This article is sponsored by Homecare Homebase. This article is based on a Home Health Care News discussion with Luke Rutledge, President of Homecare Homebase, and Nick Seabrook, Managing Principal at SimiTree. This discussion took place on April 10, 2025, during the Home Health Care News Capital + Strategy Conference. The article below has been edited for length and clarity.

Home Health Care News: I’m excited to be moderating our next session on metrics, margins, and market data trends in home health and hospice. This session is going to have a slightly different format than others today. We’ll begin with a presentation, then have some discussion after reviewing the data.

For anyone who wasn’t here this morning, I’m Tim Mullaney, VP and Editorial Director at WTWH Media’s healthcare publications, which includes Home Health Care News and Hospice News. I’m joined on stage by Luke Rutledge, President of Homecare Homebase—likely a familiar name to most of you. Homecare Homebase’s EHR software, workflows, and features are critical tools for delivering care in the home. Over 300,000 HCHB users serve approximately 1 million patients daily.

Also with us is Nick Seabrook, Managing Principal at SimiTree, which has over 450 industry experts, more than 770 active clients, and supports over 16,000 agencies. SimiTree helps post-acute care providers grow stronger and healthier by optimizing operations, revenue, and clinical performance.

With that, I’ll hand it over to Luke and Nick to walk us through the data.

Luke Rutledge: Good afternoon. I feel like we need a viewer discretion warning—this data could either make you run for the hills or double down on your investment! But Nick and I aren’t responsible for your actions after this session.

We appreciate you joining us. We’ll start with some macro themes and then dive into the data. Homecare Homebase serves about 45% of the market—roughly $26 billion flows through HCHB today. Here are three key themes we’re seeing:

1. Payer-Driven Consolidation: No surprise here. Medicare Advantage has now become the primary payer in the industry. Ten years ago, I wouldn’t have believed that would happen, but here we are. This shift is largely tied to the industry’s push toward value-based care.
   
2. Aging Population and Clinician Shortages: Data shows that by 2031 or 2032, the baby boomer population will significantly increase demand—around 80% more demand. Meanwhile, there’s a projected shortage of 200,000–250,000 clinicians.
   
3. Regulatory Complexity: Every new policy from CMS adds complexity. We’re constantly adapting to ensure clinicians are protected and agencies can get paid. It’s a tough balance.
   

Now to the data. What we’re seeing is a mix of CMS claims data and HCHB internal data. Just a few years ago, 70% of the industry was Medicare. In 2025, Medicare Advantage has become the dominant payer. That’s a massive shift.

There are challenges. Payers like Humana and United are facing issues, and we see those reflected in stock performance. From a margin perspective, Medicare Advantage patients are showing about -11% margins, while Medicare is closer to +2.3% to 2.5%. That’s why some agencies are dropping payers to renegotiate rates—$75 per day from Medicare versus $55 per day from MA is a big gap.

This leads to pressure on access to care. We’re seeing agencies having to make hard decisions on capacity. Hospice admissions have dipped slightly, while home health admissions have dropped more significantly—from 75% to 63%.

In lower socioeconomic zip codes, access is declining the most. These patients often end up in higher-cost settings or don’t receive care at all. That’s a red flag for policymakers.

On the clinician side, we’re seeing increased burden. Higher acuity, more patients, and heavier caseloads—up from 6–7 to 8 on average in home health, and from nearly 3 to 4 in hospice.

This has led to fewer visits per episode. Home health visits are down from 16–17 in 2018 to around 12 today, sometimes even 9–10. Agencies are finding ways to maintain quality with fewer visits, often using technology like remote monitoring.

Average length of stay in hospice has increased slightly, and turnover rates are trending down after peaking post-COVID. Home health turnover dropped from 34% to 28%, hospice from 41% to 32%. But we’re still not at the 19–20% seen in acute care.

That’s a snapshot of the macro and operational data. Over to Nick for more margin insights.

Nick Seabrook: I’m going to stand and walk around a bit—stretch your legs, too, if you need. We’re throwing a lot of numbers at you today.

Let’s talk about margin pressure. If you saw earlier sessions with Mark from the Braff Group, this will echo some of that. The cost of living and inflation are far outpacing revenue per patient per day. Revenue is up about 17% over 10 years, but inflation is up 33%. That’s why margins are being compressed.

