Humana Inc. (NYSE: HUM) is hoping to disrupt the traditional home health model by combining a nationally scaled payer with similarly large provider. Among the executives leading that charge is CFO Susan Diamond.
Humana named Diamond as its permanent chief financial officer on June 28. Prior to that appointment, she dually served as interim CFO and president of Humana’s home business segment.
Since joining the company over a decade ago, Diamond has methodically built out a suite of home-based care services. The goal, she explained to Home Health Care News, is to better take care of vulnerable populations with a mix of preventative, primary, urgent and high-acuity services.
HHCN caught up with Diamond to learn all about Humana’s plans for home-based care as part of its 2021 “Changemakers” series. In addition to in-home care and plans for Kindred at Home, Diamond discussed the importance of true interoperability and real-time access to information in today’s health care environment.
Highlights from the conversation are below, edited for length and clarity.
With Diamond moving into the CFO role, Humana is creating a new “Office of Home Solutions,” directed by Diamond and other members of the existing home business leadership team. The office is being established to maintain focus and continuity on building “a transformational, best-in-class, value-based home health business,” according to Humana.
HHCN: Looking back at your time at Humana, what are a couple of the changemaking efforts you’re most proud of?
Diamond: I’ve been at Humana for more than 14 years. One of the things I love about this company is we’re very passionate about making health care simpler and more affordable for our members.
I’ve had an opportunity to work on a number of projects that delivered on those goals.
The first transformative project that I was involved in goes all the way back to 2010, when I was leading our prescription drug program. Prescription drugs account for a disproportionate amount of health care spend. I was part of a team that designed a new offering that was really getting after affordability and value. We were the first health plan to introduce a sort of value-oriented, low-premiums strategy, with a plan premium that was about a third of the industry average at the time.
That created an industry-wide shift that continues to this day. That was my first experience within Humana of making that kind of an impact. That led into some additional work we did more broadly in our Medicare Advantage space, focusing on consumerism and better understanding how impactful more personalized product designs can be.
I would argue that, prior to the last couple of years, the industry was largely designing products for “a typical, average consumer.” I was able to lead a project where we sponsored some deep consumer-demand research. Through that work, we came to better understand what drove health plan buying decisions across different consumer segments.
What we found is members who are less healthy, people probably dealing with multiple chronic conditions, they were very much looking for affordability and supplemental benefits such as meals and transportation. They wanted benefits that would reduce burdens for the caregivers that supported them. Meanwhile, when you look at the relatively healthy population, they were looking for very different things. They wanted access to providers when they were traveling. They wanted fitness benefits and a whole suite of benefits that were quite different.
That led us to introduce new product designs that have supported our ability to generally exceed the industry’s average growth in the Medicare space.
At what point did you begin to focus on the home?
In mid 2019. That’s when we created a dedicated segment to the home. I would say, since then, we’ve done some great work. There have been a lot of things I’m proud of, including better understanding the challenges in delivering health care today. We have a focus on patients who are dealing with more complex medical histories and chronic comorbidities. Better understanding the barriers they experience in receiving high-quality care and keeping them at home, where we believe they can better maintain their independence with healthier lives, that’s our goal.
As part of this work, we’ve been able to observe how a broader range of care capabilities is necessary in order to achieve that. That, in turn, led to our ambition to create a full continuum of home-based care capabilities. We’re building a platform that we believe can more comprehensively address the needs of those more complex patients.
That was our ambition, which prompted us to make a number of investments, some through acquisitions, some through partnerships. Examples of the latter you’ve seen with Heal and DispatchHealth, to provide primary care and even higher-acuity care in the home.
And, of course, there was the big splash you made with TPG Capital and Welsh, Carson, Anderson & Stowe (WCAS) in 2018, right?
Right. And you probably saw our more recent announcement about our plans to fully acquire Kindred at Home. We’ve been in the home care space dating back 10 years. But Kindred was certainly our largest investment. That was predicated on a conviction that more care would be delivered in the home in the future. We had — and have — a belief that consumers will demand more personalized and convenient care, which we think can be best delivered in the home.
Home health care today really does represent the most scaled version of care delivered in the home.
Additionally, patients receiving home health care today are some of our most complex patients. They’ve got an average hospitalization rate that’s 5 times that of patients who don’t require the need for home health support. There’s a lot of opportunity to provide more comprehensive care and, we believe, reduce unnecessary hospitalization events that often lead to more decompensation in patients. Many of the more frail patients who end up in a hospital, quite frankly, are never able to return home. So, we’ve been working with our Kindred partners over the last few years to better understand those challenges, then design new care models that focus on total cost of care and patient outcomes.
