‘You’ll Get Squeezed Out’: Why Value-Based Care Is a Home Health Necessity

Nick Loporcaro, the former CEO of Landmark Health, has joined The Vistria Group as a senior operating partner.

He makes the transition from the provider side to private equity geared with decades of health care experience – and years of at-home care experience. Loporcaro led Landmark – an in-home medical care provider – until it was eventually sold to UnitedHealth Group’s (NYSE: UNH) Optum last year.

Prior to Landmark, Loporcaro spent nearly two decades with McKesson, a provider of pharmaceuticals, health information technology, medical supplies and care management tools.


As he gets his feet underneath him in his new role, he’s anything but short on ideas for the future of home-based care. He’s hoping his past experience will lend him success in private equity, which is increasingly becoming involved in the home-based care space.

Currently, The Vistria Group has its hands all over home-based care. It currently backs, among others: Mission Healthcare, a home health and hospice company; Medalogix, a home health predictive analytics platform; and Help at Home, one of the nation’s largest home care companies.

Home Health Care News sat down with Loporcaro to discuss why he made the leap, the future of home- and value-based care, and the other trends he’s most interested in moving forward.


You can read that conversation below, edited for length and clarity.

HHCN: What led you to transition from the provider space to the investor space?

Loporcaro: Prior to joining Landmark, I had spent the better part of 16 years at McKesson, being the acquirer of many companies. I decided I was going to jump the mothership and go run Landmark, which gave me a lot of exposure from another perspective — to a lot of private equity groups and the payer space.

We transacted with Optum and UnitedHealth Group, and initially I decided to stay on and help them in bringing a few other of their portfolio companies together under the auspices of home and community care. But I told them that I didn’t know that I wanted to continue to be an operator.

I was at a point in my life and my career where I had the good fortune for a couple things to line up. I was already on a couple of boards, and I am the chair of the Medalogix board. But I had some exposure to David Schuppan [senior partner and co-head of health care at The Vistria Group].

I met with Vistria’s co-chairmen and co-CEOs – Kip Kirkpatrick and Marty Nesbitt – briefly and just had a good feel for them and a couple of other private equity firms. So as I wrapped up at Optum at the end of the year, I decided to join the Vistria team for a couple of reasons.

One reason was the team and the folks that I was working with, as well as the fact that we’re opening up the Dallas office, which is home base for me. Then there was their focus on health care in this space.

I’m a huge proponent of the work we were doing at Landmark on longitudinal care. We saw the opportunity as we brought Landmark over to Optum to consider: How do you bring home health and hospice resources and attach them to that chassis?

I really do think there’s an opportunity here to elevate the home health space and hospice space into value-based care. That’s an area of focus for us. So it resonated with me. I’m dabbling in some other spaces as well, but home health care is probably where the majority of my time and interest is.

You were able to take Landmark all the way up to that point of sale. What lessons were you able to learn, on the provider side, being able to be there throughout that entire journey?

A couple of things. And some of this will sound altruistic, but please know that it’s sincere.

What drew me to Landmark is what draws a lot of providers to companies like Landmark. And it really is about keeping the patient as the North Star and being able to provide better care. A lot of people think it’s intuitive, right? Taking care of people at home – what could be better?

I remember when I first met Landmark’s founder, Adam Boehler, many years ago. He told me the Landmark story, and unbeknownst to Adam, I was in the process of transitioning my mom to assisted living back in Montreal, Canada. I literally looked at him, and I said, “So you have providers going to homes, like the old days?” And it hit me that this was sort of like back to the future, where we can provide that level of care in the home by leveraging today’s technologies and processes, doing it in an efficient and effective manner. Now, that’s the rosy story, right?

But it’s not for the faint of heart. I think you really need to appreciate that sending a provider into the home is what we used to call the tip of the iceberg. Illustrating the quality of care, I don’t think is that difficult. That is the intuitive part. Illustrating how you actually save for the overall system, that’s the difficult part. And it’s not just cost but also how you alleviate some of those pain points, and that’s where you need the systems, the actuaries, the analytics and everything that supports it as well.

What I learned on the Landmark side and dealing directly with payers is, again, it’s about making the patient the North Star. It’s not always obvious, and it’s not easy, but everything else will follow, and it truly does. But you’ve got to have that tenacity and that belief.

