VNSNY CEO Dan Savitt: HHVBP Should Include Shared-Savings Opportunities, ‘Stabilization’ Measures

In June, the U.S. Centers for Medicare & Medicaid Services (CMS) proposed to expand the Home Health Value-Based Purchasing (HHVBP) Model to all 50 states starting next year.

The Visiting Nurse Service of New York (VNSNY) is among the home health organizations excited about the move’s potential to better align care and reimbursement, CEO Dan Savitt said during a recent HHCN+ TALKS appearance. VNSNY isn’t currently in one of the nine HHVBP demo states, but it has vast experience in the value-based care world, he noted.

“We’ve embraced [value-based care] as a company,” Savitt said. “I’ve been saying for years to the payer community, ‘Let us take the risk, and we’ll show you what we can deliver in terms of value to the patient and the payer.’”

Since implemented in 2016, HHVBP has resulted in an average 4.6% improvement in home health agencies’ quality scores as well as average annual savings of $141 million to Medicare, according to CMS.

Founded in 1893, VNSNY is the largest not-for-profit home- and community-based health care organization in the United States. On any given day, VNSNY has nearly 40,000 patients and health plan members in its care.

HHCN is pleased to share the recording and transcript of this HHCN+ TALKS conversation with our members. Read on to learn about:

— What the home health proposed payment rule for 2022 means for the industry

— How VNSNY has performed in its existing value-based care agreements (and how the organization is thinking about the Home Health Value-Based Purchasing Model expansion planned for next year)

— Why VNSNY sees opportunity to improve upon CMS’s value-based care plans for home health providers, particularly around shared-savings opportunities and risk adjustment for highly complex patients

— How behavioral health fits into VNSNY’s plans moving forward

The below has been edited for length and clarity.

[00:00:03] Bob Holly: Hi, everyone. I’m HHCN editor Bob Holly and this is our first official HHCN talk. I’m joined today by Dan Savitt, president and CEO of the Visiting Nurse Service of New York (VNSNY). Dan, thank you so much for being here.

[00:00:19] Dan Savitt: Well, I really appreciate you having me. Thank you.

[00:00:22] Holly: A little bit of background on VNSNY, then I’m going to give you guys a little bit of background on what we’re doing with this conversation before we will get into it. Founded in 1893, VNSNY is the largest not-for-profit home- and community-based health care organization in the U.S. It serves tens of thousands of patients and health plan members per day. It employs nearly 13,000 people, and it’s also one of the leaders in the home health industry when it comes to research.

As for this conversation, HHCN Talks is a new premium program we’re launching to give you, our readers, a direct line to some of home health care’s top thinkers, innovators and true business mavericks. We hope to host one or two of these conversations each month, hearing from leaders in the home health world, but also in home care, hospital at home, aging in place and more. With that primer, let’s get to it.

Dan, it’s great to speak with you again. How has everything been going since we last connected with you in March?

[00:01:31] Savitt: Well, thank you. It’s good to see you again. Like many, we’re having a strong year — much stronger than 2020, which was, of course, challenging. And I mean that both financially and operationally. We have volumes returning, staff productivity improving and the like. Similar to everyone, we’re also dealing with — even with people coming back — staffing constraints. We’re finding that in all of our provider businesses. Right now, we’re dealing with that. We’re having to get more and more innovative in both recruiting and retention.

The other piece, too, is COVID continues to linger. The Delta variant, along with potential mandatory vaccinations for health care workers, is really dominating our short-term view. We continue to remain focused operationally, and we’ve got two big things we’re working on right now and continue to be focused on. That will always be clinical quality and the consumer experience. We’re marching forward.

[00:02:53] Holly: A lot of that’s good to hear because VNSNY was one of the first home health providers that we spoke to, to learn about COVID last year. You guys had to adapt when nobody else in the country did, when New York was the major hotspot. Of course, everybody’s still trying to figure out what to do with vaccinations, whether you mandate it, whether you encourage it. And the recruitment and retention aspect, I know, remains difficult for everybody.

On top of all these once-in-a-generation challenges, you also had to transition to the CEO role. How has that process gone?

