Several Months ago I wrote an article titled “Referral Agencies, Rip-off or Valuable Service”. It still get’s read frequently. Adding further weight to my concerns, yesterday The Washington Post published this article: “FTC cracks down on companies promising due diligence”
Several Months ago I wrote an article titled “Referral Agencies, Rip-off or Valuable Service”. It still get’s read frequently. Adding further weight to my concerns, yesterday The Washington Post published this article: “FTC cracks down on companies promising due diligence”
For the most part, I have a “buyer beware” philosophy about life. However in this particular case. I am delighted that the government is cracking down on referral agencies. The crux of the article is that the referral agencies CarePatrol and “Always Best Care” mislead consumers with respect to how much work they had done in evaluating the quality of care provided in assisted living communities they recommended to consumers.
I continue to believe that for the most, part referral agencies are a drain on the senior housing industry and that consumers do not have a clear understanding of the financial relationship between the agencies and the communities they recommend. That being said, I know there are many readers of Senior Housing Forum who work for referral agencies. I would be glad to have a guest article that counters my negative view. Steve Moran
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Finally: If you know anyone who is looking at emergency call systems I would appreciate the opportunity to talk with them about Vigil Health Solutions.
Thanks for the article and opinion Steve. My concern has always been the way the referral company gets paid. If they are paid by the consumer than buyer beware for sure. If the referral company gets paid by having a contracts with certain providers I feel this should be disclosed in a very open and up front way. I could be wrong, but if they are recommending community A because they have a contractual relationship with them and not even looking at facilty B because they dont have a contractual relationship with them and wont get paid, now that is a real conflict of interest and a real problem for me.
Hi – I owned a very successful consulting business that also provided ‘placement’ services. Yes, through a contract, however, I did show and offer senior living communities and home/home health care services. The difference, as I would also initially disclose, is that those with whom I do not have a referral relationship with, I could not ‘vet’ as thoroughly as I would like to do prior to referring. But, since my company was Senior-Centric, we didn’t go after the almighty dollar. Rather, we made certain that our seniors and their families were at the center of all our decisions. Also, there are many times when companies such as mine do not get paid….not having a contract is one – but also, if there is any government dollars associated, eg medicare, medicaid…read skilled nursing, we would not get paid, but we would still offer placement advice.
Full disclosure and education is key.
From LinkedIn Groups
Group: Boomers: Aging Beats The Alternative
Discussion: Referral Services Get Slammed!
Referral services fill a need but should disclose their payment arrangements. I’m aware that some of them churn residents. There will always be bad apples. What do you think?
Posted by Lorie Eber
From LinkedIn Groups
Group: Senior Living & Care Professionals
Discussion: Referral Services Get Slammed!
Hm, interesting!. Agree with you, many people are not aware about high fees which are paid for this service. It should be a disclosure clearly made that it is not free service and that they only recommend/ suggest places they have agreement fee for referrals. There is nothing wrong to be paid for a service, but it ought to be clearly stated. This is a private sales person or agency for specific community working on commission. Integrity of one, doing such job ought to be high.
Posted by Margaret Szalata
From LinkedIn Groups
Group: Assisted Living Professional Network
Discussion: Referral Services Get Slammed!
Steve, thank you very much for sharing this important information. It reminds me of the old saying “you get what you pay for” which I find interesting in relation to “free” services. As a client paid advisor, clients are assured of an unbiased approach to finding communities/services that will benefit them most. Once provided with this information and depending on level of engagement, we help them transition to a community truly of their choosing. Finding these communities/services can always be Your Choice!
Posted by Malcolm Bertram
As the owner of a referral/placement agency I almost offered to accept your offer to write a guest article to counter your negative views, however I mostly agree with the points you make and am honestly thankful you are calling attention to some of the negative aspects of this industry. I just hope you realize there is a vast difference between how different companies conduct their business. Referral agencies are a fast-growing industry, completely unregulated in most states, which requires little or no experience, and can be run with little more than a website. That being said, it doesn’t negate the fact that quality referral agencies provide a valuable service that can save families a great deal of time and money.
The article you linked to described two companies which it seems have good intentions to require their staff to personally visit the places they are referring to. They made the mistake of over-stating the geographical areas they cover.
