America is experiencing a significant demographic shift with the aging of the baby boomer population. By 2034 there will be an estimated 77 million Americans at least 65 years old, making up almost one quarter of the U.S. population — an increase of more than 42% from 2019. That also means a growing population in need of medical care — and home-based care. Nearly all seniors are affected by at least one chronic medical condition, and 8 in 10 are living with two or more ongoing health problems.
But while the country is growing older, there are not enough health practitioners to meet demand. A shortage of as many as 48,000 primary care physicians is expected by 2034, and 2 in 5 active physicians will be of retirement age within the next decade. Adding to these labor woes is a historic decline in registered nurses (RNs). An analysis found that the number of RNs decreased by more than 100,000 in 2021 — the largest drop in the past four decades, while the U.S. Bureau of Labor projects there will be more than 203,000 RN job openings each year through 2031.
These challenges are further compounded by the siloed nature of our healthcare system that combined lead to an experience that feels neither designed for providers nor patients. In the last several years, however, partly accelerated by the pandemic, we have also learned a great deal about the opportunities to redesign the ways in which we provide healthcare. Both patient safety concerns during the pandemic along with regulatory flexibilities have enabled greater deployment and experimentation with home-based care — a more patient-centric model of care that was already gaining traction prior to the coronavirus health emergency.
The pandemic demonstrated that meaningful medical care can effectively take place in the home — from supporting daily living and rehabilitation to delivering primary care, skilled nursing and even higher-acuity hospital-level care. But to continue to scale this model of care in a way that provides equitable access, we will need to create a more sustainable system that will endure beyond the recent pandemic response and beyond isolated geographies.
Primary care innovations are leading the way
Continued growth in Medicare Advantage plan enrollment, with almost half of all Medicare beneficiaries now enrolled in MA plans, has been key to moving the healthcare industry toward a value-based approach and creating a viable model for home-based care. In my role overseeing clinical operations of Humana’s home solutions business, I’ve seen the benefits of value-based care through Humana’s commitment to this approach and the senior-focused primary care model implemented at CenterWell Senior Primary Care and other centers throughout the country.
As of 2021, nearly 7 in 10 of Humana’s MA members were treated by primary care physicians in value-based arrangements. Humana members cared for by these physicians experienced fewer ER visits and hospital admissions and spent 251,000 fewer days as hospital inpatients in 2021 than those in either non-value-based arrangements or on Original Medicare. This led to an estimated 20.1% cost savings when comparing Humana value-based members to original Medicare. Moreover, Humana’s value-based members like the care they receive. The average patient experience Stars score for these members was about 25% higher than those treated under non-value-based care.
Those results are a big reason why one of Humana’s top priorities is to build and rapidly scale a comprehensive value-based home care offering that covers 40% of Humana MA members by 2025. The innovations and successful outcomes achieved in primary care provide a roadmap for the home-based care industry as we navigate the changing regulatory and demographic landscape and look to build a sustainable home-based care system.
The viability of home-based care relies on a value-based model
While the traditional home health model has been oriented towards fee-for-service, greater patient acceptance and comfort with home-based care will necessitate a shift to value-based reimbursement that incentivizes quality and accountability of care. Ensuring that the quality of in-home practice is at least equivalent to the experience of care in an institutional setting is fundamental to enable home-based care to scale beyond pilots and specific geographies.
Value-based care provides the prerequisite structure needed for greater investments needed to support outcomes focused home-based care and enable a more holistic care team approach with the flexibility to innovate on the mix of practitioners and the technologies supporting care of the patient. In addition, the value-based care model is instrumental in addressing the socioeconomic factors impacting patient health such as food and housing insecurity, lack of transportation and loneliness that make a real difference in patient outcomes.
The Centers for Medicare & Medicaid Services’ regulatory flexibility allowing MA plans to cover supplemental benefits including various in-home services, and social and wellness supports has made MA plans the right vehicle for providing value-based care in the home.
Great opportunities, but also challenges ahead
Consumer receptivity toward care in the home had been on the rise prior to the pandemic. COVID-19 has catalyzed that preference. A Deloitte report issued in 2020 found 70-80% of those surveyed responded positively when asked about receiving care in the home for medical consultations, diagnostics and post-procedure care. Last year, a report based on a survey of physicians and MA members estimated that $265 billion worth of care services, or 25% of the total cost of care for Medicare beneficiaries, could shift to the home setting by 2025 without reducing access or quality of care.
Along with the embrace of home-based care by patients and clinicians, the flexibility of government regulations and payment rules to avoid disruption of care during the pandemic enabled providers to offer many more patients the home as an alternative care setting. Those flexibilities have included the availability and reimbursement of telehealth services, the expanded definition of those eligible to receive in-home services, and non-physician practitioners being authorized to certify those services.
Unfortunately, some of these regulatory changes were temporary and have expired or are set to expire at the end of 2024, creating uncertainty and hindering industry investment and innovation. In addition, addressing labor shortages requires substantial workforce investments as well as an increase in multi-state licensing so practitioners can provide care wherever it’s needed, be it in person or via telehealth. Ultimately, continued growth and entrenchment of value-based home care will necessitate a regulatory framework that enables true patient choice and rather than specifying components of care that must be completed, anchor on a model that delivers on outcomes.
Mona Siddiqui, MD, MPH, MSE, is senior vice president, clinical operations, for Humana Home Solutions.
