COVER SERIES

It’s Time to

CHANGE THE NARRATIVE

Making the shift from a labor shortage to a talent strategy

By John McLeod

For years, the homecare workforce challenge has been framed as a labor shortage. The response has been predictable: to raise wages, offer bonuses, streamline scheduling and reduce paperwork. These measures have helped agencies operate more efficiently, but efficiency is not growth.

If homecare is to compete, the industry must shift from a labor shortage narrative to a talent strategy, one grounded in behavioral design and strengthened by intelligent technology.

The Margin Trap

Most technology investment in homecare has focused on supply side systems such as billing efficiency, visit verification, scheduling optimization, claims submission and documentation reduction. These improvements have value, but they are margin plays, and there is little evidence they strengthen demand, increase client retention or improve long-term workforce stability.

Families evaluating aging-in-place options are not asking how efficiently hours are processed. They are asking:

Will my loved one be safe?
Will someone notice subtle changes or decline early?
Will I know what’s happening day to day?
Can I trust in homecare when I'm under pressure?

Efficiency technologies may protect an agency’s systems, but tech that focuses on the care experience protects client relationships and revenue. Those who don't recognize this difference risk losing competitive positioning.

When Coordination Fails, Costs Rise

Consider a daughter living two states away from her father. He has three weekly homecare visits following hospitalization. The agency tracks the hours. The caregiver completes the tasks. The invoice is accurate.

But the daughter notices subtle things during weekend calls. Her father sounds slightly confused and he seems to forget whether or not he ate. She asks the caregiver about this during the next visit, but the information she receives is fragmented and nothing seems urgent enough to escalate. Weeks later, he is readmitted for dehydration.

No one person failed—but the system did. A behavioral tech platform could have surfaced subtle changes for the care team and avoided a negative outcome.

The issue wasn’t wages or scheduling. It was the absence of a visible, behaviorally reinforced coordination layer that could have pushed the team to make small changes earlier and aligned the daughter with everyone around her father to act.

On top of straining family confidence, these avoidable readmissions increase costs for payers and threaten referral relationships. This sort of fragmentation has economic consequences for agencies, because when coordination weakens, financial performance follows.

Without consistent feedback or recognition, a caregiver might feel their value is not appreciated.

Pay Alone Won’t Retain Talent

The same structural issue affects caregivers. Imagine a caregiver who consistently reinforces medication routines, mobility exercises and the importance of hydration. Their reliability prevents problems before they escalate, but because prevention produces no visible “event,” their contribution often goes unseen.

In a system with limited team connection, steady performance is easily misunderstood as routine or unremarkable. Without consistent feedback or recognition, a caregiver might feel their value is not appreciated. Over time, feeling unseen and disconnected, caregivers might leave for a modest pay increase elsewhere, not because they lacked commitment, but because the system failed to reinforce their contribution.

Behavioral research tells us that sustained engagement depends on three signals:

Clear expectations and standards
Visible contribution impact
Acknowledgment of performance

Most caregiving environments unintentionally suppress these signals in favor of a focus on billable hours and administrative efficiency. This approach is a hidden pathway to rising expenses, creating a profitability doom loop. As engagement declines, caregivers either ask for higher pay or leave, which drives up recruiting and onboarding costs and disrupts care continuity. Wage increases may slow the cycle temporarily, but without better system design, the loop will continue.

Bridging Behavioral Design & Technology

The next strategic advantage in homecare won't come from faster billing or tighter administration, it will come from combining behavioral design and technology to create coordinated, visible care. But we must first acknowledge a few realities:.

Families struggle to see what is happening with their loved one’s care day to day
Caregivers operate independently with limited reinforcement
Small, missed actions compound into larger risks
Confidence in care erodes quickly when information is delayed or fragmented

Tech and AI-enabled behavioral infrastructure should function as a coordinating layer that connects daily and historical observations into a shared framework. In practice, that means:

Reinforcing adherence to daily routines that will reduce risk
Surfacing subtle changes in health or wellness early, which can improve outcomes
Clarifying accountability for scheduled activity across roles, building care momentum
Creating shared visibility for families, caregivers and supervisors, which boosts confidence
Bringing everyone’s contribution and care status into the light, improving team building

This use of technology does not and should not replace human care. Instead, it strengthens it by reducing the load on the caregiver and turning isolated tasks into coordinated performance.

Focus on Demand-Side Economics

Families do not buy hours. They buy care that is safe and reassuring. When they can see care consistent routines and know who owns each responsibility, families gain trust in homecare and avoidable escalations are reduced, such as regular calls from family members.

Stability for families strengthens stability for caregivers and vice versa. As retention improves and care becomes more consistent, the agency’s economic return compounds, especially when the investment in behavioral technology is only a fraction of the cost of additional labor.

That is talent strategy, not labor management.

A Strategic Inflection Point

Homecare is at an inflection point, and other industries have faced similar transitions. The next competitive edge in homecare will begin with implementing tech and AI systems that reinforce human behavior at a larger scale.

If you reflect honestly on your business, the workforce challenge is not simply a supply problem—it is a strategic design issue. Moving from a labor shortage mindset to a true talent strategy means building environments that caregivers want to stay in and that families trust enough to choose and keep. Wage strategy may protect margin in the short term, but talent strategy that is powered by behavioral design and intelligent technology drives retention, referral strength and long-term profitability.

The agencies that understand this distinction will define the next chapter of homecare economics.

John McLeod is the founder and CEO of Proxwell CareOS, a tech platform for advancing how families, caregivers and care organizations coordinate in-home care and aging in place. As an investor and advisor to CEOs and closely held business owners, he focuses on health care innovation and enterprise value creation, as well as succession and transition strategy. McLeod has served on corporate and nonprofit boards and taught as an adjunct professor at New York University. Contact McLeod at john@getproxwell.com.