There are companies which require their placement agents to conduct business over the phone and/or internet only. They never meet the seniors or families and may or may not ever visit the places they are recommending. If they do, they often have not been trained what to look for. One key lesson I have learned over the years is that people lie. Every place claims to be beautiful and clean and provide excellent care to their residents. Photos on a website may look very nice, but there is much behind the scenes that is very different, often scary. It is also important to know as much as possible about the prospective resident to find the place that best meets their needs and personality, and the best way is through a home visit and assessment, not a checklist on a computer.
The county I live in has close to 1,000 licensed care homes and assisted living communities. It is a full-time job to keep up to date on the details. Families usually have a short time to search and often are in a crisis situation. Having a knowledgeable guide who can quickly pinpoint the best options can make all the difference. I am always honest to explain about how I am compensated and families have never complained or criticized. They realize it can be a win/win system for all involved.
I understand your concerns, but please realize that the power in with the assisted living communities and care homes, because they can set higher standards and choose who they prefer to work with. They don’t have to sign contracts with companies that provide sub-standard service.
Linda, I do think there is a place for referral agencies. In particular believe there are locally owned agencies where they know the senior communities and actually work with the prospect and their family to find the right community. But what has happened with many of the national companies is that they have inserted themselves between the senior community and the resident, but provide little value above what a Google search would provide and yet they extract huge dollars. Because they have so little real value they have to mislead the consumer about how the financial arrangement works.
Steve
PS: If you want to do an article I would be glad to work with you on that.
We have operated a referral agency for some 29 years, a pioneer of sorts I guess. We cover about 3 metro counties with some 1500 different senior care options. In the beginning we were tempted, and did, refer people to facilities 1,000 miles away or more a couple of times. We quickly realized that was defeating our mission which was to give people choices of the best qualified facilities that we have personally seen and had excellent experiences with, and which best meets their need for care, location etc. Yes, there is sometimes the dilemma of a facility that tells us “we don’t need any help from you, we have our own marketing department”. But by doing so, they cut us off from the qualifying information and experiences we would need to refer to them, whether or not they provide the quality care. Later, when they have a spate of vacancies, they often come back to us and say “please help us”. So, life is not fair, but we are very concientious and expeditious in getting our clients to the very best facilities than can best meet their need. Read some of the referral letters on our web site. (www.eztransitions.com) We have had many great personal experiences. This is more than a money-making business. It’s a labor of love. We do not subscribe to many national referral agencies policies of referring to “empty beds” for a fee. Our calling is much more personal and responsible than that. Our clients win and the good facilities win. What can be better than that?
Hi Steve,
I’ll give you the ultimate guest writer, I am the CEO of CarePatrol, one of the referral agencies that “Got Slammed” by the FTC.
First, I want to make it clear that I applaud the FTC for getting involved in our industry, it is very much needed.
Secondly, don’t always believe the angles of spin to sell a story.
Thirdly, the truth is not always as sexy as headlines.
Reality is is that I had listed on the bottom of my website the names of every state in alphabetical order (much like every other websites that try to drive keywords for traffic). Because I did not provide services in every state we got “Slammed”.
No client was ever referred to any community that my company did not personally visit, inspect or look up their care violation record. I can guarantee that the largest referral company in this nation cannot say that.
CarePatrol and another company were “slammed” because we are under the jurisdiction of the FTC because we are a national franchise. Can any other referral agency say that they are overseen by anyone, let alone the FTC? Maybe if others were regulated or overseen by someone they wouldn’t send families’ private information to every community in a 50 mile radius and actually provide a service to their families.
We disclose how we get paid to every client we work with and we never give the communities our clients’ personal information without their permission. Yes, that upsets some communities, but is it not more upsetting to receive 100 phone calls from 40 assisted living marketers inquiring about your mother who is in the hospital with a broken hip when you are in the middle of a serious family crisis?
Some people in the industry say that we shouldn’t get paid for our services. I agree, if you are just giving communities a name and a phone number and that’s it. We personally “tour” (bring our clients to our recommended communities) and we don’t recommend communities with multiple or serious care violations.
As far as being “slammed”? We were treated with the utmost respect from the FTC from Day One. We made a “semantics” mistake, we fixed it within hours. I stand behind the ethics, morals and outstanding service that CarePatrol’s hard working senior care professionals provides to our clients and their families everyday.
