Welcome to the Healthcare CEO podcast. Join us as Daniel Fernandez, healthcare leader and patient experience advocate, leads dynamic one-on-one discussions with healthcare executives, consultants, and other industry experts. Listen in as they share actionable insights and unique perspectives into the day and life of a healthcare CEO.
*The following has been adapted from our full-length interview, which can be found here.
Meet Ryan Iwamoto
Ryan Iwamota is the co-founder and president of 24-Hour Home Care. In 13-years, he went from start-up to a company that employs more than 10,000 caregivers, serves 10,000 clients across three states and generates more than 120 million dollars annually in revenue.
Origins of the Business
Daniel Fernandez (DF): Let’s talk a little bit about the beginning. In 2008, you started the company during a recession. Not exactly the ideal time, I think we would all agree. Yet, you managed to carve out a niche for yourself. How did you find this niche? What is the reasoning behind even starting it?
Ryan Iwamoto (RI): That’s a great question. I’ll start with this. A lot of great companies have been started in a recession. If you think about in 2008, I believe Uber started, Airbnb started, so you see a lot of these companies finding the opportunity and some of the challenges that the time is presenting for businesses. We’re like one of those companies. Obviously, not the size of Uber and Airbnb, but hopefully soon. 2008 was an interesting time. For me, to get you to the genesis of starting 24-Hour Home Care, prior to that, I worked with a large nationwide healthcare company. So, I was in the recruiting part of it and they were mainly focused on the skilled side of home care — what they called home health. When I started, they just launched their non medical homecare, which is what 24-Hour Home Care does today. So, I learned a lot about the industry. I learned that every single day, 10,000 Baby Boomers turn 65. Most people want to live at home. People are living longer, so it made sense from the opportunity side.
Then, around the same time, I was faced with finding care for my own grandmother. And, I was in the industry and it was a challenge. Nobody teaches you, and it’s not a conversation you have with your friends and family, but every single person is going to face that challenge. Whether you’re providing the care or you have to find the care. So, I knew that opportunity was there and I felt that I had the professional lens of the opportunity and the personal lens of the challenge, so I was able to mirror that together to really give a lens for 24-Hour Home Care and the opportunity 24-Hour had in the industry.
Then, when I look back 12 – 13 years ago, homecare was very fragmented. There were really only two types of home care companies. You had on one side, the mom and pops or the franchises that were like mom and pops, but they had a franchise name. Then, on the other side of the spectrum, you had your large home health companies, like the company I used to work with. Then, they did home care as a side or secondary service but it usually wasn’t their focus. There was nothing in between. Again, you have mom and pops and these large behemoth home health companies. We really felt like there was an opportunity for an organization to take the professionalism of a nationwide company and combine it with the personalization of a mom and pop. That’s where 24-Hour Home Care came about.
DF: You’re still relatively young, I consider myself young as well. How old were you when you started the company? Do you think there were advantages or disadvantages of being a leader in the healthcare space?
RI: I was 26 years old. First, Daniel, now everyone knows how old I am. So, thank you for that. I think there was both. I think the advantage of being 26 is that you don’t really have any experience with starting a business. You don’t know better. You have that blind ambition to go forward and fail as many times as you can and learn from it, and you have less experience to hold you back. I think it gave us an opportunity to take a little more risk. I think the downside is your youth. You don’t have the experience of going out in healthcare, where our industry typically deals with older people. Once you see the value that you can bring to them, age gets washed away. You want to focus on your perks. One more thing as a disadvantage, I was 26 and we hired our first employee at 27, I was still living at home. I had to get over that ego disadvantage.
DF: Were there companies that you looked up to or model yourself after?
RI: The company outside of our industry that came to mind was Trader Joe’s. Trader Joe’s did an awesome job to really find that niche. They’re not a mom and pop or a large grocery supermarket but they found a way to capture both. They’re your neighborhood grocery store but they’re everywhere. You always have your Trader Joe’s. They felt like it was really a part of your local community and we really wanted to capture that. They have competitive pricing on their goods, they have quality goods, and the people that you deal with seem more vested in what they do. They take more ownership in what they know and do, they’re positive, they usually have a smile on their face, they’re wearing the hawiian shirts, and it’s a little more fun. Compared to the mom and pops or large grocery stores, you don’t really see that.
So, we felt that we could take that same concept of not being your cheapest, most expensive, but we’re going to be right there in the middle and provide a quality service. The people you work with at 24-Hour Home Care are going to be a little more motivated, passionate, and positive than your local mom and pop. We’re inspired by Trader Joe’s. Their tagline was your neighborhood grocery store, so our tagline for the first few years was, “Your community home care provider.”
Partnerships
DF: In 2015 you created the RideWith 24 Program. Tell us a little about that.
RI: This goes hand-in-hand with what we were talking about with spotting an opportunity that you can bring to your own company. Everyone knows Uber, but this came about from one of our offices where we started seeing employees using or leveraging Uber for our caregivers. I remember spotting this because we would look at the P&L and we would see all of these expenses for Uber coming. That was a red flag. We found that one office was using Uber to get caregivers from one shift to another — from their home to clients’ homes. We noticed that the only way they would take the assignment was if they were able to take transportation. We thought it was brilliant, so we started doing that across the company, which was great.
