‘Let’s Find Solutions That Work’: Care Advantage, Anthem Pioneer Pay-for-Performance Agreement for LTSS

In the post-acute care world, value-based contracting can be fairly straightforward. Sick patients are discharged from the hospital, home health agencies are brought in to help them recover, and then they’re paid appropriately based on how well those people recover.

But value-based care is frequently much more complicated and murkier in long-term care, particularly when personal care services in the home are involved.

Instead of linking payment to a clear “return to normal,” in-home care agencies caring for the long-term services and supports (LTSS) population need to be compensated on more preventative and qualitative measures. Value isn’t always about improvement, but rather keeping a person healthy and happy at home in the first place.


“Value-based payments, risk sharing, alternative payment models, whatever verbiage you use, it’s really difficult to do in the LTSS world,” Jamie Swann, director of LTSS services for the Virginia Anthem HealthKeepers plan, told Home Health Care News. “Because especially around personal care, what are you looking at? What do you measure that is fair to the provider?”

True value-based care is still relatively rare in the home health space. But for these and other reasons, it’s almost nonexistent when it comes to personal care services.

Swann is working to change that with Anthem’s Medicaid LTSS members in Virginia. She’s doing so with the help of Care Advantage, one of the largest in-home care companies in the Mid-Atlantic region.


“We said, ‘Let’s go get Care Advantage,’ because we know they do great work,” Swann said.

Headquartered in Richmond, Virginia, Care Advantage considers itself a “house of brands” that operates under a number of different names based on deep-rooted community ties. As of March, the private equity-backed company had nearly 40 locations across Virginia, Maryland, Delaware and Washington, D.C.

In 2020, Care Advantage cared for about 12,000 patients. Its diversified in-home care offerings range from personal care and companionship services, to skilled nursing, rehab services and more.

Care Advantage and Anthem had been working together in Virginia for years, Tim Hanold told HHCN. In 2020, though, the two kicked off an innovative pay-for-performance pilot program aimed at caring for Anthem’s LTSS members.

“What has, I’d say, accelerated or changed in our collaboration is that we’re very intentionally collaborating at this point,” Hanold said. “In the world of payers and providers, you really have to go into it with a collaborative spirit.”

Under the pay-for-performance agreement, Care Advantage is able to assume a certain amount of upside risk determined by multiple performance measures. Examples of those measures include LTSS members’ in-patient utilization and ER usage, plus caregiver training, caregiver consistency and member satisfaction.

The in-home care provider isn’t exposed to downside risk at this point, but Hanold hopes that changes moving forward.

“It’s one gradual step,” he said. “Then eventually, it’s about true value-based care, in which we want to share in risk and have skin in the game in regard to outcomes and members’ well-being.”

‘Let’s find solutions that work’

Wheels for the pay-for-performance initiative were put in motion before the COVID-19 pandemic, Swann said. That ended up being fortunate timing, allowing the two organizations to work out any kinks before a possible expansion down the road.

On Anthem’s end, the public health emergency forced Swann and her team to pivot toward a virtual-first strategy. Typically, the health plan sends nurses and social workers into the home to check on members about twice per year.

“That had to come to a halt,” Swann said. “In fact, we are still not seeing members face to face. We are seeing them virtually, though, as often as we can.”

Securing personal protective equipment (PPE) for her team and the smaller providers they work with was also a challenge last year, Swann added.

Meanwhile, for Care Advantage, the pandemic disrupted what had previously been an aggressive growth push. Prior to last year, Care Advantage had executed a dozen acquisitions over a 24-month period.

“We really had a pause on acquisitions like most home care and health health companies, but since then we’ve ramped up significantly as we’ve moved through 2021,” said Hanold, who took over as Care Advantage’s CEO in January 2018. “So we’ll be quite acquisitive this year.”

Although Care Advantage tabled its M&A efforts, it did manage to grow organically in 2020 — by about 14% — after a slow start to the year.

“April was an incredibly difficult month for the company,” Hanold said. “We were down 15% in our revenues and overall volumes, which was totally understandable due to all the fear, anxiety and apprehension around COVID. But we ended up getting our arms around the best ways to mitigate risk around it, and we ended up having strong growth, with obviously most of that toward the back half of the year.”

So far, the pay-for-performance agreement has led to overwhelmingly positive early observations. By working closely with Care Advantage, Anthem has been able to identify potential issues with members sooner, which then allows the health plan to jump into action.

In one recent case, for instance, a Care Advantage nurse discovered an Anthem LTSS member with multiple chronic conditions had bed bugs and a phone that didn’t make outbound calls. The nurse was able to relay that information to Swann’s team, which then shipped out a new bed, called for an exterminator and resolved the phone issue.

“The members we work with are often most at risk,” she said. “They have multiple chronic comorbidities. They usually have limited financial resources, oftentimes they have limited social resources.”

Apart from upside, Care Advantage has also benefited from a general open and constant exchanging of information, Hanold explained. Anthem gets a better look at what’s going on in the home and more “touches” with its members, while Care Advantage gets access to claims-based algorithms that help it customize a care plan.

For a company like Care Advantage that’s confident in its ability to save health plans money by preventing costly trips to the hospital or ER, value-based care is a way to expand beyond extremely tight Medicaid margins.

Providing that pathway should be a priority for health plans, as they need high-quality providers to stick around.

“I recognize that the margins, particularly around Medicaid LTSS are — razor thin might even be a little too much,” Swann said. “I want to make sure that great companies are around to take care of these fragile members.”

Care Advantage and Anthem HealthKeepers have been brainstorming about a next iteration of the pay-for-performance relationship, eyeing an expansion sometime this year.

“I hope that our team can put together something even a little more expansive around these alternative payment models,” Swann said. “That would be my hope. Let’s come up with something that nobody’s doing yet. Let’s collaborate and have these honest dialogues. Let’s find solutions that work.”

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