Home health care has been taking center stage, playing a significant role in the health care system by reducing hospitalizations, helping providers manage chronic disease, addressing mental health needs and improving the patient experience.
That trend has ramped up, driven by an aging population, evolving public policies and emerging technologies that improve health care processes. Home health care experienced the highest utilization growth across all major components of our national health expenditure.
What trends should homecare agencies prepare for? Home health care providers should be preparing for the following.
- Increased focus on health equity and social determinants of health (SDOH)
- A shift to value-based care
- Increased reliance on technologies, namely, artificial intelligence (AI) and data analytics to drive performance and outcomes
Increased Focus on SDOH & Health Equity
To assess the most effective home health care model, it’s essential to zero in on SDOH, which are key drivers in client outcomes validated especially during the COVID-19 pandemic. Research shows that where a person lives greatly determines their health risk due to a patient’s access to transportation, safe housing and nutritional food options.
Even in locations with high-quality hospitals and medical services, non-medical support significantly influences health outcomes. For example, patients who don’t have access to friends, family or community-based resources may experience isolation, a significant factor in depression.
Homecare services can help address equity disparities and improve access to basic support needs as well as health care in underserved communities. This can be accomplished via sharing relevant information between and among an individual’s health care team and breaking down the silos that often divide health care providers. Homecare providers have a unique advantage in that they see individuals in their home setting. This access shines a light on any challenges they may be facing from a social, health care and emotional perspective. Homecare professionals are well-positioned to have a meaningful impact on a client’s well-being, picking up on issues that might not surface during an office visit with a provider.
Shift to Value-Based Care Models
Value-based care with homecare providers doesn’t have to be complicated. That’s because, in a way, homecare already is value-based care. Value-based care is realized when high-quality care is provided in the lowest cost setting, where it leverages resources in a way that allows all providers to practice to the top of their license. A simple solution for rewarding value is to reimburse homecare providers a fair market rate on a fee-for-service basis and recognize quality through incentive payments and volume. Quality can be gauged by outcomes such as inpatient and emergency room admission and readmission rates and through process measures like timeliness to start care and client satisfaction. Medicare-certified home health also has a star rating and satisfaction infrastructure in place facilitating the recognition of quality in processes.
With the increasing focus on coordinating care for individuals who are dually eligible for Medicare and Medicaid (“dual eligibles”) and consolidating the financial risk and accountability for this population, there is a proliferation of integrated health plans that cover both Medicaid-funded home and community-based services (HCBS) as well as Medicare-funded acute care. Homecare organizations that provide both homecare to assist with activities of daily living (e.g. Medicaid-funded HCBS) and episodic skilled nursing and therapy in the home (e.g. Medicare-funded Home Health); and coordinate care across the two service lines, are particularly well-positioned to deliver value by driving down the total cost of care and improving quality of care.
While homecare’s value proposition for all payers (especially those who have Medicare risk) is self-evident, contracting for value in homecare remains the exception to the rule. Success in this area will require the agency to demonstrate value analytically at a certain level of scale. Providers will need to answer the payer’s question—how many of my members do you or can you impact and how do you create value in your current operations?
Leveraging Analytics & Artificial Intelligence (AI)
Never has technology offered such significant opportunity in the homecare segment in areas such as improving decision-making and managing home health care processes. Whether that’s integrating data analytics, optimizing patient engagement tools or streamlining operations, technology is the key to both growth and meeting the expectations of payers in a value-based care environment.
Currently, coordinating care remains a struggle for many agencies as delivery systems and the supportive technologies behind them are siloed. Breaking down these silos requires that data be integrated across disparate systems—an issue that plagues the entire health care delivery system, but especially homecare. This is due in part to the exclusion of home health care from the federal incentives to invest in electronic medical record (EMR) systems that were part of the HITECH Act in 2009.
The data needed in homecare to drive value includes information about the client in the home setting. This can include changes in their physical and mental condition as well as changes in SDoH as discussed above. It also includes data from other providers so that care can be coordinated.
Making this data useful requires the integration of multiple systems including multiple EMRs, human resource information systems (HRIS), health information exchanges (HIE), customer relationship management (CRM) tools as well as data aggregators that house normative claims and quality data. Integrating requires that data be normalized to ensure a comparison of apples to apples in aggregate, especially true when combining EMR data. Integrating data also requires the development of a methodology to track people across each system through a standard unique identifier.
By combining data on a single platform, agencies are offered a view from one service to another (e.g. homecare to home health), from one functional area to another (scheduling and HR) and from one event to another (homecare services to emergency room admission). The availability of artificial intelligence (AI) to help tease out the signal from the noise is a game changer helping prioritize and sort events so they can be managed on a timely basis.
A comprehensive and centralized data set is also required to demonstrate value. While value-based contracting doesn’t have to be complicated in homecare, getting the attention of payer partners who are willing to contract for value requires a strong analytics capability. You need data to get the payer’s attention by demonstrating the agency’s performance in driving favorable outcomes (e.g. hospitalization rates) and quality outcomes (e.g. star ratings), and the ability to track performance on an ongoing basis in these metrics once that value-based agreement is in place.
One example is Canarai, PurposeCare’s proprietary technology that integrates data across all the platforms mentioned above. It then evaluates clinical inputs using large language models (LLM) to boil down and categorize clinical notes so providers can group and prioritize data and identify the most important elements that need immediate attention. It then measures the results of those actions to track performance and demonstrate value.
As we move through 2025, these technologies will continue to gain traction offering providers access to AI-powered tools that will further drive efficiency and result in improved patient outcomes.
Challenges & Considerations
These trends will create opportunities across the home health ecosystem, but that doesn’t mean that the challenges are going away. Home health care providers will continue to struggle with rate pressures, recruitment and retention challenges, and payer fragmentation. However, these challenges underscore the need for agencies to optimize value-added strategic planning. The value is there but is often taken for granted by the delivery system at large. It is up to the agencies to demonstrate value and make strategic investments to prepare for these trends. Those that do will be able to respond quickly to market-driven headwinds, improve patient care, and achieve positive business outcomes.