Miriam Allred (00:00) Hey everybody, welcome back to the Home Care Strategy Lab. I'm your host, Miriam Allred. It's great to be back with all of you. Today in the lab, I'm joined by two guests. I've got Angelo Spinola, the shareholder and co-chair of the Home Health and Hospice Practice at Polsinelli And then we also have Yazmin Hamilton, the vice president of compliance at 24 Hour Home Care. I've been looking forward to this conversation with both of you. Thanks for joining me here in the lab. Angelo Spinola (00:26) Thanks for having us. Yazmin Hamilton (00:28) Thank you. Miriam Allred (00:29) Let's get right into it. Let's start with some storytelling, some introductions, and then some storytelling, and then we'll get into the meat of the conversation. I would like to have both of you introduce yourselves, talk a little bit about your tenure in home care, your kind day in the life of what you're up to, and then we'll get into why we're here today. So Angelo why don't we start with your introduction and then Yazmin over to you. Angelo Spinola (00:50) Sure, ⁓ Angelo Spinaula, co-chair of the Home Health, Home Care and Hospice Practice Group here at Pulcinelli. My first entry into home care was actually as a live-in caregiver in college. That's what I did to ⁓ help pay for college. It didn't take long for me to realize that other live-in caregivers were better at being live-ins than me. and that I would probably be better serving the industry in a different role. I loved it. I loved the guys I was working with, autistic guys in a group home setting, working weekends and able to study at night and do those things. But quickly recognize the level of compassion and love that you've got to have for your client. It's a unique. ⁓ Type of person that can do that. Well change diapers and do all those type of things So so I moved on then to law and started practicing law and specializing in the industry I did that first at a employment boutique shop ⁓ for many years and then as my clients Started asking for us to do more work than just employment law to do regulatory and transactional work and those type of things I moved to Polsinelli and I've been here for the last about five years. Miriam Allred (02:13) Awesome. And we call you the lawyer of home care. So wear that title loud and proud. One just quick question, Angelo, you've told this to me, but I don't know if the general public has heard this, but why did you become a lawyer? what kind of, maybe some personal events that led you down this path of becoming a lawyer. Angelo Spinola (02:28) Yeah, I saw honestly, I was trying to figure out what could be the one thing that I would do that would make my dad proud of me, who is not particularly proud of me. you know, my annex as a, as a teenager, ⁓ and I just wanted to prove to him that, know, I could do something and then, you know, really developed a passion for the law. Right. It wasn't anything, you know, that I, I, felt like compelled to do and school. I remember doing a mock trial in high school and really liking that and really doing well at that. But it wasn't a particular dream of mine. I thought that I would probably go into some kind of public policy work for law. Got recruited by the big firms and haven't looked back since. Miriam Allred (03:17) Awesome, awesome, one more to come from you. Yazmin, tell us a little bit about yourself. Yazmin Hamilton (03:22) Well, interestingly enough, ⁓ know, kind of piggybacking off of Angelo, I had a very different experience. Although I'm VP of compliance, I went via the route of law school. And Angelo, for me, I can honestly remember being five years old and being asked in kindergarten, what do want to be when you grow up? And the answer was an attorney. No idea where it came from. No idea, like I didn't know anyone, so I have no idea if it was TV. I can't give you a core memory of where that came from other than I knew law school. was in my future. However, very quickly into law school, ⁓ I went into law school wanting to save the world and go into criminal justice and criminal defense work. And just quickly, like most of us learned, that it takes a lot more than one person to change the world. But I also knew that I wanted to do something that had an impact, but allowed me flexibility to be a mom and to be a very active and full-time mom. Even though I had no kids, I wasn't married. I knew that was something I wanted in my vision and after law school, I think, no, actually I lied. During undergrad, when I graduated, I intended to take a year off. So I had to take a year off to do some caregiving of my own with my folks and there was just some time that I needed to take off for that one year. So I took a gap year and it was intended to be a year to mostly be helpful and I got an interim, like an internship just as something to do. while I took that year off and it turned into a 10-year career. It was a software company that had a need for someone with kind of business law background, wage and hour type stuff. And so after a year, I decided that I was going to go back to law school and rather than quitting, they offered to continue to employ me full-time if I went to law school part-time. So I did an evening program and immediately was working in something completely unrelated to home care. first 10 years of my life kind of building my career more in a compliance realm, made a decision after law school graduation that I did not want to formally practice or work at a law firm. I wanted something that was a little more untraditional and more corporate America and I went into a compliance route and have kind of been building the career. I started off in software then it rolled into retail and when I came to 24 four years ago home care was very much a very different space. People will say compliance is compliance is compliance. However, this is a very different space, but I will say what made it great is that I feel like I finally found four years ago my landing pad where I'm doing something that finally makes a difference. So I'm getting to check that mark off of my original journey in law school was I wanted to change the world. I wanted to change the work, the way that our criminal system and our justice system operates. Although this is a very different space, It allows me that opportunity to truly make a difference, to have a purpose, to know that we're not trying to make sales. It's not about the profit in this industry. It matters, but it's about the people's lives that we're impacting, the families that we're able to get care for. And that's kind of been the journey, a little bit different, but very much kind of ended up in a place where I'm very happy where I am. Angelo Spinola (06:43) Congratulations on being a recovering lawyer. I hope to be there one day. Miriam Allred (06:44) Great. You Great story though, Yazmin. I think we could all agree we wouldn't have anticipated landing in home care. You I think we're all called to like purpose-driven work, but look at all three of our paths, you know, getting to where we are today and landing in home care. But I think we could all agree there's no place we'd rather be because it is so people-driven and purpose-driven. And we are changing the world, one person at a time, one family at a time, one caregiver at a time. And that's why we love what we do and stay where we are. So to kind of preface this conversation, Angelo, I've known you for years and I've had this, this idea brewing of bringing you on, but with one of your clients, so we could just talk like openly and honestly about what it looks like for you to work with a large home care provider and what's top of mind for both of you, you know, what you're seeing at the national level at these state levels, but then also from the perspective of the provider, Yazmin here is like on the ground floor thinking of compliance from the perspective of her business. And so I just want like all of our worlds to collide and for us to just talk openly about. what's top of mind and what you both are experiencing. So before we get to that, Angelo, why don't you tell us kind of the story of engaging with 24 hour, take us back to kind of the early days, why you engage them or they engaged you and what that kind of early conversation and early relationship look like. Angelo Spinola (08:01) Yeah, it's actually a pretty funny story. When I started working with 24 hour, it was not the 24 hour of today, which is a true machine. And it's been a privilege to see how the company has grown and the reputation it has. But when we