While this is a significant regulatory change in the home health care industry, some providers are unsure whether the Home Value Based Purchasing (HHVBP) model will have such a significant impact on bottom line.
The proposed model is built in such a way that the best performers receive the highest payout increase with a maximum adjustment of 5%. By contrast, the worst-performing suppliers are subject to a 5% penalty.
All other agencies should theoretically be somewhere in between.
But this basic methodology is not that simple, according to providers who have tested the model in demo states since 2016. National distribution is scheduled for January 1, 2023.
For example, 3HC, a North Carolina-based home and hospice health care provider, was one of the top 50 health care providers in one of the HHVBP Demonstration Years. However, in the end he received a small deduction in the reimbursement – about a quarter of a percent.
“One year we did get a positive adjustment, about 1%. And we had a really good year,” Ding Li, President and CEO of 3HC, said at the VALUE Home Health Care News event last week. “So in that sense, these adjustments are minimal. The only people who will really take real hits or get any real benefit are those who are in the 99th percentile or in the 1st percentile. In the form in which it is developed today, there are no significant adjustments.
Basically, this problem is due to the weighting system used by the US Centers for Medicare and Medicaid Services (CMS).
“They will continue to play this game,” Li said. “And make sure that the vast majority do not receive any benefit. [of providers]”.
Others have shared similar experiences.
Brent Korte, chief home care specialist at Washington-based EvergreenHealth Home Care, explained to his HHVBP staff in the simplest way possible: if there are 60 home care providers, the “bottom 30” will end up paying for the increased adjustments of the “top 30” providers. .
While EvergreenHealth Home Care did well in HHVBP compared to its state peers, increasing its star ratings and overall quality over the course of the demo, it has not seen significant adjustments.
“We ended up pretty high above that midpoint, but the issue was the release payments,” Korte said.
Next year will be the first program year under the nationwide HHVBP model, with 2025 being the first year of financial adjustments. In the demo, 2018 was the first year that vendors were subject to financial adjustments.
The maximum charge adjustment was 3% that year and then gradually increased to 4% in 2019, to 5% in 2019 and to 6% in 2020. In 2021, suppliers were expected to be able to achieve an adjustment increase or decrease. 7%, but the demonstration was stopped.
It was halted for several reasons, the first of which is the ongoing COVID-19 pandemic. Another reason was that it was decided that the model would be used nationwide after saving about $140 million a year for Medicare.
Whatever the reason, this meant that providers who worked hard to get a 7% increase ended up with no chance of being rewarded for their efforts.
“Our home health [represents] about $40 million,” Korte said. “[A possible bonus of 7% in 2021] It would have been a damn good reward, but we didn’t get it.”
EvergreenHealth has invested heavily in preparation for HHVBP.
The company has paid for months of serious training for its employees. It also set the goal of certifying every employee who touched the hiring or firing of OASIS, and also conducted OASIS coordination training programs.
When all was said and done, over $1 million had been invested in this training. And the upward adjustment from the demo was also over $1 million.
“The end result for us was over a million dollars, except you have to pull out $240,000…which they just chose not to pay,” Korte said. “But we invested more than a million in it.”
Based on EvergreenHealth Home Care math and HHVBP figures, the organization expected a $240,000 benefit increase in 2021. This bonus could have been directed towards additional training efforts or quality improvement programs.
No need to outrun the lion
During the demonstration, providers competed with their state counterparts.
Starting in 2023, there will be a much larger pool of competition across the country. This has worried some industry insiders who believe geographic differences make competition unfair across the country.
“The key is that I don’t have to run from a lion chasing me; I just need to get away from you,” Lee said. “So if you think about it, you’re chasing a moving target.”
In 3HC’s experience, system re-evaluation that changed the most important metrics or metrics also hurt it.
For example, during the demo, the agency significantly raised its overall performance score (TPS), Li said. But then the re-weighted dimension shifted, so to speak, the goalposts and made some aspects more important in the big picture. This, in turn, led to turmoil and took away the money the agency could have made.
And while that didn’t mean the agency was satisfied, it was able to bounce back by reconfiguring its own processes.
“You don’t have to like the game, you just have to know how to play it and play it really well,” Lee said. “Complaining about it won’t fix it, but working on your own processes will help.”
Korte agreed that service providers should start by looking at their own organization.
Especially when launching HHVBP for the first time, it is essential to equip the entire agency team with the necessary knowledge, albeit sometimes flexible advice.
“I said, ‘If we’re going to do this right, we need to build an army of experts,'” Korte said. “Our goal was not to be really smart [just as] senior leaders. We had a very different approach, which was that we needed every soldier to be a general. And it has done a lot of other things that are really paying off today, in terms of retention and so on.”
Patient and Provider Responsibility
The final problem with HHVBP or any performance-based models is that a lot of what makes a patient better is what the patient does.
Home health workers can do much more for the patient than some others because they are at home, but there is still a lot of racing ahead.
In fact, Lee told an anecdote about his own mother receiving home health care from 3HC. She didn’t do what she was supposed to do on the days she wasn’t visiting, which led Lee to jokingly tell his mom, “You’re going to make my grades drop.”
But that’s the reality.
“Modern society is such that we consider it the duty of the physician or home health care agency to take care of [someone]”, Lee said. “But you can’t afford to take care of a patient who won’t take responsibility for their own care.”
This could result in providers across the country selectively accepting patients after HHVBP kicks in, which would be bad for the healthcare system as well as for at-risk patients.
It can also be worse for nonprofits, which tend to be more inclined to take difficult patients as part of their ethics. 3HC itself is a non-commercial provider.
“This is not a non-profit activity, not a commercial activity, not a publicly traded company, not a systemic or privately funded activity,” Korte said. “We have to compete in terms of quality, period, or you’re in big trouble, period.”