What is driving the surge in growth for in-home care?

There has been significant growth within in-home care within the Senior Care market, with some estimates forecasting nearly 7.5% compound annual growth rates in the next seven years. This anticipated strong growth is linked to two main factors: increasing patient preference for care in their own home; and the broader shift in healthcare delivery models driven by the changing US demographic towards an ageing population.

With approximately 16.9% of the US population being 65 years or older in 2020—a figure expected to rise significantly in coming decades—demand for at-home healthcare services has surged. This part of the population often prefers to age “in place” and requires varying levels of medical and non-medical care and has seen a rise in disposable income for this demographic, an increase in surgical procedures increasing mobility in later life, all during a time of rapid technological advancement for in-home healthcare. This has enabled this demographic of the population to be able to benefit from living in their own homes, for longer, than previous generations.

The relative affordability of in-home care compared to long-term hospital stays is a key factor for growth. Reimbursement policies, such as Medicare and Medicaid coverage for home care services, have bolstered demand. Additionally, many healthcare systems now prioritize home-based care as a cost-effective alternative, reducing the burden on traditional healthcare facilities.

Lastly, innovations in telehealth, remote patient monitoring, and connected medical devices have expanded the feasibility of home care services. These tools enhance efficiency, reduce costs, and improve patient outcomes, further driving adoption.

However, despite the increase in popularity amongst an ageing population to remain in their own homes for longer, the industry is facing a number of recruitment challenges to satisfy this demand: the US Bureau of Labor Statistics projects that home health, and in-home care personal aides will be among the fastest growing occupations in the next decade, but recruiting the workforce to meet the demand has been difficult. This is linked to the low levels of pay – the median hourly pay was $14 in 2022 according to research conducted by IBIS, making compensation inadequate for many workers, and discouraging others from entering or staying in this sector. A final factor impacting levels of recruitment into the sector is the lack of professional recognition and limited training opportunities. It would seem that a perfect storm of high demand, and low levels of supply are brewing for in-home care, with little signs of resolution in sight.