started with them, was a much smaller business, much, much smaller. And I want to say that had to have been close to 10 years ago, it's been a long time. And we used to go to this conference where sort of mid market smaller agencies would come and learn. And I would always do this. It was called Stump the Lawyer through this program with another lawyer. And we would debate over legal topics. And the other lawyer was 24 Hours Attorney. You know, I'm not going to say the lawyer's name, but he was their attorney and we had a real difference of opinion and we would have this debate every year about the use of arbitration agreements with employees as a way of avoiding class action lawsuits. And I was a huge proponent and always have been and always will be of using these arbitration agreements and the other lawyer was not. And so the other lawyer had 24 hour not using these agreements. And then they had an issue. You can probably guess what it was. And that's how I became their attorney. like, all right, tell us about these arbitration agreements. How do we get them in? And you see that a lot where larger businesses, as they grow, graduate from kind of the smaller local council to specialists who are really focused on the industry and can provide a broader platform and that's sort of what we try to do is create a one-stop shop for home care agencies and sort of, you we work with some of the smaller ones too, but it's very common for a business to sort of say, all right, we need more centralized support. We need support across a broader spectrum, more than one state or more than one area. And that was the story. And, you know, we've never looked back and we've done. lots and lots of wonderful things together. And like I said, I've had the privilege of watching this business just explode. And it's been very, very exciting to be a part of that. Miriam Allred (10:33) What a great story. Literally outing their in-house lawyer on a public stage. Like what better way to prove yourself? ⁓ that's amazing. And I actually love where you were just taking that comment, which is oftentimes smaller agencies, they can get so far with maybe a local lawyer, local support, but then there comes this point and we're to talk about this from 24 hours perspective of like, there comes a point when you need industry specific knowledge resources to take your business to the next level because there's just nuances and issues and industry specific information that you need to kind of like wrap around your business to ensure that safety. So Yazmin, from your perspective, you've been at 24 hour for about four years now. What were some of what was happening in the business that warranted you joining as VP of compliance? Like what was happening? What led you to jump in and then kind of day in the life of what you what's in your purview today? Yazmin Hamilton (11:08) I like that. I don't want to take us all back to 2020, but I joined 2021. And if we remember home care industry, that was COVID. 24, like most other home care agencies in particular, did not know what to do with the vaccine mandates, the COVID, the masks, you know, the what do we do, the are we remote. And at the time, they had no compliance department. It was just an HR department with a handful of individuals that worked and oversaw the company. And to Angelo's point, the company where he started to where it was where I joined was already substantially different. ⁓ And at the time they were outsourcing the kind of COVID compliance work to an out an independent contractor that was charging tens of thousands of dollars a month for something that we had done and rolled out at my previous organization. I came from a billion dollar retailer. It was very different space from an industry perspective, but from a size perspective we had 80,000 employees. We had a footprint across the entire country in Puerto Rico. So when I was recruited, it was something we had already done on a retail space with cashiers that I could kind of translate and bring over to the home care space and to caregivers. However, That was a beginning of an investment at the organization recognition that the founders had done an incredible job of growing this company from a very small, privately owned, they grew it to such an enormous industry beast at this point. To Angelo's point, you went from having a boutique solo operator practitioner to then having to now have additional resources. But most importantly, what was changing was the size of the org. organization, but now we were branching off into a number of different spaces. It was no longer just Medicare, Medicaid. was some funded. It was private pay. We were expanding into regulated spaces. So we needed to have the ability to work with a law firm that to your point, Miriam, didn't just have specialty in home care, but actually more important what I have found in the last two years and particularly as we have been growing is that we have a need for real estate attorneys, home care attorneys. employment law attorneys. There's a lot of specificity and specialty that's required that we're kind of in that middle size of an organization where we're not quite a startup. We're not quite a billion dollars. We're on our way. We're very much on our way to the goal of making the billion dollar marks. However, we're in that middle where we still need a very robust law firm or number of law firms that have the ability to have a number of subject matter experts outside of home care. that allow us to grow our business within the same framework versus having to shop shop and say we're gonna go to this attorney for this, this attorney for that. It's so much nicer and convenient to have that. And then obviously the long-term goal typically becomes where I came from was at the end when I left, I believe there was 20 in-house attorneys. But like I said, it was a multi-billion dollar public. retailer that operated internationally. So it was just the growing pains, but that's not where we are. And this is part of the journey. And Polsinelli has been able to grow with us. And there is still a ton of room where we have left for expansion. And that's what's been great to work with Angelo and team that there's a huge team with a very wide array of specialties. Miriam Allred (15:03) So I want to talk more about like present state today and what's top of mind and what you guys are working on. But Angelo, I think it'd be helpful for you to kind of like timeline back. You you said you've been working together for 10 years, the organization size, shape, tenure has just changed dramatically, but just give us like the high points of your collaboration together. Like 10 years ago, what was kind of like your area of focus? And then over the years, like as the organization is skilled, what have been the areas of focus for you working with 24 hour? Angelo Spinola (15:33) Yeah, so I think initially, this is typical too. So a client comes to us either because they've had a ⁓ major event, a big problem to solve the problem, or in some cases proactively to say, hey, we're thinking about selling the company in the next year or two. We want to, you know, a health check, tell us, what we need to, what's going to make us attractive, where do we have compliance holes, those types of things. But one way or another, oftentimes what you're working with a new client on is the foundational stuff, the stuff that Yazmin does around compliance. you know, me being an employment lawyer, that's my focus is let's make sure that there's a labor business, right? Without your labor, you don't have anything at all. It's your caregiver. So how do we make sure that we're compliant and how we're doing, you know, pay per visit? compensation programs or live in. Let's build that foundational side. And then the other major component to that is the healthcare regulatory work, right? The compliance work around fraud and abuse and HIPAA compliance and those sorts of things. It's build a foundation now. sometimes with a, and I would have called 24 hour, not a small agency, kind of a mid-side. size agency at the time that we got there so we had to strip some things down and rebuild. Whereas some companies you get to them early, which is great because then you can build the framework, help them build the framework right from the very start. It's easier that way. But that would be the initial work and then the types of work that we've done since then with 24 hours really, you know, The reason I wanted Yazmin to join us from a client perspective is we've done a lot of different