Why Shifting Health Policies Favor Home Care
As the health care market continues to evolve, it behooves acute and post-acute care providers to evaluate strategies that align with new federal regulations, particularly those related to what’s known as population health. And this is making for a bright future for home care, industry leaders say.
Currently, 12 million people receive community-based care from home health services and hospice providers to help with post-acute and chronic conditions, disabilities, or terminal illnesses, according to a new report by Chicago, Ill.-based investment banking firm Cain Brothers.
“As more and more older people prefer to age in place and elect to live independent, non-institutionalized lives, they are choosing to receive home care services as their physical capabilities diminish,” Cain Brothers said. “Since chronically ill individuals account for about 75% of all hospitalizations, medical and technological advances will create growth opportunities for home health providers. Coupled with its relative low cost compared to other [post-acute care] PAC options, home health will see an influx of new patients in the coming years.”
The Centers for Medicare & Medicaid Services (CMS) has made clear that population health is one of its many quality initiatives as part of its overall goal to reduce health care costs. While there is some debate as to what population health management means, one top leader has her own definition and ideas about why it’s a positive for home-based care.
“Population health management [PHM] is basically the oversight involved when working with physicians, nurses, pharmacists and family members engaged in care,” said Molly Forest, CEO & president of nonprofit Los Angeles Jewish Home, regarding what PHM means in the senior care market. Forest spoke during Cain Brothers’ Population Health Management & Senior Care Market House Call on Thursday.
“Payment systems previously rewarded more acute settings for care,” Forest said. “When we see seniors today, the home is the focus. We’re seeing increased life spans and complexity of care. Sixteen percent of Baby Boomers do not have children, and that impacts the whole continuum of care. We are frequently dealing with more and more people who need care the most but have the least caregiving structure available to them.”
Los Angeles Jewish Home serves more than 4,300 senior annually through community-based, in-home, and residential services, according to the organization’s website.
“PAC providers will need to address how and where senior care is being delivered, who makes decisions on a care plan and how they are made, who bears risk in a care coordination network and the role of technology and big data in assessing outcomes,” said Cain Brothers in the report.
It’s no secret that CMS is calling the shots, and it’s up to providers to have the foresight to get ahead of impending regulations before it is too late.
“The federal government is moving with a sense of urgency to implement population health management,” said Wayne Sensor, CEO of Ensocare, a Omaha, Neb.-based company that improves discharge efficiency and care coordination, and helps reduce avoidable readmissions and operational costs. Sensor referenced Medicare’s recently proposed model that would give hospitals more financial incentives to work with PACs for patients who undergo hip and knee replacements.
Prior to President Obama’s election, some large health organizations balked at preparing for the regulatory changes that are now underway, Forest said.
“Years ago we could not get some of the major hospitals to talk to us about readmission rates because they did not believe Obama would be elected,” Forest said. “So, we started an internal study since no managed care [organization] would take us to find out why we were sending people to the hospital and how we could bring that number down.”
Today, many hospitals and health systems own or are in partnerships with home health care agencies, according to the Cain Brothers report.
“Partnering with a quality, stable provider is key to achieving consistent outcomes and ultimately, cost savings,” Cain Brothers said.
Written by Cassandra Dowell