I realize the truth isn’t as sexy as a headline, but thanks for at least asking for the other side’s thoughts.
From LinkedIn Groups
Group: Govig Senior Care
Discussion: Referral Services Get Slammed!
You are perfectly right Steve. I heard cases when referral agencies moved the resident from facility A to facility B just to get more money. Also keep in consideration that they are not referring the best facility for the senior, they are referring the facility they have a contract with or the one from which they get more percentage/money. I had a particular case when the referral agency brought a family to tour my facility and I was the 18th facility which the family had visited. The referral agencies are not assessing the senior’s needs with proper tools plus they are not disclosing who pays them and how much. I had situations when the referral agent didn’t even know the family or the senior. Another case, a referral agent got mad why I told the family I’m paying the agency and how much. The facilities have to increase the price to compensate for the agency fees. So who is losing again? The seniors are the ones losing money. In my opinion the referral agencies are rip off.
Posted by Doina Farcas, BSW, President
From LinkedIn Groups:
Group: Senior Living & Care Professionals
Discussion: Referral Services Get Slammed!
A Place for Mom is a free service 🙂
Posted by Carrie Storin
It’s free service for who?
From LinkedIn Groups
Group: Senior Living & Care Professionals
Discussion: Referral Services Get Slammed!
This is great news! Your website is great and you have so many good articles. Congrats. I visit your site often and recommend to others.
Posted by Margaret Szalata
From LinkedIn Groups:
Group: Senior Living & Care Professionals
Discussion: Referral Services Get Slammed!
Thanks so much Margaret!
Posted by Carrie Storin
Hi Chuck
I appreciate your response. It is fair to offer the other side of the story. I have reached out to you by email to discuss having the possibility of you writing an article to make the case for referral agencies.
Steve Moran
I have worked for a large referral service and now own my own. I would like to participate in writing an article on the other side. Please give me a call or email. Thanks Pat
847-373-1712
Hi Pat:
I will reach out to you early next week.
Steve
From LinkedIn Groups
Group: Assisted Living Professional Network
Discussion: Referral Services Get Slammed!
I work as a Care Advisor, the company I work for is not as huge as some of the competitors but large enough to due business respectfully and not dilute the quality of our service. We qualify our leads extremely well, we warm them up and encourage them to tour the communities we refer them to. When we make referrals, we are making them on budget, level of care and location. Never would we send a lead to a community with a $4000 starting rate for a room and the lead only had $1500 to spend. I am proud of the company I work for, their ethics and integrity have raised the bar in the industry. I am glad their a regulations in place to govern the activities. I feel with the right referral agency, a great partnership between community and agency can occur with win/win results.
Posted by Dina Shepherd, LPN
From LinkedIn Groups
Group: Senior Living & Care Professionals
Discussion: Referral Services Get Slammed!
There are some really great referral services out there that can really save the families a lot of time and money. But with anything in the senior industry disclosure is key! I see more referral businesses opening and the communities are willing to pay the fees. So let’s just hope integrity wins.
Posted by Kameron Chicoine
From LinkedIn Groups
Group: Senior Living & Care Professionals
Discussion: Referral Services Get Slammed!
Yes, there are excellent referral agencies. However, in California, the majority of small care home owners do little or no marketing and are dependent upon these agencies. Some, not all, agencies refer a client to a facility, collect 50%, 100% and in some cases, 200% of the first month’s fee from that facility. So it is not free to the facility. Then, again only some agencies, contact the client or the client’s family to suggest yet another but “better” facility, and collect yet another fee.
I have read many of these agencies’ contracts, and find the language to be confusing and ambiguous (illegal under contract law) allowing the agency to collect fees from facilities because it sent a fax to that facility six or eight months ago. Some, not all, agencies, are taking facilities to court and suing for fees that are not rightfully gained.
There needs to be greater oversight of these agencies to stop the “multi-referral” fee collections and to clean up the punitive contracts. What happened in Florida?
Posted by Michael Goryan
From LinkedIn Groups
Group: Senior Living & Care Professionals
Discussion: Referral Services Get Slammed!