[00:03:38] Savitt: Well, thanks for asking. The transition has gone well. Fortunately, I was here for three years as chief financial officer, and then Marki and I had a six-month transition period. I was able to really shape where we were headed during the transition period and hit the ground running. I didn’t have what some might have when you bring in a new CEO — a honeymoon period of where things sort of stop, where the organization tries to figure out who this person is and where they’re going to take the company. We had a really good launching point.

I’m really excited about where we’re headed. We’re focused on leveraging our home-based businesses and interventions and coupling that — you’ll hear me say this a couple of times — around behavioral health capabilities and supporting our health plan and all that. Then continuing to work on delivering innovative models to the market. I’m excited. The transition was smooth. We started to launch as we’ve come out of COVID into focus very specifically on a new product, a new service line development. I think we’re pointed in a really positive direction.

[00:04:58] Holly: That seems like something a lot of home health providers are focused on, apart from COVID: the coupling, as you said, of home health and behavioral health. I know a lot of behavioral health services in the past traditionally have been provided in facilities, but like everything, that’s changing. That’s headed into the home.

[00:05:24] Dan: Well, for us, it’s natural. We have a fairly robust set of community mental health programs. We have 400 staff working every day on interventions on the behavioral health side. It’s also about closing social gaps. A lot of health care businesses, over the course of the years, have developed in silos. But we’re really focused on, “How do you bring all these capabilities together and deliver a whole different set of values to the consumer?” I feel like VNSNY is uniquely positioned in that, so just look out. I think we’ve got some exciting things coming.

[00:06:09] Holly: There’s so much that we could talk about, but I think as part of this conversation, I really wanted to hone in on value-based care and the home health proposed payment rule for next year. Value-based care is a big part of that, with the Home Health Value-Based Purchasing (HHVBP) Model expansion. But apart from HHVBP, which we’ll get into in a second, did anything stand out about the rule immediately?

[00:06:59] Savitt: I guess thankfully, there’s some stability and predictability in the rule, so we were pleased to see appropriate increases in overall rates and that 30-day base payment rate, which will help with the cost pressures that we’re all seeing. It is unfortunate, though, that the behavioral adjustment in the Patient-Driven Groupings Model (PDGM) continues to remain. Everyone’s concerned about that, especially given the 2020 home health data, which CMS will be basing that adjustment on. You have a year like none other, then the concern of what CMS is going to do with that data.

We’re certainly not out of the woods. CMS has stated that 2020 exceeded the budget neutrality by 6%, so CMS won’t adjust rates until more data is available. That is a signal that there’s real danger of a reduction in the base payment rates, particularly if that trend continues in 2021. It’s going to be really important for the industry to dig into and inform on the methodology going forward.

[00:08:08] Holly: I know CMS has said similar things about the skilled nursing facility (SNF) payment methodology, the Patient-Driven Payment Model (PDPM). They’ve also said it’s not quite as neutral as they were hoping for.

All right, well, what was your initial take on the news that CMS said, “Hey, we want to take HHVBP, which has been active in nine states since 2016, nationwide! And we want that expansion to start in six months effectively.”

[00:08:48] Savitt: Well, frankly, we do support the home health VBP, even though New York was not part of the demo. The New York State Department of Health here has really tried to encourage payers and providers to adopt a value-based approach, especially in Medicaid. We’ve embraced VBP as a company. I’ve been saying for years to the payer community, “Let us take the risk, and we’ll show you what we can deliver in terms of value to the patient and the payer.” That’s what we’ve been doing in our managed care contracts, especially with what we might call “the other Medicare,” which is Medicare Advantage.

We take significant upside and downside risk today. We’re rewarded on outcomes and penalized for specifically preventable [hospital] admission. We’ve built this significant set of capabilities, care management tools and predictive modeling, really tailored and effective interventions. We’re ready for it. Right now, really, for us, it’s like we’ve got feet in two canoes, so to speak.

We’re working in an outcomes-heavy managed care environment. That might be unusual nationally, given the penetration we have here, but that’s what we’ve been dealing with. We’ve got the fee-for-service Medicare environment, which up to this point has not created a value equation. While we give everybody the care that they need and deserve, we’d love to see more alignment. We think that will help everybody, so we’re pretty supportive at this point — and have been.

