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‘A Huge Victory’: Home Care Turnover Remains Stable at 65.2%

Turnover rates in the home care industry have taken an up-and-down rollercoaster ride over the past few years, jumping from 66.7% in 2019 to 81.6% in 2018, then falling back down to 64.3% in 2019.

Yet in 2020, turnover across U.S. home care agencies remained mostly flat, climbing ever so slightly to an overall rate of 65.2%. It may seem like a counterintuitive thing to say, but that relatively small increase marks “a huge victory” for the industry as a whole, according to Erik Madsen, the CEO of Home Care Pulse.

“The phrase ‘all-time high’ could be used to describe turnover just a couple years ago,” Madsen told Home Health Care News. “In terms of caregiver satisfaction, employers did an excellent job during the COVID-19 period of reaching out, recognizing workers and communicating. They just did everything they could to make that experience as [manageable as possible] for their employees.”

Home Care Pulse reports on workforce developments, marketing strategies, financial trends and more in its annual Home Care Benchmarking Study. The Idaho-based research and education firm released its 12th edition on the state of home care in 2020 on Wednesday.

In total, nearly 850 home care providers participated in this year’s Benchmarking Study, according to Home Care Pulse. That group — a mix of independently owned agencies, franchise-associated offices, hospital-affiliated providers and others — represented more than 1,920 locations nationwide.

“We honestly didn’t know what kind of participation we were going to get,” Madsen said. “But it’s been really exciting to see the support and interest in the study.”

A less than 1% year-over-year increase in industry turnover from 2019 to 2020 is cause for celebration because of the unprecedented workforce challenges home care providers faced.

For starters, the early unknowns of the COVID-19 virus triggered widespread fear and anxiety among caregivers. Many of those home care professionals who continued to work on the front lines, caring for seniors and other vulnerable populations, then had to also juggle child care conflicts due to school closures.

On top of all that, shifts often became more unpredictable, with concerned clients canceling visits. Providers additionally had to compete with more robust unemployment benefits passed by the federal government in various coronavirus relief packages.

Last year could have been a disaster for home care employers, as far as keeping their workers. But many rose to the challenge, Madsen said.

“Satisfaction was at an all-time high in 2020,” he said. “Just because of the agencies really stepping up.”

Not all health care or senior care employers have been able to keep their workers with such success amid a global catastrophe.

As of the end of April, nursing home and residential care employment was down 63,000 jobs compared to the end of 2020, according to nonprofit research and consulting firm Altarum. That sector has seen a loss of at least 339,000 total jobs since February 2020.

Labor challenges

Turnover stayed relatively flat from 2019 to 2020, but home care operators certainty still faced their share of labor difficulties, the latest Home Care Benchmarking Study suggests.

Even before the pandemic, a rapidly aging U.S. population meant a lot of agencies had to reject new clients due to caregiver shortages. Since last spring, demand has skyrocketed even further, especially as more health care organizations have recognized the value in non-medical home care services focused on social determinants of health.

To some degree, that supply-demand imbalance has handcuffed growth, Madsen pointed out. In fact, the median client growth rate for study participants dropped to 5% in 2020, down from 6.2% in 2019 and 7.1% in 2018.

“Client growth rates are actually at historic lows,” he said. “It’s not because there’s no demand. There’s a tremendous demand for these services. For agencies, finding, training and getting the right caregivers in place is key.”

With that reality in mind, nearly one-third of the study participants identified having a “caregiver recruitment and retention program” as the top growth opportunity for 2021.

At the same time, nearly eight in 10 participants said “caregiver shortages” was the top threat facing home care providers in 2021. Roughly four in 10 participants said “caregiver turnover” was the top threat.

In previous years, “strengthening relationships with referral sources” was widely seen as the top opportunity for growth, Madsen noted.

“People are saying, ‘I don’t need to work as much with my referral sources as I used to. That’s not one of my greatest growth opportunities,’” he said. “It’s really in my recruiting and retaining of caregivers.”

Of the nearly 850 home care providers that participated in the study, more than half said caregiver shortages had an “extremely negative” or “very negative” impact on their business.

“Home care owners are realizing, ‘Look, for us to grow, I need to go out and make sure I’ve got adequate caregivers to meet the demand that is coming,’” Madsen said.

Generally speaking, the turnover rate climbs higher as home care agencies add more caregivers.

Caregiver benefits

There is no silver bullet to caregiver retention, with compensation, training, support and communication all playing critical roles. A strong employee-benefits program also can help home care operators on the labor front.

In 2020, nearly 84% of the Home Care Benchmarking Study said they provided some form of caregiver benefits. That was up from just under 81% in 2019.

The most common forms of caregiver benefits provided in 2020 were travel reimbursement, paid time off and health care. About 40% of study participants offered 401(k) matching, with 5.4% engaging in profit sharing.

As far as recruitment avenues, the vast majority of study participants turned to internet-based services for new hires, including social media platforms. While that was the most common recruitment method, it wasn’t exactly the most effective, Madsen said.

“People say the internet is easy because you put an ad out there and hope that people come to you,” he said. “But … the best retention rates are for those employees that are recruited from an employee referral program.”


This article was written by Robert Holly on May 19th, 2021 and can be found here. Please be sure to visit for more articles written by Andrew and other quality contributors.