Against All Odds, Home Health Care Helped Bend 2020’s Cost Curve

For the first time in decades, U.S. health care spending may have actually decreased in 2020, new data suggests.

Several factors likely contributed to the potential decrease, according to nonprofit research and consulting firm Altarum, which released a preliminary analysis of last year’s national health spending on Tuesday. Such factors include year-over-year declines in hospital and nursing home care, along with an increase in home health care.

“[Spending] on prescription drugs and home health care actually increased for the year, the latter likely related to individuals selecting home care rather than nursing homes to avoid exposure,” the Altarum analysis reads.

Source: Altarum

Specifically, Altarum economists estimate that national health spending in 2020 was 2% lower than in 2019, a decline of about $75.8 billion.

For context, total U.S. health care spending in 2019 was $3.8 trillion, up 4.6% compared to the previous year, according to the Office of the Actuary within the Centers for Medicare & Medicaid Services (CMS). Overall, the share of the economy devoted to health care spending, as measured by the GDP, was 17.7% in 2019.

A decrease in national health care spending of $75.8 billion may seem relatively small at first glance. But even a minor dip — or just the possibility of one — is significant, considering that total health spending in any given year hasn’t been less than the previous year since at least 1960.

“This is the first time we’ve actually seen negative growth, or a decrease in spending, using this preliminary data,” Corey Rhyan, a senior analyst with Altarum, told Home Health Care News. “It’s a significant finding, though, it’s very dependent on how some of the underlying data is going to play out.”

Compared to 2019, spending on hospital care was down 7% in 2020, Altarum estimated.

Similarly, spending on physician and clinical services was down 4.3% on a year-over-year basis.

Largely due to the COVID-19 virus and widespread efforts to keep vulnerable populations out of congregate settings, spending on nursing home care decreased by 2.5% in 2020 compared to 2019, according to Altarum. Meanwhile, spending on home health care jumped by an estimated 2%.

While that statistic reflects the important role that home health providers have played since last spring, it’s not entirely surprising. The “shift to home” has been happening in a gradual manner of the past several years, Amedisys Inc. (Nasdaq: AMED) CEO and President Paul Kusserow told HHCN.

“While the pandemic certainly accelerated the transition away from facilities to home care, the transition has been underway for some time,” Kusserow said. “Care in the home is the most economical for all payers. It’s where patients want to receive their care — and it has proven, quality outcomes.”

With roughly 21,000 employees and 415 care centers across the U.S., Baton Rouge, Louisiana-based Amedisys is one of the largest home health and hospice companies in the country.

A safe bet

The new analysis on 2020 spending from Altarum isn’t set in stone. In all likelihood, economists won’t be able to put a price tag on the COVID-19 pandemic or all of its indirect health care impacts for several months.

Traditionally, CMS doesn’t release solidified spending figures until December. That’s why Altarum creates its preliminary analysis using U.S. Bureau of Economic Analysis (BEA) data and its internal Health Sector Economic Indicators framework.

Currently, that BEA data likely doesn’t include all health-related spending from certain categories linked to the public health emergency, however.

Increased activity associated with COVID-19 testing and contact tracing, for example, could cause health spending to exceed Altarum’s projected values. Conversely, the pandemic-induced recession may have suppressed spending on structures, equipment and services provided in non-traditional settings.

COVID-19 relief in the form of CARES Act payments and advanced payment from CMS may likewise end up throwing the projections off, Rhyan said.

“You’re aware of the direct money that went to hospitals to support their bottom lines [and] help them stock up on supplies to make sure they could more adequately combat the pandemic. You’re aware of some of the changes that have gone on in Medicare reimbursement such as the accelerated payments, which need to be paid back,” he said. “There were a lot of financial issues in 2020 related to how much the federal government has directly supported health care, which may not be in some of these estimates.”

Yet the key finding of nursing home spending being down — and home health spending being up — is a safe bet. In fact, it’s a trend that’s likely to stick around for the foreseeable future, as nursing home operators are just now starting to stabilize from sharp and persistent declines in occupancy.

There are plenty of indicators that back that up, Rhyan said.

Spending on hospital care and physician services plummeted in March and April, as most Americans opted to delay any care that wasn’t absolutely necessary. Non-COVID-19 hospital admissions, for instance, fell to about 80% of predicted levels nationally by the week ending Dec. 5, according to Kaiser Family Foundation.