We specialize in helping senior living communities attract move-ins with inbound marketing. This is the gift-that-keeps-on-giving, for once it’s setup properly, you continue to get highly-targeted leads right from your own website, ow.ly/e6LjK
Posted by Larry Levenson
I know I am perhaps adding fuel to the fire, but I find it “curious” that no one who who works in a senior community has commented saying they feel like referral services add value to their community.
Steve Moran
From LinkedIn Groups
Group: ElderPeer Network, Business Professionals Serving the Geriatric Care Industry
Discussion: Referral Services Get Slammed!
I wrote this a while ago (2009) about the business models of referral (or directory) services.
http://www.ageinplacetech.com/blog/senior-care-directories-so-many-so-confusing
Nothing’s changed except the addition of the interest of the FTC.
Check out the website in which people who work at APFM:
http://www.glassdoor.com/Reviews/A-Place-for-Mom-Company-Reviews-E240285_P2.htm
Posted by Laurie Orlov
From LinkedIn Groups
Group: Senior Care Services Companies
Discussion: Referral Services Get Slammed!
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I enjoy my subscription to Senior Housing Forum, very interesting and pertinent posts
Posted by Dave L. Mainwaring
As someone who has witnessed firsthand the practices of Elder Traffickers (referral agencies) I can tell you it isn’t pretty. The consumer is told “it’s a free service.” Really? If I’m paying a trafficker, I will not cut anything of off rent, care or community fee. I can’t because I have to pay a minimum of 50% (APFM is quite a bit more) of the full first month’s rent and care to the trafficker. Therefore, it IS costing the consumer. They sell themselves to hospital social workers as the “one stop shopping” place. You know, to the social workers are paid and trained to refer to an appropriate place, but out of laziness the hospital workers just let traffickers handle it. Unfortunately, that is the best case scenario. Many traffickers are paying for these referrals with under the table cash or trips. Under the table money is rampant. Oh, and large facilities have to report they money paid out, so as a result, most trafficker business is through the small six beds. Most recently, because six beds are totally dependant of these traffickers, the traffickers have started charging 100% of rent and care as their fee.
Someone mentioned earlier the practice of bouncing. This happens all of the time. A senior is placed in a inappropriate place, like a six-bed home, collects the fee, then bounces them over to a large facility and collects another fee. If a traffickers knows another trafficker has contacted the facility first, the second trafficker will not show the senior the facility in question. I have literally been called by one of these people who had a senior in their car stating, “I have someone for you, but I won’t stop by if you don’t pay me too.” If the facility doesn’t play ball with them, you will likely get a visit from the state from an anonymous bogus complaint. What’s worse is some contracts actually have in them that they own that senior for life. In other words, if they move out of one facility, the facility is REQUIRED to notify the trafficker who originally referred them. That means they will collect another fee off the unsuspecting senior.
This is a filthy business and I wonder how many of them sleep. Most are not even qualified to determine an appropriate place. All decisions about placement are solely financial. Who pays the most, the quickest and is it going to be reported as reported income to the IRS. Most of the people in our area are ex sales people from assisted living communities who were fired, or people who worked for another Elder Trafficker learned the craft and broke off. After all, what do you need to run a “referral business?” Oh, that’s right, nothing. Other than a website, a phone, fax and in some cases a car. You don’t have to have education, a license and you are accountable to no one. I guess it’s a pretty good gig if you can sleep at night. We have seen traffickers grow from one business to over twenty in eight years. It’s getting worse and rendering trained experienced assisted living sales counselors worthless. Our business is misunderstood to begin with. Many doctors don’t know who is appropriate for skilled, dementia, A/L, or independent living. Do you think the traffickers are educating them? CALA isn’t interested in making this a priority. For the state to have over-sight, it means finding a way to pay for the regulation of these people and we have no way to pay for anything right now. Trust me, this greedy filthy business is completely out of control and getting worse. These people are necessary evil is today’s assisted living world. I hate it, but will anyone stop it?
You know not what you speak about! Obviously, you have not research the entire business in order to call it a greedy, filthy business. As with any business there will be greedy, filthy people that work in them and do not do the right thing.
