NAHC’s Dombi: Many Medicare Advantage Insurers Do Not Value In-Home Care

Most Medicare Advantage insurers do not yet appreciate the value of home-based care, according to Bill Dombi, president of the National Association of Home Care & Hospice (NAHC).

“I didn’t enroll in a Medicare Advantage plan, because I don’t think they believe in home care yet,” Dombi said in opening remarks at NAHC’s annual conference in Dallas on Sunday, earning applause from the crowd of attendees.

There are some exceptions, Dombi emphasized to Home Health Care News in a follow-up interview after his speech.


For example, major MA insurers Humana (NYSE: HUM) and Anthem (NYSE: ANTM) are demonstrating that they appreciate how home-based care could help lower costs and improve patient satisfaction and outcomes. But many other Medicare Advantage companies have a narrower outlook, and home health and private duty providers should be realistic — and cautious — as they evaluate and move to capture potential opportunities.

Here are highlights of Dombi’s remarks to HHCN regarding Medicare Advantage, edited for length and clarity:

Insurers not focused on value:


What’s conveyed to us by our members and in our own conversations with the plans is that unit cost matters more to them than value … they’re not at a mindset where they see what I label “dynamic value.” The value of a home health agency that reduces re-hospitalization rates, for instance.

Part of that is their structure. What’s been conveyed to us is that home health is 2% of their budget. So, make it an easy thing for them. Go sign up some people, make it a part of the network, give them the best prices you can, and move on … They don’t want to see an increased home health spend, even if that translates to a decreased spend in another sector. So, they’re very siloed in their own business analyses.

I don’t say that across the board, I hope plans recognize that. But when you see that 2% of their spend is in home health, that’s a starting point, because they’re spending 98% probably in much higher-cost settings.

On the acquisition of Kindred at Home by Humana:

We’re hoping that the Humana acquisition of Kindred ends up sending a message to the rest of the managed care industry that they might want to look again at whether a partnership with home care could be a good pay-off. Sometimes, buying the cheapest visit isn’t going to get you the best return.

On Medicare Advantage home health payment rates:

Too many of the plans pay less than cost. We’re concerned that going forward, with pressure on Medicare rates, [agencies] will no longer be able to subsidize those plans. As the proportion of patients grows on the MA side, the ability to subsidize is diminished.

So, the plans don’t yet have a willingness to accept value. You can talk to some of the large companies walking in with all kinds of data, they talk about value-based [arrangements], dynamic value, they talk in terms of readmission rates, and those conversations more often than not end up with, that’s all well and good, but how much are you going to discount your services? They just don’t see that there’s value beyond that visit itself. Beyond taking care of that momentary need. While they talk about population health, are they really doing population health?

On CMS allowing Medicare Advantage plans to start offering non-skilled, in-home care:

From what we have seen, interest has been growing in learning more, but most of the plans were already set for 2019 when CMS announced this. Anthem being one of the exceptions.

When I first contacted AHIP, America’s Health Insurance Plans, and said, I’d like to talk to you about this new opportunity, their awareness of it was limited … that’s no longer the case. They are now thinking about it. Their members are thinking about it. The Anthems of the world are coming forward, and they’re looking at Anthem and they’re looking at Humana, and maybe they’re going to let someone else take the first journey down that road, but it’s now something that’s on their radar.

I still have a cautious approach to it. I was just with a group of private-pay personal care services companies, and you can ask the rhetorical question: Would you rather sell your service for $25 an hour to a private-pay patient or $15 an hour to a managed care plan? That’s the situation that I think the industry will be facing.

We’re hoping that the industry that offers this kind of [personal care] service does not think that if they get their foot in the door, they can raise the price to what they think is a market price. We saw that happen in home health more than once, and instead, what happens is, the plan says, “If you’re not going to take our price, we’ll find someone who will.”

If I were running a private-pay company, I would be suggesting that if they pay $25 an hour, they’re going to get a highly skilled personal care workforce that can be used for more than just personal care — can be used as the eyes and ears to know when there’s something wrong starting to develop, and can be a manager, making sure [patients] see their doctor, take their medications, have food that’s fresh rather than moldy in the refrigerator. So the plan can avoid a $50,000 hospitalization by paying a few more bucks on the personal care side. I’m not sure the plans are ready to have that conversation.

Written by Tim Mullaney

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