CMS proposed a permanent prospective adjustment to the CY 2025 home health payment rate of -4.067% back in June. All in all, the agency proposed a 1.7% cut to aggregate home health payments next year.

Providers have experienced cuts in the previous two years, but have also seen CMS back off more severe cuts in the time between the proposed and final payment rules in 2022 and 2023.

“[CMS] thinks, ‘How much can we threaten to reduce the current payment rate, so that when we drop a few breadcrumbs [in the final rule], providers will feel good about picking a little something up?” Pinnacle Home Care CEO Shane Donaldson said on stage at Home Health Care News’ FUTURE conference last month. “History tells us that the final rule will probably be a net neutral event.”

Based in Oldsmar, Florida, Pinnacle Home Care is one of the largest home health providers operating in its home state. The New York-based HCS-Girling recently acquired Pinnacle Home Care, which plans to significantly expand in the coming years.

While providers are hoping that they at least see those breadcrumbs in the final rule, they’re not banking on it.

Instead, they’re working toward becoming sustainable shops in spite of a turbulent payment environment.

“If you’re not really good at something – whether that is collecting your AR, doing your coding, OASIS review – it’s time to look at people who are really good at that, and maybe make some different decisions,” Interim HealthCare President and COO Rexanne Domico also said on stage at FUTURE. “What I would really suggest to people at this stage in the game is to think about your efficiency in all of your locations.”

Based in Sunrise, Florida, Interim HealthCare is a home health and home care franchise with more than 330 locations across the U.S.

Efficiency is a broad term, but Domico was specifically referring to outsourcing certain tasks, reducing redundancies and also exploring home health-applicable AI.

AI was a major talking point at FUTURE, and the vast majority of providers were bullish on what new technology could do for the industry in terms of efficiency, especially in light of recent rate cuts.

On top of that, Domico mentioned utilization as an area for providers to keep an eye on.

“I think there’s a lot of times we don’t focus on utilization,” Domico continued. “And I think there’s a tremendous opportunity to focus on there. And that can be part of your increase, if you work it the right way.”

Donaldson added that clinicians should be working at the top of their licenses, which also helps drive efficiency.

“What we’ve got to do is improve our margins, and that means we’ve got to get evaluating clinicians to do as many evaluations and assessments as possible, and we’ve got to get the non-evaluating clinicians doing the majority of the straight visits,” he said.

There are home health providers trying to do more to be a better partner to payers and referral sources. But, sometimes – to Domico’s point – less is more.

In general, providers agreed with the idea that they should focus on their strengths, and find a way to outsource their weaknesses, or at least level up in those areas.

“If [that margin] is not going to be given to you, how are you going to get it?” Domico said. “I think you get it by really being an expert at what you’re really good at, which is delivering care. And if those other things are not working for you, then I think it’s time to look at doing something different.”

Working with other payers

As those fee-for-service rates become less reliable than they’ve been in the past, providers are having to spend far more time thinking about their Medicare Advantage (MA) strategies.

With less growth in traditional Medicare payment, it’s paramount to avoid MA payers that reimburse at a subpar rate. For the most part, providers don’t expect – but do hope for – MA rates on par with traditional Medicare rates.

But 40% lower, for instance, is unsustainable.

“In the state of Florida, we have 850 home care agencies, and so Medicare Advantage plans still consider us to be largely commodities,” Donaldson said. “When they can find an agency next door that’s willing to do a visit for $80, they’re not going to pay us $130. Irrespective, it seems, to how much we can prove that our quality is better than any of our neighbors.”

Pinnacle has had success with one MA plan, however. That plan has agreed to pay the company with some upside opportunity.

That came about when the plan moved from being managed internally to being managed by a third party.

“We had a good relationship with the third party,” Donaldson said. “In negotiating, we said, ‘Look, this really needs to be an episodic relationship, even if it’s at a percentage of Medicare. Give us the opportunity to control our own destiny, give us a pot of money and let us run with it.’”

While some improvements have been made in home health contracts between MA plans and providers of late, Domico still sees providers largely as “price takers” in the relationship.

“I think we are price takers, and I think the negotiations are really very one-sided,” she said.

But she also believes that there’s still plenty of opportunity out there for providers to be paid more fairly, and that starts with regional plan partnerships.

Well Care Health COO Rebecca Higbee, also on stage at FUTURE, said her company has seen most success with those local-level health plans.

“Some of our best partners are those regional partners,” she said. “Those local partners where you can speak to the actual decision makers of the plan.”

