved ones don’t undergo any of these hardships.

Some home health care franchises, including A Place At Home, have already noticed this trend. Our in-home non-medical services include companion care. That can look like enjoying the senior’s favorite hobbies, having stimulating conversations, socializing, opening and sorting mail, and teaching seniors to use email and social media.

4. Use of Technology to Monitor Patients

Another trend that could keep you competitive in the home care industry is the use of technology. The pandemic showed us we could stay connected without meeting face to face, including through telehealth in the medical world. The downfall with telehealth appointments is that they don’t allow medical providers to collect vital signs like blood pressure and oxygen levels. New technology like remote patient monitoring (RPM) can solve this problem. It works by having patients collect their vital signs and submitting them so medical professionals can analyze the data. They would typically do this throughout the day.

This technology is expected to help lower the costs of medical care for seniors by reducing their hospitalizations. About 85% of older Americans suffer from at least one chronic health issue like diabetes, asthma, heart disease, and COPD. Through monitoring vitals with RPM, medical providers can help manage chronic illnesses from afar and help them avoid any costly downturns. In addition, medical providers will turn to home health caregivers to assist with this monitoring.

Take On These Trends With A Place At Home

As you can see, the home care industry is trending upward. Get a head start in it by joining a franchise like A Place At Home. You’ll help meet the growing demands of this industry and provide much-needed care to the senior community when you become a franchise owner. We offer multiple revenue stream opportunities, including helping staff agencies in your community solve labor shortages through staffing services. Take the next steps of owning a home care business by submitting a franchise form.

Innovative senior care model to be made available to residents this fall.

SCOTTSDALE, AZ, August 28, 2018 – Former Marine Alex Caudill is no stranger to the healthcare industry, nor to senior care. But he saw gaps in the local senior care scene, leading him to become the latest franchisee for A Place At Home, an innovative Senior-Focused care model. The new branch, located at 10601 N. Hayden Road, Suite 108 in Scottsdale, is scheduled to open later this fall.

Caudill has cared for seniors both personally and professionally, and has seen multiple family members and friends through assisted living, homecare, and hospice.

“Every person deserves high quality care, regardless of their circumstances. I believe every company that serves seniors should go above and beyond to make sure every person has a top-notch experience while they’re being cared for by others,” says Caudill. “Every person’s needs are a little different, and I appreciate the APAH model, which allows caring professionals to tailor the experience to every person.”

Caudill goes on to say he was impressed by the company’s accessibility and dedication.  “I aligned with A Place At Home’s core values, ‘We are CARE,’ because it stands for the core values I live by personally. Being compassionate, accountable, respectful, and ethical are core values I teach my kids and try to emulate on a daily basis. They help care for people who can no longer care for themselves. That is the epitome of selflessness and compassion. I can honestly say every time we’ll be caring for a senior we’ll be caring for them as if they were our own family.”

Caudill spent 10 years serving in the Marine Corps, both on active duty and on the reserves. He spent the next seven years holding multiple leadership positions in the healthcare industry, including operations, sales, marketing, and business development. This has given him an extensive education in leadership, sales, and the operational success of a healthcare company.

A Place At Home launched in 2012 in Omaha, NE. After experiencing explosive growth, co-founders Jerod Evanich and Dustin Distefano continued fulfilling their mission: to be Passionate Professionals Providing the Compassionate Care Solutions You Need, Where and When You Need Us. To that end, they began awarding new franchises across the nation. A Place At Home offers a unique “Senior-Focused care” model which provides a continuum of  in-home care, care coordination, community placement, and staffing services.

Distefano was especially impressed with Caudill. “Alex’s positive energy, military background and his personal experience caring for others—his father in particular—was a perfect fit for our CARE values. I am extremely excited to work with him and to get him up and going in the Phoenix market.”

“We are excited to bring on another franchisee with ambitions to help people and to grow their own A Place At Home business in their community,” adds Evanich.

Considering a Senior Care Franchise?

When you join our group of dynamic business owners, as franchisees of A Place at Home, you’ll have strong support, thorough training and valuable business resources to help you succeed. Contact us to learn more.

“It starts with a conversation,” stresses Distefano. “We are looking for people who align with our values. If your personal foundation is built on those values then we are happy to help you parlay your professional background and acumen into becoming a successful A Place At Home owner.”

CONTACT:

Dustin Distefano, CFE
Co-Founder and Head of Franchise Development

O: 888-502-6310
F: 402-281-0736
E: dustin.distefano@aplaceathome.com
W: aplaceathomefranchise.com

ABOUT A PLACE AT HOME

A Place at Home (a NorEast Franchise Group) offers a range of customized in-home care services, care coordination and assistance in identifying and transitioning to senior living alternatives. The company is dedicated to preserving the quality of life for seniors by giving them the support they need to stay as independent as possible for as long as possible. Those who would like to explore franchising should contact the owners to start a conversation. Visit  aplaceathomefranchise.com or aplaceathome.com for more information.