Fred Johnson, President & CFO at Team Select Home Care

Exceptional and Affordable Home Care for Medically Frail Children with Fred Johnson, President & CFO at Team Select Home Care transcript powered by Sonix—easily convert your audio to text with Sonix.

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Saul Marquez:
Welcome back to the Outcomes Rocket. Today, I have the pleasure of hosting Fred Johnson. He’s the President of Team Select Home Care and is passionate about making the world a better place for medically fragile children and their families. A large portion of Fred’s career has been devoted to driving innovation and data analytics. He completed his undergraduate studies in business from the University of Wisconsin, Madison, and an MBA from Cleveland State University and an advanced certificate in data analytics from Cornell University. Fred and Team Select our pioneering new home care models for medically fragile children, save state Medicaid organizations millions of dollars per year, while also driving 80 to 95 percent reductions in hospitalizations and hospital expenses. I’m excited for today’s talk. I had a chance to connect with Fred previously and just incredible work that they’re doing and it’s going to be a treat for everybody listening to hear some of the insights. So, Fred, such a pleasure to have you here with us today.

Fred Johnson:
Thank you so much. So really excited to be here.

Saul Marquez:
Absolutely. So. So you guys are doing some brilliant work. And I mean, your your career history is fascinating and just the way that you do things in general. Before we dive into the meat and bones of what you guys are doing at Team Select, tell me a little bit about what inspires your work in health care.

Fred Johnson:
Yeah, it’s interesting. Health care was was really a second career for me in my in my early forties or so after spending a couple of decades with three different large multi-billion dollar global aerospace defense manufacturing type companies. And and I relocated so many times, moved all over the globe, that lifestyle became a little difficult on my family. And so getting into health care was really kind of a planned lifestyle change. I’m looking to really improve some work life balance in a less cyclical business, really do something fun and interesting in a smaller company, and really team up with my best friend from grad school and the founder of Team Select Level. And it really took me a minute to find my passion within the business. And I ended up finding it within our pediatrics business, which is our business around providing nursing care for medically fragile children and their families. So we provide that care for them in the home so these children can spend their time living out their days at home versus in a in a hospital or clinical setting.

Fred Johnson:
And until I jointing select, I really had no idea of the struggles and difficulties that these families face. It’s kind of an invisible population to the vast majority of Americans. And what medically fragile it really means is children who require frequent or around the clock skilled nursing. So these children are usually medically complex. There’s usually an element of technology, oftentimes a ventilator, feeding tubes and other sorts of complex care. So with this population, these children are either cared for in hospitals or skilled nursing facilities, which is very expensive. That’s usually a solution. Around three to ten thousand dollars a day or more ideally, which everybody agrees with, is these children oftentimes can and should be cared for in the home for a few hundred dollars a day. They’re leveraging technology advancements as well as having a skilled nursing workforce that can take care of these children in the home. The challenge with that, with the preferred and least expensive model which is caring for these children in the home, is that most of the care for these children comes from the state Medicaid budgets. And so this is no surprise to anybody. People on Medicaid all work hard, want to do the right things, want to take care of these children as bad as anybody does. But due to decades of funding challenges, the Medicaid reimbursement rates, meaning what Medicaid pays home care agencies like a Team Select in order to provide that daily nursing care that these children need in order to frankly survive and thrive at home. Those reimbursement rates, depending on the state in general, have been pretty flat for almost 40 years. So rising way less than one percent a year, not keeping up with inflation, et cetera. So the challenge with that is, is most people in health care know we’ve got a pretty big nursing shortage.

