Home Health Adapts Post-Pandemic in Push for Efficiency
COVID-19 made home healthcare a necessity as non-emergency care was moved outside hospitals. Post-pandemic, its role in care delivery continues to grow, fueled by high inpatient-care costs that impact insurers, providers, and patients, emerging technologies, and patient demand for greater convenience.
Even before the pandemic, health systems were encouraging more home care, which is projected to grow 8.5% annually through 2027 to $340.2 billion globally, according to the market research firm Markets & Markets. It is seen as a partial solution to two of the factors affecting the larger healthcare sector: margin issues and labor shortages.
Home healthcare could be game-changing for disease-management programs that focus on the 5% of patients that account for half of all medical costs – more than $2 trillion in the U.S. alone.
“Our ability to safely monitor and care for patients outside of the hospital is growing by leaps and bounds [thanks to advancements in technology],” says Dr. Nathan Starr, Medical Director for Castell Home Services and the lead Hospitalist for Intermountain Healthcare’s Tele-Hospitalist Program. Artificial intelligence is also helping to identify patients who may be at risk for hospitalization, Starr adds, allowing for at-home interventions that could circumvent costly and/or lengthy hospital stays.
Shifting financial risk
Both private and public health insurers are looking to control costs by shifting more of the financial risks to providers by reimbursing them a flat rate per episode of care or paying a set fee to manage a specific population of patients. For their part, healthcare providers are looking for ways to deliver quality care without absorbing costs or potentially losing money under less- favorable reimbursement plans. Increasingly, home care is becoming a solution to close the gap between cost and quality, working for both providers and insurers.
Ashraf Shehata, who leads KPMG’s healthcare & life sciences practice, says health plans have been more active in coordinating care management in delivering care in the home. “You’ve got to be able to strike the right balance of trying to drive profitability or to drive quality of patient care,” he says.
Consolidation in home health
Some healthcare companies are seeing home health as a way to complement their other businesses and improve care coordination. For example, Humana’s home-health division, CenterWell, broadens the company’s operations beyond health insurance and has made the company one of the largest home-health providers. CVS, a leading pharmacy chain and health insurer, completed an $8 billion deal in March to buy Signify Health. CVS believes that the home health company’s technology-driven approach, serving 2.5 million unique members, will create opportunities for greater integration with pharmacy services, urgent care, and benefit coordination, especially around Medicare Advantage coverage for senior citizens.
“This transaction advances our value-based care strategy by enhancing our presence in the home,” CVS Health President and CEO Karen S. Lynch said in a statement. “Our expanded capabilities will bring us closer to the consumer as we continue to redefine how people access and experience care that is more affordable, convenient and connected.”
Finally, home health captures what is often missed in a hospital setting: how patients live.
“That’s probably more important than a lot of the actual medical issues themselves,” says Starr, who is part of a 33-hospital system with 385 clinics in Utah, Nevada, Idaho, Montana, Colorado, Wyoming, and Kansas. He notes that s and environmental factors can significantly affect an individual’s need for medical attention, namely matters of nutrition, the condition of a home, or how well a person takes care of him or herself. “I think that is one of the trickiest parts of where we’re at as a health system with our aging population. How do you actually define health care? And what do you include within healthcare?”
KPMG’s Shehata concurs, saying, “If you want to be able to leverage the home as a kind of a new healthcare hub, we’ve got to add transportation services. We’ve got to add social services and community services. We can do a lot with home care, but we’ve got to be able to create a model to treat the whole person at home.”
Home health preserves independence for those who might otherwise opt for assisted living or a nursing home at a much lower cost than inpatient care. “A lot of these actions [in home-care delivery] compared to hospitalization or a nursing home stay are incredibly cheap to do,” says Dr. Starr. “We’re trying to get a team into the home to identify exact issues and comprehensively approach their care in a different way to keep [patients] healthier and drive down utilization.”