Well Care Health provides home health and hospice services across North Carolina and the upper part of South Carolina.

Higbee also emphasized that health plan relationships need to be nurtured on a daily basis.

“It still takes years to make progress,” she said. “We have made progress of late. There’s a handful of payers that are finally seeing the value, while at the same time, there’s also payers that in years past have seen value and are now looking to move backwards. It’s really a mixed bag. I think it’s something we have to be working on daily, and something we have to be thinking about daily.”

The post Top Home Health Operators: If You’re Not Really Good At Something, Ditch It appeared first on Home Health Care News.

Top home health leaders maintain that they’re operating in a space filled with “tons of opportunity.”

Payment uncertainty and other contemporary operating dynamics can muddy the waters, but there’s a way through those challenges, those leaders believe.

“I’m going to sound delusional,” Pinnacle Home Care CEO Shane Donaldson told me on stage last week at Home Health Care News’ FUTURE conference. “But I think [the home health industry] is in a great place for the future.”

At the conference, many of the same talking points were hit: Medicare Advantage (MA), fee-for-service rate cuts and staffing.

But providers are on the brink of their third straight year of rate cuts, and are about a decade into significant MA penetration in most cases. The staffing situation ebbs and flows, and providers are used to that, too.

As I talked to home health leaders in one-on-ones and on stage last week, I filled a whole page of notes related to what providers were bullish on.

Donaldson is bullish on the entire industry. Other leaders, too, are bullish – and offered specifics on where they feel like they can score some ‘wins’ in the near-term future to keep their patients happy and their margins healthy.

Those notes, quotes and other takeaways from last week’s FUTURE conference in Nashville, Tennessee, are the topic of this week’s exclusive, members-only HHCN+ Update.

Tons of opportunity

Pinnacle Home Care is one of the largest home health providers in the state of Florida. The New York-based HCS-Girling recently acquired Pinnacle, as both companies look to accelerate their growth goals.

At some point, Donaldson said that he believes HCS-Girling – along with Pinnacle – will have a home-based care footprint all along the East Coast.

Donaldson believes that home health providers will have the ability to optimize operations so much over the next few years that CMS will have to again consider large cuts to payment. He said it would be a “good problem to have.”

“I have a belief that in the not-too-distant future, if we take advantage of the current technologies, when we submit our cost reports, the problem we will have is that our margins are too high,” Donaldson said. “With artificial intelligence, robotic process automation, predictive analytics – all of these things that we have at our fingertips now are going to make life so much easier.”

Donaldson was essentially suggesting that margins will improve so much because of newly available technology that the Centers for Medicare & Medicaid Services (CMS) will again feel the need to chop rates.

Even if that sounds “delusional” – as Donaldson warned it would – many providers feel the same about certain technology advancements.

Take the aforementioned issues plaguing home health care. Scheduling is the leading cause of turnover in the industry, and there’s now AI solutions to address that. That improves retention, and, in turn, staffing. The same goes for AI that helps reduce clinicians’ documentation time.

Predictive analytics can help better manage patients with chronic conditions, which will help in the Home Health Value-Based Purchasing (HHVBP) and in value-based arrangements with other payers.

Those are just a few examples. And, of course, it won’t just be that easy.

But nearly every vendor was enthusiastic about these new offerings at the conference. This time, their enthusiasm was matched by providers.

By driving down operating costs, providers will also be better able to take on MA members that come with a lower – or currently non-existent – margin. Compassus CEO Mike Asselta suggested on stage that providers needed to go through some “maturation” before realizing all of the opportunity that lies ahead of them.

That mostly had to do with presenting value to payers, however.

In that arena, providers are already figuring out ways to better deal with payers, even if a better way is walking away from agreements entirely.

“I would suggest that providers really look at their [payer] strategy,” Interim HealthCare COO Rexanne Domico also said on stage. “What are the regional opportunities? What are other national opportunities? Where can you find that upside that’s not necessarily wholly dependent upon the big managed care providers? There’s some opportunity that’s still out there.”

Almost every provider still agrees that working with health plans in home health care is not easy.

But, anecdotally, providers told me that they’ve had a much better go at it when working with regionally focused plans.

“Some of our best partners are those regional partners,” Well Care Health COO Rebecca Higbee said on stage. “Those local partners where you can speak to the actual decision makers of the plan.”

