Home Health Providers Have ‘More Power Than They Did Yesterday’ In MA Plan Negotiations

It has become increasingly difficult for home health providers to ignore Medicare Advantage (MA) plans’ growing reach. Providers looking to thrive will need to learn to navigate this evolving reimbursement landscape.

In 2023, MA plan enrollment surpassed traditional Medicare enrollment. There has been a growth of more than 10 million MA plan enrollees over the last decade.

“There’s been a lot of celebrity endorsements of Medicare Advantage, a lot of marketing and it’s paid off,” National Association for Home Care & Hospice (NAHC) President William A. Dombi said during a recent MedBridge webinar.


Home health providers will experience a financial impact from this, as MA plans generally pay less for home health services than traditional Medicare does.

“This translates to likely losing money on the [MA] program,” Dombi said. “This would require subsidization from other payers. The other payers primarily subsidizing [MA] is the Medicare program, which has had a margin of sorts for many years, but that traditional Medicare margin is shrinking, as there are payment rate cuts, combined with a growing proportion of agency patients coming from [MA].”

In order to operate successfully, providers will need to have a strong understanding of the business relationship with plans, have a thorough understanding of their contracts and prepare evidence that demonstrates their value, according to Dombi.


“Imagine saving the MA plan the cost of a hospitalization through your high-quality service that presents a lot of value to the plan, and the opportunity to negotiate a better payment rate,” he said.

Dombi also noted that providers should have a willingness to consider innovative payment models.

This could mean episodic contracts rather than per-visit ones. It could also mean capitated payments, where providers take on risk.

“No matter what model you use, expect to show the financial value to the plan,” Dombi said.

He also touched the tricky referral dynamics that can occur between MA plans and providers.

“Many home health agencies accept [MA] patients because their referral sources are saying, ‘You won’t get our traditional patients unless you take the [MA] patients off our hands,’” he said.

In these instances, it’s important for providers to determine if the organization has enough resources for both types of patients.

Ultimately, providers should be able to answer the question: Is this MA plan the right fit for your organization?

“For the first time in years, we are hearing from our members who are actually saying no to plans, because they cannot sustain their existence if they continue to get those rates of payment,” Dombi said. “[This is] creating some negotiating leverage. Clearly, it’s a David and Goliath situation. You don’t have great leverage, but you have more today than you had yesterday.”

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