HHCN FUTURE Conference: Fireside Chat with Homecare Homebase

This article is sponsored by Homecare Homebase. This article is based on a Home Health Care News discussion with Scott Decker, CEO of Homecare Homebase. The discussion took place on September 15, 2022 during the Home Health Care News FUTURE Conference in New York City. The article below has been edited for length and clarity.

Home Health Care News: I am joined now by the CEO of Homecare Homebase, Scott Decker. We’re going to be talking a lot about the Medicare rate environment next year and how home health providers could be impacted by the proposed rule’s changes. Homecare Homebase has studied the rule, and has analyzed it.

You work with the 10 largest home health providers and hundreds of other organizations. You have very detailed insights into the market. You’ve analyzed the data. What are the main takeaways of how providers could be affected?


Decker: Well, I think obviously the main way they’re going to be affected is the rate cut. The interesting thing, as we’ve looked at the data and it is pretty consistent across all of our largest clients, is there is a bit of inconsistency between the assumptions that CMS used as the basis of the changes versus what we’re actually seeing in the data. I think the mission of us supporting our clients in the industry has been trying to get that data in front of CMS, for better or for worse, whether that’s going to help the case. Clearly, there’s some things that aren’t consistent. There’s a little bit of lack of transparency from CMS on how they’ve come up with the calculations. So there’s an ongoing dialogue.

HHCN: That’s just one of the ways providers will be affected. There’s, of course, going to be access to care challenges. There’s going to be increased operational burdens. Let’s look a little bit further into that access to care point. We learned a little bit about referral conversions earlier. What has Homecare Homebase seen about how referral conversions have changed? I think in that letter something that stood out to me was in 2021 alone, your providers were unable to admit 2.1 million patients.

Decker: I think there’s probably three different dynamics we see in the data, which are interesting. We’ve seen a steady increase in the number of patients per provider across the entire user base. At the same time, we’ve seen a consistent drop in the number of visits per patient. Those two things are obviously capacity signs to us that there’s not enough. Then you layer on top of that this whole referral conversion.


That’s probably the most troubling of all, and it even started before COVID but we’re at the layer now of probably 50% plus of referrals not getting converted and a steady decline we’ve been seeing on that, which means we’ve got a real capacity problem right now in the industry. You look at all that data saying more patients per provider, less visits and not enough capacity, and somehow a rate cut is going to help us solve that problem. That’s the interesting dilemma we all face.

HHCN: It’s not just an access to care challenge. All home health patients might have that, but really there are certain types of patients that could be hit harder than others. I think really at-risk, vulnerable patient populations could be affected by the proposed rule.

Decker: It was interesting because I think the assumption going into it was rural would get hit harder than urban. Our data at least shows the opposite. Urban areas have actually seen more patients being turned down than the rural. You can extrapolate from there that we’re probably looking at lesser served populations in general. All that’s pretty concerning. That’s what we go back to Congress with. Is that really the direction we want to be going? I don’t see that a rate cut’s going to help that as opposed to just make it worse.

HHCN: You mentioned more patients per provider, more patients per clinician. Are there other ways that providers have worked to try to stretch clinical capacity that you’ve observed?

Decker: Well, I think the other two things that everybody’s starting to lean into is A, do you need to actually do a physical visit? I think we’ve all been intrigued by telehealth. We have reimbursement issues there, but it’s an obvious path to go down. I think people have been trying to lean into acuity. Is there a way to try to figure out the acuity of patients on a more real time basis so you can allocate resources where they’re most needed.

Then I think just efficiency and optimization of scheduling and documentation and all those things, anything we can do to stretch capacity. It’s interesting as I hear the conversations around retention and attraction because to me it’s a net sum zero game for us. Yes, you may do a better job of attracting and retaining, but the issue is we don’t have enough capacity. The question is how do we stretch capacity? What things can we do to just bring more availability to the nursing staff?

HHCN: Let’s talk a little bit more about how what CMS is observing doesn’t match up with the PDGM realities of providers. What’s one particular example of that? For instance, I know that in the comment letter to CMS Homecare Homebase had some interesting findings about upcoding effectively.

Decker: Let’s call it behavioral adjustments as opposed to upcoding. There’s a lot of assumptions around behavioral adjustments that came out in the original. To be honest, we actually see none of that, the CMS proposition is that it’s almost 50% of the time it’s happening, at best we see it maybe happening 10% of the time. We see people, we will use your term upcoding as well as down coding, in equal proportion. This behavioral adjustment, which is one of the major underpinnings, we just don’t see in the data at all.

HHCN: Where else doesn’t the provider reality match up with what CMS is saying is happening?

Decker: I think that’s probably the major one, and then just like I said, the referral conversion challenge is absent from the conversation. This concept of access to care I think is the one that we need to lean into the most as an industry.

HHCN: Contextually, these potential cuts are coming during a time of inflation. Nurses travel a lot, gas prices are going through the roof. In what ways does this create operational burdens for home health providers?