Fred Johnson:
We had it well before COVID and it was highly acute. And now beyond COVID or post COVID or during COVID, it’s made significantly worse. So what that means is it’s very difficult to find and retain nurses that specialize in this type of pediatric home care because we have to find them willing to work for significantly less than they can earn in a hospital or clinic setting where the payments are much higher and the margins are stronger. So the result is that many of these kids and families don’t get the consistent home care nursing that their child needs. So that results in either these children being stuck in hospitals or skilled nursing facilities, like I mentioned at. Three to ten thousand dollars a day or more likely, it means that a parent or parents are stuck trying to care for these children at home with little or no training or supervision. And what that results in is a divorce rate of about 80 percent for medically fragile families. And that’s due to the physical stress, the emotional stress, the financial stress. You haven’t had a vacation in a in a decade because your child’s invested invented in the living room of your one bedroom apartment. So spouses end up arguing over all those things. And the worst element of it is because the nursing care is either non-existent or sporadic. For many of these families, because of the low reimbursement rates means low salaries can only be offered to the nurses to do this type of care. And so what that means is a lot of the time these shifts don’t get filled or the nurse doesn’t show up. And what that means is the spouses or the parents are then arguing over who’s going to put their career at risk next by calling into sick work again for the fifth day in a row or the fourth time in three weeks. And they end up losing their jobs because they can’t consistently work outside the home. And then they end up on food stamps and welfare a lot of the time. So so really helping these families and developing real world and innovative but simple solutions has become the main reason I get up every day now. And clearly what inspires me to keep working as hard as I do in health care. The one piece that didn’t come true was the work life balance. I still searching for that, but helping families has has definitely given me the inspiration to, frankly, work harder than I’ve ever worked right now,

Saul Marquez:
Well, you you have identified a huge problem. And this this population of kids needing help, the families providing the care, struggling 80 percent divorce rate. I mean, the reimbursement rates are flat, just tough to retain nurses. Talk to us about what you guys are doing to solve for this mismatch in resources of time and demand and care that these kids are needing.

Fred Johnson:
Yeah. You know, I spent 20 some years of my professional career telling every employee I ever manage that there’s no such thing as a silver bullet solution and in health care, business or life. But in this case, this is about as close as it gets. So there’s actually a program that there’s no need to reinvent the wheel here. Thankfully, Colorado implemented a very special program about 20 years ago aimed at this exact problem. And it’s called different things in Colorado. You hear sometimes the parents CNA program, we call it the family CNA program. Others call it the related caregiver program. But really what we learned about these children and what Colorado learned is that it’s not the level of care that drives the cost down of these kids and improves the outcome. So what it means is it doesn’t necessarily matter whether you send an RN or an LPN registered nurse or a licensed practical nurse or whether you send in a CNA for some of those lower acuity children. And by and we’re talking a certified nursing assistant. But what the data shows, it’s not necessarily what level of clinician you send in, but the consistency of the care that those children receive. And there’s a direct correlation between the consistency of the care and the lower cost and the lower hospitalization and better health care outcomes for these children. So historically, in almost every state other than Colorado, if a child qualifies for private duty, nursing could be somewhere as few as a few hours, up to twenty four hours a day. Every state basically says you either get a registered nurse or an LPN or you get nothing. And what’s interesting on that is if you look at the typical care plan for one of these children, if you look at the majority of the hours that the nurse is taking care of that child, there’s generally only depending on the acuity of the child.