things. we've reviewed programs and jurisdictions. We've helped them open locations and close locations. We've helped with commercial contracts, trademark kind of work, transactional support, immigration work, ⁓ you name it. We've looked at a lot of the alternative. care models and evaluated the pros and cons of that. We've done some forecasting in various, with respect to programs or jurisdictions. this something that's going to be viable? What's the rate structure going to look like into the future as best as we can say? So there's been a variety of, and then litigation and reactive kind of things as well. But 24 hours has been really great about being proactive. and looking at things kind of on the front end, probably because of folks like Yazmin and folks that are compliance oriented and they don't want to get into something without knowing all about it and knowing what the risks and the pros and the cons are. So it's been a great partnership and we have felt like we have been able to grow with them, right, as they've grown, which has been excellent. Miriam Allred (18:52) So towards the beginning of that comment, Angelo, you were talking about that, setting the foundation, almost that initial like audit process. I think this is really valuable for all home care agencies is to understand where those common pitfalls are in that audit process. Like before you were talking about those arbitration agreements, what are some of the most common areas in that audit process of a mid to large size home care company where you come in, you're doing that audit? What are some of the areas that you need to attack? first based off what you see in their compliance territory. Angelo Spinola (19:24) Yeah, I think you sort of triage based on where they are, who are the payers, right? What are the most common claims in a jurisdiction? And it's two audiences. One, you have some companies that are very concerned about liability and litigation and risk. And then you have others that want to be the most attractive seller that they can be. and want to sort of mirror the transactional diligence process. What's going to happen? What are they going to look at? And we call that mini diligence or a health check of let's come in as though we were a buyer and tell you where your soft spots are. And so with government payors, and it's not just government payors because there's several ⁓ all payor statutes in certain states, right? But generally when there's government payors, we want to look at reimbursements and make sure that we've got, you know, all the fraud and abuse kind of issues, anti-kickback issues addressed, that we're doing what those payers would expect. And then on the labor side, wage hour, like, you know, Yazmin and 24-hour are largely California, where California, the wage hour issues there and the PAGA claims are so common and prevalent. that you start there of how do our pay stubs look? Are we doing split shift correctly? Let's actually pull payroll and look at it and evaluate and determine where there might be some areas where we can improve and strengthen. And then you always want to have accurate records. There's typically many, many ways in which you can accomplish something. you know, the the Hugo to the, you know, the Ferrari, and we want to at least get you in a in a nice Honda Accord, right somewhere in the middle where you're you've got, you know, it's reliable, it's steady, it doesn't have to be every bell bell and whistle, but it's got to be better than maybe what you're doing now. So supervisor right now is doing time edits, and we don't have any sign off from the employee. How do we change that where we at least get the employee to have visibility? Miriam Allred (21:23) He Angelo Spinola (21:44) and the opportunity to say that isn't correct so that we can defend you better when somebody alleges wage theft, Or ⁓ rate manipulation or whatever the case may be. So things like that, right? And you kind of lay out the menu, figure out what is your biggest risk right now today? Where are you sitting on maybe a time ⁓ bomb? And let's address that first and kind of lay out a plan. And generally, those things get resolved over time and you know the executive team will determine what they're willing to do and what they're you know going to wait on. Yazmin Hamilton (22:17) Ruff! Ruff! Miriam Allred (22:21) You said a minute ago, two groups of people come to you, people that have a problem that needs to be solved or people that want to be proactive. If you had to ballpark quantify, you know, what percentage of those two camps there are, what, would you say? Just ballpark. Angelo Spinola (22:36) I'm gonna go 80 20 80 20 80 20 other yeah reactive of geez, you know, I've got an audit, you know We've got an audit situation. We're being accused of over billing and I'm not talking about 24-hour here I'm just talking about in general 24 hours like we want to get into this program. They're a unionized program You know what impact might that have on our overall workforce, right? Those are the kind of Miriam Allred (22:38) 80 on the problem. Yazmin Hamilton (22:40) reactive. Angelo Spinola (23:04) things 24 hour will come before they make a decision to do anything. But a lot of folks have made the decision, they're operators, right? You're operating, you're trying to run your business and you're not thinking about what could go wrong. You're thinking about where do we get our next cases and where it's our next contract. You're not necessarily thinking about the details of the contract and indemnification and things like that, or maybe using an alternative workforce, not realizing that independent contracting is a challenging thing. You know in home care those sorts of things and so all of a sudden you've got a DOL audit an IRS audit, a government, know audit, you know around your compensation structure. You know something like that that you've got to deal with which is you know what we have really strived to do is come up with programs subscriptions things that make it much easier for the small business which I have a real passion for right the the single agency owner who is not only the owner but the operator, right, and they're wearing many, many hats. How do we help you set up that foundation affordably from the start given the amount of volume that we do in this? You know, it's not a new concept. We're not reinventing the wheel. You just have to be willing to pay some attention to that on the front end before there's a problem. But it's still, even with all of those Programs and POSH and cost shares and it's still 80-20 and all that That's why I speak the way that I do that's why I go out and talk to everyone like look You know come to me before they find you right and we can we can help you Avoid that altogether or at least be much much better prepared for it Miriam Allred (24:49) Absolutely. And Yazmin, I think that's a perfect question for you. You've been with 24 hour for four years and granted you came on during the pandemic, but now you see all of these compliance complexities, tell operators what they should be proactive on. Like you've learned, both of you have learned the hard way, you know, what the reverse looks like if you wait too long and you come up on an issue or a problem and then you have to solve for that. But what are the most important areas of your business that you need to be proactive on to avoid the problems down the road? Yazmin Hamilton (25:18) And I think it's it's going to be different for different employees, but for us to Angelo's point We are a California based organization So there's just everyone knows California New York tend to be the tougher highly regulated just on the surface outside of the home care space You add that on top of that I think for us the number one things that we look for our wage and hours So making sure that our individuals are getting paid appropriately. Are we paying overtime split shift? transportation time, training time, do we have different rates, what are those rates? Because it's really easy to get the corporate staff right. It's easy to get the individuals that you see every day that clock in and clock out are sitting at meetings. But when the majority of your population is a caregiver population that you do not see, where you have a workforce that's out and about, that becomes a difficulty. How do you communicate with your caregivers that are out boots on the ground, how do you properly get them taken care of, how do they properly record their time, how do we make sure that they know where they're supposed