But after that steep dropoff, spending levels rapidly started to normalize. That didn’t happen with skilled nursing facilities (SNFs) and home health care services, Rhyan said.

“Nursing home care did not fall off a cliff like hospital care and physician services did early on in the pandemic,” he said. “It has seen a much slower decline, but a very persistent decline. It has actually continued to fall throughout the year, without that kind of recovery period that hospital care and physician care had.”

Home health care similarly didn’t see a huge dropoff right off the bat. But instead of a persistent decline, it has seen a steady rise in spending levels.

“I think that’s indicative of a more permanent, longer-term trend,” Rhyan said.

Amedisys has seen home health care’s resiliency play out firsthand. During the third quarter of 2020, the company grew its total home health admissions by 5% compared to the same period in 2019, with its overall patient volume growing by 6%.

“The pandemic has clearly shown the value to patients and payers of delivering post-acute care services in the home, and this is a trend that will not abate but only accelerate,” Kusserow said. “As a result, you will see more rapid development — and adoption by payers — of SNF-at-home models offered by the home health industry.”

Cutting costs

Normally, health spending is “pretty robust” during recessionary periods, Rhyan said. Altarum’s preliminary analysis suggests that hasn’t been the case, which is another interesting takeaway.

“It really hasn’t been, as a result of the direct causes of the pandemic,” Rhyan said. “There was the disruption and slow down in elective care, for example, during this time period.”

Moving forward, spending on home health care is also likely to increase due to the possible evolution of the home health benefit itself.

Today, home health care is often seen as a post-acute care service, even though just one-third of patients actually go to home health care following an institutional stay. In the future, policymakers may seek to make the benefit more all-encompassing and flexible.

The Partnership for Quality Home Healthcare (PQHH) has been working diligently to make that happen, executive director Joanne Cunningham told HHCN.

“We’re actually exploring this from a policy standpoint — maximizing the home health benefit so all Medicare beneficiaries have access to the services they need,” she said.

The government’s investment in home health care may also rise as a further cost-saving necessity.

The federal government ran a deficit of $3.1 trillion in fiscal year 2020, more than triple the deficit for fiscal year 2019, according to the Bipartisan Policy Center. So far, the 2021 defect is upwards of $735 billion.

Source: Bipartisan Policy Center

Eventually, policymakers will need to flatten that curve — and they may look to home health care for answers.

A 2019 study found that patients who received home health care in-home immediately after going to the emergency room had a total 90-day cost of $13,012, compared to $20,325 for patients who were treated in the hospital.

Additionally, a 2017 study found that patients who received home health care after a hospital discharge saved the U.S. health care system about $6,500 over the course of a year.

That ability to bend the cost curve has only been magnified during the pandemic, Cunningham said.

“I think COVID has shown us the vulnerabilities of some of the institutional care settings and taught us valuable lessons about how we, as a country, do a better job managing care,” she said.

The post Against All Odds, Home Health Care Helped Bend 2020’s Cost Curve appeared first on Home Health Care News.

In-Home Care Providers Concerned About Clients Turning Away Unvaccinated Caregivers

Despite individual concerns and procedural roadblocks in some states, many home health and home care providers say their workers have been able to gain access to the available COVID-19 vaccines.

As the U.S. neared a large-scale vaccine rollout, some in-home care operators feared their clinicians and caregivers would be overlooked, especially with government officials often focused more so on hospital and nursing home staff. The fact that several states have explicitly recognized home care professionals as eligible for the COVID-19 vaccine is particularly encouraging, Dary Anderson, vice chairman of the Partnership for Medicaid Home-Based Care (PMHC), told Home Health Care News.

The Washington, D.C.-based PMHC is an industry advocacy group that represents home- and community-based care providers operating in the Medicaid space.

In addition to his role at PMHC, Anderson also serves as executive vice president and chief strategy officer for Addus HomeCare Corporation (Nasdaq: ADUS). Headquartered in Frisco, Texas, Addus provides personal care, home health and hospice services across nearly two dozen states.

