Humana’s Bruce Broussard: Consumer Demand for Home-Based Care Models Will Continue to Increase

Humana’s (NYSE: HUM) long-standing home- and community-based focus served the insurer well in Q2 2020 — a quarter dominated by the COVID-19 emergency. The coronavirus pushed more senior care into the home, boosting business for Louisville, Kentucky-based health insurance giant.

As a result, the insurer doubled down on home-based care initiatives in Q2 2020 and will continue to do so going forward.

“We believe consumer demand for high-quality home-based care models will continue to increase,” Humana CEO and President Bruce Broussard said on the company’s Wednesday earnings call. “And COVID has reinforced this belief as we see increased awareness and interest in home-based care models by consumers.”

Humana has long been bullish on home- and community-based care. In 2017, the company, along with two PE firms, announced the acquisition of Kindred at Home, the largest home health provider in the country.

The insurer ramped up its home-based care efforts even further amid the pandemic, announcing strategic partnerships with the in-home primary care company Heal and the home-based urgent care provider Dispatch Health.

“Heal will serve as our preferred home-based primary care model, which is inherently more capital efficient and scalable, allowing Humana to offer high-quality, value-based primary care to more members than a clinic-based strategy,” Broussard said on the call. “The ability to deliver emergency room and hospital-level care in the home through partners like Dispatched Health is highly complementary and allows patients to recover in the safety and comfort of their home. [It also] reduces caregiver burden and avoids the risk of secondary infections and further health declines often experienced at the result of inpatient hospital stay.”

Additionally, Humana has continued to invest in Kindred at Home, most recently by working on developing new clinical models and operational enhancements for the service line. Broussard did not elaborate on what those look like.

Humana also saw the fruits of its home-based care efforts partly in the form of increased Medicare Advantage enrollment in Q2.

Last quarter, Humana’s individual MA plan enrollment was up 11% year-over-year, growing to 3.8 million in Q2. That’s especially impressive considering the fact that Humana recorded its highest individual MA growth rate in a decade in 2019.

“Medicare Advantage plans were some of the first organizations to proactively identify and implement policy and benefit changes at the outset of the pandemic,” Broussard said. “These actions addressed testing and treatment costs associated with the coronavirus, identified and tackled social determinants needs such as food insecurity, and ensured continuity of care for our members.”

One reason for MA’s success amid the coronavirus is that supplemental benefits allow plans to offer members services such as home-based care, food delivery and more, lessening the risk of seniors’ virus transmission while also addressing some of the effects of loneliness and isolation.

Bolstered by the COVID-19 emergency, MA’s popularity at Humana is only expected to grow more in the months to come.

The insurer raised its expected MA growth projections as a result of the strong performance it’s posted so far this year. Humana increased its individual MA growth range for 2020 from 300,000 to 350,000 new members to 330,000 to 360,000 by the end of the year.

For the quarter ended June 30, Humana saw its profits soar to $1.8 billion, or $13.75 per share. That’s double the $940 million in profit the company posted a year earlier in Q2 2019, with a nationwide delay of elective procedures largely to thank for the spike.

Humana’s Q2 revenues totaled $19.1 billion, up from $16.2 billion year-over-year.

MA competition, synergies

When asked about competition in the MA market, Broussard acknowledged that a number of smaller plans grew substantially last year, orienting recruitment around member experience.

“They’re always a concern to us, but we continue to believe our brand is strong in the markets that we compete with them,” he said. “Our value proposition is strong both with our customers and with our providers.”

Humana has technology on its side, as well as potentially Walmart, which recently announced it would get in the MA game.

“They’re not really getting into the MA business; they’re getting into the MA distribution business, and they have been in that business for a long period of time,” Broussard said. “So they would distribute Humana products but also competitor products. … We frankly look at it as a great complement to us, as they can continue to be a distributor for us.”

Humana’s stock price was $403.91 at the end of the day Wednesday.

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Budgeting for the Future: Kindred at Home, Johns Hopkins Home Care and Always Best Care Look Ahead to 2022

As home health leaders look to the future, the lessons learned from the COVID-19 emergency will likely continue to shape their efforts for years to come.

In terms of business planning, it will likely be a long while before there’s a return to a world where the coronavirus isn’t the central driver of health care strategy, outcomes and cost.

“We realize the current situation is not really going away anytime soon,” Mary Gibbons Myers, president and CEO of Johns Hopkins Home Care Group Inc., said Wednesday. “We’ll continue to be flexible, creative and resilient.”