Then, we started thinking about why we couldn’t do this for the clients as well. One of the number one requests for seniors that we work with is transportation. We also found that 80% of them want to check the box of having a caregiver that can drive. I would say that only about 10 – 20% of our caregivers actually drive or are comfortable driving our clients, so that means there’s a disproportionate amount of supply and demand. And, it would always be a pinch point of finding a caregiver that can drive for the majority of our clients. So, we would have to scramble and we may not find the right fit for the caregiver — personality fit or skill set fit — because of the transportation barrier. So, we started leveraging Uber so that we could start using them to do the transportation. So, the caregiver can go on the ride with them and be a companion while they get transportation.
We started using that and then we said, “Hey, can we bring this to the hospitals?” Because the hospitals are our number one referral source for our business. They provide referrals for people that need care. Then, if you’ve ever been discharged from a hospital, they have a whole taxi voucher program, so if they were going to pay for transportation for you to go home, they would give you a voucher that you give to a taxi that would pay for the ride. Most of us don’t take taxis anymore, because generally, the experience isn’t good. You can’t track it, so there’s no accountability and the feedback from the hospitals is that they’re always asking the patient for tips. Even though they were given vouchers, they were always haggled for tips and that was a problem. It also takes 30 minutes to an hour for a taxi, so we leveraged Uber. The timing was fortuitous because Uber launched their Uber for Business platform and we were one of the first beta companies to use the platform. It allowed us to go on a desktop or laptop to open a concierge platform, similar to dispatch. We were the only homecare company, so we were one of the first homecare companies in the world that partnered with Uber. To date, we have more than 100 organizations that contract with us to facilitate their on-demand rides and around 40+ hospitals that contract with us to manage their on demand rides. Some of the big names are UCLA health, Cedar Sinai, Mayo Clinic, and Scripps. We save them around 30% and provide a better experience.
DF: Speaking of the hospitals, you created a partnership with Cedar Sinai called Care Extenders.
RI: This is something that I’m super excited and passionate about. I see where home care is going and I think Covid is putting an additional spotlight on transitioning care to the home. This was a good milestone on how to leverage health care. It was a conversation with Cedar Sinai and their medical group. They were saying for their high-risk patients, they had an ambulatory care management team that would go out and do visits. They would drive to the patient’s house, check on them, call them, and sometimes do tuck-in visits to make sure they’re set up for success. It was hard to do as you’re paying a registered nurse to travel around to do all the visits and it’s very costly.
We were having conversations with them to leverage our caregivers to be your eyes, ears, feet, and hands. Also, to expand the bandwidth of your ambulatory care. So, hiring nurses, lets hire caregivers at a much lower cost to be your eyes and ears. If there’s more of a clinical need and escalation, then our caregivers can ping the nurses that are at home base to take clinical action, if needed. So, we did a pilot with around 50 patients and it was very successful. We started tracking the number of patients that could be readmitted and had more than 50 patients throughout that quarter period of time and the cost of one admission for one of the patients in the Cedar Sinai group was the cost of the entire program to pay for the caregivers. The savings were significant. Now, we’re working with more departments and hospitals specifically with what we call the Star Program, which is focused on getting patients back from hospital to homes safely. So, it’s led to more programs put together which shows the value of home care and showing where we think health care is going down the road — which is lower costs in the home.
DF: Covid has been so challenging but you’ve found some opportunities. You have something called Grub 24?
RI: Yeah, this is more of a case study of being agile as a company. We’re a larger organization but when COVID-19 hit, we had to shift gears from our brand and messaging. We went from your everything-convenient home care company, to making your lives easier, to safety and relieving anxiety that you might have around Covid. We did that overnight, and not with a large marketing team either. We had to do that very quickly during this time because nobody cared about some of the things we were doing before but now they’re concerned with safety. Our employees wanted to be safe and had to get the training to be safe. We created our safer at home program that focused on training, messaging, and protocols to make sure that our caregivers, clients, and employees in the offices were safe. And, everyone knew that if you reached out to us, that we had everything listed out to make things safe.
Another thing we saw with our Grub 24 opportunities was that we leveraged some of the things with Uber and Lift but with seniors being socially isolated in their homes. We had a stat of 5.3 million seniors being food insecure. They didn’t have access to nutritious food and/or they potentially can go hungry every night. We wanted to help because a lot of these seniors are our clients. They might not have a caregiver anymore because they don’t have anyone new in their home, so we partnered with a delivery app. We found Grubhub to be a great partner and they worked with us to create something similar to Uber and Lift. We made a platform where seniors can call us, speak to a live person, and we can put in their order and have that food delivered to them at no cost. It was a service that we felt was needed for our community and we saw great success with it.
Learn More About How Ryan and Other Healthcare Leaders Are Shaping the Future of Healthcare
Watch the full interview with Ryan Iwamoto, and be sure to subscribe so that you don’t miss future shows where we interview other industry-leading healthcare CEOs and executives as they look to shape the future of healthcare.