“It’s maybe a little easier on the nursing, therapy and more clinical [roles], to have them acknowledged as health care workers needing the vaccine,” he said. “We had concerns initially that it would be harder for the home care aides and more paraprofessional staff to be considered in that health care group, but that honestly met very little resistance.”

To help gauge vaccination progress, HHCN recently polled more than 100 home-based care professionals. Roughly two-thirds of the respondents worked for Medicare-certified home health agencies, with the remainder working for Medicaid and private-pay in-home care providers.

Overall, more than three-quarters of survey respondents said they have staff members who have received at least a first dose of the COVID-19 vaccine. Staff members have typically gotten their shots via external vaccination sites, though about 17% of the HHCN survey respondents reported their organizations are doing in-house vaccinations.

The Visiting Nurse Service of New York (VNSNY), for example, decided to internally handle staff vaccinations to speed up the process and maximize efficiency. So far, the nonprofit home-based care giant has vaccinated 2,000 of its eligible employees.

“Our staff [members] who want the vaccine are very [eager] to get it,” VNSNY Chief of Provider Services Andria Castellanos previously told HHCN. “As a large employer who really cares about our employees, we felt like we could deliver the vaccine to them faster than they could likely get it in the rest of the city.”

The ‘sausage-making process’

While the vaccination rollout to home health and home care workers appears to be going smoothly on the whole, there are still isolated problems due to mixed messages and confusing guidance.

Certain in-home care workers in Florida have claimed they’re not getting sufficient access to the COVID-19 vaccine, for instance, which goes against an executive order from Republican Gov. Ron DeSantis.

Specifically, the order states the first phase of vaccine distribution should include all health care personnel with “direct patient contact.” Yet some vaccine sites aren’t lumping home health or home care staff into that group.

“We are classified in the executive order; we are just not being recognized as such,” Shayna Adaniel, the director of client services for BrightStar Care in Delray Beach, Florida, told WPBF News. “From the beginning, home health has kind of fallen into this blind spot.”

More than half of the respondents in HHCN’s vaccine survey said their state had explicitly prioritized both home health and home care workers in their prioritization strategies. About one-quarter said their states didn’t prioritize any in-home care workers.

Los Angeles County in California is the epicenter of the pandemic right now. Its local government did clearly confirm home health and home care workers are eligible for the vaccine.

After initial confusion, Colorado officials announced on Jan. 19 that individuals who provide in-home health care for homebound elderly or sick people do qualify to receive the coronavirus vaccine in the current distribution phase. Massachusetts opened up eligibility to all in-home health care workers last week, too.

Considering the “Herculean” vaccine undertaking, Anderson told HHCN that difficulties with the “sausage-making process” were to be expected.

“But there are good stories, too,” he said. “I think Arizona has done a really nice job. At Addus, our experience in downstate Illinois has been positive. We’ve had good success with the prioritization of home care workers and their access to [the vaccine].”

‘Be Wise, Immunize’

Apart from access, home health and home care providers must also navigate vaccine hesitancy among their workforce.

In HHCN’s survey, just 10% of the respondents said their organization had a universal willingness from staff to get vaccinated. About 70% of respondents said a majority of their workforce was willing to get vaccinated.

“That’s really the No. 1 question on most people’s minds right now,” Anderson said. “It’s a bit early to tell, I think, to get a real true sense of how much vaccine hesitancy there is among this workforce.”

To help educate the in-home care workforce and alleviate anxieties, PMHC recently launched a “Be Wise, Immunize” campaign, which includes a public awareness website with information about the COVID-19 vaccine, front-line-worker testimonials, state-level guidance and more.

“We wanted to bring together facts and science-based information into one place to continue to provide education to home care workers regarding the vaccine,” Anderson said. “We really believe that the more direct-care staff hear from their peers about the positives of the vaccine, the more they get the real story about side effects, … the more we can reduce the vaccine hesitancy.”

Of the more than 100 home-based care professionals to take part in HHCN’s survey, just four said that their organization is mandating staff vaccinations. About 62% of the respondents said their organizations are encouraging or incentivizing vaccinations.

Moving forward, providers may need to start considering what they do if clients decline visits from caregivers who aren’t vaccinated.

More than two-third of the HHCN survey respondents said they are concerned about patients or clients turning away visits from unvaccinated workers.