Oftentimes, within national health plans, the decision makers on home health rates are siloed from the head decision makers. The rate setters are most interested in keeping costs down, while the head decision makers may see more home health access as a better long-term strategy.

That disconnect leads to snags in negotiations between national MA plans and home health providers.

“It’s really difficult when you’re speaking with large payers,” Higbee continued. “You’re not going to change their mind about the directives that they’ve been given. You’re not going to change their mind about the plan that they have laid out for the next quarter. But you can speak to the medical director of a local plan and really get their buy-in, in terms of the quality and the return for them.”

Domico also said that she believes there’s room for providers to get “more creative” in how they approach different payers, specifically around the presentation of home health care’s value.

A slew of leaders told me that they were encouraged by Enhabit’s (NYSE: EHAB) termination of its contract with UnitedHealthcare earlier this month.

Providers want to work with big payers, but they also need better rates – at least for now.

“I would just say that my heart was warm the other day when Enhabit walked away from the table with UHC,” Donaldson said. “I think that we’ll look back on that as being a significant event.”

The post ‘Opportunity Is Still Out There’: AI, Regional Payers And The Other Factors Exciting Home Health Leaders appeared first on Home Health Care News.

As one of these next generation leaders, RJ Gagnon is making a name for himself at Andwell, but it doesn’t end with him. The company has already set its sights on developing the next set of future leaders.

“Our organization has really focused on development of leadership,” Gagnon said Monday during a panel discussion at the National Association for Home Care & Hospice’s (NAHC) Financial Management Conference. “When we look at our budgets, sometimes that’s one of the things that’s first cut. That’s something we need to invest in.”

Formerly Androscoggin Home Healthcare + Hospice, Andwell is a nonprofit operator that offers home health, hospice, palliative, behavioral health and pediatric care services. The company employs over 500 workers across all 16 counties in Maine.

Along with cultivating the next crop of leaders, companies are figuring out how best to work with a multi-generational workforce.

Currently, UVA Continuum Home Health has four different generations that make up the organization’s staff. Catherine Harris, the home health director at UVA Continuum Home Health, has learned to accommodate individuals based on what stage they’re at in life.

This also gave Harris the opportunity to listen and learn from her more experienced colleagues.

“When you think generationally, you’re really thinking about where that person is in life,” she said during the discussion. “My younger partners are just starting to have kids. They’re taking leave, [it’s about] giving space for that, and celebrating that, versus the generation before us, the baby boomers … who are preparing to retire. Am I listening to them? Am I focused on the lessons that they’ve learned? Because if we’ve learned nothing, it’s that history constantly repeating itself.”

UVA Continuum Home Health is an academic home health agency associated with the University of Virginia in Charlottesville. The organization serves several cities across the state.

Matt Chadwick, CFO of Well Care Health, stressed the importance of not bringing preconceived notions to the workforce when working with multiple generations.

“It’s about, [for example], not going in with the perception that a younger person might know technology better than the older person, but listening to their concerns, hearing what their skill sets are and really trying to find the right space for them,” he said.

Well Care Health is a Wilmington, North Carolina-based provider of home health and hospice services. The company serves more than 4,000 patients, and employs more than 600 employees. It operates across 40 counties in North Carolina and South Carolina.

Chadwick noted that it has been important for Well Care Health to make sure they are placing people in the roles where they’ll succeed the most.

At VNS Health, leaders began to notice a higher turnover among younger nurses. The company sought to address this by establishing a nursing grad program six years ago that emphasized mentorship.

“They’re learning about home care,” Sarani Doshi, vice president of corporate financial planning and analysis at VNS Health, said. “They’re getting their feet wet and taking care of patients in the homes for real now, and we’re giving them the tools they need to be successful, to grow and develop in the way that they’d like to.”

New York-based VNS Health is a full-service home-based care organization. The company has almost 40,000 daily patients.

VNS Health has seen less turnover among younger nurses after the implementation of the program.

Additionally, the company has begun developing closer partnerships with New York area nursing schools, according to Doshi.

“We’re spending a little bit more time in the school, educating students around home care, the value of home care and the benefits of home care, and providing scholarships to students who are showing interest in coming into home care post-graduation,” she said. “That, coupled with our nursing graduate program, has started to gain some traction, and we’re seeing some of that affect turnover and retention.”

Ultimately, Gagnon believes that it’s imperative to set employees up for success by taking professional development seriously.

“We need to let the teams know that they matter,” he said. “We have management meetings where the first half is business as usual. The second half is very direct leadership development with strategies where we bring in facilitators. We are investing in that team. That lets them know, ‘We want you to be successful.’ Our No. 1 job is for our team to be successful.”