to be, how they're supposed to log on. So I think for us, it's predominantly wage and hour, making sure that we have all of the right audits, making sure that all of our operators know when individuals ⁓ move, if they have a different customers, we need to know where our clients are located because minimum wage in California is related to where they're doing the work. And so we may have different pay rates that apply if they have multiple clients versus just one client. So for us, it's a very convoluted web. But the overarching hot topic in California is always wage an hour. It's making sure that our caregiver population is well taken care of. Here we have a lot of leave and benefit rights that we not only do you want to do, but you want to assure that not only are you complying with what's the right thing to do, but are there any local ordinances that are different? state law, typically for us, state law typically supersedes federal law requirements. So we have to look at California law. But then we have the added layer of there's a lot of local ordinances, local minimum wages. So kind of making sure that on a monthly basis on our end, on the employer side, where we are, we've been able to leverage is we have our hot topics. It ends up being fraud, waste and abuse, wage and hour arbitration agreements. So kind of onboarding, making sure that that we get it right. Are we getting individuals right at onboarding? Are we getting those arbitration agreements for our protection as well as theirs right off the bat? Are we paying them the right amount? And then how are we following up with those on a recurring basis? And those tend to be the hot topics that we deal with. And being able to now proactively audit those versus reactively. When I first came in, there was, you didn't have a dedicated compliance department. We had two to six dedicated individuals that encompassed benefits, human resources, compliance, all the things that you would think are the soft skills for over 20,000 employees. what we were able to focus on four years ago, 10 years ago, was very different. Now that we have systems in place that to Angelo's point, 24 was able to leverage all of the resources so that when I came in four years ago, the foundation was already great. So now we're building on a foundation. Now we have a team of 20 on the compliance department for the organization, which is a very heavy compliance department. But that means that we're able to have individuals that focus on maintenance, individuals that focus on proactive situations and then individuals that can do research on what's upcoming and work with Angelo and team and work with Polsinelli on continuing to not only educate ourselves but educate our operators. Sorry, super long minute, Miriam, but. Miriam Allred (29:12) Okay. No, that was amazing. You answered some of my follow-up questions, which one was going to be, yeah, how big your compliance department is. You just said 20 people. And then also you mentioned auditing this process monthly, because I think what deters a lot of owners and leaders to do this is just, they don't know where to start and they don't know how to do it. And so I wanted to ask like one layer deeper, how you do this. It sounds like you have a lot of people that, that dissect like every part of this process, but then you meet monthly to review everything. I imagine a lot of reports out of the EMR and go through almost like line by line by wage an hour to make sure that everything is accurate. Just talk about kind of what those meetings look like. Obviously you can't break down maybe all 20 people and their roles, but what, those meetings look like and how you catch the problems and then how you stay proactive on these things. Yazmin Hamilton (29:54) Yeah. And part of it was, it's, you we kind of have to take a step back. So part of it was a journey. So getting operators to do anything proactively, I'm sure Angelo's dealt with this even just with companies. More often than not, when you're walking into a boardroom, when you're walking into a meeting room, it's the, is this impacting the business? How is this gonna affect the business? Is it gonna be a loss on the P &L? Is it gonna be a gain? That always is important. So the first thing we had to do four years ago when we joined was get the business to buy into and understand what they were doing. So before they considered anything important, we could have told them until they turned blue in the face that they needed to do X, Y, or Z. We need to properly pay people because otherwise we could have a huge loss. particularly in California with PAGA where you have unlimited recourses available to you. However, we needed them to understand just because it hasn't happened in this long doesn't mean it won't. And as we grow, this is the potential risk. And we were able to show that by working with the business to create reports. So to your point, Miriam, we now have a team. I can give you the big buckets. So we have a team that focuses on like the work comp safety side of the house. So that's OSHA report. reporting or comp claims. We have another team that are called our compliance partners that deal with compliance from A to Z. So we do fraud, waste and abuse training, sexual harassment training, all of the legal annual required trainings, both for supervisors, managers, caregivers, you name it. And then we have another division of the department. The third prong is our employee relations team. So they do all of the investigations. So trying to deal with things internally so that they don't turn into higher litigated matters or that we've at least done an initial investigation so that if it does and we do have to hand it over to outside counsel, we've done something to mitigate. And our final prong is we now have a contracts division where we have an individual that has a JD that helps us just look through the initial just independent contractor contracts like any kind of renewal clauses and gives us flags on what needs to be sent to outside legal counsel. The monthly meetings, there's a ton of them, but mostly what we do is on a monthly basis, all of those 20 individuals have to report into their direct supervisor. So their managers report that they pull on a monthly basis on how much are people getting paid, data integrity, ⁓ are different systems matching each other. Everyone kind of has their big bucket that we've identified that I'd be happy to share, but we've used a lot of the resources that Angelo has provided. on the audit checklist. And what we've done with that audit checklist is essentially we've divided it up into responsibilities and individuals will do mini audits on a monthly basis. We did the big ones four years ago, five years ago. So now if you just on a monthly basis take a sample size and what we try to do is we do a sample size of 5%. So whatever that looks like, whether it's by department, whether it's by division, we try to do a 5 % sample size every month that's random to give us an idea and that helps us to proactively identify are there gaps, are there holes, but I think it's the hardest part is getting started and to be fair we started four years ago and it took two years to even get to the place where we could do one audit. So that was getting the business to buy into why, what are you doing, what does this mean or even to be fair to get the reports from IT to be able to do our audits because to be fair there bigger priority were other reports versus our auditing reports. But I think it's been a journey. And once we were able to get the right reports and the right measures, we were able to kind of deploy a team to proactively do it in chunks. So you take little chunks out of time. And I think the key for us was identifying what was our biggest risk. And that's where we started with our audits. And at the time, our biggest risk was employee files. So we had had many offices moved many times over the the course of the 10 years prior to me joining. And so that was my concern is. ⁓ There is a combination of hard copies versus soft copies versus some lived in banker boxes in office A, some lived in someone's office somewhere else in a personal home. So the first identification was what is our biggest risk right now? What is the number that that can mean to the organization? How do we now have a plan for the next year to fix that? And so we were able to deploy an employee file audit that took us a year. quite frankly a year to complete and at the time it was only about 12,000 employees. To some individuals and some