Decker: Well, I think the panel’s been pretty consistent and you’re to the point. We’re just facing this ongoing upward pressure and there’s not enough capacity out there. This is just exasperating the problem.

HHCN: Well, let’s try to look at solutions. We talked a lot about what potential problems could be, but in a world where some of these cuts are realized, how could providers prepare now to mitigate them somewhat, maybe not offset them entirely, but put themselves in the best position possible?

Decker: I think that’s the right approach. This is coming in one form or fashion. Even if it gets pushed or reduced it’s coming. The reality is, I think, the industry, as they look at us, we have been able to stretch. We’ve been able to see more patients and do less visits. The reality is that we can’t really see that there’s been a difference in quality yet. I think as long as we continue to be able to deliver care and not see a decrease in quality we’re going to continue to be pushed. We need to step back and say, “Okay, what do we do?” I think we need to be pulling triggers on all fronts.

We see a wide variation across our client base just in the time of start a care, maybe up to an hour difference between different clients on their start a care. If you even dig further, the ones who do shorter start of cares have better outcomes and quality measures. It says there’s opportunities to go back in and say, how do we get more efficient? Can we get our nurses more efficient? Can we, as a vendor, make documentation simpler and easier and more streamlined? You have that whole side of the equation from the nursing standpoint.

Then I think on the other side, back office efficiency and I’ve heard several people allude to the fact that we’ve got to lean into that. It’s an obvious place to go after. In some ways it feels the industry almost needs the pressure to say, are there different ways and more efficient ways to tackle back office and move to centralized models.

HHCN: Somebody is asking if upcoding isn’t happening, why is CMS still seeking such large rate cuts? In my view, it’s just there’s this major push and pull with the way that CMS is looking at PDGM and how it’s analyzing it and the way that the industry itself is.

Decker: Yes. I think their assumption is that it is happening. One of the challenges this year has been, they just haven’t been nearly as transparent with the data and how they’ve done the calculations than they used to be. All we can do is sit here and say when we look at the data, we can’t replicate the assumptions they’re making, so from our perspective, until we see a model or data that indicates otherwise, that’s where we fall. I think the good news is that as it plays out, hopefully we have an opportunity to challenge some of those base assumptions.

HHCN: I know one of the points the industry makes to CMS is the way the agency is looking at PDGM and its effect is very different than how it reviewed the patient-driven payment model in the SNF space. They’re using different methodologies for similar overhauls, which is a head-scratcher.

Decker: Well, and layer onto that, the calculations right now are based on the last two years, which is in the heart of COVID and that isn’t necessarily representative of a reality going forward.

HHCN: We’ve talked about a lot of direct ramifications and potential consequences of the proposed rule, if it’s realized, but what about indirect consequences, indirect industry trends that we might see? For example, I recently spoke with a nonprofit home health executive and they had planned, going into next year before the proposal came out, to roll out a palliative care service line, knowing that it would be a loss leader for them. It wasn’t going to make the agency money in any sense. They’re not doing that anymore because they can’t afford to. What types of trends like that do you see coming down the pike?

Decker: I’ve been doing health care IT for a long time, longer than I care to admit. The reality is every time there’s change, and in this case government change, it causes a pause. I think we can see it across the board. People aren’t innovating, they’re not going to try new things. They’re not going to put in new systems. Until we can get clarity on what the future looks like, it causes a pause. Once again, the last thing we need to be doing in this industry is pausing. We need to be innovative. We need to be pushing the envelope. That’s probably the most frustrating part when we get this kind of uncertainty.

HHCN: It’s really tough too, because it’s coming at a time of great innovation. You’ve seen probably 10 years of home health innovation squeeze down into 2 and this could be a step backwards in many ways.

Decker: It’s the uncertainty. In some respects, even if the rate cut comes, it’s going to force innovation. We’re going to have to do things differently. Going through COVID I heard one hospital say, “Yes, we moved at COVID speed.” I had never heard that term. It makes total sense. But they changed at a pace that health system had never achieved before. Sometimes badness can be goodness. At least it forces us to reflect and just say, hey, we’ve got to do things differently than the way we’ve done them in the past. But not knowing is the worst thing that can happen to us.

HHCN: What message do you want to leave our audience members here with and what else is on tap for Homecare Homebase in the rest of the year?

Decker: I think it’s probably that last theme, which is to continue to be more efficient. We need to lean into it. We’re certainly taking that approach from Homecare Homebase of doing everything from reinventing the frontend for the nurses, essentially from scratch to some pretty, innovative things on how we can more efficiently schedule resources with our smart scheduling tools.

So, for us, it’s really just leaning in with our clients and saying, “Where do you see the biggest opportunities for efficiency?” I think there’s some real opportunity to take back-office inefficiency out of the system right now and what better time to do it than now, but it’s going to take some innovation and some partnership to do it.

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