The post How Home-Based Care’s Leaders Foster A Multi-Generational Workforce appeared first on Home Health Care News.

For Well Care Health, it’s an opportunity to capitalize off of the demand for its well-established home care footprint, while also focusing on a new strategic direction moving forward.

“There’s a couple of drivers behind [the move],” Well Care Health CEO Zac Long told Home Health Care News. “I think this is such a positive step for both Well Care Health and for our home care team. On the Well Care side, it allows us to more deeply focus on our core service lines of certified home health and certified hospice. We see a tremendous amount of opportunity to grow responsibly through those two operating divisions.”

The Wilmington, North Carolina-based Well Care Health provides home health and hospice care to over 4,000 patients via its over 600 employees. It operates across 40 counties in North Carolina and South Carolina. The home care segment represented about 7% of its overall net revenue.

The two companies will continue to work closely with each other during and after the handoff, meaning Well Care won’t be losing the clinical value of home care for patients in its markets. All of Well Care Health’s employees are being retained by Avid Heath at Home.

On its end, Avid Health at Home is a new home care platform backed by Havencrest Capital. The company first kicked things off with the acquisition of the Chicago-based For Papa’s Sake Home Care. Its CEO, Jen Lentz, told HHCN in August that the company was primed and ready for immediate and significant expansion – specifically in the Midwest, Mid-Atlantic and Mountain West. 

Since May, it has closed on three acquisitions. Overall, Avid Health at Home is providing personal care and private-duty nursing services across seven locations in the Chicagoland area and North Carolina.

“Knowing Well Care’s reputation for being a best-in-class provider was what initially attracted us to the opportunity,” Lentz told HHCN in an email. “When we really got going in the process, it became evident how strong the culture was. Zac and the Long family have built an incredible organization, and we are thankful they chose us to be stewards of the home care business after 35 years.”

Lentz previously told HHCN that Havencrest Capital – where she also serves as an operating partner – ultimately decided to go the platform route because it wanted the home care enterprise to be data-driven and technology-enabled. Ultimately, Havencrest believed rolling up smaller acquisition targets was the easier way to achieve that vision.

“The Well Care team is packed with talented clinicians and operators, and we are confident that we have acquired a group that can carry out Avid’s mission to be a data driven, tech-enabled home care company,” Lentz said.

Long added that he is happy that the home care team can now join an organization that is “fully dedicated and focused on home care services.”

“As we were evaluating the opportunity, we felt like that focus and that dedicated service model will be instrumental in allowing them to unlock their potential and their continued growth in home care,” he said.

Well Care Health wants to be on the cutting edge of the payment shift in home health care, moving more toward value- and risk-based contracting with payers.

“We’re really excited to deepen our focus on not only home health and hospice, but also our strategic priorities, which include improved payer relationships, value-based care positioning and taking a major step forward in terms of our hospice service line,” Long said.

As for Avid Health at Home, it plans to continue to be highly acquisitive over the next year.

“Avid’s near-term pipeline is full of some great companies both within our current footprint and in new markets in our existing states,” Lentz said. “As we look ahead to 2024, Avid will be expanding its operations into new states through additional M&A.”

The post Well Care Health Divests Home Care Segment To Avid Health at Home appeared first on Home Health Care News.

Medicare Advantage (MA) plans, collectively, were one of the home health industry’s clearest opponents over the last couple of years.

Now, providers are making a distinction in their criticism of MA plans. They’re not all bad. Some are even good.

“I think there’s going to be a real separation between the Medicare Advantage plans,” Well Care Health CEO Zac Long told me. “The ones that view home health providers as partners, versus the ones that view us as commodities.”

That’s a massive win for providers, that even some MA plans – whether regionally or nationally – are becoming easier to work with. In certain instances, forming harmonious partnerships may take years.

Home health providers have been backed into a corner by Medicare fee-for-service rate cuts and further MA penetration. In a backwards way, that’s given them more leverage against MA plans. They’ve put their foot down, which has forced plans to reconsider their relationships with providers, with a recognition that patient access is crucial.

“Do I do what I need to do now to survive?” Healing Hands Healthcare CEO Summer Napier told me, referring to her agency’s thought process in MA. “Or do I make a strategic decision for the future?”