[00:10:35] Holly: It sounds like you’re pretty bullish on this expansion of HHVBP because, among other reasons, it could bring those “two canoes” closer together?

[00:10:53] Savitt: Yes. When I talk to folks in this space across the country, we’re ahead of everybody. New York has been, we’ve been in a value-based set of agreements since 2017 with up and downside risk. The peers here have been pretty aggressive. We’re a pretty low Medicare fee for service organization, in terms of volume, to our total business. We’ve had to be in it, and we’re happy that everyone else is going to join us.

[00:11:27] Holly: As president and CEO of VNSNY, you obviously have to be thinking two to three steps ahead at any given point in time. What are some things you’re already looking at to maybe further position your organization for value-based purchasing success? Or do you feel like, based on your past history in value-based care, you’re already in a great spot?

[00:11:57] Savitt: Well, no. From my standpoint, we’re never done. We can always get better clinically. We can always get better from a patient experience perspective and in how we work with our providers. For us personally, we want to be better connected to the patient and to the providers, specifically the doc or the primary care physician. That’s the first thing. We want more connectivity.

The second is we want to … I feel like we’re in a good position on an analytics and tech basis, but we can, as everybody can, get better. We don’t hold the magic key there. Analytics and tech are both critical to the success in a value-based environment. We’re also positioned well to be a national leader. We don’t want to just be “a visiting nurse service of New York.” We want to be seen as an organization that can play in the space of value on a national basis.

The next step really is further incorporating behavioral health into our value-based models. We do some of it today, but certainly there’s significant room for better and more robust interventions. Related to that is partnering better with other organizations in the community around social determinants and health. We can, as I think the entire home health industry can, do a better job of connecting patients. First recognizing the needs of patients, then connecting them to needed resources.

[00:14:12] Holly: Apart from the care itself, I want to circle back to something you said at the very beginning of the answer. Apart from the care itself and making sure that the outcomes are strong, that the people going into the home are doing a great job, that patients are satisfied with the care that they’re getting, would you say that the data and documentation component is the single most important part of value-based care?

[00:15:05] Savitt: Yes, I agree. Most agencies are getting much, much better on documenting. Then the question becomes, “Do you have the analytic engines behind the scene to really drive better outcomes and hit the mark, at least from CMS’s point of view?” That’s where I’d like to say VNSNY has accelerated and really shines. I’ll also say, though, that what happens between visits is really important. We overlay multi-disciplinary care management around the staff that’s in the home, so that when the staff isn’t there, things are happening.

We’re working on closing gaps — social determinant gaps. We’re looking at closing other types of gaps in care and, again, making sure that appointments are set for a primary care provider, that the primary care physician is engaged in the process. I think, “yes” on the data, “yes” on the documentation, but then it becomes, “What do you do with that?” That’s the most important step in my view. In my 20 years of working in the area of complex populations, I’ve seen a lot of data and analytics. If all you’re doing is using them to check some boxes, you’re not going to be successful — and you’re going to miss the mark significantly.

[00:16:46] Holly: What do you think value-based purchasing and this nationwide expansion will mean for the industry overall? Do you think everybody is kind of as excited about it?

[00:17:03] Savitt: No, I don’t think everyone’s excited because there’s a lot of work to do. I think, well, I would step back and say those agencies that participate in the demonstration, they should really be proud of “making it to the majors,” if we use a baseball analogy. CMS saw material cost savings and quality outcomes. CMS certified that and then decided to roll it out nationally. That’s really a validation of the impact that effective home health care can have on patient care and overall health care.

Those agencies that are passionate about bringing value to their patients should be excited about it because it’s their way of capturing additional economics and really separating themselves from the rest of those that are in their market. The flip side is HHVBP is not a cure-all. There are plenty of debates that are going to happen about how it can be done effectively. I do think it connotes a level of confidence and expectation of home health that we should all embrace.

Not everyone’s going to do well. That’s okay. That’s the idea. Not everyone’s going to be able to get to that bar we set. The best news here is that others outside the home health industry are recognizing the critical nature of home health and what it can bring, in terms of clinical and quality outcomes.

