The healthcare field is growing at a fast clip right now, and the demand for home health caregivers is keeping pace with this progress. This is a great time for you to become the proud owner of a home health care agency.
There are two options open to you. You can start your agency from scratch or buy an existing business that is up for sale. There are pros and cons to both, and you need to pay attention to the following aspects to decide the right option for you:
- When you buy an existing business, you get a ready-made infrastructure- staff, equipment, even clientele. That’s a great plus. But along with these, you may also be taking on the owner’s liabilities. A thorough check can help you avoid this pitfall. Also, ensure that you ask the owner why they are selling the business and verify their claim if possible.
Remember that if the agency has built up a bad reputation previously, that might be tough to discover. In this case, you could have an uphill task on your hands, trying to obliterate the bad reputation and build a new one in the target marketplace.
That’s a risk you run in taking over an existing business. With your start-up, these risks are averted, but you also spend a whole lot more to set up the infrastructure from scratch.
- You have complete control over every aspect when you set up your business from bottom up. You can build it exactly the way you envisioned. If you take over a business, remember that it has been built in line with the previous owner’s dream; so, it may not exactly match what you aspire to have.
You can make changes, tweak it to your liking. But this may not be possible with every aspect. For example, you are looking at specializing in a specific kind of health care, and the previous owner catered to a broader clientele. In such a case, you have to lose clients in order to make the change. That takes away some of the advantages you have in taking over an existing business.
- The time taken to get operational may be substantial with a business you are just building. With an existing business, you are stepping into the field with a ready-to-run business model and team.
Keep in mind that in this sector, training the staff is critical. You do need to invest time in ensuring that all your team members are taught what to do, how to do it, and how to approach the clients. This training takes time and also requires the investment of cash. You avoid both of these with an existing business.
However, with the latter, the staff is trained in line with the credo that the previous owner followed. So, you may still have to retrain them or acquaint them with your way of doing business. The skill sets training may be avoidable in this latter case since the previous owner would have already trained them, and they have already worked in this field for a while.
The right protection for your business
Irrespective of whether you have set up a business from scratch or taken over an existing one, one important thing to do is making sure that it is protected. To cover it from potential business risks, you need the right kind of insurance. Home health agency insurance usually comes in two forms- general liability insurance and professional liability insurance.
General liability insurance is the policy that covers your business from the financial impact of any damage that is caused to others by your business. For example, a client sues your business for injury caused to him or her when you visited their home. If you end up having to pay out damages against his or her claim, the general liability insurance will cover those costs.
Professional liability insurance covers you when your service is called into question. For instance, a client files a lawsuit claiming that:
- you gave him improper service
- you (or your staff) were negligent in your duties
The right way to protect your business is to ensure that you have the right kind of Home Health Liability Insurance policies covering it. As a smart business owner, this is one of the very first steps you should take.