Industry Change Has Silver Lining For Home Care Providers
As hospitals react to the rash of changes brought on by new health care regulations and cost containment laws — all while the elderly population grows — home health industry experts expect the field to grow exponentially, as well as adapt to changing health care needs.
The U.S. Bureau of Labor Statistics says personal care and home health aides are the two fastest growing occupations in the nation, with projected 10-year employment growth rates of 70 and 69 percent, respectively, by the year 2020.
At the same time, the number of U.S. residents over the age of 65 is expected to more than double between 2000 and 2030, to 72.1 million, according to the U.S. Department of Health and Human Services.
Barbara Brooks, vice president of clinical services at Worcester-based VNA Care Network & Hospice, said new home health care companies that care for the elderly, including the terminally ill, are opening all the time as a result. In about 10 years, Brooks said baby boomers will be entering the stage in their lives when home care becomes a reality.
“I do think it's going to be gradual, but it's coming,” Brooks said.
Baby boomers are more likely than the current elderly population to want to remain in their own homes, even if they require regular medical attention, according to Brooks. To make home care safer and more efficient under increased demand, Brooks said agencies like VNA Care Network & Hospice must invest in communication technology that allows medical professionals to access patient charts from outside the doctor's office —something that's not widely used at this point.
As home health care agencies look to invest and expand, hospitals are reevaluating the profitability of keeping home care services in house. The recent sale of UMass Memorial Medical Center's home-based health care services to VNA Care Network is one example of how one organization chose to let go of its home-care unit.
Taking Aim At Costs
Patrick Muldoon, CEO of HealthAlliance Hospital in Leominster, said all hospitals must consider the feasibility of home care as they look to drive costs down.
“I think every owner of a home care business has to think about their strategy going forward. Can they provide great quality and cost?” Muldoon said.
HealthAlliance has decided to maintain its home health and hospice services — for now. Muldoon said the hospital's cost structure has made home health viable for HealthAlliance. Specifically, the staff that provides home care is part of a separate labor bargaining unit from hospital staff, and the payroll in the home health industry is generally lower.
“Should the time come, two to five years from now, that we cannot compete on cost or quality, then we would have to make a decision: Can an independent organization do it better than we can?” Muldoon said.
Home care is a relatively small piece of the HealthAlliance budget — about $10 million out of $180 million, according to Muldoon. But he is said it's important to the core business of hospital care, and becoming even more important than ever.
Starting next month, hospitals with high readmission rates will start facing Medicare penalties for readmission of patients covered by the Medicare program who are treated for heart failure, pneumonia, and heart attack.
The idea is to motivate hospitals to do a better job of making sure patients receive better follow-up care, thereby reducing the readmission rates, and as a result, Medicare costs. According to Muldoon, it's easier to keep readmissions low when follow-up care is handled by hospital staff.
But home health agencies might not be exempt from similar regulation, as far as Chizoma Nosike is concerned. Nosike, owner and president of Worcester-based Acclaim Home Health Care, said Medicare is tracking readmission rates for home care agencies too, and she thinks they might see similar penalties in the future.
It's one of the reasons home health agencies must be more focused on delivering quality health care, Nosike said. But for smaller agencies like hers, customer satisfaction is also crucial.
Founded in 2005, Nosike said her agency relies on word of mouth as larger home health agencies, like VNA Care Network, are tapped as preferred providers for major area hospitals. Hospitals will send their patients to those providers, unless patients specifically ask for another, Nosike said. Though the company is constantly expanding with new hires and patients, competition can be tight.
“Most patients are not in a position, medically, to be strong enough to say 'This is what I want',” Nosike said.
The good news for smaller agencies like Acclaim is that home health providers that put out a good product will fare just fine in the new, cost-driven health care system, said Pat Kelleher, executive director of The Home Care Alliance of Massachusetts.
“Home health agencies that are able to be efficient in costs and have good outcomes are going to be successful,” Kelleher said.
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