How do I tell what a group home owner actually takes home?

The profit line on a group home’s statements can mislead in both directions. An owner who works many shifts and draws little pay makes the home look more profitable than it will be under a manager. An owner who runs personal costs through the home makes it look weaker. The task is to see what the home earns once every job is paid for by someone.

How the money comes in

Income may follow each resident, paid under an agreement with the agency that placed them. Ask who the paying agencies are, how each rate is set, when it is reviewed and how quickly invoices are paid. If one agency supplies most of the residents, the home depends on that relationship. Ask what happens to income when a resident leaves.

Empty beds and the cost of staffing

A bed with nobody in it earns nothing, but the house still needs heat, food and often a full staff. Ask for the history of placements and how long beds usually stay empty between residents. Then look at staffing. Overnight cover, overtime and agency relief staff add up quickly. Ask what the schedule really looks like in a week with a sick call.

What the owner does without being paid

Many owners work shifts, take overnight calls, do the paperwork and fix the house themselves. A buyer who cannot or will not do the same has to pay someone to do it. List every task the owner performs and ask what it would cost to hire for each. If the owner holds the house, separate the rent a tenant would pay from the home’s operating results.