“If we get clients who say, ‘Don’t send me an aide that’s not vaccinated. Don’t send staff into my home that’s not vaccinated.’ What do you do in those situations?” Anderson said. “Nobody is really truly comfortable mandating the vaccination. But we want to encourage it — and for that very reason.”

Yet any decisions on how to encourage vaccinations depend on the nation’s stockpile. As of Sunday, it’s unclear how large that stockpile actually is.

“I can’t tell you how much vaccine we have,” Dr. Rochelle Walensky, director of the U.S. Centers for Disease Control and Prevention, told Fox News. “And if I can’t tell it to you, then I can’t tell it to the governors, and I can’t tell it to the state health officials.”

The post In-Home Care Providers Concerned About Clients Turning Away Unvaccinated Caregivers appeared first on Home Health Care News.

As FDA Nears Authorization, Home Health Industry Still Evaluating Vaccine Mandates

A panel of U.S. Food and Drug Administration (FDA) advisers voted on Thursday to recommend that the Pfizer-BioNTech vaccine be authorized for emergency use during the coronavirus pandemic.

Originally, it was believed the FDA — which typically follows the guidance of its advisers — would move forward with authorization on Saturday. That timeline has likely been pushed up to even sooner now, with the White House reportedly pressuring FDA’s leader to give the greenlight to the vaccine or step down.

Early Friday, President Donald Trump compared the FDA on Twitter to “a big, old, slow turtle,” and urged the agency’s commissioner, Stephen Hahn, to “stop playing games and start saving lives.”

While the general public is following those developments closely, home health operators are paying particularly close attention. Many are currently in the process of crafting their COVID-19 vaccine protocols, including whether or not to mandate employee vaccinations.

David Totaro, chairman of the Partnership for Medicaid Home-Based Care (PMHC), touched on the issue Thursday during the Home Health Care News Capital+Strategy event.

“The next thing that we’re trying to address right now is whether or not vaccines should be mandatory among our staff,” Totaro said. “And that’s a very, very complex issue. We’re taking it very seriously.”

Broadly, home health stakeholders agree that their patients — especially high-risk seniors with multiple complex medical conditions — should be prioritized for early vaccine access as part of the first wave. That is in line with U.S. Centers for Disease Control and Prevention (CDC) recommendations finalized last week

Ultimately, decisions around prioritization come down to the state level.

In a similar vein, decisions around mandating vaccinations for home health staff will likely be made by individual providers, Totaro said.

“We’re evaluating from the standpoint of legal implications there,” he said. “There are state regulations, religious considerations — so many things to consider. But I think in the long term, and we haven’t made a decision yet [as an industry], I think it’ll be up to individual providers.”

As home health operators debate vaccines mandates, there’s little legal precedent to consider.

In fact, some of the organizations that health care providers would normally look to for clarity have been quiet on the issue thus far.

“The Equal Employment Opportunity Commission (EEOC) has not yet spoken to whether employers may mandate that all employees take a COVID-19 vaccine when one becomes available,” Elaine Turner, a shareholder at the national law firm Hall Estill, told HHCN in an emailed statement. “However, during the H1N1 public health crisis, the EEOC determined that, during an influenza pandemic, employers could not mandate that all employees take a flu vaccine regardless of employee medical conditions and religious observances.”

While home health operators wait for the EEOC and other government entities to speak to the vaccine question, employers should evaluate whether their businesses are legitimately in need of a mandatory COVID-19 vaccine policy, Turner noted.

For some, encouraging workers may be a better alternative to mandatory vaccinations.

“Under federal law, employers must have a reasonable belief that a mandatory vaccine policy is required because an employee’s ability to perform essential job functions will be impaired by COVID-19 or an employee will pose a direct threat due to COVID-19,” she said.

If home health providers do mandate or strongly encourage COVID-19 vaccination for staff, it could end up shaping the attitudes of their patients.

In a Transcend Strategy Group survey of 599 individuals, 65% of respondents said a provider’s COVID-19 status will have “some” or a “significant” impact on their willingness to receive care from them.

Home health operators still have time to hammer out their strategies around staff vaccinations.

Once the FDA authorizes the vaccine for emergency use, the federal government can start distributing the vaccine to states. But even then, additional steps would still need to be taken by the CDC before actual vaccinations can start.

