Serving the home health, home care and hospice industry since 1999.

At this week's Annual Leadership Conference of the Home Care Association of America, the usual lineup of keynote addresses and breakout sessions filled a packed, two-day schedule, followed by an assault on Capitol Hill on day three. What conference organizers will remember most is that they did not schedule a classroom large enough for a breakout titled, "The New Medicare Advantage Benefits: What it Could Mean for your Agency."

Do not blame the organizers. The hotel probably did not have a room big enough.

Consultants Anne Tomlinson and Ginny Kenyon gave the overflow crowd of Private Duty Home Care executives a thorough background and history of the federal Medicare Advantage program and followed with detail about what they can expect over the next two years. Though their briefing was based on what limited information CMS has released so far, it gave the audience some valuable marching orders.

Changed by Congress

A provision in the Bipartisan Budget Act of 2018 opened the door for insurers who participate in Medicare Advantage to cover certain non-medical services for their members. Approximately one-third of Medicare beneficiaries have opted for Medicare Advantage over straight Medicare or Medicare with a commercial supplement so far.

Final rules will be published in December but only minor changes are expected for calendar year 2019 with full implementation to arrive in 2020. According to Ginny Kenyon:

  • Where existing rules require so-called "Supplemental Benefits" to be health related, the new rule will allow MA plans to reimburse for many quasi-medical services commonly provided by private duty agencies. Examples include medication management, disease prevention measures, and treatment of common illnesses. What is not included are "comfort" or "social" services such as companionship, shopping, house cleaning, etc.
  • Under the "benefit uniformity rule," MA plans are required to offer the same benefits to all plan members. The new rule allows plans to target benefits to groups of enrollees who have certain clinical diagnoses.

Less Than Universal Glee

While most non-medical providers cannot wait for the MA doors to open next year, there are a few observers and agency owners approaching the new rule with caution. We spoke with Bob Roth, founder and Managing Partner of Cypress Home Care in Phoenix. "I'm feeling positive about offering these services to our clients and patients who are enrolled in Medicare Advantage," he told us, "but I'm waiting to see what hoops CMS might be requiring us to jump through. What certifications will they want? What kinds of claims? Will our software have to undergo major changes?"

Roth's concerns were echoed by the software vendors we spoke with at the HCAOA conference. Friendly competitors Geoff Nudd, CEO of ClearCare, and Todd Allen, CEO of AxisCare, said they are ready to begin to work on adding MA claims capability to their products but cannot begin until specific guidance is released by CMS. Even after that guidance appears, however, these MA plans are still private insurance companies that can create their own forms and set their own claims procedures. There is no requirement on the horizon that will demand uniformity among them.

That concern led us to another HCAOA exhibitor that might be effective in the middle, between providers and MA plans. Paradigm Claim Services takes over the tedious paperwork for home care agencies, often acting as their entire billing department. Chief Customer Officer John Corrigan told us about one of the advantages of using his service. "In addition to reducing denials by making sure claims are clean and accurate before being submitted, we have gained some clout with payers," Corrigan said. "We convinced their legal teams to allow us to submit claims on our forms instead of having to adapt to every insurer's unique form. They wouldn't do that for any one individual provider. And we think we will be able to get the same concession from MA plans when the time comes."

CMS has concerns as well, Ann Tomlinson told the gathering. When the Act was signed into law, regulators queried Congress about limited Medicare dollars being diverted to cover increased spending by MA plans. This arises, she explained, from the way MA plans are funded. "Each plan bids for business, every year, based on a benchmark monthly premium specific to each county. But those benchmarks are then risk-adjusted. So they may only be paid 70 percent of the benchmark for their healthy 65-year old members but as much as 2.8 times the benchmark for an 89-year old with several co-morbidities."

Where to Begin?

Questions from the packed room revealed provider concerns as well. "How do we figure out who is eligible?" "How much benefit should we provide?" "How do we describe and market our less familiar services, such as adult day care?"

The two consultants did offer some recommendations to home care providers, keeping in mind that MA plans care first about their enrollment numbers and only secondarily about actual healthcare spending.

  • Form partnerships with physician groups and other providers. Approach MA plans with those partners to demonstrate you belong to an effective care network.

  • Insurers are looking for operationalized programs, not ideas for possible futures. Talk with them about your patient outcomes and your operations.

  • If you are small, use your size to your advantage. Don't try to "beat" the national franchisor, offer to be the backup for their overflow.
    • (This point was confirmed by John Aurelio, president of Kindred at Home's south central region. "You are exactly right," he offered, raising his hand from the back of the room. "Even with our tight relationship with Humana, we can't handle every patient.")

  • Demonstrate your ability to support good relationships between insurers and enrollees; maybe your selling point is that you can help them retain enrollees, their primary concern.

  • Bring peer-reviewed studies to the MA conversation; they will be skeptical of your own data but will believe peer reviewed literature on programs like yours. Cite the studies that indicate the need for long-term supplemental services is associated with a high rate of hospital admissions.

  • Yes, getting a meeting with an MA CFO -- the one who will resonate with your claim that you can save them money by keeping their members out of the hospital -- is not an easy task. So start with those where you may already have a Medicaid contract.

  • Walk in to the meeting with a one-page data sheet that show how you could work with them to decrease their costs and improve their outcomes and generate higher client satisfaction.

  • Prepare for the fact that you may be informing this MA CFO for the first time of the new law. Even the ones who are aware of the law often say it is too late to make changes for 2019.

  • Know which diagnoses cost them the most and what each hospitalization costs them. (You may first need to get this information from the plan's CFO.)

  • Remember, you are a partner, not a vendor. You are there to help make it all work for your shared patients. You can increase their star rating, which may increase their CMS payment.

  • If they offer you a reimbursement rate lower than your costs, be prepared to walk away. You cannot make it up in volume.

  • Start to prepare now but be patient. The full benefit of this new law will not be seen until January of 2020.

  • Once you have a contract, train your home care aides to recognize problems and get in the habit of reporting them. Be sure to track changes in readmission rates before and after you enter the partnership. Use that data to continue to market your services.


©2018 by Rowan Consulting Associates, Inc., Colorado Springs, CO. All rights reserved. This article originally appeared in Tim Rowan's Home Care Technology Report. One copy may be printed for personal use; further reproduction by permission only.