Fred Johnson:
Maybe if the child has a trache and a vent that needs to be changed each day and some suctioning performed, which is definitely a task you want done by an R.N. or an LPN and but the rest of the tasks generally are lower acuity, in some cases very likely skilled type of care like bowel care, tube feedings, advanced personal care, bathing assistance with activities of daily living. And so what Colorado did is what most health care providers do in most clinical settings, which is to match the level of care with the appropriate level and cost of a clinician. And so what Colorado basically does, what team select does and a lot of competitors in Colorado do the same is we take that child and that plan of care and we evaluate it and we look and we see. And what we find is that often times we’re able to free up valuable nurses, which are the most precious commodity in all of health care right now because of the lack of supply and over demand, and we basically free up that those nurses to maybe work on a handful of cases of different children doing the higher acuity tasks. And we take parents and family members. We generally and again, most of the time, a lot of the time, these are single parents who’ve unfortunately ended up on food stamps and welfare because of the situation. We will train them for free to become CNA’s. And it’s basically about one hundred and twenty hours of classroom and clinical training. And we’ll take those lower acuity items on the care plan, like the ones that I mentioned. And we’ll transfer those those hours of those visits and shifts over to the parent. What we get as a result is the state of Colorado gets to save 30 to 40 percent on every single hour work that we replace of nurse with a CNA. We’re training people for free for the country’s fastest growing job, which is certified nursing assistants or home health aides. We pay them a very solid wage, which is usually enough to lift them and the family off of welfare and food stamps. So we’re saving the states a lot of money there as well. If if they work more than 30 hours a week, we give them and their entire family a full benefits package, the same benefits package that I’m on, a full 401k, etc.. So really what we’re doing is really just matching the level of care with the appropriate level of clinician and then freeing those nurses up to work more at the higher end of their license and promote them and move them into more supervisory roles. So at the end of the day, the states end up saving tons of money. The families end up in a better position, both financially and their mental health. The child wakes up to a loving, smiling, happy face every day instead of a stranger or no nurse at all. And so it’s really hard to find too many or any real challenges with this program. And and the results really speak for themselves.

Saul Marquez:
Well, I think it’s a phenomenal program. What what parent, if they’re already doing the work and they want to see their child do better, wouldn’t want to just contribute and get paid for it while they’re doing it, right?

Fred Johnson:
Exactly. Exactly. When we call this program practical innovation, it’s a solution that’s really been there this whole time. But outside of Colorado, it’s as if of people were not really looking at it from from the right angle. And generally speaking, the reality is, is that no one takes better care of their child than a parent or a loved one. And so now with decades of data in Colorado, it really supports the fact that the cost is lowest and the patient outcomes are the best. When these children get the same consistent care they need every day, they get the care they need daily so they remain infection free and out of the hospital. Same thing for nutrition and feeding. It’s when those things don’t happen every day with the traditional private duty nursing model because of the reimbursement rate and nursing shortage. It’s that when those nurses are nonexistent or don’t show up, that those children bounce in and out of the hospital. So it’s again, it’s really focusing on the parent who never calls in sick, never misses a shift, provides that that that strong care to that child every single day. And and then we end up with with amazing, amazing outcomes at a significantly lower cost of it.

Saul Marquez:
And you guys, given that you’re doing the training and providing the support, you get to bill Medicaid directly to pay for the the families providing the care and everybody wins.

Fred Johnson:
Correct. And so, yes. So we Medicaid, like I mentioned earlier, instead of paying us, you know, somewhere in the high 40 dollars an hour, they can pay us in the low 30s to high twenty dollars an hour and save money basically with each hour that we replace. But that that continuity of care. If we could talk about just the outcomes for just a quick second, the outcomes that we really get here with these children are staggering. And so these children represent about one percent of any state’s Medicaid’s pediatric population, but that one percent of those children account for more than 40 percent of Medicaid’s pediatric costs. So it’s a rate of about 40 to one compared to a non medically fragile child. And of that 40 percent, only two percent of that is spent on home care. And the other ninety eight percent of that cost that’s spent on these medically fragile children is mostly spent on the hospitalizations. So so going back to the claim I made earlier about the cost in the outcomes driven by the continuity of care, not the level of care, the the national hospitalization average for these children is eighteen point three percent. We’ve treated over a thousand of these children with this model in the past year and. Colorado, in the entire year, only one point six percent of our children ended up in the hospital at any point in time.

