On the acquisition of Kindred at Home by Humana:
We’re hoping that the Humana acquisition of Kindred ends up sending a message to the rest of the managed care industry that they might want to look again at whether a partnership with home care could be a good pay-off. Sometimes, buying the cheapest visit isn’t going to get you the best return.
On Medicare Advantage home health payment rates:
Too many of the plans pay less than cost. We’re concerned that going forward, with pressure on Medicare rates, [agencies] will no longer be able to subsidize those plans. As the proportion of patients grows on the MA side, the ability to subsidize is diminished.
So, the plans don’t yet have a willingness to accept value. You can talk to some of the large companies walking in with all kinds of data, they talk about value-based [arrangements], dynamic value, they talk in terms of readmission rates, and those conversations more often than not end up with, that’s all well and good, but how much are you going to discount your services? They just don’t see that there’s value beyond that visit itself. Beyond taking care of that momentary need. While they talk about population health, are they really doing population health?
On CMS allowing Medicare Advantage plans to start offering non-skilled, in-home care:
From what we have seen, interest has been growing in learning more, but most of the plans were already set for 2019 when CMS announced this. Anthem being one of the exceptions.
When I first contacted AHIP, America’s Health Insurance Plans, and said, I’d like to talk to you about this new opportunity, their awareness of it was limited … that’s no longer the case. They are now thinking about it. Their members are thinking about it. The Anthems of the world are coming forward, and they’re looking at Anthem and they’re looking at Humana, and maybe they’re going to let someone else take the first journey down that road, but it’s now something that’s on their radar.
I still have a cautious approach to it. I was just with a group of private-pay personal care services companies, and you can ask the rhetorical question: Would you rather sell your service for $25 an hour to a private-pay patient or $15 an hour to a managed care plan? That’s the situation that I think the industry will be facing.
We’re hoping that the industry that offers this kind of [personal care] service does not think that if they get their foot in the door, they can raise the price to what they think is a market price. We saw that happen in home health more than once, and instead, what happens is, the plan says, “If you’re not going to take our price, we’ll find someone who will.”
If I were running a private-pay company, I would be suggesting that if they pay $25 an hour, they’re going to get a highly skilled personal care workforce that can be used for more than just personal care — can be used as the eyes and ears to know when there’s something wrong starting to develop, and can be a manager, making sure [patients] see their doctor, take their medications, have food that’s fresh rather than moldy in the refrigerator. So the plan can avoid a $50,000 hospitalization by paying a few more bucks on the personal care side. I’m not sure the plans are ready to have that conversation.
Written by Tim Mullaney
- Bill Dombi on stage at NAHC: Tim Mullaney for AMN