Meanwhile, the MA market is becoming more crowded. There are 3,998 plans available nationwide for individual enrollment in 2023, which is a 6% year-over-year increase. On average, an individual has 43 plans to choose from, more than double the options they had in 2018, according to a Kaiser Family Foundation analysis.

Access to home-based care is paramount for plans from a member recruitment and retention standpoint. It’s also crucial for their bottom line. If members cannot access home health care, they’re more likely to end up in a costlier care setting like a skilled nursing facility, or, worse yet, the hospital.

In this week’s exclusive, members-only HHCN+ Update, I break down why it’s good business for plans to become more home health friendly.

Win-win relationships

Long is one of those leaders who believes that things can, will and are getting better when it comes to MA plan-home health provider relationships.

His organization – Well Care Health – is a Wilmington, North Carolina-based home health, hospice and personal care provider that is family-owned and operated. The company serves 45 counties in North Carolina and South Carolina.

“I do think the next couple of years will be a bit of an acclimation period, as providers across our space reforge and reestablish win-win relationships with payers,” Long said.

Well Care Health has recognized the payers in its area that treat home health care as a commodity, and the ones that don’t.

Like many other home health organizations, it has begun to differentiate the two by allocation of its clinical capacity, which is any home health provider’s most critical resource.

“It really is about the allocation of our clinical capacity,” Long said. “I think we view the management of the clinical capacity – which we work so hard to build – as one of our most precious resources as an organization. We allocate our clinical capacity, in a larger sense, to the payers that view us as a partner.”

In order to become a better partner itself, Well Care Health is enhancing its reporting for payer partners.

Napier and Healing Hands are doing the same. She’s laid out the value of her organization in creative ways over the last couple of years.

“For instance, we’ll say, ‘We’ve had this many audits, and we’ve had 100% success in them,’” she said. “‘We’re 100% RCD, our quality scores are this high, our VBP scores are this above average, our hospitalizations are lower than the state and national average.’”

Based in Wichita Falls, Texas, Healing Hands provides home health, hospice and private-duty home care services in 22 counties.

Healing Hands has held up its end of the value-based bargain. It has laid out the relevant numbers and methodologies to MA plans.

The problem is that many of those plans don’t know how – or don’t want – to use those numbers as a jumping off point to a value-based arrangement.

“We took a fee-for-service rate with an MA payer, and had discussions that we would have a value overlay added,” Napier said. “Well, we believe that they will keep their word eventually. But they don’t know how to do that right now. So, for right now … that’s not as lucrative as it [could be]. And when you have control over a value-based payment, your decisions are not the same as when you have a fee-for-service rate.”

That’s where Long sees opportunity for a more “robust” partnership model with MA plans, one where there’s deeper communication and more aligned payment mechanisms.

And, while he’s optimistic, one of the hurdles that remains is primary contacts or point people specifically overlooking home health care from the plan side.

That’s a thorn in home health providers’ side that I wrote about in an article earlier this month.

For relationship purposes, that primary contact can make all the difference in the world, and put a plan in the “partner” bucket for providers.

“Oftentimes, there’s not a primary contact or an overarching relationship manager from the payer perspective,” Long said. “I think that’s a tremendous opportunity for payers, to invest in those contacts, and to really think about the value in forging and managing those value-based relationships with care providers. That’d do a great deal of good, I believe.”

From the plan perspective, the risk of investing in these partnerships is almost nothing, particularly if the partnerships are under a value-based structure.

The reward, on the other hand, could be huge: easy and timely referral acceptance; patient satisfaction, and thus, increased star ratings; a much greater percentage of post-acute patients in the least costly setting, the home; and a network of trusted providers that can reinvest in their businesses because they’re not being commoditized.

“You have to really make hard decisions,” Napier said. “Do I take what I have to take now to survive, or do I take a little bit of risk for the future in hopes that this partner becomes a true partner? We ultimately have to [dig into] the payment methodologies and see if we can survive if we take this or that rate. And then, sometimes, that means just having to walk away.”

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Virtually none of those leaders believe anything positive is coming from the proposed payment rule itself, or from the final rule – which set to come out around Halloween – for that matter. But there’s a recognition now that solely focusing on CMS’ rate setting is not a winning strategy long term.

“We need to have long-term investments in our people strategies, in our managed care relationships and in having sound, compliant and efficient operations,” Well Care Health CEO Zac Long said during a panel at the National Association for Home Care & Hospice’s (NAHC) Financial Management Conference Monday. “I think we’ve got to continue to invest in the long term. We can view this proposed rule as a sky-is-falling scenario. I view it as just another reason, and a reinforcing reason, why we need to go the direction we’re going.”

