Despite wage competition from retailers and immigration policies that could potentially dry up the labor pool, Bayada Home Health Care leaders are optimistic about 2019 and feeling good about the Moorestown, New Jersey-based company’s transition to a not-for-profit model.
Bayada — one of the largest home health providers in the country, especially when it comes to pediatric care — officially filed for nonprofit status at the end of December. It expects to complete the massive undertaking by mid-year, Chief Government Affairs Officer David Totaro told Home Health Care News.
Also on Bayada’s radar: working to reshape the Patient-Driven Groupings Model (PDGM) by leveraging the congressional support the company has built on both sides of the political aisle.
HHCN checked in with Totaro to discuss Bayada’s 2019 outlook and its upcoming plans for shaping policy on Capitol Hill. Highlights from that conversation are below, edited for length and clarity.
HHCN: I always like to take a glance back before we look ahead into 2019 and beyond. I think it’s fair to say that 2018 revolved heavily around Bayada’s transition to a nonprofit model, a point punctuated by founder Mark Baiada’s surprise $20 million gift to employees in November. What stands out about 2018 in your mind?
Totaro: From a highlight standpoint, there certainly was that announcement and the beginning of the transition to a not-for-profit status for us, which is something that Mark and the leadership team here at Bayada have planned for almost a decade.
It was longer and maybe a little bit more difficult than what we had originally thought. No one had ever done this before. Every time we spoke to anybody — whether at the Centers for Medicare & Medicaid Services (CMS) or at the state level — we were met with enthusiasm and surprise. But no one really had a clear idea of what needed to be done, so it took a long time.
We successfully filed [for nonprofit status] at the end of December. We’re in that status now waiting for final determination, which we believe will take maybe six or seven months.
What else stands out as a highlight? I’m not sure this is a highlight, but there’s PDGM, of course, which I’m sure Bayada has started to prepare for.
I would classify PDGM as maybe not a highlight, but rather a lowlight. It hit us by surprise because the industry had gone through a great deal of effort to comment on the Home Health Groupings Model (HHGM) a year before. When we looked at the results of the new model, it was virtually the same except for CMS changing the name a little bit.
From a highlight standpoint, though, it crystalized how important it was for our industry — the home health care industry — to come together as one larger, unified voice. We’re a very segmented industry. We’re represented by associations and alliances that align behind specific settings, whether Medicare, Medicaid, home health or hospice.
We have really begun to understand the importance of creating a movement. We’re working actively together to address big issues. That’s something we’ll work on even more in 2019.
What were the top issues the industry worked together the most on to address? I’m guessing that has to be the behavioral adjustment aspect.
It is. The behavioral assumptions is just something we just don’t understand — how CMS could utilize something like this for home health care when they haven’t applied that to almost any other setting.
We’re working with the Partnership for Quality Home Healthcare to get this adjusted.
There were several points you identified as interesting topics for conversation during this interview. One of those was the Texas Obamacare ruling and what that might mean for the future of home health care. Why is that important to touch on — and how does it tie into home health care?
I believe at the time the ruling came out, there was some concern about its impact on the future of the Affordable Care Act (ACA).
I think every day the Supreme Court comes out with a different ruling, we are surprised with how they lean and what certain justices say. Recently, Justice John Roberts was the deciding vote of an Alabama case, striking down an attempt to limit access to abortion rights. I think that says we’ve got a Supreme Court now where we really can’t determine up front how it’s going to rule on a given issue.
The other thing that has happened since the Texas ruling was the November elections. We now have a very strong majority of democrats in the House, who are traditionally much more positive about health care and home care, supportive of ACA. At the end of 2018, the Texas ruling was a concern of ours. I believe it has been replaced [priority wise] by some other things — even on the state level — attracting our attention.
That includes the rolling appetite for increasing the minimum wage.
Speaking of democrats, a pillar issue for the party right now is “Medicare for All.” I think it’s interesting we don’t hear more about that and potential ramifications in home health and personal care services.
I think you’re absolutely correct. Similarly, when we started the Partnership for Medicaid Home-Based Care in Washington, D.C., in 2014 … we were not surprised, but disappointed that there were so many members of Congress and their staff who had no knowledge of what Medicaid is or who the beneficiaries are.
It’s not surprising to me that there’s little awareness about what Medicare for All means. Having said that, we are making a lot of progress in educating both democrats and republicans on the benefits of Medicare, Medicaid and, particularly, home care when it comes to saving money. Home-based care is a more cost-effective and efficient approach to health care.
Congressman Frank Pallone — a House democrat from New Jersey who’s now chair of the Energy and Commerce Committee — is someone who is stepping up to become a strong advocate for home care. Sen. Debbie Stabenow (D-Mich.) has been an advocate for a long time, as has Sen. Susan Collins (R-Maine). Rep. Vern Buchanan (R-Fla.) is another. This is the only time in close to a decade that we can provide a lengthy list of folks on both sides of the aisle who we could turn to, members of Congress who appreciate the benefits of a strong home care environment.
Home health care and home care are things nobody ever has a bad word about.
Let’s focus on 2019 and the year ahead now. What will Bayada’s priorities be in 2019 on the regulatory front?
Unfortunately, some of the priorities are carryovers from 2018. We’re going to try to get the PDGM issues resolved. While it doesn’t go into effect until 2020, we know we have probably less than four or five more months to get the behavioral assumptions at least changed. That’s when CMS will start to issue guidelines and rulings on this.
Minimum wage is also on our radar. States are rapidly passing minimum wage laws, but without addressing the need — or budgeting for — the gap that will occur between current reimbursement rates and rates that need to be in place.
And further pressuring home health care companies is wage pressure from Amazon and other retailers.
All the retailers are. Right. Some health care systems are raising pay rates too. Here in New Jersey, that includes Virtua and other larger systems.
The minimum wage hasn’t been increased in many of our states for a very long time. But many of our Medicaid rates haven’t been increased for maybe 10, 20 years. One of the reasons is because Medicaid beneficiaries aren’t as well-known as those under Medicare — older adults. People think Medicaid only means low income.
One-third of all Medicaid beneficiaries today are actually children. That’s probably that largest segment of who benefits from Medicaid. It’s an informational, educational issue and something the Partnership for Medicaid Home-Based Care is trying to shed some light on.
We’ve reported on how there’s a dire need for pediatric home health services. What’s Bayada doing in its own operations?
Our pediatric practice represents almost 35% of the entire Bayada business. Years ago, many of the children who we care for today would have never come home from a hospital and would have maybe ended up in an institution somewhere.
Apart from PDGM, minimum wage and some of the other items we’ve brought up during this conversation, what else are you focused on in 2019 in your role at Bayada?
Immigration. Immigration laws that are certainly going to be discussed in the House and Senate. A curtailed immigration policy is going to affect the supply of our home care nurses and aides throughout the country.
CMS has made multiple moves over the past several months to broaden Medicare Advantage (MA) and give plans more flexibility in the supplemental benefits they can offer. What’s your take on that?
I think that’s an example of the opportunities that exist for us if we can boldly and aggressively pursue them. I’m more optimistic about 2019 than I was entering 2018.