[00:19:07] Holly: To your point, CMMI even before this expansion plan became official, said, “Hey, we’ve tried 54 or so alternative payment programs, and hardly any of them have been successful, frankly.” There have been a handful that have really, really worked. HHVBP was one of those.

I know, you’re probably still going through all of the details at this point, as there’s a lot to unpack. But initially, is there any aspect of the proposal plan that you find concerning? for example, while I’ve been talking to folks and reading through things, some people have said they’re a little bit concerned about the competitive cohorts.

Some people have voiced concerns about how fast this is coming. I’ve also heard that it’s really, really difficult — from the experience of providers in the nine demo states — to get any kind of true upside. You could invest in quality all day, every day, and still, maybe you just get a little bit of a tiny bump.

[00:20:41] Savitt: From my view, I would say a few things. One, using 2019 as a baseline was definitely the right move relative to what they could have done, which was to use 2020. Last year and 2021 are not normal years,

Overall, I have to say, though, we’re still analyzing the impact, including the competitive cohorts and the other things that you said. Overall, I’m going to say I’m putting in the three things that we’re thinking about right now: The first is, we’d like to see it be a true shared savings. Right now, the way it’s laid out, it’s a zero-sum game. You referenced this, about that little bit of upside. We have a fixed pot of money, which is what you’re referring to. There are going to be winners and losers, but we know that the VBP program and the demo saved $141 million in one year in just those nine states.

If you think about that, that should be in the pie to share. In a true value-based agreement — and in our value-based arrangements — we’re sharing. We’re sharing in the savings that’s produced in the lower hospitalizations, so that’s the first thing.

The second is, that the impact should reflect patient stabilization as well as improvement. Most of our patients on Medicare are in some form of decline. We do our best to help them improve. That’s hard, but stabilization should be recognized as success, when that is appropriate. As many of us know, these events that happened, that lead you to a home health episode, are really part of a stage of decline. We’d like to see stabilization be talked about more.

Then third, we’d like a stronger risk adjustment model. The VBP needs to recognize that some home health agencies simply care for much sicker and more complex populations than others. That should be a factor in the risk adjustment models, so agencies can compare fairly and ensure that incentives are aligned to care for patients with complex health and social determinant needs.

[00:23:52] Holly: Before VNSNY, I know that you were formerly in leadership positions with UnitedHealth Group (NYSE: UNH) and Landmark. I was wondering if you think something like this in fee-for-service Medicare can bode well for home health providers’ relationships with non-Medicare payers down the road?

[00:24:37] Savitt: I think the VBP should signal to managed care that there’s something in home care they should be paying attention to. As I like to say, we’re in most managed care environments and typically home health has been ancillary. It’s not something that the payers have seen as a real lever that they should be using and leveraging. That’s changing, which is really, really good. The population is only getting older and sicker and more complex. There’s also this recognition from the payers that their members want to stay at home. They don’t want to go to the nursing home. They don’t want to go to the hospital if they don’t need to. When they do, they certainly don’t want to come home and bounce back.

[00:26:29] Holly: Well, before we wrap up, is there anything else that you wanted to add about the proposed payment rule or HHVBP? Otherwise, I was just going to ask about your other plans and priorities for VNSNY for the remainder of 2021. I personally can’t believe we’re already past the halfway mark.

[00:26:50] Savitt: I don’t really have anything else to add. What I would say about VNSNY is we’re really focused again on a few core areas across all our businesses. Whether it’s the health plan or on the provider side, we want to be an integrated organization. In that integration, we want to bring all the capabilities together, creating new programs and services that we can bring to payers, whether they’re governmental payers or they’re part of managed care, that really do all the things we talk about when we say “triple aim,” which we don’t hear much anymore Or even the “quadruple aim.”

We’re in growth mode. We’re expanding both within and outside of New York. We’ve got a number of new areas that we’d like to partner with others around the country on. We’re just readying ourselves for the rest of the 21 and beyond. Of course, we’re dealing with the things that are right in front of us as well, like we’ve talked about, in terms of COVID.