In mid-July, Joe Biden announced as part of his presidential campaign a policy proposal to invest $775 billion to expand access to home-based health care delivery for our nation’s aging population. The announcement is raising the profile of what has long been a covered benefit — but underutilized resource — available to Medicare beneficiaries: skilled nursing and rehabilitation services provided within the home, under the care of a physician.
The home health benefit provided by Medicare (and many other payers) encompasses a wide range of services that can be delivered in a patient’s home, including injections, post-operative and chronic wound care, rehabilitation, physical therapy, intravenous or nutrition therapy, etc. These types of services can be a life-line for vulnerable patients, including the Medicare population that is both at increased risk of developing serious complications from Covid-19, and more likely to suffer from chronic comorbidities — a potentially deadly combination.
Fortunately, the Centers for Medicare and Medicaid Services (CMS) continues to evaluate and provide regulatory waivers designed to increase access to home health services. In part as a result, the industry has also seen a dramatic increase in telehealth platform use in response to Covid-19; according to Forrester Research, telehealth visits are projected to top 1 billion in 2020.
Covid-19 has clearly proven itself as a health care innovation catalyst, reinforcing the benefits and growth potential of the home health care industry. And while broader utilization of home health care services continues to face a myriad of challenges — most notably from a cost, coverage and policy perspective — the future is brighter than ever before.
Home health is a preferred site of care among patients and providers during the pandemic
As Covid-19 continues to upend health care delivery as we know it, the preference for home-based care options will continue growing, with consumer sentiment and preferences continuing to shift towards greater acceptance. According to a recent Kaufman Hall survey, 54% of consumers cited fear of contracting Covid-19 as a primary reason to delay care, with 43% citing a fear of going to the hospital as the reason. Looking at Medicare enrollees specifically, 35% attributed any delays in care with wanting to avoid the hospital setting altogether.
"People in nursing homes have been hit especially hard by the coronavirus, shining a bright light on the fact that many would prefer to be in a home or community-based setting," the Biden campaign said in a statement accompanying the newly announced proposal.
But it’s not just patients who want to stay at home. Increasingly, providers and hospitals are changing their preferences as well; according to a recent William Blair survey, 81% of physicians responsible for discharge planning now prefer to refer their patients to a home health agency versus a skilled nursing facility, a figure that is up from 54% before the pandemic.
Increased home-based referral requests are something that Bud Langham, chief strategy and innovation officer at Encompass Health — one of the largest home health providers in the U.S. — has witnessed in the recent months. “We’ve definitely seen an increase in referrals directly from physicians,” Langham said, adding that the company has also seen an increase in referrals for patients with more acute, complex conditions.
At AccentCare, a leading provider of post-acute health care services, CEO Steve Rodgers likened the company to becoming “the arms and legs of getting physician practices back into the home” amidst Covid-19, noting that the company has also seen more physician groups reaching out directly in recent months.
“Home health agencies have probably not gotten the credit they deserve,” said Todd Montigney, founding partner of BlackTree Healthcare Consulting. “With Covid-19, we’re seeing patients who don’t want to go to hospitals or skilled nursing facilities. They want to be cared for in the home if that’s possible.”
Making it possible can be tricky.
“A huge challenge for home health agencies receiving a new patient referral is just answering the question, ‘How much care does this patient actually need?’,” said Elliott Wood, CEO of Medalogix, a technology company that provides predictive analytics to help home health agencies optimize physician staffing. “The answer may be three visits or forty visits needed over a sixty day episode. That’s a big difference,” he said, highlighting the critical role that data and analytics play in helping to solve that puzzle.
Home health is compelling from a cost perspective
Beyond shifting preferences and increasing opportunity, the cost benefit of home health alone is compelling. CMS estimates that home health care in Medicare saves at least $378 million a year through reduced hospitalizations, based on the nine states participating in the Home Health Value Based Purchasing (HHVBP). Value-based care arrangements link quality, outcomes, safety and other measures directly to reimbursements.
From the hospital perspective, researchers at the Cleveland Clinic determined that the use of home health services following inpatient care “decreased the hazard of follow-up hospital readmission and death,” saving Medicare nearly $6,500 per patient over the course of a year.
And in his recent speech on economic recovery from Covid-19, Biden cited The Johns Hopkins School of Nursing’s CAPABLE Program as an innovative way to reduce costs associated with hospitalizations and improve home- and community-based care. With an upfront $3,000 investment, the CAPABLE program will return more than $20,000 in medical cost savings by helping older adults stay out of nursing homes and remain in their homes longer.