The work we’ve done the last few years has solidified our belief that new care models are needed — and that it’s possible to implement them. When you do that, you can definitely improve health outcomes. That drove our interest in accelerating our full integration of Kindred.
How does Humana plan to change the traditional fee-for-service home health space?
We have a very strong belief that a value-based mindset needs to come to the home health space. The current model is based on fee-for-service reimbursement, which really doesn’t provide the right incentives for home health companies to comprehensively support patients’ needs. The current model is designed more around whatever the immediate need is, whatever led to that referral in the first place.
We have a strong conviction that a value-based mindset and a total-cost-of-care approach could lead to significantly improved outcomes. That’s what we plan to do, as we integrate Kindred. And we’ll continue to support and grow the core business, which is important.
We intend to stand up a new value-based model. Initially, that will be more in support of Medicare Advantage health plan partners. We intend to make these services available to all of Kindred’s health plan partners, but under a value-based payment and operating model that we believe will allow for a greater range of support for patients and lead to better outcomes. We’re really excited to introduce that. We think it’ll be the first of its kind, at scale, in this country.
Not all changemaking efforts are successful. What’s an example of something where the end result or final product just didn’t match the initial vision?
Probably the largest failure I’ve had came earlier in my career. Before Humana, I worked with early-stage technology companies, typically venture-backed. One of the first ones I worked with was delivering wireless internet and voice-over IT technology services. I would argue we definitely had the right idea, but were a few years ahead of consumer demand. That did not stand in the way of us raising a significant amount of capital. I think we still hold the record for raising the most venture capital by a Kentucky startup.
Unfortunately, we spent what we raised — and more. And so ultimately, we ended up leading that company through liquidation, which certainly wasn’t pleasant at the time. But in hindsight, it provided a great deal of learnings. Those technologies are obviously prevalent today, so again, we had the right idea. We were just a little bit too early. But that experience and the challenging work certainly reinforced my appreciation of just how important it is to deeply understand the problems you’re working to solve through your solutions.
And then as we went through the liquidation, that gave me some of the best lessons I’ve probably ever learned, in terms of the importance of transparency, compassion and respect when you’re dealing with employees who are impacted by the actions you have to take through those types of events. The last thing I’d say that taught me was, you know, at the end of the day, nothing really matters more than your integrity.
What are some of the key changes underway in the home-based care space that have caught your interest? And in your view, what will it take for providers of all shapes and sizes to thrive under those changes?
Humana has been focused on the home for longer than most. The pandemic has created incredible interest in the space. One thing that’s been really pivotal is the U.S. Center for Medicare & Medicaid Services’ (CMS) commitment to partnering through the pandemic. They were very quick to act on implementing the needed flexibilities to bring more care to the home.
Prior to the pandemic, there were real regulatory and reimbursement barriers that stood in the way. Generally speaking, a patient had to be homebound in order to receive home-based services, which we view as an unnecessary barrier. Through the pandemic, we were able to work with CMS, and they implemented some new flexibilities. We’ll continue to work with them, in the hopes of making some of those flexibilities permanent. I think the pandemic has allowed everyone to better appreciate the quality of care and the range of care that can be delivered in the home. That’s great to see.
I’d say there’s more interest in higher-acuity care. Services like hospital-at-home and SNF-at-home, for example, have been accelerated.
Why do you think that is?
Skilled nursing facilities have taken the largest hits through the pandemic, for clear reasons, with the infection rates and the access issues that family members had. We’ve seen sustained depression and utilization in those facilities, as both patients and their providers seek out home-based solutions more than ever.
That, in my mind, accelerated the introduction of those types of models by years, compared to what we might have seen in the absence of a pandemic. That’s important for us, considering we made our investment in DispatchHealth long before the pandemic. They’ve been really successful and have been expanding their services, demonstrating the level of care that can be brought into the home. They’ve demonstrated quality outcomes, reduced readmissions and more.
I would say the other thing is the use of virtual channels and remote monitoring capabilities. We’re particularly excited about voice and AI. Before the pandemic, there was a lot of skepticism, I think, on the part of providers. But through pandemic, out of sheer necessity, we saw providers and specialists with exponential increases in their use of the technology. While that was certainly helpful in making sure patients were receiving the needed preventative care, a big benefit was just for everyone to get comfortable and better understand the range and quality of services you can provide using virtual channels.