audiences listening to this it might seem like a really small number to others it's going to be a very large number but it was quite frankly a year of a project and since then because of the success of that audit we have been able to slowly incorporate additional audits and as the team has grown we're able to now expand the proactive nature but I would argue that I think the best practice for any out there is to be to identify the first one, two, or three biggest gaps that they have and start with number one because it can be very overwhelming and it can get very overwhelming very quickly and it will feel like you're drinking water out of a fire hydrant if you take on too much ⁓ and you end up doing yourself a disservice as well as the organization. Miriam Allred (35:39) That was fantastic. Yes, means so many good nuggets in there. And I think the one that I want to just articulate is you are one of several large providers that I've talked to that do the mini audits. But I love what you said. It took you a year or two just to like lay the groundwork for one solid annual audit. But then when you get good at that, it's like, okay, let's audit monthly or quarterly. Angelo Spinola (35:41) Thank Miriam Allred (36:01) So that we're staying ahead of what could be the annual audit, because every provider you talk to, they cringe at the thought of an annual audit or an annual survey where they have to do all of that due diligence at one time. But if you slice that up, do it, you said monthly or even quarterly, it makes the annual audit way less intimidating. And I love what you said about like that 5 % sample size. You don't have to do it with your entire census your entire business population, but just do a sample size that then is kind of the health check on the entire business as a whole. Yazmin Hamilton (36:09) Yeah. Miriam Allred (36:30) I think that's a great place to start. And Angelo, you've got these POSH resources that essentially lay out what these companies need to do. Because again, I think like you were saying, Yazmin, it's so hard to know where to start, but if you're given kind of an audit log, if you're given some of those like base resources, then it just becomes, let's find our top three issues and start there. So Angelo, maybe just share a little bit about some of the resources that you offer that helps agencies really get started down this path that Yazmin has just outlined. Angelo Spinola (36:57) Yeah. So, so Posh is Polsinelli Online Solutions for Home Care. And that is a shared model. call it, you know, a shared cost model where agencies of all sizes ⁓ will subscribe and have access to handbooks, offer letters, live in agreements, all the information. Yazmin Hamilton (37:12) I'm not going to Angelo Spinola (37:22) You know, Yazmin was talking about the fact that there's not only state law, but now you have all of these city ordinances and municipal ordinances. Some are industry specific, like domestic worker bill of rights. And there's not a lot that covers what all those requirements are. There may be some generic materials out there, but not industry specific materials. Right. So what we do is we try to create. resources that make it very, very easy for non-lawyers to look at, understand, and triage. Like we've been talking about, you know, what can I do now and how can I do this in a way that's pretty affordable where I don't have the budget necessarily to call my lawyer and ask about this or to have something created from scratch. But if I can kind of build a foundation off of these templates that then I customize for my business. But we know that legally they're compliant and legally they stay up to date. So we have a team of lawyers that maintain all of those documents. And as the laws change, we're updating them. We're sending out client alerts. I'm sure a lot of the folks that listen to your podcast are hearing from Polsinelli on, need to watch this or you need to watch that. This is coming. So how do we educate folks to take what feels like It's overwhelming. mean, every time we do something, there's always like a webinar or something. There's somebody that says, is this even worth it anymore? Should I stay in this business? And you know, we always want to encourage that. Yeah, absolutely. You stay in and you don't have to try to do everything at once. Pick the things that are the most problematic for you and just start. You know, I had a call the other day with Miriam Allred (38:55) haha Angelo Spinola (39:14) ⁓ company, think I consult a company probably about the size of 24-hour at home health and We talked I think it was in 2023 and gave them all this advice of what to do and you know their their big issue was around Paper visit right and how they were doing that and we talked to him about arbitration and they just came back You know two years later like all right. We implemented the arbitration. We haven't done anything on paper visit. We're ready now So at least you mitigated your risk. You still have the risk, but you've at least mitigated your pool of liability where it's harder to access that full pool. And now they're ready to move forward. Not surprisingly, they also want to sell the business. So they're ready to make sure everything is compliant and all of that. And that's how it works. And that's better than not doing anything at all. So let's break it down into digestible sized pieces and work out a plan to ultimately get to as close as you can to full compliance, which I'm not sure is really possible in home care. I mean, you're not going to be all the way compliant, but you want to be better than your competitors so that they're the ones targeted, not you. Miriam Allred (40:32) And yes, I mean, a few minutes ago, you talked about like buy in the initial hurdle is like buy in making it known to the leadership team how important this is and what the cost of not prioritizing this is. My mind goes to in home care. Everything feels urgent all of the time. So compliance just falls to kind of the back burner because everything else is more important. But it sounds like even at 24 hour, like a really sophisticated, large established company. there was still like legwork to get buy-in from the leadership. I'm curious, you kind of addressed this, but who are the people or where was the pushback coming from? And then how do you get that buy-in from the leadership, but maybe the entire like administrative org, like everybody has to be bought into, like who was pushing back, why the pushback, and then how do you get that buy-in? Yazmin Hamilton (41:21) And I think part of it is it's healthy pushback. I think the leadership, so the founders had a huge hunger to do things differently. They recognized that the organization needed a new way of thinking when it came to compliance, when it came to human resources, when it came to the way they handled the corporate side of the business, if you will. They had done a great job of growing it, but we hadn't done the best job of growing the corporate staff to support the business side of it. I think we're at the... the hesitation, the pushback came, if you will, was from the operators and it was coming from a place of the organization had been in existence for over a decade and there really hadn't been any huge, like major lawsuits, but we were on the precipice of some of those starting to happen. And I think there was this feeling of, if it isn't broke, why are we fixing it? Or we've been doing it this way and we have been okay. Like, is it really worth all this trouble? Because as you know, anytime you go from zero to a hundred, if we're going to change something, change seems to be difficult for all of them. ⁓ But it became to Angelo's point, a matter of working with them to say, A, I'm not coming here and saying we're going to change anything overnight. And B, actually I'm not even coming here to say we're changing anything at all. Let's understand where we live right now. Sometimes, and I know you don't want to hear this Angelo, but I've spoken this as this is why I don't practice. There's an area of gray with compliance where there are many employers that part of what we do in the compliance world as in-house compliance versus attorneys is we have to help explain to the business what is the risk of doing something or the risk of not doing something. And there are times that unfortunately or fortunately the business makes a decision that financially the impact is much lower than being compliant. So if we're compliant it's to cost me a hundred dollar fine with the DOL versus