Category: Avalere Health

Under the Trump administration, federal health care policymakers have long been vocal about the ability of Medicare Advantage (MA) to lower costs and improve outcomes among vulnerable populations.

A recent report from the Washington, D.C.-based Better Medicare Alliance (BMA) and consulting firm Avalere Health is now putting hard numbers on that claim, particularly around home health services and post-acute care.

“The hallmark features of Medicare Advantage — risk-adjusted capitated payment, strong value-based performance incentives and flexibility in benefit design — enable health plans to offer care management interventions that meet complex care needs of vulnerable beneficiaries in ways that produce robust positive outcomes and greater value for high need, high cost beneficiaries,” the report states.

To study cost and outcomes differences between MA and traditional fee-for-service (FFS) Medicare, Avalere and BMA analyzed data tied to more than 1.4 million MA enrollees and 7.9 million FSS beneficiaries. Researchers pulled data from 2015 to 2017.

Broadly, the findings show that MA enrollees spend far fewer days on home health services compared to their FSS peers. For every 1,000 individuals, home health days on service were nearly 20% lower in MA than in traditional Medicare, with an even greater difference among certain subpopulations.

For every 1,000 individuals under the age of 65 living with a disability, for example, home health days on service were about 27% lower in MA than FFS. For every 1,000 individuals living with a major complex and chronic condition, home health days on service were again 27% lower.

The smallest gap in home health agency days came in the frail elderly subpopulation, according to the report. For every 1,000 frail and elderly individuals, home health days on service were about 10% lower in MA than in traditional Medicare.

“The data … show that home health utilization is lower for all three populations in Medicare Advantage compared to traditional FFS Medicare,” the report notes. “One possible explanation is that inappropriate use of these services is minimized in Medicare Advantage relative to traditional FFS Medicare, but further research is needed to evaluate differences in use of home health services.”

High-need, high-cost MA beneficiaries had lower rates of post-acute utilization across all settings compared with those in traditional Medicare. Skilled nursing facility (SNF) days were 16% to 41% lower in MA, for instance.

In general, differences in post-acute care costs were similarly aligned with differences in utilization of post-acute care.

Across all populations, home health agency costs were about 38% lower in Medicare Advantage compared to FSS Medicare.

The Congressional Budget Office (CBO) forecasts that 47% of all Medicare enrollees will be Medicare Advantage beneficiaries by 2029.

“This study finds that overall Medicare Advantage delivered robust positive outcomes for high-need, high-cost beneficiaries compared to similar populations in traditional FFS Medicare,” the report continues. “Higher utilization of preventive screenings, preventive therapy and post-acute care follow-up in Medicare Advantage suggests that care management results in higher quality of care for this vulnerable population.” 

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Individual and clinical characteristics of home health patients continue to shift, reflective of both America’s aging population and providers’ ability to handle more acute cases.

That’s according to the latest Home Health Chartbook, an annual overview of the home health landscape put together by the Alliance for Home Health Quality and Innovation and Avalere Health.

In addition to highlighting the industry’s ever-changing patient population, the Chartbook also details the economic contribution of home health providers on the U.S. economy.

Compared to the overall Medicare population, home health patients tend to be older and slightly more economically vulnerable, the Chartbook suggests. Home health patients additionally tend to reside in rural areas and live alone at slightly higher rates than the broader universe of all Medicare beneficiaries.

“The Chartbook helps to conceptualize the home health landscape via data and charts that roughly sketches home health care in the United States,” Jennifer Schiller, executive director of the Alliance for Home Health Quality and Innovation, told Home Health Care News in an email. “We continue to see the value of home health care to patients and the health care system, writ large.”

When it comes to the health status of patients, home health users are far more likely to suffer from several chronic conditions.

Nearly half of the home health patient population suffers from five or more chronic conditions, with another 19% suffering from four chronic conditions, according to the Chartbook. In comparison, just 22.4% of the overall Medicare population suffers from five or more chronic conditions.

The apparent imbalance is partly attributable to the rising population of dual-eligible beneficiaries in home health care, Schiller noted.

“We continue to see a small but fairly steady increase in dual eligibles receiving home health care,” she said. “Dual-eligible home health users tend to have more chronic conditions and need assistance with more activities of daily living (ADLs) than home health users as a whole.”

On top of needing more assistance with ADLs and their chronic conditions, home health patients also often need more support for a severe mental illness, such as depression, bipolar disorder or schizophrenia.

More than one-third of the home health patient population suffers from a severe mental illness, the Chartbook shows. But just 28.9% of the overall Medicare population suffers from such an illness.

