Mona Alseth, a registered nurse, is accustomed to taking care of people. She’s just not used to paying for it out of her own pocket.
But that’s just what the El Cajon, Calif. resident started doing three years ago when she assumed the role of family caregiver, following a rollover car accident that left her niece Lani, now 26, paralyzed from the waist down. Although Lani lives on her own, Alseth and Lani’s mother help with her daily routine: bathing, eating, and simply making her way around the apartment.
Alseth says she was ready for the time and emotional commitment – just not the financial one. From nutritional supplements and bathing supplies to grab rails and wheelchair accessories, Alseth estimates it costs around $500 a month to care for her niece.
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“Most of these products aren’t covered by insurance, and the prices are unbelievable,” Alseth said. “All these things you don’t think about when you’re not handicapped, but when you turn around and have to start paying for this stuff, it’s a real eye opener.”
For the last three months, though, Alseth has been able to shave more than 15 percent off the cost of her niece’s supplies. Her solution: A Rhode Island company that has started a national discount program for family caregivers.
Caregivers Marketplace offers its members discounts on home-health supplies and equipment by negotiating special deals with suppliers. Founded last April by South County entrepreneurs Paul Alper and Thomas Doyle, the start-up, for-profit company already has more than 7,000 enrollees across the country.
It works like this: Customers sign up with Caregivers Marketplace – via mail, fax, phone, or online – at no charge, and then receive a catalog of more than 700 products, along with a directory of locations. Members buy products from retailers and send in rebate forms and receipts, to Caregivers Marketplace, which consolidates them and cuts each member a monthly check. For some items, members buy discounted supplies directly from the manufacturer.
The Caregivers Marketplace never actually takes possession of the merchandise; rather, it serves as a conduit between the buyer and seller, Alper said.
“This builds a bridge between caregivers and manufacturers,” said Alper. “Caregivers have unmet needs – to find information about products and to save money – and manufacturers want to market their products in a cost-effective way.”
Product manufacturers offer the discounts in exchange for exposure to the Caregivers Marketplace’s fast-growing membership base. The company has agreements with 21 suppliers so far, Alper said.
For its part, the Caregivers Marketplace makes money three ways: Suppliers pay an annual participation fee, plus a small transaction fee for every member purchase. And some suppliers also pay for customized advertising or promotions, such as targeted e-mail campaigns. (Alper emphasized that the company never sells membership information).
Alper declined to disclose the company’s revenues, but said he expects to have enrolled “several hundred thousand” members by the end of 2003. It has five full-time employees at its small office in Charlestown, and it contracts with private vendors to process rebates and to run its call center.
The market for caregivers is massive: Nearly 27 percent of the adult U.S. population, or more than 50 million people, has provided care for an ill or disabled family member or friend in the past year, according to the National Family Caregivers Association. They sometimes spend as much as $1,800 a year on diapers alone, according to the association.
But it is also a market that is tough to pinpoint, Alper said, because it spans all races, age groups and genders. To reach prospective customers, the company has won the endorsement of a number of not-for-profit caregiver groups, such as the National Alliance of Family Caregivers and Visiting Nurse Associations of America. These groups have promoted the service to members as a way to trim their out-of-pocket costs.
“Before the actual need hits, caregivers have a misconception that Medicaid or Medicare will cover everything, and that’s not the case,” said Brian Duke, executive director of Children of Aging Parents, a Washington, D.C.-based advocacy group.
“The most valuable aspect of (the Caregivers Marketplace) is that it lets caregivers ameliorate the very real costs that they encounter,” Duke said, adding that he doesn’t know of any other service that offers discounts on such a large number of home-health products.
Caregivers Marketplace also has partnered with insurance companies, such as MetLife and United Behavioral Health, which offer the service as a benefit to subscribers. And the company has received some high-profile media attention, with write-ups in Wall Street Journal, Kiplinger’s Retirement Report and Ladies Home Journal.
While products such as adult diapers and Ensure nutritional drinks make up the bulk of the marketplace’s volume, the catalog also has hundreds of hard-to-find items, so members don’t have to search for products. For instance, the list includes a “waffle” seat cushion that prevents bedsores, Alper said.
Another example: Alseth said she and Lani’s mother are considering buying an $8,000 hydraulic lift for Lani’s bathroom from manufacturer Sammons Preston Rolyan, which would enable Lani to bathe on her own. Alseth said they hope to get a 30 percent discount through the Caregivers Marketplace.
“For big equipment like that it really, really helps,” Alseth said. “Otherwise, there would be no way we could buy it.”
But even for caregivers who only buy everyday supplies, Alper said the discounts can add up. “You’re looking at getting checks of $20 or $25 checks each month, when you weren’t getting anything before.”
