Enhabit (NYSE: EHAB) is aiming to be a home health provider of scale in order to better negotiate with plans and forge relationships with referrers – but the path to this goal has been more time-consuming than the company’s leaders originally envisioned.

To achieve more referral partners and increase patient volume, Barb Jacobsmeyer, president and CEO of Enhabit, seeks to become a “full-service” provider – a provider that has expansive payer relationships and can take care of a high volume of a referrer’s patients. Payer innovation has been the “most critical part” of Enhabit’s strategy to be perceived as a full-service provider, but has been a longer process than Jacobsmeyer anticipated.

“Effective January 1 of this year has been the first time that I would consider us really full service,” Jacobsmeyer said at the Goldman Sachs 46th Annual Global Healthcare Conference on Tuesday. “Up to that point, we were either negotiating, renegotiating, or given notice to various payers. So January 1 of this year is the first time that we’ve had all the large national payers, as well as a large number of the regional payers.”

Dallas-based Enhabit Home Health & Hospice operates 364 locations in 34 states, including 251 home health locations and 113 hospice locations.

In addition to expanding its payer mix, Enhabit has recently returned to renegotiate some of its contracts and succeeded in securing several rate increases, all tied to quality metrics, according to Jacobsmeyer. While negotiating, the company always seeks to forge episodic contracts and currently has around 70% of its home health patient census in episodic payers.

“That allows us to manage the visits for the patient, versus the payer managing the visits,” Jacobsmeyer said. “We go into every one of these discussions looking for episodic.”

Now that Enhabit has reached a critical mass of payer relationships and is finding success in achieving higher rates, the company is focusing on messaging to inform referral sources of its expanded payer mix.

The company’s payer mix has seen continued growth in traditional Medicare and in its payer innovation contracts, Jacobsmeyer said.

Looking at industry-wide reimbursement trends, Jacobsmeyer advocated for Medpac to analyze all payer margins, rather than focusing solely on Medicare.

“They’ve continued to produce reports for home health with only Medicare margins,” she said. “Obviously, that was fine 10 years ago, when the majority of home health was fee-for-service. It’s not okay anymore when you have more than 50% in Medicare Advantage.”

The company reported that the rate of decline in Medicare fee-for-service volumes has decreased and is now coming in line with the company’s peers, according to Ryan Solomon, the company’s chief financial officer.

The company anticipates that the percentage of revenue from Medicare will continue to normalize, Solomon said.

In terms of continued expansion, Enhabit is looking to grow strategically through both de novo and acquisitions, focusing slightly more on growing its hospice business than it’s home health business, according to Solomon.