Apart from basic demographic information, the Chartbook also highlights the most common diagnosis-related groups for beneficiaries discharged from the hospital to home health providers under Medicare Part A.

In order, the most common diagnoses of patients referred from the hospital to home health are: septicemia or severe sepsis; major hip and knee joint replacement; heart failure; hip and femur procedures; and pneumonia.

In 2019, 6.93% of all home health claims were coded for Type 2 diabetes, with another 6.47% coded for orthopedic aftercare.

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The home health industry continues to carve out a bigger role in the overall U.S. economy, with agencies creating more jobs and paying more in wages than ever before.

Overall, home health agencies created more than 2.22 million jobs in 2019, employing more than 1.51 million workers in the process. That workforce took home more than $49.52 billion in estimated total wages.

These and other findings were highlighted in the latest Home Health Chartbook, released earlier this week by the Alliance for Home Health Quality & Innovation. Compiled annually by the Alliance with the help of Avalere Health, the Chartbook is a comprehensive analysis of the home health industry and the Medicare beneficiaries who utilize its services.

Data from the Chartbook comes from a range of government sources, including the U.S. Bureau of Labor Statistics (BLS), Home Health Compare, Medicare fee-for-service claims and several other Centers for Medicare & Medicaid Services (CMS) files.

The fact that the home health industry is becoming such a major economic force couldn’t come at a better time.

Millions of Americans have lost their jobs over the past nine months due to the COVID-19 public health emergency and its far-reaching impact. BLS reported Thursday that another 709,000 individuals filed first-time claims for unemployment benefits last week, on a seasonally adjusted basis.

That total is a slightly smaller number of initial claims than economists had expected, but still an astronomical spike compared to recent periods of economic stability.

To offset economic losses tied to the COVID-19 pandemic, multiple policymakers and politicians have suggested diverting further government support to the in-home care workforce. President-Elect Joe Biden, for example, pitched a $775 billion plan to boost the caregiver economy in July.

Home health agencies employed a similar number of workers in 2018, paying out a smaller wage total of $46.2 billion, however.

Employment of home health aides and personal care aides is projected to grow 34% from 2019 to 2029, much faster than the average for all occupations, according to BLS. As the baby-boom generation ages and the elderly population grows, the demand for the services of home health aides and personal care aides will continue to increase.

Broadly, the economic contribution of home health agencies has steadily risen since at least 2003, the Chartbook suggests. That’s true despite the shrinking size of the industry, at least in terms of Medicare-certified freestanding home health agencies.

From 1994 to 2015, the number of freestanding home health agencies climbed from 4,613 to 10,554. That total has fallen since then, dropping to 10,034 in 2018, according to the Chartbook.

Total home health expenditures reached $35.88 billion last year.

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At the height of the COVID-19 emergency, in-patient hospital volumes fell, with skilled nursing facilities (SNFs) and home health providers experiencing similar downturns. While home health providers began to see a turnaround in June, the same can’t be said for SNFs.

That’s according to a recent Avalere Health study examining discharge destinations recorded on in-patient hospital claims for Medicare fee-for-service beneficiaries.

Washington, D.C.-based Avalere is a health care consulting firm that specializes in strategy, policy and data analysis for life sciences companies, health plans and providers.

Specifically, Avalere researchers found that discharges to home health saw a year-over-year increase in June, with a 4.6% increase in discharge volume. Meanwhile, SNFs saw a 25.4% decrease in year-over-year discharges, which was below pre-pandemic levels.

By July, there was a 34% decrease in patients discharged from hospitals and into SNFs. Home health volumes took less of a hit, with only a 1.8% decrease.

“The main takeaway, from my perspective, is we’re seeing that the hospital discharges to SNFs are not rebounding in the same way as hospital discharges to home health,” Heather Flynn, a consultant at Avalere Health, told Home Health Care News. “We’re seeing that this could indicate some increasing use in home health relative to SNFs.”

Throughout the public health emergency, many have tried to avoid institutional settings. Facilities with a large number of residents or patients can often become sites of possible COVID-19 outbreaks.

“The hypothesis that we are working from, due to COVID, there may be caution in the use of in-patient settings, in general,” Flynn said. “When faced with the choice of in-patient versus community care, given the pandemic, use of care at home may be a preference for some beneficiary.”

As the COVID-19 emergency continues, some experts have asserted that the U.S. health care system will become increasingly decentralized, with more services pushed further into the home.

During the early days of the public health emergency, there were greater restrictions around visiting SNFs.

Additionally, some home health leaders believe that there will be stricter regulations and capacity caps for SNFs moving forward, in turn widening the pool of patients that can be shifted into the home.