Using cost report data, we’ve analyzed margins without trimming inaccurate reports as CMS does. Medicare margins are around 22%, consistent over the past four years. But Medicaid margins are -21%, and “other” payers (including MA) are around -6%. Overall, we’re seeing net margins around 5%.

Care period counts have stabilized since PDGM’s implementation, but total care periods are dropping—down 8% from 2021 to 2022, then 2% and 1% in subsequent years. The same with payments, though we’re now seeing slight increases due to higher case mix and reimbursement per patient.

Rural areas are being hit the hardest. The rural percentage of total periods dropped from 19.5% in 2021 to 17% in 2024. Visit counts per period are also lower. This data is crucial when talking with policymakers and advocating for better support.

Payment trends show California, Texas, and Florida lead in total dollars. New York and Minnesota are also notable. Maine, interestingly, saw an 11% drop, likely due to MA penetration over 60%.

On the hospice side, margins dipped from 15% to 11% over three years. Medicaid dropped from 20% to 14%, while other payers increased slightly from 4% to 7%. Net margins are about 6%—only a point above home health.

Hospice claims and payments are rising. Claims rose 3% from 2022 to 2023 and another 1% projected for 2024. Payments jumped 6.5% and then 7% year-over-year.

California again leads in payments, with Texas and Florida following. Most states have seen payment increases, unlike in home health. California’s growth rate is modest, likely due to its moratorium on new agencies.

HHCN: Perfect. Great data—thank you both. We’ve got about six minutes left. Any questions from the audience?

Let’s start with this: how should providers translate all this into strategic planning?

Rutledge: Sure. I’m not a provider, but from a data and EMR perspective:

1. Relentlessly focus on clinician experience. They own the patient relationship and the outcomes.
   
2. Understand payer mix and reimbursement. With MA becoming dominant, you have to be an expert in your payer landscape.
   
3. Embrace technology. Generative AI and other tools can improve capacity and experience.

Seabrook: Yes—first, negotiate with Medicare Advantage payers. More are willing to pay PDGM rates, which are much more straightforward than PPS. That helps ensure positive margins.

Second, technology. Not just EMR, but a broader tech ecosystem for clinician and patient experience. Do your homework on what’s out there.

Third, know your market. Understand referral dynamics, caregiver shortages, and local margin trends before making acquisitions or entering new areas.

HHCN: Great. We have time for one more topic. Let’s dig deeper into the innovation and tech side. You mentioned “bear hug technology”—what should agencies be doing?

Rutledge: Good question. We see two types: prescriptive AI and generative AI.

We’re launching meds reconciliation via generative AI this June—it currently takes 30–45 minutes per clinician. We think we can cut that in half.

We’re also bringing in ambient listening and scribing technologies into the EMR, which are already widely used in acute care. And for the administrative burden from MA—automation can help streamline eligibility checks and authorizations. Intake and scheduling are two other big opportunities.

Seabrook: Absolutely. Technology isn’t just your EMR anymore—it’s an entire ecosystem. Optimize your EMR, but also research solutions that improve both patient and clinician experience. Compare platforms and find what fits.

HHCN: Any last audience questions?

Audience Member: There’s so much to take on. Smaller providers—mom-and-pops—seem to just take it all on blindly. How big does the problem have to get before they push back?

Rutledge: Yeah, it’s a great question. I see rate-takers out there—$98 per visit! I don’t know how they survive. They often end up shifting patients to higher-cost settings, which strains the healthcare system.

Seabrook: That’s a major issue. Some agencies take any rate to get volume. But in CON states, if no one takes a low-paying MA plan, providers have leverage.

We’ve seen payers come back to the table when providers hold the line. So don’t be afraid to say no—it can open future negotiations.

Audience: Have you seen regional providers band together?

Seabrook: Yes, especially in CON states. Everyone knows everyone, and when one agency refuses to take a payer, others often follow. It’s public and can be effective at forcing higher rates.

By automating everything from scheduling and IDG, to billing, bereavement and volunteer management, Homecare Homebase gives caregivers the most important resource of all: More quality time with their patients and families. To learn more, visit: https://hchb.com/.