As an owner of an Always Best Care Senior Services Franchise in Virginia, I can ASSURE you that I can and do sleep at night if I am not worrying about my own children or the seniors and their families who we care for. I become an extension of my customers family and love them dearly. We laugh together and cry together. Our business is to assist them in whatever manner we possibly can, working always to make sure that what is right for them is ultimately what is done. We provide one service for a fee to the senior – the ultimate in hourly in-home care to assist individuals to stay in their own homes for as long as it is physically, socially and financially feasible. Our other service we provide that we get paid for is the referral service. And yes that fee is paid by the community where we end up placing the senior. Not unlike a realtor the seller pays the fee/commission. We also provide a whole host of services that are not revenue generating. We are licensed by the Virginia Department of Health to provide in-home care services and meet or exceed all their requirements to do so including being licensed, bonded, insured, doing criminal back ground checks, reference checks, it’s not requried but in our Always Best Care Richmond West office we are a drug free work place. Ultimately, I do not hire anyone that I would not allow to take care of my mom and dad or my 2 young children the dearest things in the world to me! I take care of my customers and their families the same way I would my own!!!
I am ALWAYS completely up front with families that I do not charge them a fee but if they select one of the communities I show them I am paid a referral fee. Does this mean I only show communities where I have a contract. No it does not. I have in fact frequently shown communities where I do not have an agreement it shows the community the quality of work I do and the quality of referral I will bring to them and has resulted in them wanting to work with me and even asking for a referral agreement. I also never claim to know everything about every community. If someone inquires about a community which I have no knowledge of I make it part of my service that I will research it for them.
Our service is supposed to assist already overwhelmed families with the monumentous task of finding a community for their loved ones that is clean, afforable to them, licensed by the Commonwealth of Virginia, and provides the level of care that they require. I do not get paid for referring to Adult Day Centers or P.A.C.E. which is a more affordable alternative and always offered as an option to my customers. I do not get paid to help someone on Medicaid which does not even pay for assisted living in Virginia. I do not get paid to refer someone to a Skilled Nursing Facility even if they are paying privately a monthly rate of anywhere from 7,000 – 8,000$ a month in our area. I am educated – I have an undergraduate degree and an MBA. It distresses me that you have had such bad experiences but again I do not believe that you have enough information to call out an entire industry and call them names.
My customers appreciate the hard work I do for them, identifying their needs with the help of an assessment from an RN on my staff, helping them work through budgets and identify sources for paying the exhorbitant rates that are charged by Assisted Living Communities (I have even helped a family find the extra 80$ a month they needed to cover Dad’s personal expenses by advising they add him to their own cell phone policy for $9 a month versus the $89 a month they were currently playing!!!! – does that sound like someone who doesn’t care and is not working for their customer?), I save them time from personally calling places that are not within their budget or do not have the services they need or want (examples: why should they call communities without memory care if they know their loved one is a wander risk and has Alzheimer’s or why should they waste time calling places that only have studio apartments if they need a 2 bedroom apartment for their parents, or call places that do not allow pets if their dad’s little dog has to be part of the picture?) once we have narrowed down their choices, I coordinate and schedule tours for them at their convenience and then personally pick them up and drive them on the appointments (I even have a wheel chair to help our senior family members take the tour). I take notes for them and provide questions that they should ask – like what is your caregiver to resident ratio and who is your Director of Nursing. Do you have an RN on staff or on call? – Is there a nurse on premises 24/7? etc….do you think the assisted livings offer this information up willingly – especially if what they provide is not favorable? NOOOO. After we tour I work with the family to answer additional questions they may have, refer them to other sources (DSS to see reviews on the community) or other residents to ask questions about the community. I have assisted with paperwork, coordinating with moving companies and even helping a senior with no “willing” family members to help her get her address changed.
What value do I provide to the communities in my area? I am an extension of their marketing team. I am telling people about their communities. I qualify a potential resident and do not refer them people that have no way to pay their rates. I do not refer them someone that has care needs beyond what they are licensed or able to provide. I escort the referral into their community and have highlighted the reasons I believe it is a good fit. When we arrive on our tour I have already provided the marketing director with as much information as possible so they already know what is important to the family, what the concerns are, what type of care they need, what their medical concerns are, what ADL’s they need assistance with, etc. That means the community now has everything they need to shine in front of their potential new resident. I also provide feedback after the tour as to what the family thought , likes and dislikes. If they do not select a community I find out why and share that with the community as well.