We’ll see sustained use of those channels of delivery that allow for, we think, better patient care and more contacts than would be possible with face-to-face alone. And we’re really excited about voice, in particular. It can be challenging to proactively identify patients who have emergent issues. The ability to identify them and intervene with a real-time intervention is important. Think of all the things you can do with voice technology. Let’s say there’s an Alexa device in the home, for example. It could be as simple as Alexa asking our members how they’re feeling each morning.
As far as value-based care, I do think that will continue to be critical. Value-based models really do allow for the necessary reimbursement to approach everything from a total-cost-of-care lens. Traditional models can address emerging needs quite well, in terms of medical care. But oftentimes, there’s a broader range of needs, including the social determinants of health. It could be food insecurity, it could be social isolation and a variety of other barriers. Without a value-based model, those things are typically hard to address by the provider, community and support services.
Humana will certainly look to continue to lead in this space. We’ve done that, I think, in the primary care space. We’ve demonstrated there that value-based models consistently deliver higher quality and better outcomes. As I mentioned, we intend to do the same thing in the home health space. We believe it requires the capabilities of a nationally scaled health plan and a nationally scaled home health provider. Home-based care is quite fragmented today, and that was one of the reasons we sought out our investment in Kindred. It provided a nationally scaled platform of clinicians on which we could innovate and implement new care models.
Even beyond your role at Humana, do you consider yourself to be somebody who runs toward change or somebody who shies away from it?
I would definitely say I run toward it. Again, I’ve been at Humana a little over 14 years. I’ve, every two to three years, have really proactively looked to do something new. I’ve really tried to just keep learning more about delivery systems.
This is one of the most complex industries there is. There’s a lot to learn. Receiving and delivering health care continues to be quite challenging. Many other industries have introduced much greater advancements, in terms of real personalization and simplicity. The health care sector is continuing to strive to deliver similar experiences, but it’s quite challenging.`
If you could snap your fingers and change one thing about how health care or senior care is delivered in the U.S. today, what’s one example of something you’d change?
If I can only pick one, I would probably say to solve for true interoperability and real-time access to information. That’s a really hard problem to solve, though, and the industry has been working on it for quite some time. If that can be fixed tomorrow, it’d be amazing.
It’s very hard for patients and providers to have a full view of a patient’s medical history. Even when it is available, it’s often quite lagged and not as useful as it could be. There’s just such a long way to go. Especially when caring for older adults, there are oftentimes multiple chronic comorbidities. True interoperability and real-time access to information would allow providers and caregivers to work together toward a common care plan.
My mother passed away a few years ago. She had a really complex medical situation. As I tried to navigate that for her, even with all of the education I have about the health care system and resources I have access to, it was amazingly challenging, intimidating and scary. When I think about the hard time I had, I then try to imagine an elderly couple who’s trying to navigate that and how much more challenging it can be.
What’s maybe one reason you’re optimistic about health care or senior care moving forward?
I am so excited about the adoption of higher-acuity care in the home. I think that in the absence of a pandemic, it might have been five years before that took off. A hospitalization can be devastating, particularly for an elderly patient. Oftentimes, they’ll go into the hospital and be bed-bound. They may not be eating well. They may be isolated from loved ones. Being able to bring care into the home, empowering patients and their caregivers, is extremely important to us.
Just before the pandemic, as we were finalizing our broader home strategy, we had the opportunity to go and actually do ride-alongs with providers that deliver true high-acuity care in the home. It was an eye-opening experience. A patient I went to visit, she was in her mid 80s. She had a CHF exacerbation. She’d been in the hospital a number of times. She lived alone. When she was given the opportunity to remain in her home and receive the needed care there, I mean, her entire face just lit up. There was a sense of pride because she was able to remain independent in her home. She’s walking around her apartment, making herself lunch, even though she’s on oxygen and really not in good health. That was just amazing to see. We’re looking to do a lot more of that.
Is there anything else you’d like to address, as far as how Humana is trying to change the health care landscape?
We didn’t talk a lot about the broader set of home-based capabilities that we’ve assembled. But it really is our goal to have the full range of care, from preventative to primary, to urgent to high acuity. Our belief is that each of those types of care, in their own right, can deliver a lot of value to patients. But when you can bring all of those capabilities to bear in support of patient care, they have even greater value and can solve many more problems.
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