The Wilmington, North Carolina-based Well Care Health cares for over 21,000 patients across 69 counties. It offers home health, home care, hospice and pediatric care services.

Frontpoint Health CEO Brent Korte struck a similar tone, again publicly arguing that many home health providers need to fundamentally change their business models, whether CMS goes back on proposed rate cuts or not.

Based in Dallas, Frontpoint is a home health and hospice company that specifically tailors its business model to take on Medicare Advantage (MA) patients, which are quickly becoming the dominant group among Medicare beneficiaries.

“A one-point decrease in Medicare feels catastrophic,” Korte said. “But what’s bigger than that is the fact that right in front of our faces, we are [seeing] that those patients are going to become a minority. As an industry, for us to assume that we can keep competing and saying, ‘We need 85% to 90% of our patients from Medicare,’ that doesn’t seem like sound strategy.”

Korte acknowledged that the MA rates Frontpoint receives for its delivery of home health services are still not great. But, because Frontpoint was structured to take on MA patients – and not primarily Medicare fee-for-service patients – its able to enjoy a “healthy gross profit margin.”

For home health providers large and small, a pivot to MA patients is a tall task. Even with cuts, Medicare fee-for-service rates are still generally far higher than what MA plans are paying across the country.

A full pivot to a model like Frontpoint’s may not be possible. But it is possible to acknowledge that Medicare fee for service won’t represent the sturdy base to stand on for providers anymore.

It’s also possible for providers to become more selective. To take on more traditional Medicare patients, but also to take on more MA patients from plans that are willing to pay acceptable rates for services.

“We’re going to see providers have to be more and more selective with the referrals that they accept,” Long said. “Access to care is going to be impacted by that, … and that’s already a real issue today. So, I do also think we’ve got to have a real strategy as an industry to work through that.”

Access-to-care issues are bad for the patients, a tough reality for providers to grapple with. But a reduction in home health care access also theoretically will increase post-acute care spend for those MA plans, which could lead to better rates.

That’s something that one of the largest home health providers in the country, Enhabit Inc. (NYSE: EHAB), has had to navigate. But Enhabit CEO Barb Jacobsmeyer recently said that reduced access to home health services has forced MA plans to take negotiations “more seriously.”

In Korte’s opinion, the payment cuts’ effect on home health providers will be a symptom of the problem, but not the underlying problem itself.

“That shadow behind this is the proposed rule,” Korte said. “But the problem, in my mind, is what we all have been woefully prepared for. In spite of the fact that there’s more home health patients than in any time in history right now, we are competing for this scarce resource – [the traditional Medicare patient]. And our business models are not meant to allow us to accept Medicare Advantage.”

The value is still there

Part of what enables provider leaders to keep a glass-half-full mindset is the focus on the home in health care right now.

UnitedHealth Group (NYSE: UNH) is not just one of the largest health care companies in the country, but one of the largest companies period. It acquired LHC Group last year, and is in the process of trying to acquire another home health company in Amedisys (Nasdaq: AMED). Clearly, it sees value in home health services moving forward.

For what it’s worth, NAHC President William A. Dombi also told Home Health Care News that UnitedHealth Group and Optum have already joined in on home health advocacy efforts.

“I would say I think that the last three years have certainly weighed raised awareness of what we do and the value of the care that we provide,” Jennifer Sheets, the former CEO of Interim HealthCare, said on the panel. “But progress comes with challenges, and we certainly have been in the midst of several challenges of late.”

One of the ways to get through rate challenges is value-based care, a concept most home health providers have increased focus on over the last couple of years.

At CenterWell Home Health – which is a part of Humana Inc. (NYSE: HUM) – it’s the “no. 1 priority,” according to its president, Susan Benoit.

“We are just like every other home health company in this room, we’re feeling the effects of the decline of traditional Medicare,” Benoit said. “We have been challenged to move to value-based care very quickly. … Our goal is, by 2025, to have 40% of Humana members that [receive] home health to do so under a value-based care model.”

Treating patients under value-based care models is a potential way to sidestep rate cuts. On CenterWell’s end, it is developing a value-based clinical model that will treat home health patients differently than in the past.

“How do we use automation, and how do we use more data analytics?” Benoit continued. “And how do we identify those high risk patients to keep them out of the hospital?”

Though Humana is also has one of the largest MA plans under its belt, Benoit suggested that does not absolve CenterWell from all MA-related home health problems.