Fred Johnson:
So that’s a ninety one and almost ninety one and a half percent reduction in the hospitalizations. And when we know that the hospitalizations are the majority of the cost, then the savings here, in addition to the hours, worked in training people for free and getting people off of welfare and food stamps and giving them benefit packages. It’s my belief that we’re saving the state of Colorado and then future states to implement this either tens of millions or in some cases maybe hundreds of millions of dollars. And at a time of COVID right now, when states desperately need savings and we desperately need these children safe at home, away from hospitals, away from doctors’ offices as a child on a ventilator that’s already medically fragile. If they end up in a hospital and catch covid, it’s it’s most likely going to be an impossible type situation and have a very bad outcome. So so we’re really trying to push this program even harder right now at a time of hope because of the of the savings as well as the safety it enables by keeping these kids safe at home. And if we can leverage parents a lot of the time instead of nurses and stop the flow of so many nurses in and out of the home, then that also keeps these children more safe from COVID another disease.

Saul Marquez:
And I think that’s wonderful, Fred. And so, folks, if you have questions, you should definitely visit friend and his team’s website team, select home care and T h c dot com Fred. So you guys are operating in many states now. I guess the states are seeing the benefits outside of Colorado as well.

Fred Johnson:
Yes. So this has been about two years of myself and the company A have a lobbying in the background for for these families. What we’ve realized is that it takes it takes an army of people. So we’ve begun to to to really launch more of a national public relations campaign. And we’re just at the beginning of that. We’re we’re forming alliances with other home care companies and a lot of nonprofit groups. What we’ve been able to accomplish outside of Colorado is this program was legislatively approved and actually our home state where we’re headquartered in Arizona. And that was approved legislatively about a year ago. Unfortunately, with covid and in Medicaid resources being scarce, we are still working closely with with Arizona Medicaid to bring this program to market. Our hope is to have that before this calendar year is out. And but we definitely could use some some purging of other stakeholders. Similarly, we had to pass legislation after trying to work with the state of Missouri for a couple of years to implement it. Eventually, we we put through legislation, had this program legislatively approved, and we’re currently working with them to also bring this program to market, hopefully within the next couple of months. The biggest area right now is the health plan for the active military is called Tricare. And there are a lot of active military unfortunate with medically fragile children. And that that makes it very difficult for those service members to be relocatable by being need to be close to children’s hospitals makes it very difficult or impossible for the spouse to work outside the home.

Fred Johnson:
So we are currently working with the Armed Services Committee and seeking to bring this program to all active military nationally through the TRICARE benefit. We are we definitely need a little bit more help to for people out there to help demonstrate the need. But we know that the military and every government budget could definitely use cost savings at a time like this. And we know this program would deliver that. We’d also be training military spouses for free, giving them employment opportunities while saving the government quite a bit of money there so we can make military families stronger or relocatable and frankly, happier in making sure they get the care that their children need. So we’re currently looking to multiple other states, New Jersey State, and we’ve been we’ll try to work with for a couple of years to try to get this program through. So the good news is this is happening. The problem is, is it’s happening too slow to a lot of the a lot of the red tape, which is which is why we’re really trying to get the word out now and really get some more followers and people that can kind of join with us on this on this fight.

Saul Marquez:
And would you say that’s one of the biggest setbacks you guys have had, is just the the the adoption has been slow?

Fred Johnson:
Yeah, it really is. We’ve had, I think, six governors that we’ve spoken to, Republican and Democrat, and they all love it. And what’s not to love the challenges is that they kind of throw it over the wall and say, OK, go work with my Medicaid director and tell me when it’s implemented and do that. The resource constraints, budget constraints, even though we don’t need any budget dollars for this, we. Only deliver savings, but it’s just been hard with different types of regulations and different little rules here and there, and the red tape is really slowed things down quite a bit. And that’s where I just kind of had the internal dialogue with myself and then the team select team that we got to we got to make this more of a national problem. And and if not us, then who? And so the good news is this. Just in the past few weeks when we’ve really been trying to start to get the word out, we’re starting again to generate quite a bit of momentum. So my hope is that five to 10 years from now, every state will have a program like this and hopefully Arizona, Missouri and maybe even New Jersey. And Tricare can can really help get this started and a lot of other states begin to follow.