How does your experience leading a provider entity inform your approach to your work at Vistria?

You start understanding the providers’ motivation, and what it is that’s important and what it is we need to deliver. Now, from the investor perspective, we’re looking for companies that understand that, too. How do you best scale that and then balance what you want to deliver, but at the same time, remember we’re still a business? You still have to be able to grow it.

I used to put up this hokey slide and refer to it. It had the patient at the top, the payer in one corner, and then the shareholder in another. And I said that in order to give our patients everything they want and deserve, we’ve got to do it at a price point that the payers are willing to pay while delivering double-digit returns to our shareholders.

When you think about that, if you don’t deliver those returns, you don’t have the capital to invest in the services and the systems you need at a price point that payers are willing to pay.

As you understand each one of those components, it helps guide you to what are the best assets out there to look for, based on the thesis or themes in the industry that you want to build towards.

Value-based care is a buzz term right now in home-based care. How do you get to a point where it’s actually being implemented on a wide scale?

Three years ago, when I was invited to talk on a panel about value-based care, you could tell people were paying a little bit of lip service to it, right? But last year, you could feel that it was starting to be a little more real. And then this year at an event I attended, it was real. I think people were getting it.

If you don’t have data or analytics, and you’re not figuring out a way to get into value-based care, boy, are you going to get squeezed out of the equation at some point. And I say this very respectfully.

I think the home health industry is highly fragmented and has been relegated for a long time. It has struggled to elevate beyond a certain point, where providers are actually trying to negotiate rates based on the value they actually offer.

Some of the analytics we’re pulling out now – with our Medalogix platform, for instance – is showing and illustrating the value of home health and what that can deliver. You need to have those analytics.

I should preface this by saying I’m a huge proponent of value-based, risk-based population health. And there’s a way to wean the industry into it.

The contracting and the settlement process – that’s where we have an opportunity. There’s an opportunity to elevate this industry by demonstrating to the payer community that there’s true value. This is not just about, say, reducing the number of days of intervention. In fact, the irony is, you may want to increase it to get better value on the back end.

Are there any at-home businesses or service lines that you think there’s value in that maybe people haven’t explored as much just yet?

Yes. One area that intrigues me is home health benefit management. You think about other models that exist in health care like management services organizations (MSOs), or similar organizations like that, that can help the industry get better organized and elevate it.

Because when you have as many agencies as you do, from the provider-agency perspective, you have very little leverage in the conversation with payers. You’re dealing with the procurement-level folks, and I don’t mean that to be derogatory; that’s just where you are in the food chain.

But you can come back and be better organized, able to illustrate value and able to get into the risk-based arena. And it doesn’t have to be full upside and downside risk initially. It could be quality measures, anything.

So I think there’s an opportunity there in being able to do that without necessarily consolidating the whole space, but being able to offer those types of services. Now, all of a sudden, you’re up at the plan-sponsor level, you’re speaking to total cost of care and overall quality of delivery.

When I think about what’s out there, what you could create by leveraging those capabilities, that is really interesting to me.

You spoke a lot about direct contracting during your time with Landmark. I know some lawmakers, Sen. Warren (D-Mass.) in particular, have come out against the program. Could you share any perspective on the merits or flaws of the program?

*Editor’s note (March 2, 2022): This conversation took place before the U.S. Centers for Medicare & Medicaid Services announced the creation of the ACO REACH Model.

Respectfully, Sen. Warren and I don’t agree. As I said earlier, I’m a huge proponent of value-based, risk-based care and any form of that we can get.

I applaud CMMI and CMS for looking at models like this. I know there’s a group of individuals that aren’t terribly bought into Managed Medicare in any way, shape or form. But I really do believe it allows the opportunity to deliver a different type of care, where you’re less concerned about how many units or how many visits are delivered.

Because again, that’s almost counterintuitive. I could show you in my past experience instances where we probably would have done three or four times the number of visits that anybody could justify in a traditional model.

But in that construct when considering total cost of care, that’s in the realm of possibility. So all of that is to say, I hope direct contracting stays alive and they fine-tune it over time. I think it’s a great mechanism, and I hope to see it flourish.

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