becoming compliant and changing the way that you are telling me to track training time is going to cost me forty thousand dollars a year versus if I get it wrong I may owe someone a fine of a hundred dollars in California for failing to pay them appropriately in that circumstance. So there have been times where that decision is made but part of the conversation became I'm not asking you to do a hundred percent of the things that you need to 100 % compliant. Let's understand where we live. And then became a business. We had to learn how to talk numbers and I learned this in my prior organization. When it was a public organization, it was my job on a quarterly basis to present to a board of directors. And so I became accustomed to trying to find ways to communicate to the business in financial terms how doing something would have a financial impact, whether it was a detriment or whether it was a gain. So one of the things, for example, I'll give you now, one of the stories that now after four years we've been able to highlight is that we took on, we the compliance department took on employee relations investigations two years ago. And in two years we have not had any new litigated matters. So coincidence or not, our theory was that if we had in-house individuals at the front lines when an issue comes up, they could triage it immediately, address it, have someone feel heard document it and potentially address it and then at the same time fix if there's any underlying issues that are more systemic. And we were able to show the business this is why we wanted to invest money. We wanted to invest in headcount to be able to reduce litigated numbers, to be able to reduce the number of claims that come out, to be able to potentially not have anymore. We haven't had a PAGA threat in the last two years, knock on wood, because I'm sure we'll get one, you know, as soon as we're done with this. But again, it's finding ways to remind the business of the value that we do add when it comes to being compliant. quite frankly, sometimes... it's that first big lawsuit that they get that we don't do well or that you do have to settle. So year one, there was a very unfortunate particular case that we were dealing with and it would have been an easy compliance solution had they done it two or three years before. But given that we didn't do it and we found ourselves in that situation, it was potentially a class action lawsuit and potentially a PAGA claim that we settled, which was great. But we settled for a number of that. nobody would have wanted to, ⁓ wanted to settle. And I think that also added a little bit of leverage. And sometimes that's what happens. And sometimes you don't get the buy-in until there is a big fallout. And then there's the, told you so. Luckily for me, that was before my time. I was just here to help through Navigate, through having not made that decision. But that's been most of the journey is finding a way to talk numbers to everything that we do and to convince the operators that Miriam Allred (46:08) Mm-hmm. Hmm. Yazmin Hamilton (46:37) we're working with them and that at the end of the day, all of these things help us drive more hours, help us get clients have additional time. It's our ability to have clients have the care around the clock without any interruption in service is essentially the way that we've been able to connect it to them is the least amount of money that we're paying out for frivolous lawsuits or for little issues that we could have just fixed right away. It's better to just put it in the hands of the caregivers and or to have a trans Miriam Allred (46:52) Thank Yazmin Hamilton (47:05) into hours that we can provide to families that need it. Miriam Allred (47:09) So this is super interesting. When I asked the question, my thinking was top down buy-in. Okay. The leadership doesn't want to front the costs. And so they're going to kind of push until it becomes a problem. But what you're saying is actually like bottoms up operators. But I think that means compliance is a piece of every part of the operation. And so maybe when you have an administrative team of, don't know, 40 or 50 people, they, they still wear a lot of hats and compliance is kind of in the back of their minds. And so that's where it's like, okay, we need to hire a compliance team to take that piece off of their plate so they can keep focusing on their top priorities. And that's where compliance slips through the cracks is it's not top of mind for them. And so they don't want to deal with it until you kind of like offload that to another department. You mentioned today, your compliance team is 20 people. This might be hard to quantify. I don't know how your organization is structured exactly, but how many administrative staff do you have in total? Because I'm curious how big that compliance department is in comparison to all the administrators. Yazmin Hamilton (47:52) exact. And this will give you an idea of where it's top down priority from leadership. So we're probably a little under 300 total administrative staff. So inclusive of operators, HR, finance teams, you know, all of my compliance team. So we are a very large component of the organization. When I first started four years ago, I will give you this as well, though, because I think that's important. Four years ago, there was no compliance department and I had a team of four. So we have grown substantially in the last two years and that is also very indicative of the company's growth and the company moving into a very different space. So now that we're in both private pay space, disability service space, as well as community support space, it is a little different. They have invested a ton both in headcount and financial in time. It has been an important move from the top down. So we have been, and that was where it came from, Miriam. So part of where they came from, the idea was we have such in the grand scheme of things, small corporate staff and administrators compared to our caregiver population, that we did want to make sure that we are operating incredibly, compliantly, that we are operating in spaces where the consequences can be very high of not complying. And all of them were wearing a compliance hat. So within having to onboard. So even though I was an operator, part of me having to onboard you included having to complete your I-9, know the I-9 rules, but also deal with part of my KPIs meant I needed to onboard a hundred of you a month. And so then I'm not really as concerned about making sure that all the fields in the I-9 are complete. I'm not as concerned with making sure that I'm retaining all the appropriate documents. I'm not as concerned with making sure that the zip code that's in the system matches, which might not seem like a big deal if I'm just an enrollment coordinator that's processing applications, but on the back end it means that if we don't have the right zip code, we may not have the right pay rate for that particular individual because a zip code makes a huge difference in California. So what we did is the company invested on a compliance team that is much more from, we took off the compliance administrative burden from the operators so that they could truly focus on the business and we've been trying to absorb those functions as much as possible and where we can't just based on volume we are now training operators. So one of the things that we do is on a monthly basis there are five people on my team that go to any remote offices and train teams one month at a time. We just kind of best practices, reminders, what are our audits? Do you have questions? What's coming up? What's happening in your office? We're trying to target compliance that's specific to that individual office or that population. Again, the reminder of taking bites of the apple versus trying to eat the whole apple and trying to determine for your organization what is that problem? And not everyone has 20. I came from a world with believe it or not, because I came from a billion dollar organization prior to 24. They had in-house counsel but there really was, I was the only compliance person for the entire organization. I was the national SCP of compliance for all of the organization but that's because I had a huge you know number of attorneys I could literally run to down the hall. So I think it could look different and I've worked for a privately held company prior to all of this where it was one but it was a very small organization and we wore all of the hats. So it just it's taking a bite of the apple and