“I think in the next five years, the SNF industry is going to undergo a significant transformation,” Bruce Greenstein, chief strategy and innovation officer at LHC Group, said earlier this month at the 2020 Baird Global Healthcare Conference. “The facilities themselves are designed very well for efficiency but not infection control. You can see policies that will roll out over the next two years that will help the SNF industry, but reduce their capacity.”

Some home health providers have already started to enter the SNF-at-home market, retooling their operations to handle more acute patients otherwise served in a SNF.

While the findings from Avalere Health seemingly bode well for home health providers looking to take on more acute patients or officially enter the SNF-at-home space, it may be premature to use this data as a measure of future opportunities, according to Flynn.

“I don’t know that we’re jumping there yet,” she said. “I think, right now, the trends that we are seeing are the COVID-related impacts.”

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By MORENIKE AYOVAUGHAN, NELLY GANESAN, EMMY GANOS, and JOSH SEIDMAN

It is no surprise that beyond COVID-19 health risks, the pandemic has also caused significant disruption to the lives of everyone in America. It has caused exacerbating financial pressures and ongoing job losses. An estimated 42 million people have lost their job since March 2020, which has increased the number of uninsured. The loss of coverage has the potential to yield catastrophic healthcare costs for those seeking care during the period.

While the pandemic has exacerbated coverage challenges, it also highlights gaps that existed long before the outbreak. Prior to COVID-19, average out-of-pocket costs were on the rise with an estimated 24% of Americans spending over $1,000 per year on direct medical care and surprise medical billing. The pandemic-induced economic disruption reinforces the need for physicians and patients to embrace conversations regarding cost in the clinical setting; avoiding such discussion may result in patients foregoing care and not realizing their options.

Patients should be able to rely on their clinicians to help them understand the costs of their care, including losses associated with the time away from work and transportation expenses for visits. Our past research, and the research of others, has demonstrated that these conversations are valued and can be impactful in helping patients understand their options to address concerns upfront. And yet, the concept of having a Cost-of-Care (CoC) conversation is merely optional. These conversations are not typically supported with access to price information, nor are they consistently viewed as a routine part of practice. Cost conversations are not consistently documented, lack standardization, and structure. Furthermore, physicians have not adequality been trained to address CoC conversations with their patients.  

Our work to date as shown that patients feel supported by clinicians and care teams when the clinical staff addresses cost concerns and can connect patients to financial resources to help them make decisions regarding their care. Measurement is one mechanism to encourage these conversations. In partnership with patients and clinicians, Avalere Health, the National Patient Advocate Foundation and Robert Wood Johnson Foundation are exploring the feasibility of quality measures to normalize and improve the quality of CoC conversations in the clinical setting.

Implementation of meaningful quality measures allows health care system leaders and policymakers assess whether clinicians are engaging in respectful conversations about costs with patients, and whether patients’ concerns about costs are being addressed. We also know measurement alone will not drive improvement. Measures can be used to support quality improvement and systems change.

Based on our research and a growing body of literature, we are exploring measure concepts to facilitate CoC conversations between patients/caregivers and their care teams and to assess their impact. We need to ensure these measure concepts meet three main goals. First, they need to resonate with patients; the measures need to address issues that really matter to individuals who are trying to make decisions about their care. Second, the measures should have some impact on holding clinicians accountable; normalizing CoC conversations – asking clinicians to do something patients want but is only happening a quarter of the time – requires accountability for their actions. Third, we want these measures to drive improvement; the measures need to provide information that guide clinicians and the organizations they work in on what steps they can take to make conversations respectful, responsive, and effective. Based on existing gaps and our knowledge of the clinical workflow, the concepts we are exploring address: discussion of CoC during a clinic visit, documentation of CoC concerns and a patient-reported assessment of the CoC conversation.

Having a CoC conversation requires a shift in how a clinician prioritizes how to use their time with patients. This shift will need to be addressed and implemented by clinicians, care teams, payers, and policymakers. Only then will patients see a meaningful change to their experiences in care delivery. Our partners are very excited to test, implement and evaluate these measures in a real-world setting, we’re hopeful that introducing quality improvement in this space will enhance cost transparency and put more pressure on policymakers and regulators to advance the use of measures to address barriers to CoC conversations.

Morenike AyoVaughan, MPH, is a Consultant II at Avalere Health, Nelly Ganesan, MPH, is a Principal at Avalere Health, Emmy Ganos, PhD, is a Senior Program Officer at the Robert Wood Johnson Foundation, and Josh Seidman, PhD, is a Managing Director at Avalere Health.