Home Health Providers Near Turning Point in ACO Relationships

Home-based care providers are finally getting the attention they deserve for doing what they do best: safely caring for seniors in their homes while cutting health care costs in the process.  

COVID-19 has elevated home-based care’s impact to the national stage, with skilled nursing facilities (SNFs) and hospitals leaning on providers to care for more medically complex patients. The Centers for Medicare & Medicaid Services (CMS) has also demonstrated its appreciation for in-home care, granting providers long-overdue operational flexibility.

Next, some stakeholders think the coronavirus has the potential to help push accountable care organizations (ACOs) to include more home-based care providers in their programs in the future.

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“Even just the awareness of the capability of home health providers has gone up, and I think that’s tremendous,” Bruce Greenstein, an executive vice president at LHC Group Inc. (Nasdaq: LHCG) who also serves as chief innovation and technology officer, told Home Health Care News. “How can [we] take that recognition and then turn it into year-round, year-after-year programs?”

Generally, ACOs are groups of health care providers that work together to care for patients, with the goal being to improve quality of care while also cutting costs for a population of Medicare beneficiaries. If ACOs achieve that mission, they are financially rewarded. On the flip side, they can likewise face downside risk. 

As of January, there were at least 558 Medicare ACOs in the U.S, government statistics show. Overall, roughly 10% of the U.S. population was covered by an ACO in 2018, according to past Health Affairs research.

Within the ACO landscape, there are several individual programs, including the Medicare Shared Savings Program, one of the biggest value-based payment programs in fee-for-service Medicare. Other individual programs include the Pioneer ACO Model, the Next Generation ACO Model and more. Medicare ACO programs care for about one fifth of all Medicare beneficiaries. 

Because ACOs are exposed to downside risk and get compensated mostly based on value, it’s only natural that home-based care providers would want a piece of the pie. But historically, home-based care providers have been largely shut out of the ACO world, though not for lack of trying.

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Many agencies have struggled to be chosen for ACOs, and those who have been chosen have struggled to be compensated fairly.

There are a few exceptions. For example, New England home health provider VNA Care’s involvement with nonprofit ACO Atrius Health has helped generate millions in savings. Massachusetts-based home health provider Nizhoni Health has similarly had success working with ACO partners.

Then there’s LHC Group.

The Lafayette, Louisiana-based home health, personal care and hospice provider is unique in that it has not only succeeded in participating in ACO relationships, but it owns an ACO-management company of its own. Imperium Health Management, one of the country’s largest ACO-management companies, came as part of LHC Group’s 2018 Almost Family acquisition.

“While we may be one of the few or the only large in-home, post-acute care providers that also owns large ACO assets, I kind of view [us] in home health as being a major and strategic part of the whole ACO world,” Greenstein said.

Since acquiring Imperium, LHC Group has taught the management company about the cost benefits of sending patients to home health rather than skilled nursing facilities or other institutional settings.

COVID-19 could be just the push the ACO world as a while needed to make a similar revelation, Greenstein said.

Health care consultants from Avalere Health seem to agree. They discussed the impact COVID-19 would have on alternative payment models during a recent webinar, sharing their insights on what could come on the policy side.

“I think you can have a model or a carveout within a particular model that can focus on … any type of patient that might have a viral infection or patients that might be at risk if they go into a facility,” John Feore, associate principal in Avalere’s Center for Health Care Transformation, said. “You can create the incentives to have more care at home. … Now, there will probably be an appetite to pursue this.”

Meanwhile, thanks to COVID-19, ACOs are already in that pursuit, with home-based care and telemonitoring now top of mind, according to the National Association of ACOs (NAACOS). The Washington, D.C.-based advocacy group says ACOs across the nation “quickly pivoted” to deploy telehealth and keep beneficiaries safe at home amid the coronavirus.

“ACOs across America are identifying vulnerable patients at high-risk for COVID-19 using their population management tools, educating patients about minimizing exposure, making sure they have enough food and medication to stay home, remotely monitoring their underlying conditions, treating cases through telemedicine and managing post-discharge complications with integrated home health and effective relationships with post-acute providers,” NAACOS wrote in a May press release.

While COVID-19 was the catalyst for the change, home health stakeholders like Greenstein hope the residual effects will be lasting, giving home-based care providers their long overdue place in the sun — or rather, in ACO relationships.

“The days of just having one day a year to think about post-acute care and lock in those contracts … are finally over,” Greenstein said. “Now, we’re in the managing-total-cost-of-care [days]. And it’s important to think about who you choose as partners, who you use in a network and make sure they are efficient.”

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