Myers made her comments at the National Association for Home Care & Hospice’s 2020 Financial Management Conference, which was held virtually due to the COVID-19 emergency.

For Baltimore, Maryland-based Johns Hopkins Home Care Group, utilizing lessons learned from the public health emergency and understanding how it fits into the company’s business model moving forward has been crucial.

“For example, prior to the pandemic, we were preparing for a huge expansion of our facilities,” Myers said. “What we realized is that we really did not need as much space as we thought. We moved that mindset from expansion to contraction and making sure our employees have the optimal experience for the non-patient-facing to be able to do that remotely.”

The COVID-19 emergency also served as a catalyst for innovation for Johns Hopkins Home Care Group, according to Myers.

“In a matter of weeks, we expanded our remote patient monitoring program exponentially to meet the needs of our health system by monitoring COVID-positive patients,” she said. “We are actively discussing strategies to further remote patient monitoring over the years to come with or without COVID.”

Johns Hopkins Home Care Group falls under the larger umbrella of Johns Hopkins Health System’s Home & Community-Based Services division, which includes four Medicare-certified home health agencies, two private-duty companies, a large home medical equipment company, 10 outpatient specialty pharmacies and three alternative care infusion sites.

Similar to Johns Hopkins Home Care Group, Always Best Care Inc. has also scaled back in terms of office space, in relation to the COVID-19 emergency.

Roseville, California-based Always Best Care is a home care franchise company that operates across 209 territories in 30 states.

As part of its COVID-19 strategy, Always Best Care has placed a greater emphasis on infection control — something that will play a larger role for all in-home care providers in 2020 and beyond, according to Sheila Davis, the company’s senior executive vice president of operations.

“One thing that we have learned within our businesses is that you have to be mindful of — and protective of — not only the clients but also of your employees as well,” Davis said at the Financial Management Conference.

While infection control has always been a major aspect of home health, the public health emergency has pushed this to center stage on the non-medical home care side as well.

Additionally, amid the COVID-19 emergency, there have been a number of regulatory exceptions, waivers and other changes.

For Kindred at Home, the Centers for Medicare & Medicaid Services (CMS) and its move to broaden the definition of “homebound” under home health rules has been critical, according to David Causby, the company’s president and CEO. CMS’s goal in the expanded definition was to expand access to home health services, especially to populations at heightened risk for contracting COVID-19.

“This is something the home health industry has been pushing for an extended period of time,” Causby said at the Financial Management Conference. “I think with COVID and … the homebound status relief, we’re really starting to see some real qualitative outcomes, in regards to being able to treat seniors in their home.”

Atlanta-based Kindred at Home provides home health, personal care and community care services in almost 800 locations across 40 states. The provider organization also offers hospice care, palliative care, skilled nursing services, social services and therapy services.

Ranked at the largest home health provider in the country in 2019 by LexisNexis, Kindred at Home operates under the umbrella of Humana Inc. (NYSE: HUM)

Like many providers, Kindred at Home has leaned on telehealth use during the COVID-19 emergency. But Causby believes more relief around telehealth use for home health care is needed.

“While there’s no reimbursement associated with that today, we believe continuing to demonstrate the outcomes and the value of this will be something that, hopefully, CMS will take a look at in the long run,” he said.

Aside from lessons learned, the three Financial Management Conference panelists shared a sneak peek of what they will be prioritizing in their companies’ annual budgets for 2022.

One common theme among the home health leaders — technology.

Kindred at Home’s focus will also be on redesigning the company’s clinical innovative programs.

“We will be focusing on building out new clinical design programs that will have a lot of the technology associated with it,” Causby said. “We’re already starting to look at how we would redesign those clinical innovative programs to possibly care for seniors over a much longer period of time. The ability for these patients not to have to end up back in the ER or an acute setting will change how clinicians think about being task-oriented.”

On the vendor side, all of this means budgeting for more growth.

“As a technology provider, we are budgeting for even more growth next year,” John Olajide, founder and CEO of Axxess Technology Solutions, said at the event. “We’re continuing to hire as our business grows rapidly, not just in the U.S. but globally as well. We’re also continuing our strategic partnerships around expanding all our interoperability solutions to ensuring that our clients are positioned for success long term.”

Additionally, John Hopkins Home Care Group has plans to invest heavily in skilled-nursing-at-home models and hospital-at-home models.

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