Looming Provider Choice Home Care Regulations ‘Slap in Face’ to Smaller Providers

A new proposal in Pennsylvania that would create “unnecessary” duplication for how disabled patients choose their home care providers and receive care is causing some angst in the Keystone state.

The proposal not only affects providers in Pennsylvania, but could also force patients to rely on out-of-state agencies to provide replacement care if a patient’s caregiver is sick or unavailable.

“The proposal is intended to create a hybrid model between the consumer-tracking model and the agency model,” Teri Henning, director of the Pennsylvania Homecare Association, told Home Health Care News. “But the fact is agencies all across the state currently hire, train and employ family and preferred paid caregivers, so we do think it may be unnecessary duplication, depending upon the details of the implementation.”


Choosing a home care agency or caregiver plan is one of the highest priorities for people living with disabilities in Pennsylvania.

A new proposal from the state legislature that is intended to give patients more freedom to choose could end up giving patients less, according to experts.

What the proposal does

Many Pennsylvanians with physical disabilities are covered by Medicaid, which pays for at-home caregivers.


Pennsylvania has three Medicaid managed care organizations, which receive state funding to pay for the caregivers. Those three organizations contract with dozens of home health care agencies that provide services in Pennsylvania.

Over 75% of the estimated 115,000 Pennsylvanians with disabilities get home care services through Medicaid via the agency model.

However, the other patients use a “consumer-directed” model, which gives them the ability to hire and manage their own caregiver.

Henning said people will often hire a family member or someone they know to look after them. Those caregivers are paid by the state, which contracts with a vendor to handle things like payroll.

The Pennsylvania Department of Human Services is now proposing a third option called “agency with choice,” which it says combines the best aspects of the two models in place.

However, many in the home care space feel like the proposal could be rushed and also believe that providing one statewide vendor would diminish consumer choice.

“Given that contract processes procurements sometimes take years at the state level, this — at least as it was initially rolled out — was intended to be implemented in less than a year, which felt very quick,” Henning said.

Still, consumer choice has really been the primary concern that Henning has heard from consumers and other stakeholders.

Whether the change is needed

The CEO of Liberty Resources, Thomas Earle, described the move as a “disappointment” to the whole disabled community in Pennsylvania.

“The way this RFP is written is they only want to use one vendor statewide, which sort of defies the name of the program, ‘agency with choice,’” Earle told HHCN. “It’s agency without choice if you only have one vendor.”

The Philadelphia-based Liberty Resources is a federally funded center for independent living that provides transitional services for nursing homes. It also runs a home care agency that employs about 600 caregivers and serves about 450 seniors.

Following the news that a third model could be implemented, 29 home care agencies in Pennsylvania — including Addus Homecare Corporation (ADUS), Americare Home Solutions and Aveanna Healthcare (AVAH) — submitted public comment on the proposal.

Most providers — 18 of the 29 that submitted public comment — did not agree with the singular statewide vendor.

“There are diverse regions in Pennsylvania, which present unique challenges in the delivery of services, which are best served by a range of agencies,” the joint public comment read. “We recommend the use of regional providers throughout the state which will increase choice, provider competition and allow providers to operate efficiently and effectively.”

The reduction in choice, executives worry, could potentially put agencies out of business as caregivers are enticed to the one statewide provider for better pay and benefits.

Earle said the proposal is also worded in a way that precludes any current Pennsylvania provider from meeting the requirements.

“You have to be providing services in at least two other states, and you have to have a demonstrated track record of serving at least 10,000 consumers, which is huge,” Earle said. “It’s sort of designed to go to a mega corporation [that’s] out of state, and we feel like that’s a slap in the face to the network of existing Pennsylvania providers.”

Providers are also confused on why this new model is necessary because Pennsylvania does already have an agency with choice option.

“We believe [choosing a provider] can be adequately handled within the current service models,” Henning said.

The state has responded by saying the current agency with choice model is not recognized as an official model of service in the state’s Office of Long-Term Living (OLTL) waivers.

“Currently, the recognized models of service in the waiver programs are agency model and participant-direction, including budget authority,” the state wrote. “This model shifts the role of the participant from being a legal employer to being the managing employer while the agency with choice vendor becomes the legal employer and takes on responsibility for hiring, training and firing.”

Another issue with the new proposal is that it will pay for caregivers’ benefits — something caregivers working under the existing consumer-directed option lack — but only if the caregiver is working under the new model.

What happens next

If the proposal is approved and implemented as written, every agency in Pennsylvania will be affected. Several hundred others in neighboring states will be as well, Earle said.

The initial push for the new model was made in part by SEIU Healthcare Pennsylvania, a labor union that represents about 5,000 direct care workers. Earle said the move is Pennsylvania Gov. Tom Wolf “throwing the union a bone.”

“This could happen in other states,” Earle said. “I think it’s going to be something that SEIU attempts in other states.”

There are several agency with choice models that are successful in other states, Henning said, including the one in place now in Pennsylvania.

“Every one of these Medicaid programs are unique so it’s hard to do an apples-to-apples comparison,” Henning said. “We’ve encouraged the state to look at some of the models in other states to make sure that we are implementing the model in the best and most appropriate way, and in a way that protects choice.”

Instead of one statewide vendor, Earle and the rest of the industry prefer to have four to six qualified vendors in each of the state’s three Medicaid managed care regions.

“As an independent living center, one of our principles of independent living is consumer choice,” Earle said. “Choice means more than one option to choose from, not one.”

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