Elara Caring Targets Physicians as Home Health Providers Rethink Referrals

In the build-up to 2020 and the Patient-Driven Groupings Model (PDGM), many home health providers began shifting their referral strategies to focus more on hospitals, skilled nursing facilities (SNFs) and other institutional sources.

Generally, providers realized that patients coming from such settings likely meant more Medicare dollars under PDGM, especially when patients were also classified as “early” in terms of timing. While that’s still true, the COVID-19 emergency has seriously disrupted home health admissions patterns, forcing many providers to rethink community-based referrals.

Now, some operators — including Elara Caring — see non-institutional referrals and relationships with community-based physicians as a core part of their future plans.

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The decision to double down on referrals from physicians in the community originally stemmed from access challenges during the early days of the public health emergency, Elara Caring CEO Scott Powers told Home Health Care News.

About 80% of Elara Caring’s patients historically have come from institutional settings. But with hospitals suspending elective surgeries and some SNFs restricting visits from outside staff, the Addison, Texas-based company knew it had to make a change.

“It’s been a wild year, obviously,” said Powers, who came to Elara Caring after leading the rapidly growing Medicare Advantage organization Alignment Healthcare. “We’ve done a pretty good job trying to recruit more physicians for referral sources, just given some of their access challenges. We’ve been actively thinking about physicians and how we partner with them beyond just the usual skilled nursing and hospital systems.”

Formed in 2018 after Great Lakes Caring, National Home Health Care and Jordan Health Services merged, Elara Caring currently has more than 225 offices across 16 states. Its more than 35,000 employees care for about 60,000 patients daily.

Since the public health emergency started, Elara Caring has increased its referrals coming from community sources by about 10%.

That means roughly one-third of its referral base now comes from the community.

“If I have it my way — and we continue to do things the way we’re doing them — that will be 50% or more a year from now,” Powers said.

Unexpected upside

The early part of this year played out as expected when it comes to referral patterns, data from Strategic Healthcare Programs (SHP) shared during last month’s Financial Management Conference shows. The virtual conference was hosted by the National Association for Home Care & Hospice (NAHC).

In January, 47.8% of home health referrals came from institutional sources. Similarly, over 32% of home health referrals came from institutional sources in February.

But then those figures took a nosedive.

In March, 30.8% of home health referrals came from institutional sources, according to SHP data. That then fell to just 23.2% in April, when the U.S. health care system felt the full impact of the coronavirus.

“In the early days of PDGM, and in January and February, what we saw was basically what we expected,” Nick Seabrook, principal and founder of BlackTree Healthcare Consulting, said while discussing the SHP figures during a presentation at the Financial Management Conference. “We expected to see a lot of those early-institutional patients.”

For the most part, the decline in institutional numbers was unplanned — and it will likely prove short lived.

In fact, referral patterns are already starting to stabilize, with most providers seeing their home health census recovering to pre-coronavirus levels as well.

“We saw dips early on in COVID,” Powers said. “At least from a skilled home health perspective, our census has rebounded above pre-COVID levels. It’s been there for the last three or four weeks.”

But there’s unexpected upside to community referrals, too, even for those that fall under the “late” timing category.

While “early-institutional” cases have higher reimbursement rates associated with them, it typically requires more time and resources to care for those patients.

Meanwhile, “late-community” cases often have a lower resource use, meaning margins are actually higher.

“When you look at early-institutional periods, they’re going to give you the highest cash flow, but we also have the highest resource use for those,” Dave Saling, consulting manager at BlackTree, said at the Financial Management Conference. “What we’re seeing with late and community is a significant decrease in resource use and actually higher margins with some of those [cases].”

That means late-community cases may be more beneficial to agencies’ bottom lines in the long term, Saling noted.

Telehealth leverage

On its end, Elara Caring is working to beef up its community-based referral strategy by becoming a “partner of choice” for physicians.

That means making physicians’ lives as easy as possible by providing high-quality care across the entire post-acute continuum.

In addition to its home health business, Elara Caring also maintains large hospice and personal care services (PCS) lines. It additionally has a growing behavioral health business.

“In the year ahead, we not only expect to grow by adding more physicians, but we expect to grow by being the easiest to do business with in the markets in which we operate,” Powers said. “We’re going to bring all our assets to bear. So if we have a skilled home health relationship in one place, we’re going to bring our PCS business into that and be more forceful, more thoughtful about that.”

During the public health emergency, Elara Caring has also made major inroads with physicians by leveraging its telehealth capabilities, which are powered by Health Recovery Solutions (HRS).

“We’re using our telehealth platform as a partnership tool with physicians, primarily those who don’t have telehealth platforms themselves,” Powers said. “There are still many specialists, primary care doctors and geriatricians out there who need access to their patients, but haven’t been able to see them.”

Apart from its referral strategy, Elara Caring has its sights set on continued growth.

Its behavioral health business, in particular, is “growing like a weed,” according to Powers.

“In the back end of the year, as our strategies come together and our integrations come together, you’re going to see us on an even faster growth trajectory,” he said. “Now that we’ve got things plugged together … and the right team in place, I think you’re going to see a really strong year for us.”

Elara Caring’s most recent leadership hires include Chief Medical Officer Dr. Joe Jasser and CFO Bruce Jarvie.

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