Where to Start: Strategically Navigating Advanced Payment Models as a Home Health Provider

Thoughtware Article Published: Mar 01, 2016
Nurse and patient holding hands

The health care payment landscape seems to change almost weekly, and providers are left wondering if their strategy is positioning them for opportunities—or risks. While there are many available educational resources out there to help you understand the rules, the next steps aren’t always clear.

Advanced payment models (APM) are focused on increasing care efficiency and improving quality outcomes, so it’s imperative that home health providers take a good look in the mirror and ask these critical questions:

  • What are our strengths?
  • How do we compare to local competition?
  • Where should we focus our efforts?

Hospitals and other health care providers are looking at publicly available outcomes data and historical Medicare payment outlays for potential home health collaborators. Competitors are looking at the same data. Your home health agency needs to assess Home Health Compare scores, “star” ratings and service utilization now to prepare for the emerging payment landscape and maintain your competitive position.

Steps for Providers with Strong Public Data

If your public data is strong, then congratulations! You have the opportunity to grow your market share through an increase in referrals as a preferred provider. Develop a strategy to showcase the data that positions your agency as a future collaborator with hospitals, skilled nursing facilities and physicians. Rhetoric and reputation will not be enough; you must use data to tell the story.

Your strategy also needs to address how you’ll maintain your best-performing metrics when volume increases. All providers are prioritizing quality outcomes and continual improvement. So while your current metrics may be competitive today, what strategies will be implemented for improvement to stay ahead of the curve? Focus on continual improvement by:

  • Pulling together and comparing your metrics and your competitors’ metrics
  • Creating a go-to-market strategy and getting it in front of potential collaborators
  • Developing a plan for continual improvement to retain your competitive edge

Steps for Providers with Weak Public Data

If your historical public data isn’t strong, opportunities are still available. Adapting to outcomes-based payment models is a marathon, not a sprint. Your first steps are to pinpoint and prioritize your investment areas. Tackle three quality metrics at a time, starting with those that will have the largest impact and then work your way down the list. Prioritized improvements may include re-hospitalization rate, emergency room visits, improvement in functional status, etc. Focus on improvement by:

  • Finding both your positive and less-than-stellar metrics
  • Prioritizing your weaknesses and developing a plan to methodically improve
  • Developing a go-to-market strategy focused on things you do well and being prepared to address questions about your weaknesses

Waiting on the sidelines until your numbers are more competitive is not an effective option. The most proactive agencies will reap the financial rewards while the wallflowers watch their market share dwindle. You can’t invest for the future if your margins are shrinking.

Regardless of whether your historical data is strong, you need to share your strategy for continual improvement with potential collaborators. They’re looking for a partner who will commit to improving outcomes and increasing care efficiency. The go-to-market strategy that made you successful today won’t necessarily work tomorrow.

A successful home health agency was recently told by a hospital point-blank that they would no longer be receiving any referrals for Comprehensive Care for Joint Replacement (CJR) payment model patients unless they were willing to meet certain CJR treatment requirements. Losing that much volume could cripple the viability of many home health providers. It should be an industry wake-up call—you can’t afford to be reactive.

Organizations that harness their data and are committed to being intentional about their approach have the opportunity to substantially grow their market share. It may not seem like APMs are a big deal in home health right now, but competitors who are ahead of the curve are seizing opportunities to gain market share. They’re positioning themselves as proactive agencies and developing the relationships that will allow them to not only be financially viable in the short term, but in the long run as well.

Have questions about crafting a strategy that helps you remain viable in the current market while preparing for long-term success? Contact your BKD advisor today and start the conversation.

Related Thoughtware

Kate & Ben — How can we help you? Contact Us!

How can we help you?