determining what's going to cost the organization the most in that particular moment in time, sitting in that boardroom with the executives or the operators and helping them understand why it's important. How does it relate back to them and how does it help the business? And I think when you get those three components together, it slowly becomes very easy. And as we've been able to show success, the team reports out monthly. So every month when we do our audits, I also report out monthly to the entire organization how we are doing. Like these are the reports we've improved, we've not improved, we've decreased. These are the areas where we're seeing some gaps. So it's also a reflection of if we're doing all of this hard work, this is the grade that we're getting as an organization and being very transparent with if even my team has gaps. there audits that we haven't been top of mind and now we're starting to see a decline in those areas and is there something that my team needs to pick up? And it's been very much a, rather than a pull and tug situation, it's been very collaborative for the last two and a half years. Miriam Allred (53:11) And then there's almost no going back. Once you like put your organization under this like compliance microscope and you start looking at every shift, every hour, every client, every form, every pay stub. Like once you start looking at everything through the compliance lens, there's no going back because look, you said a few years ago, there was four of you. Now there's 20 of you. You start to realize how every single layer of the operation has a compliant aspect that is extremely important. They're all important. And so you need somebody's eyes and attention on, every single one of these components. And then that proactive piece. Okay. Now that we've like established the baseline done the audits, how do we stay ahead of this? Because city by city, state by state things change. And so we have to stay on top of all of this. Something that you said that was interesting as me, and you said a few years ago, you were on like the precipice of maybe like a lawsuit or something larger. Angelo, I wanted to ask you, and I don't know if there's any rhyme or reason to this, but what, what is the size or the shape of the organization? that warrants something is going to happen. Like it's kind of like a volume thing. Okay, you have 100 or 200 or 500 clients. Like you're going to get the organization to a point where you're bound to have something happen. Can you put your finger on like what that size or shape is or what the indicator is that then leads to something larger happening? Angelo Spinola (54:21) Yeah. Yeah, it's a great question and something that that Yazmin said earlier that I wanted to touch on and I agree with you by the way, think absolutely compliance is gray and your approach is the same as mine. I think one of the criticisms that outside attorneys sometimes get is it's yes or no, or it's overly conservative. You can't do that effectively and help your client because you know that your client, they're going to do certain things, right? It's business first. They're going to focus on the operation first. So you have to understand what their goal is and help them achieve their goal. That's what I meant before by having the options, right? The Yugo versus the Ferrari, right? That there's a lot of ways that you can improve. And it is absolutely 100 % a cost benefit analysis. That's how the board will make a decision, executives will make a decision. is, what's the cost? What's the lift versus the risk? And if it's a relatively minor lift and a large risk, that's an easy one. And it's a matter of convincing. And people always say that I'm the black cloud or I scare them. But I do that intentionally because I'm on the front line litigating, seeing these things that they're not aware of. They're not aware that, wow, that's such a big issue. So somebody is going to get to them. To your point, Miriam, it's going to be me or someone like me or the other side. And it's inevitable at a certain time and place. And what Yazmin said is so true that you hear from clients all the time as they start to grow and scale. And you become weightier and heavier and heavier. And you're pushing that scale down more and more. and becoming a bigger target. But the view often of particularly founders is, hey, either to one of two things. We've always done it this way. It's never been a problem before, right? Which to me, I would equate that to saying, you go and buy a new car off the lot, a lot of car analogies today. A new car off the lot, yeah, that's got oil and everything else. And you say, I've never changed the oil before, so why do I need to do it now? Eventually, that car is going to break down. Well, I'm the mechanic I can look in there and tell you where are you going to break down and you know that there's no ⁓ Set answer to when because some of the tiniest companies get sued and it becomes a bet the company kind of litigation, but you know, generally when as soon as you Enter the world of government payors as soon as you're over a threshold of say 50 employees, right? ⁓ certain jurisdictions like California, we probably have, I would say 20, 25 home care PAGA lawsuits going on right now. ⁓ There are certain jurisdictions and certain things within those jurisdictions that trigger lawsuits like California. If you're not paying ⁓ business expense reimbursement, you're not paying cell phone. Re reimbursements things like that mileage you're going to be sued in California one way or another Sooner or later whether you're a small agency or the large the largest agencies And yeah, I want to edit out what you have been said We haven't had a PAGA case in a while the larger agencies a lot of times the plaintiff lawyers will sit and wait For the statute of limitations to expire and then bring another one Right, and another one, and you have to then try to argue that there's overlapping classes and timeframes and things like that, but it's, it is so common, but that same business expense reimbursement requirement, that exists in Illinois too. And you don't see those lawsuits in Illinois. So I mentioned there are two things. One, we've always done it this way. The other thing that we always hear is this is how everybody does it. This is how everybody's doing live in, right? I do this California Administrators Conference every year and every single time I find companies that are paying by the visit, right? In hospice or in home health, they're paying visit-based care, which you just can't do effectively in California. And they all look around and say, well, they're doing it, right? They're doing it. I'm like, yeah, that's why we have so much litigation because one lawyer needs to bring one case and then they can just change the name of who the defendant is. Sometimes it's the same plaintiff because the caregiver is working across multiple agencies. But once they figure it out, and this will happen in Illinois and other states that have rules and regulations like California, and once they do, then you'll just see a ton of lawsuits. ⁓ And sometimes that happens before a company even realizes that what they're doing is wrong or even We realized, another example would be a direct hire provision in your client service agreement in California. Nobody knew that that was a problem. It wasn't a problem until the Department of Justice changed their mind and made it a problem and then find one of our clients, a half a million dollars. Nobody saw that coming, right? But when that happens to somebody, then everyone else has got to react quickly. And it's the ones that react fast and say, okay, I don't want that to happen to me. or they're proactive, we're going into this jurisdiction, what do we need to be aware of? Where do the risks here? You can discuss, and those are the ones that keep their nose relatively clean. But to answer your question as best as I can, I'd say 50 employees, government payors, those are a lot of the triggers where you start to have potential risks. Miriam Allred (1:00:26) Good answer. And I wanted to kick that to you, Yazmin. You guys have crossed state borders. You've added new service lines. You've added obviously a ton of headcount, but open new offices. Like there's kind of these like indicators that things are getting more complex, which means more compliance, complexities as well. And so I wanted to ask like which of those has proven the most difficult? Is it crossing state borders? Is it adding new service lines? Is it opening