But she – and others on the panel – do see a way for MA plans and home health providers to have more harmonious relationships moving forward, with the patient in mind.

“I think at the end of the day, there’s so much gravity, so much commonality and interest between [MA plans and providers],” Long said. “There’s alignment between those two groups and ways that we can help each other. I can’t help but be long-term optimistic about that broader direction.”

The post Home Health Provider Leaders Reject ‘Sky Is Falling’ Narrative Post-Proposed Rule appeared first on Home Health Care News.

Wilmington, North Carolina-based Well Care Health is the perfect example of that trend.

Founded in 1987 by Tanya and Wayne Long, Well Care Health started out as a privately owned, Medicaid-licensed home care agency. The company — which currently operates in about 45 counties in North and South Carolina — added Medicare-certified home health services under its umbrella years later with the purchase of New Hanover Home Health.

Well Care Health has now rolled out a hospice service line as well, CEO Zac Long told Home Health Care News. In addition to his role as CEO, Long also serves as Well Care Health’s general counsel.

“We’re very excited about opening that service line,” said Long, who took over as CEO in 2017 following the passing of his father, Wayne. “We’ve been working very hard and recruited a great hospice team that’s building out that line in our Triad branch, based in Davie County.”

Overall, Well Care Health has more than 900 employees who care for upwards of 5,000 patients. The company is forecasting a 2019 revenue north of $75 million.

He noted, however, those projections could quickly change due to unforeseen challenges. This year, challenges include Hurricane Dorian, which battered the North Carolina coast last week, bringing heavy rain, high winds and destructive tornadoes.

“We work really hard to be prepared [in disaster situations],” Long said. “The name of the game is being proactive and prepared. We try to do a great job with communication, not only with staff but with patients, making sure all their needs are being met proactively and that they’re not in an unsafe home environment.”

The ‘one-stop-shop’ model

Home-based care providers of all shapes and sizes have similarly strived to build integrated care models over the past several years.

The largest include LHC Group Inc. (Nasdaq: LHCG), Addus HomeCare Corp. (Nasdaq: ADUS) and Amedisys Inc. (Nasdaq: AMED), the latter of which has regularly touted plans to aggressively grow its hospice business following the announcement of its $340 million Compassionate Care Hospice deal in October 2018.

“We are really going to feed the beast in hospice,” Amedisys CEO and President Paul Kusserow said during a presentation at the RBC Capital Markets Global Healthcare Conference in May. “Right now from an M&A perspective — where we should be focusing on de novos, on tuck-ins, on deals, on integrations — we are pushing hospice.”

Generally, there are several reasons post-acute care companies are trying to diversify their services.

For starters, being able to take care of patients as they age — from a “pre-acute” basis to end-of-life-care — finally has appeal to potential payer and health system partners thanks to value-based care mechanisms and improved data collection. Providers have tried to build integrated models in the past, but ultimately found little appetite on the market, Les Levinson, co-chair of the health care transactions practice at legal firm Robinson & Cole LLP told HHCN.

“For somebody who’s been in the space a long time, this trend is very interesting,” Levinson said. “Twenty or so years ago, you had one-stop-shop models that people were trying to promote, pitching to managed care companies. But the market just wasn’t quite in tune enough to make that succeed.”

Additionally, becoming a one-stop-shop also allows businesses to diversify their revenue, an especially important strategy for home health providers facing the Patient-Driven Groupings Model (PDGM), a possible phase-out of Requests for Anticipated Payments (RAPs), the Review Choice Demonstration (RCD) and an onslaught of other regulatory volleys.

PDGM alone, in fact, may come with a more than 8% behavioral adjustment component, placing a severe financial burden on several home health agencies. That paired with a phasing out of RAPs could put more than 30% of existing agencies out of businesses in 2020, sources previously told HHCN.

“In light of all the challenges, revenue diversification is certainly wise,” Levinson said. “Hospice has been strong over the last number of years, whether you look at the valuations or M&A activity in the space. There’s definitely a feeling it has been more protected.”

For the most part, hospice outlook has actually been “rosy.”

“We wanted to bulk up on hospice, which has a very near-term, rosy regulatory future, so we believe this should offset any of the PDGM chop that could occur,” Kusserow told HHCN in October 2018.

Well Care Health’s plans

Broadly, Well Care Health’s revenue mix includes Medicare, Medicaid, private pay and commercial insurance, according to Long. Currently, the vast majority of its business is in the certified home health space.

