by Tamela Buhrke
What is the difference between fear and trepidation? While one freezes you in your tracks, the other spikes your adrenaline and motivates you into action. The three subjects of this week's interview are all afraid of what is coming to home healthcare, but they are anything but frozen. One offers survival strategies from the point of view of skilled medical care, another from the non-skilled or private pay perspective. One is also a consultant to other non-skilled agency owners. What they have in common is adrenaline, and action, and a commitment to thrive throughout the healthcare reform era.
We sent healthcare writer Tamela Buhrke to Phoenix to see what makes KC's Home Health and Cypress HomeCare Solutions so successful. And we asked her to add a veteran of both home care agency management and software vendor marketing to the mix to keep the other two honest. Tamela learned what it takes to see opportunity within the coming healthcare changes in this conversation with Kerry Halcomb of KC's Home Health, Bob Roth of Cypress HomeCare Solutions, and David Cole of HHA Exchange Software.
HCTR: Our industry has some big obstacles to face as 76 million baby boomers head into their care years. Can you give us some perspective on what we are facing?
Halcomb: It's exciting! Because there's going to be huge opportunity to provide care. On the other side, because you have so many aging people, will our health care systems sustain that? Will we be ready or will all these people break the bank?
Roth: It's no secret out there that there is a caregiver shortage. According to AARP, we have 7 caregivers available to every person in need of care. By 2050, there will be 2.9 caregivers available for care. We have a real issue here. How are we going to care for these masses? Part of it will have to be technology solutions.
Cole: Right now, the real issue is not the coming Baby Boomers. That's a nightmare. However, right now, the problem is that healthcare, at discharge, sees the patient as either qualified for home health care or not. What about those patients who don't qualify? What our industry is missing is that these patients actually represent the largest share of readmissions—a serious cost for Hospitals. Hospitals should be contracting with home care agencies to deliver these services. Why isn't that happening? Why isn't home care pushing the idea of these contracts?
HCTR: What are your thoughts on fee-for-service versus bundled payments?
Halcomb: What I want to know is, 'who will be handing out the money?' Will it be hospitals or will it Medicare? With fee-for-service, we know what we will be paid. The scary part with bundled payments is making sure they pay enough to cover costs. Bundled payments are a risk.
Plus, I'm concerned that hospitals that bundle will just look at the cheapest bundled rate instead of realizing that companies with slightly higher prices might be better at lowering their readmission rates, where far more money is at stake than there is in paying for home health.
Roth: Medicare doesn't pay for home care services, so we haven't had much pressure to bundle. However, for us, the future may consist of bundled services, because technology will have to be a part of our future offerings.
Cole: The problem is that you have all these agencies and hospitals that don't understand the fee-for-service model. In the meantime, the average cost of readmission to a hospital is $17,000. Resources and staff that could be producing revenue in an operation are instead handling minor patient issues. We have to get the point across. Would a hospital rather have a $100 bill for a nurse to address a medication issue or would they rather have a $17,000 readmission?
HCTR: Estimates are that fifty percent of home health care businesses will fall in the next ten years. How can companies ensure they come out on top?
Halcomb: Companies will not only need to be smart and efficient, but they will need cash flow to sustain them. Multiple payment sources and the increased use of commercial insurance are creating variability on when we receive payment. Procedural and regulatory changes and the unpredictable situation with ACO's can also cause delayed payment. Home health care companies who make it will be the ones with deep pockets to remain adaptable.
Roth: I think the companies that are going to thrive will be the ones that really get the whole transitionary component. Enabling someone to successfully exit a hospital or rehab center and come home and be in compliance with the discharge orders and make sure that they continue to be able to thrive at home and not be challenged. That is paramount to success.
Cole: Home care companies who can fill the discharged-patient gap will achieve the triple aim of reducing costs, improving outcomes and improving patient satisfaction. Yet very few in the home health care industry see this opportunity. This isn't even a process of thinking outside the box—just look at the rest of your box! Adapt to a new model for care. The fact that insurance companies can no longer dump patients when they get sick will be a game changer. Who are commercial payers going to turn to for cost control when they are stuck with long-term care patients that they used to abandon? It ought to be home care.
HCTR: What is your company doing to prepare?
Halcomb: We are looking at our efficiency and adapting. We are learning our way around the ACO's to achieve an efficient way of getting referrals from them. But the big thing is to make sure that we can keep readmissions to hospitals and skilled nursing facilities low. That's what we offer to the healthcare system. And that's what will help us to thrive.
Roth: In our company, it starts with the people. If we aren't hiring quality people, then we aren't doing our job right. We've created a caregiver-training lab. We've trained not only our caregivers, but also over eight hundred families in our area. We do this training for free. I think that is one of our key differentiators. Visibility in the community is key. I have a radio show. I'm on the board at Banner Health Alzheimer’s Foundation. We've won the Better Business Bureau's Ethics Award. All of these contribute to the stickiness of our brand.
Editor's note: These three home healthcare leaders have helped shape the message and inspire the energy behind our "Healthcare in Transition" seminar, April 13-15, in Scottsdale. Designed to teach skilled and non-skilled in-home care provider owners and administrators the tools they need to thrive during the healthcare reform era, this seminar will be repeated on the East Coast in early October. Register here.
©2015 by Rowan Consulting Associates, Inc., Colorado Springs, CO. All rights reserved. This article originally appeared in Tim Rowan's Home Care Technology Report. homecaretechreport.com One copy may be printed for personal use; further reproduction by permission only. firstname.lastname@example.org