Online homecare provider MyCare says technology efficiencies can help pay for aging population
Online company MyCare says its technology platform - which is like the Airbnb of homecare - could be a game changer for the industry through cutting delivery costs by a quarter.
MyCare is co-founded by former lawyer and IT entrepreneur Mark Jeffries, Carers NZ chief executive Laurie Hilsgen, strategic consultant Chris Mathews, and tech specialist Robert Stewart, and has raised more than $1 million from private investors including Spark chairman Mark Verbiest.
Its online platform launched last December allows people who need care in the home - the elderly, disabled, and injured - to search online for care workers in their area that best suit their needs.
In addition to the matchmaking service, MyCare also provides tools online and via mobile phones so families and care workers can manage and share the person's daily care tasks more easily.
Vetting of the caregivers includes a Ministry of Justice check for past criminal convictions and those receiving care can rate the workers, similar to the Airbnb system for home accommodation.
Jeffries said the founders' first-hand experience supporting a family that needed home help revealed a gap in the market for a service that would make the process of finding carers much simpler.
MyCare already has 1,200 workers registered and around 1,000 clients using its services and plans to launch in the next few months a payments system that would allow it to directly handle workers' fees and tax.
Homecare is provided to 75,000 Kiwis annually by several agencies mainly under a 'fee-for-service' basis where funders pay third party home and community support providers an hourly rate for domestic assistance and personal care services. The Ministry of Health is responsible for disabled people, the District Health Boards for people aged over 65 years, and the Accident Compensation Corporation for the injured.
Currently, MyCare is only available to those privately paying for homecare and under a Ministry of Health funding contract to provide its matchmaking tools for disabled people under 65.
Jeffries, the start-up's chief executive, said it was hopeful of soon starting pilots of the service with over 65s for two District Health Boards.
Funders pay an average $26 an hour plus GST for homecare. An estimated 60 to 70 percent is said to reach the hands of homecare workers who typically earn minimum wage and the rest goes to the agencies contracted to provide the service.
Jeffries said MyCare's technology efficiencies means the same service can be provided for 25 percent cheaper, with the homecare workers receiving higher than minimum wage and getting 80 percent of the funding. Workers set what hourly rate they're prepared to accept on the platform.
Those sorts of savings become significant, he said, when you consider the number of people aged over 65 years in New Zealand is expected to double from 650,000 in 2012 to 1.2 million in the next 18 years. Existing services and agencies will struggle to expand quickly enough to meet the growing demand, Jeffries said.
A Deloitte report last year for the Home & Community Health Association found the current funding model is unlikely to be sustainable. Three providers had been struggling with negative margins for the past three years, in 2014 four out of six respondents had negative earnings before interest and taxation returns, and one was in a position of negative equity. "Because of cost-cutting efforts and an improving economy, providers are finding it difficult to retain staff when there are perceived superior opportunities elsewhere," the report said.
Jeffries said MyCare had attracted a number of carers who didn't want to work for agencies, including students, parents, and even volunteers, opting to work part-time locally.
MyCare charges those seeking homecare help $250 plus GST for an annual subscription. If awarded government contracts, it will take a service margin.
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