Additionally, it’s important to note that, once that happens, it’s not the end of America’s battle with the coronavirus. In actuality, the worst of the public health emergency is likely coming up, with many home health agencies preparing for a post-Thanksgiving spike that may only become exacerbated after the winter holidays and family gatherings.

“At least the first quarter of the new year is going to continue to be a very COVID-challenged environment,” Joanne Cunningham, executive director of the Partnership for Quality Home Healthcare (PQHH), said during the Capital+Strategy event. 

The two-shot Pfizer-BioNTech vaccine has already been cleared by Britain, Canada, Bahrain and Saudi Arabia, according to The Washington Post.

It has been shown to be 95% effective in randomized trials.

The post As FDA Nears Authorization, Home Health Industry Still Evaluating Vaccine Mandates appeared first on Home Health Care News.

Congressman Vern Buchanan Urges CMS to Scrap PDGM’s 4.36% Behavioral Adjustment

In August, the Partnership for Quality Home Healthcare (PQHH) unveiled a first-of-its kind, comprehensive analysis of the Patient-Driven Groupings Model (PDGM).

Among its findings, the analysis — conducted by health economics and policy consulting firm Dobson DaVanzo & Associates — highlighted how government spending on home health care is 21.6% lower than what the U.S. Centers for Medicare & Medicaid Services (CMS) projected going into 2020. The cause of that discrepancy: PDGM’s behavioral adjustment, which the home health industry has largely opposed since early drafts of the payment overhaul. 

It appears the analysis has done its job in attracting attention to PDGM’s potential flaws.

U.S. Representative Vern Buchanan, a Republican from Florida, has sent a letter to CMS Administrator Seema Verma voicing his concerns about PDGM. Buchanan had previously co-sponsored legislation that, if passed, would have restricted CMS from making assumption-based rate reductions rooted in what it believes providers may or may not do.

The Dobson DaVanzo & Associates analysis showing a drop in home health spending was based on Medicare claims data from the first four months of PDGM. In his letter, Buchanan notes that many of the factors contributing to the spending decrease have continued since.

The Bipartisan Budget Act of 2018 requires PDGM to be budget neutral.

“With these current trends continuing, Medicare home health spending will be well short of the required budget-neutral level, as outlined by Congress,” Buchanan stated.

Specifically, home health spending is down because at least two of the three PDGM assumptions made by CMS have not played out.

According to the Dobson DaVanzo & Associates analysis, home health agencies aren’t “upcoding” by choosing the primary-diagnosis code tied to the most reimbursement dollars. 

Additionally, agencies have been hit with far more Low Utilization Payment Adjustments (LUPAs) than CMS projected.

In the first four months of the year when home health agencies were adjusting to PDGM, the national LUPA rate was 24.4% — with an all-time high of 28.7% in March.

Citing the uncertainty of the COVID-19 pandemic, CMS released its 2021 proposed home health payment rule in June with basically no changes to PDGM’s framework. The agency normally releases its final payment rule for the upcoming year at the end of October.

“I urge CMS to carefully consider the data submitted by commenters and to re-evaluate the assumptions used as the basis of the 4.36% rate reduction made in last year’s rule and proposed again for 2021,” Rep. Buchanan added. “CMS should take a data-based approach to its 2021 rulemaking responsibilities and move away from earlier theoretical assumptions and projections in favor of relying on actual provider experience.”

Senators Susan Collins (R-Maine) and Debbie Stabenow (D-Mich.) have also previously taken aim at PDGM’s built-in behavioral adjustment. Rep. Terri Sewell (D-Ala.) has joined Buchanan on the House side.

A Washington, D.C.-based home health advocacy organization, PQHH was quick to praise Buchanan for his continued support of the industry.

“The Partnership thanks Congressman Buchanan for his leadership on this issue and continued support of issues impacting the delivery of Medicare home health to American seniors,” Joanne Cunningham, the organization’s executive director, said in a statement. “Congressman Buchanan is a long-standing supporter of the home health community, and we echo his request that CMS discard any previous theoretical assumptions and projections of providers’ behavioral response to PDGM, and remove the -4.36% behavioral adjustment for CY 2021.”

The post Congressman Vern Buchanan Urges CMS to Scrap PDGM’s 4.36% Behavioral Adjustment appeared first on Home Health Care News.