Although Well Care Health is particularly bullish on hospice, home health will remain an extremely important part of its business plan moving forward, he said. The same holds true for home care, which will always play a major role in Well Care Health’s strategy.

“I’m very bullish on post-acute care, especially home-based care,” Long said. “I think we’re in the early innings of realizing the opportunities that these care settings can play in terms of the larger care ecosystem.”

So far, Well Care Health has had ample success growing its home health operations.

When the company acquired an agency in Raleigh around 2012, it grew the agency’s relatively small patient census to more than 1,700. More recently, when Well Care Health acquired another home health agency in Davie County three years ago, it also grew that agency’s similarly small patient census to over 800.

“We share the optimism for hospice and think it’s an incredible opportunity due to the value of the service for patients and their families — and we continue to see a lot of very attractive tailwinds for that industry,” Long said. “But we still see a number of growth opportunities in front of us in terms of home health and home care.”

On a high level, PDGM will force Well Care Health to boost its back-office efficiency and clinical programs, according to Long.

Innovating ‘across all fronts’

Apart from expanding into hospice and preparing for PDGM, Well Care Health is also focused on maintaining its relationships with partners and exploring all sorts of technological innovation.

As one of the larger independent home-based care organizations in the Carolinas, Well Care Health already has several hospitals and accountable care organization (ACO) partners, Long said, though he declined to name specific partners.

“Our sweet spot is partnering with large health systems across our service area to be an extension of their care teams and what they’re trying to accomplish from a population health standpoint,” he said.

Meanwhile, when it comes to technology initiatives, Well Care Health currently runs a telehealth program by working with Health Recovery Solutions (HRS). HRS recently announced it raised another $10 million in Series B funds, bringing its total funding raised to $16 million since launching.

“We’re pushing the envelope of care innovation,” Long said.

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Executives shared that view and other winning sales and marketing strategies April 10 during a panel discussion at Home Health Care News’ Capital + Strategy Forum in Washington, D.C.

“A home health sell is very different than a home care sell and is very different than hospice,” panelist Wanda Coley, president and COO at Wilmington, North Carolina-based Well Care Health, told conference attendees. “[We’ve been] trying to really divide those sales teams so you can speak to the customer at that level.”

Panel moderator John Griscavage, CEO of San Francisco-based PlayMaker Health, agreed.

“In my experience, it’s a very different sale,” he said. “The several-hour conversation, holding the hand of the family member is a very different thing than the more transactional nature of home health.”

As those conversations have grown more sophisticated over time — with a larger focus by clients and referral sources on factors such as readmission rates and quality scores — Well Care has updated its sales teams to match.

“Most recently, we separated our teams,” Coley said. “We did have our sales teams selling the care continuum.”

Well Care provides home care and home health services to patients in eastern North Carolina. It’s also working to roll out hospice offerings.

“What we found was home health really took the majority of the [sales representatives’] time,” Coley said. “They were incentivized more on the home health side, so that’s what they sold. Private duty or home care received less attention, so we separated our marketing teams. In fact, we eliminated marketing on the home care side and rolled it into a branch manager role.”

The move has allowed sales representatives to hone in on selling home health, maximizing referrals. Well Care’s hospice line will also have its own sales team, Coley said.

Panelist Tim Hanold — CEO of Richmond, Virginia-based CareAdvantage, which offers medical and nonmedical services in the mid-Atlantic — also lauded separating service lines. His company has also recently taken a similar approach to marketing, allowing CareAdvantage to customize content for different areas.

“Previously we took a broad brush approach to our digital marketing platform,” he said. “We found that we really needed to outsource it and use a company called Five19 out of Richmond. They have these different tactics that allow us to be more hyper-local across the mid-Atlantic. That’s native video, that’s really unique blog content and things that really speak to our different markets.”

Meanwhile, panelist Lesly Cardec — senior vice president of marketing and public relations at Sunrise, Florida-based Interim Healthcare — says the home care and hospice franchise is also leaning into local marketing.

While maintaining brand consistency is a priority, the company is exploring new ways of allowing local offices to make locations their own.

“It’s a balance game,” Cardec told attendees. “Consumers are local. They want local marketing and local marketing is now becoming hyper-local marketing. … Where the opportunity lies is maybe the industry should look at the franchisor from the marketing perspective a little differently. Maybe the way that they view us is more providing the infrastructure to allow the markets to make it their own and adapt to their market’s needs.”

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