new offices? Like what from a compliance perspective proves to be the most difficult. Yazmin Hamilton (1:00:59) Absolutely by far I can easily say adding new service lines because we added very new service lines and they were new to the state. So not only is it a new service line to us, Community Supports is a new program and so with that it was the two service lines that we added were new programs where the states trying to figure out what the rules are, where, auditors are trying to figure out what we're auditing versus not auditing. So that very much has been our busiest and our number one priority for the last year and a half has been trying to grow with and the growing pains of operating in a new funded space with the new program and what that looks like. It has now had the two year anniversary of the program and we're starting to see some really drastic changes that are impacting compliance and it is becoming very cumbersome because the rules are changing. a service line for us was by far the number. And if I could even go back from an employer perspective and touch a little bit on Angelo's response, I think absolutely you never know when something's going to happen and the shoe could drop at any moment. But I do think there are some things, having worked in a number of different employer sizes as well as public and private spaces, I think there's some things to look for. to your point, Miriam, as your head count is increasing, I think any time that you are growing your head count by any more than 20 % in a short period amount of time, it's something to be mindful of. Are you moving too quickly and too fast? Slow down and that's the time. Maybe you won't know, but that's the time to maybe do an internal audit of something. Maybe kick something in, use the resources that you have available. But if you're growing too quickly, too fast, it's a big sign. If you're going, if you're opening office, into a new office location trying to level set like do I need to do research now about the location where this office is located like I said oftentimes we think of out-of-state state lines but we don't think of county lines or different city ordinances and different city lines that may take into effect but I think anytime the organization is growing whether it's expanding Those are kind of key things to start looking at proactively from a compliance perspective. And then I think the really how you add headcount to compliance is really going to depend very much on the business model and who owns all of the components of keeping risk mitigation low. ⁓ It's different for every organization. Sometimes it's built into operators. But I think what you have to be mindful of is the changes that are happening in the organization to try and stay proactive during those times. Miriam Allred (1:03:42) Yeah, great comments from both of you. You know me, I want to get prescriptive. I'm like, tell me at how many hours you're going to hit a lawsuit or tell me what the ratio is compliance to administrative staff. it's more ambiguous than that. But I think both of you shared really good numbers that are kind of like baseline for other agencies to think about and to start to implement these things. In our last couple of minutes together, what's top of mind for both of you the next 10 to 12 months There's, things on the horizon for both of you. just want to hear like, what's top of mind. What are you thinking about? What are you worried about? Um, but what, what are you focused on going into kind of the next 10 to 12 months? Angelo, let's start with you and then Yazmin after. Angelo Spinola (1:04:18) Sure, one of the major topics I think that we need to be paying attention to is the reinstatement of the live-in and companionship exemption and how that impacts different states differently and the analysis around that. I've seen a lot of ⁓ bad analysis out there of folks that, ⁓ including lawyers, that don't have an understanding of what the impact's gonna be, who it impacts. I had a very large client, one of the largest home care. companies tell me that one of their attorneys said that it doesn't apply with Medicaid waiver caregivers, which isn't true. So I think that's a huge issue. I think that's going to impact the market a fair amount. We have a lot of private equity and strategics that are looking at jurisdictions that just like you would think about Medicaid waiver rates and what's going to happen with rates and the more beneficial rates. we're gonna be looking at what are favorable jurisdictions to operate a home care agency. So, that's one, the changing state laws is always a huge deal, like Yazmin said, and just keeping our clients up to date on what's changing and getting connected with those changes early. There are always law firms and lawyers out there, I call them gotcha claims, that are looking for easy cases to bring. Right? Well, this is an easy case. The law changed. It's strict liability. You're either doing it right or not. Wage theft notices, things like that. You're either providing the documentation, the acknowledgments that you need to be or you don't. And that's a fine per occasion, particularly when it's around new hires, right? People who are applicants who aren't necessarily on an arbitration program and can bring class actions on behalf of all the other. applicants because they didn't see wage, theft notice or they didn't see the rate of pay of the position that they're applying for things like that that are like Yazmin was saying easy fixes if you're aware but not everybody is aware. Miriam Allred (1:06:29) Yeah, those were great. I love, Yazmin, that you're taking notes. I'm the same when Angelo's talking, I'm like writing down every other word that he says. I'm like, I'm gonna have to Google a look up half of these after we get off. But yeah, every time Angelo talks, it's like there's just so many good things and things that just aren't on people's radar that need to be on our radar. So that was great. Yazmin, internally and externally, what what's top of mind for you for 24 hours? Yazmin Hamilton (1:06:33) You Angelo Spinola (1:06:34) Hahaha. Yazmin Hamilton (1:06:52) Yeah, I think both of those internal and external are very similar. think, you know, local changes in California are always a mystery. It feels like every month, every quarter, there's something that changes. So staying on top of those. But there's a few in particular looking towards there's been a lot of regulatory changes on non-compete clauses, on pay to stay clauses, and just making sure that we are staying on top of any employment contracts, any agreements that we have with individuals and making sure that whatever clauses, Clalbeck agreements we're taking a look at, how does that impact the business? And I think as an organization and both externally for me, fraud, waste and abuse, given the funded space has been huge there. There is, at least in California, there appears to be a huge uptick in audits in relation to fraud, waste and abuse. And not that in any way, shape or form 24 is worried about it. What we're concerned about is agencies are taking very strong and to Angelo's very black and white ways of this is what compliance means or this is what it means to be compliant with fraud, waste and abuse. When there's just, there's a lot of gray space on what that can look like, what we should be doing, what we can do to remedy those situations. So looking to find ways to collaborate with MCOs, with providers, with health plans to work with them to figure out how we address fraud, waste and abuse. versus finding ourselves in their reactionary state where they're telling us what they think we need to be doing but it doesn't really make sense from a home care industry perspective. But yeah, definitely fraud, waste and abuse on the horizon from a 24 perspective is what seems to be having the biggest impact for us. Miriam Allred (1:08:38) Awesome. Great conversation, both of you. I really appreciate just like the honesty, open vulnerability. Yazmin, you talking about 24 hour and you know what you all have been through over the last few years. Like this is so insightful for small to medium to large home care operators to just get kind of an inside look into both of your brains and your operations and how you think about these things. I think just a lot of great comments and great feedback and insights today. So thank you for joining me in the lab. We'll go ahead and wrap here. Yazmin Hamilton (1:09:04) Thank you for having us. Thank you. Angelo Spinola (1:09:04) Thank you, Miriam.