As for social workers in hospitals – where I live they have never even visited one of the assisted livings. They have a list and give it the patient or if they refer it is because the AL has provided them information but they have no information on what the community is like – I am certain they could not tell you the layout of the community, the levels of care provided, if they have 2 bedrooms, studios, outdoor areas, what type of activities they have, etc…..They are already overwhelmed with the number of patients they are forced to churn through and get out the door. They should all be so lucky as to have a good referral agency to work with that they know will do the right thing for their patients! And yes I follow up with the discharge planners to let them know the outcome of the work I have done with the family. They care about their patients as I do but what I do is not what they do.
You call referral services a necessary evil – not so. I know of no referral service that has forced someone to sign an agreement with them. Do I think someone should sign that they “own” a client for life absoultely not – that would be in-sane and should be struck from any agreement. I also believe that an assisted living community should only have agreements with people who bring a qualified referral through their doors not just send them a name and number to have them do all the work. I have had a customer come to me wanting to use my services and fire another referral service who you mentioned in your post but I will keep nameless in mine and they were not allowed to do that!!! The other service insisted that the community pay them even though the customer had said they did not want to work with them – now I do have to agree that is NOT right. Anyone should have the option to not work with someone if they do not think they are getting the service they expect or desire.
I could go on but if by now you do not understand why I believe you spoke without thinking your comments through I will never convince you……you should give your local Always Best Care a chance – I am sure you wouldn’t be disappointed!!
“Executive Director”
It is interesting you can boldly call us “Elder Traffickers” but not be as bold to stand up for your beliefs by leaving your name or company you work for? Come on man, be bold and be proud or forget the name calling,
The thing I don’t like about referral companies is that if I, as a senior community, do not pay them, my community will not be listed on their website (a note, there are a few free ones…not many though) so this give the consumer the idea that only the ones listed are valid. I cannot afford to pay everyone! It also bugs me that when you go on a referral website, you HAVE to type in your name-address-phone. Why? If they are really helping the consumer, you shouldn’t have to do this. But alas, this is how most of them work. Plus, I know for a fact, that my families have no idea how much we as providers have to pay.
Hi Kim,
My name is Robert Walker, and I’m with a directory called RetirementHomes.com.
I’d like to mention that we are a referral website (our name kinda gives it away), but we do list communities which pay us, as well as communities which don’t pay us.
Of course, a paid client will get more exposure and visibility, but we display nonpaid clients in our listings, and then pass the leads to them, to demonstrate the value of our service.
Just wanted to clarify that not all online directories are the same!
Robert
RetirementHomes.com
As far as Elder Traffickers adding value, far from it. It is an out of control necessary evil. I’m sure any community would agree. I would much rather give the senior on a fixed income a discount than pay a third party leach.
From LinkedIn Groups
Group: Licensed Nursing Home Administrators of America
Discussion: Referral Services Get Slammed!
Interesting article and so true. After dealing with “referals”, I have found the person/persons referring are 1-doing a favor for someone 2- following through on a “great” offer or 3- scratching each others back. Makes one stop and think! Thanks Steve
Posted by Barb Przybylowicz
From LinkedIn Groups
Group: Senior Living & Care Professionals
Discussion: Referral Services Get Slammed!
What should a person do when trying to get clients for Home Health Care Service. I am finding it real hard to get clients for home care service, I have pass out flyers. I have tried to talk with Hospitals, Assisting Living Facilities e.t.c and they informed me they don’t refer to home health care because they have their own home health care service. I am hoping someone can give me some pointers on what to do because I am lost.
Posted by Tamika Shelton
Well, I am not surprised. About one year ago I received a call from an attorney with the FTC scouting around for information on the proliferation of these referral agencies in Florida. I have been an approved trainer for the Dept of Elder Affairs and have known that the regulations are clear in the state of Florida concerning the illegality of these referral agencies. Teaching prospective students who are about to become licensed Assisted Living Administrators the illegality of hiring these agents and giving them kick backs for bringing in residents is completely wrong. When referral agencies went public with their websites, the Feds decided to crack down.
Try reaching out to Geriatric Care Managers in your area. Our clients may someday need a good home health agency to refer our clients to and becoming familiar with your agency might be a win-win.
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