Humana’s recent divestiture of 60% of Kindred at Home’s personal care and hospice assets is in line with the company’s overarching home care strategy, the CEO said.
“We explored a broad range of alternatives for the hospice and personal care businesses and believe this transaction best allows us to accomplish our previously stated intent, divesting majority ownership of these non-core businesses while maintaining a strategic minority interest through our remaining stake,” Humana CEO Bruce Broussard said last week in the company’s earnings call, according to a transcript.
In April, the company disclosed it was selling a majority stake in Kindred at Home’s personal and hospice care business to private investment firm Clayton, Dubilier & Rice. David Causby, president and CEO of Kindred at Home’s hospice and personal care divisions, will continue to lead these businesses.
“We are certain these divisions are well-positioned for success under the joint ownership of Humana and CD&R,” Broussard said. “Importantly, we are pleased that when viewing this transaction in conjunction with our purchase of the broader Kindred at Home platform, we have been able to achieve our objective of substantially increasing our footprint in home care by acquiring one of the leading home health platforms in the country and an attractive valuation for our shareholders.”
Onehome
Broussard also talked about how onehome, which the company bought last year, figures into the company’s home care plans.
“Onehome’s management service organization capabilities and experience providing home health, infusion and durable medical equipment services establishes the platform for our value-based home care model,” Broussard said, adding that the company is on track to launch the value-based model in North Carolina and Virginia in June and plans to expand into additional geographies later this year and early 2023.
Besides providing in-home medical services, onehome is a critical link in the company’s home care ecosystem, Broussard explained. The company can provide primary care referrals, if needed, and also connect patients to Humana’s pharmacy.
Value-based model
Chief Financial Officer Susan Diamond said the value-based home care model should support approximately 15% of its Medicare Advantage members as of the end of the year. Within five years, it should support 50% of the company’s MA members. Overall home health, durable medical equipment and infusion spending should continue to decrease under the model, she said.
