The stakes of the home care game rise; will some hospital-based players fold?
NAHC’s annual meeting leaves providers wondering about the future
Directors of hospital-affiliated agencies who attended one of the early lectures at the National Association for Home Care’s 16th annual meeting in Boston got a glimpse of their future. Or what they should hope will be their future.
Any members of the audience paying attention would have recognized that Gail L. Warden, president and CEO of Henry Ford Health System, was offering a plan of survival for their future, no matter what the 1997 Balanced Budget Act eventually does or what future Congresses do.
One of the nation’s largest vertically integrated regional health care systems, Detroit-based Henry Ford provides an array of health care services for 800,000 southeast Michigan residents. Another 550,000 get insurance through its health alliances plan, medical value plan, and life insurance units.
Henry Ford’s system comprises a tertiary care hospital, nine community hospitals the system owns or manages, 30 ambulatory care centers, a physician medical group of more than 1,000 doctors, a full-service psychiatric facility, a chemical dependence program, two nursing homes, and home health services.
The home health unit, called Henry Ford at Home, includes a Medicare-certified home health agency, home infusion, private duty service, hospice, home medical equipment, electronic emergency response system, customized wheelchairs, and home-delivered meals. In a largely managed care-driven environment, Henry Ford at Home cares for 22,000 patients through 210,000 annual visits. That low patient-visit ratio is due, Warden explained, to his organization’s 60% capitated environment and a competitive market.
"There’s tremendous pressure on us from the car makers and the UAW [United Auto Workers] to keep costs down," Warden told his audience, noting that Henry Ford has held its recent health insurance premium increases to 2% a year by increasing employee productivity and decreasing patient visits whenever possible.
Other, less fortunate providers may be excused for some cynicism; however, the fact that you may only be able to dream of such a system is less important than what lessons you can learn from it.
One of the major concerns emerging at the conference was the future of hospital-based home care after cost-shifting which was so attractive to hospitals disappears with Medicare prospective pay. What can agency directors do to ensure survival?
That question was answered at Henry Ford when hospital administrators began to look at home care as an important part of the system, not just an adjunct service with little value beyond Medicare cost reporting. Survival requires reversing all previous thinking, according to Greg Solecki, Henry Ford’s home care administrator. Home care is no longer a service to be accessed only after a hospital stay, he asserts.
"The time has come to help decision makers understand that home care is a case management concept, a public relations concept, a concept to reduce the overall cost of health care. It’s much more strategic than what we learned home health to be about 10 to 15 years ago."
Solecki says Henry Ford’s administrators changed their minds about home care when they saw the future of Medicare managed care and began applying those principles to their system. After an extensive redesign, Henry Ford emerged with a set of strategies that solidified home care’s place near the foundation of the continuum.
Henry Ford’s organizational pyramid contains nine health systems, arranged in the following order, from the top:
• tertiary;
• acute care;
• specialized hospitals;
• long-term care;
• ambulatory, specialty, multispecialty, high tech;
• ambulatory primary care;
• home health services;
• health and lifestyle services;
• health care financing.
It has taken Henry Ford administrators several years to recognize home care’s importance, but the strategy began with just the basics, as suggested by attorney William Dombi, director of NAHC’s Center for Health Care Law, to a roomful of hospital-based agency directors attending the Boston meeting.
"What you [hospital-based providers] need to do to continue in home care," Dombi explained, "is to tell the hospitals and their CEOs that home care has a value in the continuum. It’s a matter of education for hospital CFOs and CEOs, to tell them what home care is."
Although home care directors frequently complain that the hospital hierarchy just doesn’t understand their mission, Dombi reminds them that communication is a two-way street.
Susan Schulmerich, RN, BS, MBA, executive director of Montefiore Home Health Agency in Bronx, NY, agrees that having hospital administrators on your side is not only desirable, but crucial now as Medicare’s home health benefit changes. "If the CEO isn’t well-versed in how home care is a value-added extra," she warns, "there are some hospital-based agencies that will go out of business. I’m lucky. Montefiore’s CEO is a home care advocate."
That was not always true at Henry Ford. Solecki admits that Warden was not fully aware of home care’s value until the CEO went along on an actual home care visit.
"Getting Gail Warden out on a visit to an entire family infected with HIV did more for us than any report I could write," Solecki says. "It was a bilingual family, and we had an interpreter along. It really opened his eyes.
"That’s why Gail now says things like, Home care is the glue in our continuum that holds things together.’"
Warden goes along on home care visits at least twice a year. Henry Ford’s strategy has proved so successful that Michigan’s governor, several state representatives, and U.S. congressmen have also accompanied home care nurses in the field.
"I was talking the other day with one of my friendly competitors," recalls Solecki. "She kept asking, What are we going to do about his whole patient choice matter, this whole feeling that hospitals should keep patients in the system; what are we going to do?’
"I responded by asking her if she had ever taken her CEO on a home care visit. Her answer was no.’
"It’s not a novel idea," Solecki concedes, "but it’s a powerful one."
It’s one that providers will do well to keep in mind as the new year approaches, bringing with it a revamped Medicare system and uncertainty. The key to survival will be the ability of hospital-affiliated agencies to adapt to that changing world.
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