caregiver holding hand with patient in bed

Home healthcare can potentially reap substantial financial rewards as managed care plans look to providers to take on more risk. That was the message earlier this week from a session of the Home Care 100 conference in Orlando.

“You take on the full risk where you are managing the total cost of care or some portion for it,” Tim Craig, Lincoln Healthcare’s vice president of education, told home care agencies during an education session on the potential of increased reimbursements by assuming risk.

Plano, TX-based Resilient Healthcare has taken on the full risk of patients enrolled in its hospital-at-home program. Company co-founder and CEO Jackleen Samuel said if agencies want to make more money by assuming risk they must reduce overall costs by keeping patients out of the hospital and keeping them healthy.

“We take on risk through benchmarks,” Samuel told the audience. “These are the things that we found that we can definitely change and many are common sense.” 

For Resilient Health, those benchmarks include better medication management and improving physical and mental health scores of patients. 

While the upside to taking on risk can translate into better profits, there are significant downsides if providers can’t contain patient costs, according to Amedisys Chairman and CEO Paul Kusserow.

“It can either go very well for you or it can go badly for you,” Kusserow told McKnight’s Home Care Daily Pulse. “That’s why you need actuaries, underwriters, reinsurance companies, contacting expertise. If you get that wrong, you’re writing a check and you’re out of business.”

Find a partner

Some home health agencies may not have the scale or leverage to negotiate appropriate rates with payers in order to assume risk and others may not have the stomach to put their profits on the line. For those agencies, partnerships might be a better option.

San Francisco-based Homeward Health partners with healthcare providers and payers to bring value-based care to patients in rural communities. The company signed a deal last summer with Priority Health to manage care for 30,000 of its Medicare Advantage patients in Michigan. 

Stephanie Gutendorf, Homeward’s senior vice president of strategy and development, said partnerships her firm has forged with home health agencies provide them a great opportunity to “tiptoe” into risk.

“Homeward can shoulder some of the brunt of that responsibility and create a payment mechanism [for home health agencies] that essentially allows them to try out or pilot risk in a smaller construct of their population,” Gutendorf explained.