In 2019, the United Nations estimated there was a worldwide population of 703 million people age 65 and older. By 2050, the U.N. estimates the number will reach 1.5 billion.
Jeff Huber, the global chief brand officer of Home Instead, called the change a “massive demographic shift.”
“For the first time in history, there’s more older people than young,” Huber said. “Years ago, we used to talk about how every day, 10,000 people were turning 65. In a couple of years, that will be 10,000 people turning 80, and that’s about the time when the average person becomes a client.”
The number is backed up by research from the Administration of Community Living, which found that 70 percent of older American adults require long-term services and support.
“The reality in home healthcare is that we don’t have a demand issue,” Interim Healthcare President and CEO Jennifer Sheets said. “Our challenge has been and will continue to be supply. Across the board as an industry, we’re saying ‘no’ to somewhere between 25 percent and 35 percent of the referrals that come into our space. That includes people who need and deserve high quality home healthcare.”
As demand increases, though, so too does the number of new franchise owners. “We’ve seen about three times as many sold units in the last two years than we had in prior years,” said Sheets. “We’re also seeing a different makeup of the people looking for franchises. What we saw in the past was typically somebody who had been in healthcare looking to get a business on their own. Now, we’re seeing more investment groups. We’re also seeing more people with existing home care businesses raise their hands and say they want to be part of a franchise.”
The story of existing business owners entering franchising is taking place at Home Instead, too, according to Huber.
“We’re continuing to grow the Home Instead network with additional franchise owners, but we’re also seeing a lot of growth with the transfer of existing businesses into the Home Instead ownership,” Huber said.
Home Instead Global Chief Brand Officer Jeff Huber
Founded in 1994 by Paul and Lori Hogan, Home Instead today has 1,200 franchises in 13 countries. In 2021, the Hogans sold the company to Honor Technology, a start-up home healthcare and technology provider.
In selecting new franchisees to grow the brand, Huber said the company carefully reviews what potential owners’ motivations are. “Sometimes they bring experience in healthcare or social services, but it’s not a prerequisite for us,” Huber said. “We’re looking for a track record of success, somebody’s who’s a great culture fit for us.”
Interim, founded in 1966, has 350 franchised units across 42 states. It is part of Caring Brands International, which also franchises Bluebird Care in the United Kingdom and Just Better Care in Australia. CBI was acquired from Levine Leichtman Capital Partners in 2021 by New York-based private equity firm Wellspring Capital Management.
Sheets said while Interim is also growing its franchise network, the process for new owners is thorough. “We have a very strong brand and we want that to continue,” Sheets said. “The way we do that is really vetting and finding like-minded people that are not looking at a new shiny franchise to get rich quick. We want mission-driven individuals. The whole process is about why they want to do what they do, as well as what they know about healthcare and the needs of their community.”
Interim Healthcare President and CEO Jennifer Sheets
Once the franchisees are on board, Sheets said Interim assists with technology and business strategies, as well as recruiting new employees, which is essential for the industry right now. A report by the Global Coalition on Aging and Home Instead found that by 2030, there will be an estimated shortage in the United States of 151,000 caregivers, and the number will increase to 355,000 by 2040.
In Home Instead’s case, the workforce strategy is to enhance the position of the caregiver.
“One of our business imperatives is to elevate the care profession,” Huber said. “To professionalize it, bring a new set of standards around it and change the perception of the work while increasing the pay and benefits around that to commensurate with the importance of the job and the value it brings. That’s how we’ll grow the field and help meet the needs.”
For Interim Healthcare, Sheets said the company is helping franchisees bring in new employees with a model emphasizing what makes home care special.
“We’ve put a ton of time and resources into how to find and train the best people,” Sheets said. “We’re never going to be able to pay the same as an acute care hospital, the reimbursements are very different, and Medicaid varies greatly from state-to-state. So, we’re really focused on what is it about the role that makes it different.”