Home health networks are seeing the savings for both providers and CMS. “It's about $50 a day to have home health care over a 60 day period on average. $50 a day is pretty compelling from a cost standpoint. Every hospitalization that Encompass Health mitigates is at least $10,000 saved,” said Langham. Rodgers from AccentCare agrees, noting that “most patients want to be in the home, which is good for the system because it's actually a lower cost way of doing business.
With the cost benefit becoming clearer, Montigney is bullish that home health will finally have a proverbial seat at the table. “Spend is so much higher at hospitals that there tends to be more focus there. But with Accountable Care Organizations (ACOs) over the past few years, we’re starting to see attention due to the cost savings of providing care at home.”
Home health care embracing technology and innovation
There is no shortage of technology solutions designed to help improve provider and patient care coordination, with more and more providers and home health organizations taking advantage. “Investment in technology for the home is really accelerating across the spectrum,” said Greg Chittim, who co-leads Health Advances' Health IT and Digital Health practice. “It’s cardiac, it’s diabetes, it’s respiratory, home dialysis, and even things like wound care and ostomies.”
Langham noted that at Encompass Health, the organization is “constantly assessing and growing our capabilities in the telemedicine space, specifically with tele-nursing and tele-rehab,” focusing on building out the necessary processes, procedures and policies thoughtfully and carefully. When it comes to remote patient monitoring, Langham has a strong bias towards technology that is simple that both patients and staff can easily understand and use.
“What we're looking for is something that includes a passive biometric data collection device, at a reasonable price and with a long battery life,” said Langham, adding that the company is also using predictive analytics through its work with Metalogix to better understand patients’ needs upon admission.
On Medalogix’s approach to tech implementation in the home care setting, “The intent is never to come in and have technology replace a clinician’s decision or judgment,” said Elliott. “It is to come in and inform and support that decision with data to ensure that every patient gets what he or she needs.”
And there’s plenty of data to mine. “For the last twenty years, CMS has required that these post-acute providers collect a standardized data set for every patient that comes in their door. It creates an incredibly rich set of data,” said Wood, which Medalogix leverages to help predict outcomes, including those patients who are at higher risk of hospital readmissions, those who may require more care touch points, and those who may benefit from hospice.
Rodgers notes that AccentCare also sees an incredible opportunity for technology and virtual care in particular to improve patient care, while reducing Covid-19 exposure for both caregivers and patients. The company has even seen improved clinician satisfaction, Rogers said, adding that this was in part because, “Our clinicians aren't running all over the place. They actually can see more patients more efficiently and effectively.”
There is a flip side to every coin, however, and for telehealth, it’s the lack of a meaningful reimbursement structure for telehealth services. While CMS continues to move the needle in the right direction with its temporary waivers lifting telehealth restrictions, without permanency or a reimbursement component, the lingering question becomes whether or not telehealth will continue to see the levels of utilization and adoption that we’ve seen since the Covid-19 pandemic began.
Policy mandates: Make way for virtual care longer-term?
In response to Covid-19, on March 13, 2020, under the Stafford Act and the National Emergencies Act, CMS was granted the authority to temporarily lift existing Medicare program restrictions, allowing providers to offer beneficiaries a wider range of telehealth services.
Under the temporary waivers, home health providers can use virtual care platforms to deliver care in any location, including the patient’s home, so long as the services are part of the patient’s care plan and do not replace any mandated in-person visits. The waivers also enable physicians to qualify patients for the Medicare Home Health Benefit, if the patient is unable to go into the care setting because of a “medical contraindication or due to suspected or confirmed Covid-19.”
“Unfortunately, we can’t bill for telehealth services,” said Langhan. “We can’t bill for remote monitoring. There’s no reimbursement for it, which has resulted in a stagnation in the expansion of these programs.”
Even so, Medicare has seen a steep increase in telehealth use since the pandemic began. Prior to the emergency declaration in March, about 13,000 Medicare beneficiaries accessed telemedicine services during a typical week. That number jumped to more than 9 million beneficiaries having received a telehealth service between mid-March and mid-June.
While Medicare may not reimburse for telehealth services, opportunity knocks through Medicare Advantage (MA) plans. Since writing personal letters to CEOs of some of the largest health plans, Rodgers says that he has Medicare Advantage plans coming to the table and paying for virtual visits.