Saul Marquez:
Yeah, I love it. Well, it’s certainly a phenomenal work that you’ve dedicated yourself to. And the team select team has also dedicate themselves to what would you say you’re you’re most excited about today?

Fred Johnson:
So I think, quite honestly, this is the first podcast I’ve ever done. So I’m just excited to be kicking one off and move down this down this program. I think the the things I’m probably most excited about is probably that that Tricare opportunity just for a chance to to help that many military families who have been had to deal with this with this difficult burden in their lives. So I think I think the biggest thing is I’m happy that, you know, something like coded, which doesn’t have a lot of silver linings, but that, you know, it really took something like this, I think, to to enable a program like this and to get people to start to listen. And and I’m just really excited about the level of interest and support that we’re starting to kind of receive with competitors, putting aside any competitive differences and coming together along with nonprofit groups and families for the best of what’s in the best interest of these children. So to me, it feels like this is just the beginning and I’m excited about where we’re going to be a few months from now and especially a few years from now.

Saul Marquez:
That’s certainly exciting. And we’re rooting for you guys.And so everybody listening. Oh, for sure.

Fred Johnson:
This is a hard one not to get behind.

Saul Marquez:
It really is. And, Fred, when you reached out to tell me about this, I just said, wow, yeah, let’s do this. So I’m so grateful and I’m grateful for the work that you guys are doing because it’s an uphill battle. But you know what? You guys are getting wins and it’s exciting. You’re going to say something.

Fred Johnson:
Thank you. Yeah, we’re just we’re just kind of refusing to give up. So we’ve been told no so many times, but we’re not going anywhere. And I appreciate you given that website address to tshc.com. At the top of that page, there’s a there’s a button that says families CNA program. And so if anybody listens to this and wants to get in touch with us or be on our books for to receive more information or anything, you can click on that family CNA program button and scroll to the bottom. There’s a place to log your information. And pretty soon in the next couple of weeks, we’ll have a place for for families of medically fragile children to put their information in, whether it be in Colorado or Missouri or Arizona, and and seek to see if your children, your child and you or your spouse or other family members qualify to take part of this program going forward.

Saul Marquez:
I love it. That’s such a great call to action. If you or somebody you know, falls into one of those three states and wants to spread the word, now’s the time. Just go to the website as we as we shared with you. It’s TSHC And at the top, the link is very clear. Family CNA program. Scroll down and you’ll see all the other info and a way to get in touch with the team. So, Fred, I truly appreciate the work you guys are doing, the insights that you’ve shared. Why don’t you go ahead and leave us with a closing thought and then we’ll we’ll say goodbye.

Fred Johnson:
You know, I think my closing thought is because you don’t you don’t see these children every day in these families, because most of the time they’re stuck inside their homes, but they do exist. The problem has never been more acute than it is now. So if you can help in any way, frankly, even if you’re if you’re a competitor of ours, if you exist in a state that we’re not in yet, please go to that website, get in touch with me. Google me online. Fred Johnson, team select or, Fred Johnson family CNA. You can find me also out on LinkedIn. And even if there’s no business benefit in this for for my company, we will be there to help support anybody that would like to make a run at this and looking to bring this program to whatever state that they live or operate in all of it.

Saul Marquez:
And so take him up on it, folks. Fred Info will be on the podcast show notes, link to his LinkedIn profile and any other way that he wants you to connect with him. So. Make sure you check out the show notes, just go to the website outcomesrocket.health. Type in Team Select and you’ll see the the entire show notes a transcript and most importantly, how to get in touch with Fred. Fred, just brilliant, my friend. Really want to just say thank you again for sharing the outstanding work that you guys are up to.

Fred Johnson:
Thank you so much Saul I know this this this podcast is going to get out there and hit a few people and then it’s giving me this opportunity is is bound to help a handful of families and probably a lot more completely change the trajectory of their lives. So I can’t thank you enough.

Saul Marquez:
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