Called to serve
Friday, February 04, 2011 7:00 AM
Tom Moreland displays maps in his Clive office that pinpoint the growing number of locations for Saint Jude Healthcare. As if he wasn’t busy enough, Moreland will be getting married in early March. Photo by Duane Tinkey
Moreland gives $1.3 million for shelter expansion, youth chapter
Having volunteered at St. Joseph Emergency Family Shelter for five years, Tom Moreland knew that the Des Moines homeless shelter was turning away between 20 and 30 families each month because it lacked space.
“I told myself that if I ever had the opportunity to change that, that I would do something about it,” Moreland said.
Within two months of selling Iowa Hospice, Moreland approached Catholic Charities of the Diocese of Des Moines with an offer to give $1 million to the shelter. “The only stipulation that I gave was that it had to serve more families,” he said.
That donation, along with state I-JOBS funding and other private contributions, enabled Catholic Charities last year to complete an expansion project that doubled the size of the shelter. Along with five more bedrooms, the project added a playroom and doubled the size of the kitchen, doubling the shelter’s capacity from five families to 10.
“For me, seeing that built and the families move in meant more to me than the success of Iowa Hospice, and I love Iowa Hospice,” Moreland said. “Truly, that was a great thing.”
Though he’s starting a multistate health-care business from the ground up, “the other half of my life now is really philanthropy and being part of charitable organizations’ boards,” he said. “There’s a lot that can be done nationally, but really here in the state of Iowa is where I’ve kept my focus.”
In addition to serving on the board of Catholic Charities, Moreland is on the Bishop’s Advisory Council Board for the diocese and the board of KWKY, a Christian radio station. He’s also heavily involved with House of Mercy as a volunteer, and from 2007 to 2009 served as the title sponsor for its major fund-raising campaign.
He’s also putting his time – and more of his money – into starting a Young Life chapter in Des Moines. Moreland has committed $300,000 to fund a local chapter of the national, nondenominational high school youth organization for the next three years. Most of Iowa’s larger cities already have chapters; a group attempted to start a Des Moines chapter in the 1970s, but it failed.
“It was very instrumental in my high school years in Iowa City,” Moreland said. “Really, it saved my life. I was kind of a wild child, and Young Life really steered me in the right direction.”
This summer, Moreland hopes the chapter will be able to take 25 teens to Young Life’s summer camp, and in the fall programs will begin at Valley and Dowling Catholic high schools in West Des Moines and Waukee High School.
“I’ve been so greatly blessed financially, and I had to look back and see what got me to where I am today, and Young Life was one of the major things,” Moreland said. “I can’t wait to see the impact it has on youth in Des Moines.”
Tom Moreland could have settled into a comfortable consulting career after selling Iowa Hospice, a start-up company he developed into one of the largest and fastest-growing hospice care providers in the state. Instead, the 32-year-old entrepreneur is on the road again, this time building a multistate hospice and home health-care business called Saint Jude Healthcare.
“Basically, I’ve kind of put all my chips back on the table,” said Moreland, who plowed a portion of his profits from the sale of Iowa Hospice into his new venture, which is already serving more than 120 patients daily in three states. “That’s why the success of this company is so important and I believe in it so much.”
Moreland, an Iowa City native, began laying the foundation for Saint Jude Healthcare two years ago, at the same time that he sold a majority stake in Iowa Hospice to Voyager HospiceCare Inc., a Texas-based hospice provider. He continued to serve as the president of Iowa Hospice for the next two years, growing the business to an average daily census of more than 500 patients.
“We grew to 13 offices and hit that magic 500-patient number that had been a goal for me,” he said. So last June, as his employment contract with Voyager was coming to an end, he told the company’s executives he would not be renewing it.
“It was just kind of the entrepreneur in me,” said Moreland, who was among the Business Record’s Forty Under 40 in 2006. “I had really done what I had set out to do in Iowa and had accomplished a lot, but I was really ready to take that to a more regional or national level. And they understood that.”
Voyager also had some big news for Moreland – it was going to be acquired by Harden Healthcare, a $900 million home health and hospice provider based in Austin, Texas.
“They already owned Lighthouse Hospice, which was at 500 patients,” Moreland said. “Adding Voyager would take them to almost 2,500 patients, and that’s the business they really wanted to grow. So they asked me to stay on to the end of the year to help with the transition to Harden.”
Though he had already started Saint Jude Healthcare, “we came to an agreement quite easily that they would allow me to continue building my own company,” he said. “As long as I stayed within my non-compete (agreement), they had no problem with me starting my new company. You really can’t do better than that, though I was working two jobs there for a few months.”
Moreland said he believes both acquisitions were good for Iowa Hospice and its clients as well, because each company has a track record for keeping the original owners in place and maintaining the same values and standards of care.
Moreland’s passion for hospice care extends beyond the entrepreneurial. While he was an education major at the University of Kansas, he volunteered for two summers at an AIDS hospice in San Francisco operated by the Missionaries of Charity, an order founded by Mother Teresa.
A devout Catholic, Moreland incorporated the values of his faith into Iowa Hospice, as he is now doing with Saint Jude Healthcare. In 2008, he was invested as a Knight of Magisterial Grace in the Order of Malta, taking perpetual vows with the church to serve the sick and the poor.
Rather than providing a hospice home for patients, both Iowa Hospice and Saint Jude offer their services solely in people’s own homes or at the assisted living centers or nursing homes where they are living.
“Hospice houses are wonderful, but for a private organization, they’re nearly impossible because they cost anywhere from $2 million to $3 million to build,” Moreland said. “With our operation, our highest expense is payroll. If I were to start doing buildings, it would be so much more costly. And 85 percent of Americans want to die at home, so we’re only missing 15 percent of the market by not having a hospice home.”
In March 2009, Moreland opened Saint Jude’s first hospice office in Oakdale, Minn., about 40 minutes north of Minneapolis. His non-compete agreement precludes him from providing care in Iowa and Missouri for the next couple of years.
Though he originally planned for Saint Jude to operate only in the Midwest, some opportunities came his way that were too good to pass by, beginning with two hospice companies in Mississippi.
“Both of them had been started for the right reasons, but by people who didn’t know the industry, so they were kind of a fire sale,” he said. “I got them for very, very little money and I felt there was an opportunity there. I felt we could turn these around.”
As brokers continued to present opportunities, he acquired a hospice business near Los Angeles. Within the next couple of weeks, Moreland expects to receive licensing for a start-up office in Madison, Wis., and in the third quarter plans to open offices in the Chicago and Omaha areas. He said he also has commitments to purchase two hospice locations in Florida and will open in four additional counties in the Los Angeles area.
Each market area in which Saint Jude operates a hospice will also have a home health-care operation, “because they very much complement each other,” he said. The home health business will operate as Spirit Home Care.
“Most home health patients have chronic illnesses that turn into terminal illnesses, so they become a great referral source for hospice care,” Moreland said. “And some people discharge from hospice care; they no longer need it. But they then need home care.”
Moreland said Saint Jude offers some of the same innovative features that he introduced with Iowa Hospice, including full-time massage therapists and music therapists based at each office, amenities that few hospices offer because those services are not reimbursed by Medicare.
Both hospice care and home health care, which receive the majority of their funds from Medicare, will see significant cuts under health-care reform, Moreland said.
“We are going to plan that those cuts are going to remain in place and not be repealed,” he said. “The great thing about it for us is that these cuts won’t happen until 2014, so we’ve got three years to really put a nice savings together and pay off any remaining debt that we have. And we feel we’ll still be able to be profitable with the cuts.”