“If Medicare could work with us on a way to create more chronic care pilots using home-based services, I think that that would be another very valuable thing that we could all be working on together,” said Rodgers.
Langham agrees. “If we had a mechanism to be appropriately reimbursed or to allow tele-visits to count the same as in person visits on the claim, that would substantially improve our ability to better care for patients.”
Home health agencies have been grappling with other policy changes as well, including the Review Choice Demonstration (RCD) project. Announced in May 2019, the RCD is meant to thwart Medicare billing fraud and abuse on behalf of home health providers, which cost CMS at least $3.2 billion in 2018, according to the Government Accountability Office (GAO).
Though CMS suspended the RCD in late March due to Covid-19, the agency is planning to move forward with the demonstration “regardless of the status of the public health emergency” beginning in August for all included states: Illinois, Ohio, Texas, North Carolina and Florida.
The industry’s overwhelming feedback to the RCD has been that it amounts to a lot of paperwork and an undue burden that couldn’t have come at a worse time.
William A. Dombi, president of the National Association for Home Care & Hospice (NAHC), called the resumption of RCD “misguided at this point in time”, according to Home Health Care News. “The restart of the RCD program fails to take into account that we are at the height of the pandemic with no early end in sight,” Dombi said to HHCN. “Clinical staff need to be providing clinical services, not shuffling paperwork for a demonstration project.”
Home health agencies are also faced with adapting to the Patient-Driven Groupings Model (PDGM), which represents the biggest shift in home care reimbursement frameworks in the last two decades. Per CMS, “The PDGM relies more heavily on clinical characteristics, and other patient information to place home health periods of care into meaningful payment categories,” including diagnosis coding, OASIS data, and additional patient data.
In addition to fundamentally changing how home health care is reimbursed, the PDGM requires that post-acute care facilities embrace the shift to value-based care — prioritizing care quality and outcomes — and increasingly adopt the necessary technologies to help make this shift possible, including electronic health records (EHRs).
Wood is seeing the industry embrace digital tools for this very reason. “There's a lot of tech coming into this space, and I think it provides a huge opportunity for home health to continue to emerge as the destination of choice.”
Home health’s Covid-19-driven momentum
Covid-19 has only underscored the benefits of home-based health care delivery and the critical role the segment will play in the future. From changing payment models and new policy levers, to increased use and adoption of technology in the space, the momentum over the past few months is promising.
For example, the Mayo Clinic recently launched its advanced care hospital-at-home model, with plans to scale nationally. As Modern Healthcare reports, “The initiative aims to deliver more affordable and efficient high-acuity care to patients typically bound to the hospital for infusions, skilled nursing, lab and imaging work, and behavioral counseling, among other services.”
Mayo Clinic Platform president and emergency medicine physician, Dr. John Halamka, also noted that the initiative will help ensure there is space within the hospital setting to treat those with Covid-19 and other more intensive conditions.
"During Covid-19, we've learned that patients expect more virtual and remote care than ever. The Mayo Clinic Platform, in collaboration with Medically Home, has assembled the technology and expertise to deliver high quality, acute care in non-traditional settings like the home,” said Halamka.
The increased utilization and adoption of virtual technologies in recent months has also had a meaningful impact on patient/provider communication, said Chittim. “One of the silver linings of Covid-19 is the level of investment that we are seeing in virtual care technologies. And beyond the technologies, providers and patients are building that comfort with traditional real time communication. I think we have moved 10 years ahead in 10 months.”
The future of home health care
While the future is bright for the home health industry, it is certainly not without challenges, including unexpected home health agency consolidation and new funding requirements to support the influx of required technology. Experts also expect “drastic overhauls to the Medicare Home Health Benefit, a revival of SNF-to-home diversion and more,” according to Home Health Care News.
Consolidation concerns, changing policy frameworks, funding requirements and technology investments are just some of the obstacles that the home health care segment faces in both the short and long term. But as the industry learns to operate amidst the new normal of a Covid-19 environment, there has never been greater demand for home-based care options or recognition of the power and benefits of care delivered in the home, whether in person or virtually.
If there was any doubt before, home-based care and community services now most definitely have a seat at healthcare’s table. Only time will tell what the next few months and years will hold, but home health care’s future is definitely brighter than ever before.