How can we overcome the caregiver shortage?

Author

Sarah Richard
April 07, 2024

The human element in relationships

I’ve been amazed to realize how “human” the technology is that serves older adults. Of the ~200 AgeTech startups I’ve researched, 21% are actually a form of people matching platform (e.g., companion matching, caregiver matching, tech coach matching) — and that doesn’t even include the startups that provide older adults services via a call center.

This week I’ve thought a lot about how people build relationships, and what predicts a successful match. Most people my age are more focused on dating matches, but I’d argue that caregiver matching holds just as much weight in the lives of the people being matched. Papa might not have the same cheeky branding as Tinder, but they face just as many challenges in producing successful matches between finicky humans.

If anything, the stakes are higher in caregiver matching because the match is mediated by an imbalanced and unfair incentive structure, which has led to insufficient safety checks and a massive (and growing) caregiver shortage.

Overcoming the caregiver shortage

The Global Coalition on Aging reveals a daunting projection: we need a 60% increase in elder care workers by 2040 to maintain current care standards. That’s a whopping 13.5 million new care workers1 . NYC alone will have 930K individuals needing home care but just 400K home care workers by 2035. Under the assumption that each posting requires 2 workers to be filled, NYC will be short 1.47 million workers by 20352 . I’ve felt the caregiver shortage in my own experiences as a tech coach and caregiver, with many clients sharing they spent 1-5 months on waitlist before we were paired.

In most industries, such demand for labor (increasing by up to 48% by 20353 ) would increase wages to reach an equilibrium. Not so in caregiving. Medicare reimbursement rates act as a cap on wages, stunting wage growth to the point that nearly a quarter of home care aides live below the federal poverty line. Such commoditization has led to a very high turnover rate — 65% for aides and 30% for nurses4 . Insufficient wages have exacerbated existing labor shortages and led to inefficiency in caregiver onboarding and matching. To say nothing of the fact that caregiving is very important work that should be valued and compensated fairly, the current caregiver labor market dynamic ultimately hurts our elders.

Approaches to matching caregivers with clients

Several companies are building “all in one” platforms to support agencies in expediting caregiver / client onboarding:

  • Aaniie (formerly Smartcare Software) is a true all-in-one platform. Aaniie includes integrated recruiting, hiring, scheduling, payroll & billing so home care agencies can attract, hire, and manage top talent from one simple interface.

    • Founder (2012): Scott Zielski

  • AxisCare is the #1 rated home care software with unmatched flexibility. From customizable features to cutting-edge functionalities, AxisCare is designed to help home care agencies scale.

    • Founder (2013): Todd Allen

  • Mon Ami is the modern operating system for aging and disability services. Mon Ami partners with agencies across the country who are currently not tech-enabled and are wasting 60% of their time on administrative paperwork that can be digitized and automated.

    • Founders (2018): Madeline Dangerfield-Cha, Joy Zhang, and Steven Fram

    • Notable investor: Cowboy VC

Voices of the Upper West Side

This week’s tech coaching sessions with older adults in the Upper West Side (NYC) underscore the unsustainability of our ecosystem of support for older adults5 :

  • Carol employs multiple caregivers to fulfill various specific functions: I work with her for tech support, but she also has a caregiver who provides “hands-off” companionship during walks and grocery shopping, and another caregiver who supports her with personal admin needs.

  • Robert endured a 5-month wait to be paired with me as a tech coach. Tech coaches are so in demand at one of the organizations I work with that the match is determined almost entirely by the coach selecting a client from the open postings — which means that some clients never receive a match.

  • Mentioned last week, Brenda has employed her physical therapist as a personal assistant to help her stay on top of paperwork for her medical practice. She struggled to find a qualified candidate with experience so repurposed her existing PT relationship to fill her personal admin needs.

Improving the network of care

As the population of older adults needing support increases, I’m hopeful policymakers will intervene to prevent the caregiver shortage from increasing as well. Though we really do need a policy resolution by way of higher Medicare reimbursement rates (and therefore higher home care aide and nurse wages), home care agencies can leverage matching algorithm software to facilitate more efficient caregiver onboarding in the meantime. It’s time we stand up and show caregivers the value of their work with adequate wages and less administrative thrash.

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5 Name and identifying details have been changed to protect privacy.