The value-based and home-based care enablement platform CareCentrix is in an interesting position. Not only is it in between home health providers and Medicare Advantage (MA) plans, but it’s also now owned by Walgreens Boots Alliance (Nasdaq: WBA) – one of the retailers diving head first into home-based health care services.
In a recent conversation with Home Health Care News, CareCentrix CEO Steve Horowitz explained the sometimes misunderstood value of home health care.
“You actually want more home health,” Horowitz said. “You want your home health costs to go up. You don’t want to overpay for anything, but you want your home health cost to go up, because it’s a cheaper setting than if you were taking care of the patient in the facility.”
That is a sentiment all home health providers love to hear. It’s the view they want both MA plans and the Centers for Medicare & Medicaid Services (CMS) to take, as opposed to the short-sighted view they’ve taken in the past.
With the home-based care rush behind it, CareCentrix is in a solid position to grow. It’s also now, as mentioned above, a part of Walgreens, which allows it access to far more resources and partnership opportunities.
Horowitz took over as CEO of CareCentrix in October of 2022, after spending the previous decade as the company’s CFO.
He sat down with HHCN to chat about home health care, Walgreens, CareCentrix’s near-term focuses and much more.
Highlights of that conversation are below, edited for length and clarity.
HHCN: Since the Walgreens investment, how have things changed? What have been the positives, and negatives – if there are any?
We’ve been continuing to run our business; we are still a separately run company. And that’s the expectation as we move forward.
What has changed is the way we’re able to collaborate with Walgreens more and start to leverage what they have. The value in that business is amazing. When you think about the trusted consumer brands, you think about 8,000 retail locations in communities all through the country. You think about the expertise in pharmacy and medications, and just the 300,000 employees throughout the world. There’s a lot that we can leverage to help improve our own business and help improve the impact we can have on patients.
And then, correspondingly, what we’re also finding is that there are avenues where we’re helping them improve their business. So, that kind of cross-pollination of ideas and expertise has been really interesting. And I think it has benefited both organizations.
I’m curious about your thoughts on retailers getting into health care and home-based health care services, in general. What’s your view on that trend?
It’s been a trend, although more recently, it’s been a bit of a trend to go the other way.
I think it’s similar to what a lot of technology companies experienced, when suddenly they all think they’re going to come in and fix health care. I think what ends up making it not work is just that health care is complicated. The technology, in a lot of cases, is not cutting edge. Whether it’s the government running Medicaid, whether it’s health plans running old systems, a lot of the vendors – everybody’s on relatively old technology. And it’s often a complicated, siloed environment that has a lot of regulation. When you put all that out there, none of that’s even important, because it’s all about the patient, and ensuring access to care. And that’s not a scalable technology model.
Learning that always seems easy from a distance. Once you get in, you realize it’s more complicated.
Walgreens in particular, I think they’re coming in with the right attitude, which is trying to make it work by putting the patient first, which is key. And not taking a one-size-fits-all approach.
What are the top business priorities right now at CareCentrix?
Our top priorities right now are around post-acute care and ensuring that patients have a smooth journey when they leave the hospital. And more importantly, making sure that they don’t end up back in the hospital.
It’s that efficiency, just trying to continue to get efficient in terms of how we operate our business, so that we, in turn, can be even lower cost to our customers. It’s trying to use technology in ways that help us identify the right provider for the patient at the right time.
Continuing to get better at our product performance is probably what it all boils down to, and making sure that the impact we’re having on the patients that we serve is as big as it can be. Because if we get that right, then costs go down, customers flock to our doors, everybody’s happy. That’s the nirvana of all of this.
And it’s not all about activity, it’s about, did we actually make the patient better off? And again, if the answer is yes, all sorts of good things happen. If the answer is no, then what was the point? Let’s go back and figure it out, so that next time the patient is better off.
From a company in your position, how do you make sure that there’s still seamless transitions, that you’re breaking down barriers in a way that’s beneficial for the patient, knowing that home health providers may be a little bit more specific on who they’re able and willing to take in 2024?
It’s definitely a challenge. I mean, look, we’re here to reduce costs for the health plan. That’s our job.
But what we find is, that doesn’t mean you want to lower costs everywhere else. You actually want more home health. You want your home health costs to go up. You don’t want to overpay for anything, but you want your home health cost to go up, because it’s a cheaper setting than if you were taking care of the patient in the facility. If you can get a patient home, that is clinically appropriate to be home, and you’re getting them the right care at home, they end up in a much better situation. They’re healthier, the recovery is smoother, and the costs are lower.
But to do that, again, you want more of it. So we want to make sure we’re paying a competitive price for that home health care, we don’t want to be in a race to the bottom.
When we try to identify a provider for a patient, 99.97% of the time we find a home health provider for the patient. And we wouldn’t be able to do that if we didn’t have good partnerships with the providers, with the right economics.
We’re always going to pay them less than they want to get paid. And they’re going to make us pay them more than we want to pay them. That’s the balance, and it needs to be a win-win. But it can’t be too low or it doesn’t work. And if we’re paying a reasonable rate, there’s enough supply out there that we haven’t had any trouble. Again, if we push the envelope too hard on the right side, we absolutely have trouble finding nurses out there.
Do you think health plans are now better understanding those cost efficiencies from home health care?
A little bit. And I think as plans keep moving toward risk-based and value-based models, it’s going to become that much more important.
The example I always use is a balloon. If health care costs are a balloon, you can squeeze any part of that balloon and lower costs in that area. I can cut home health costs in a heartbeat, or DME costs, or inpatient utilization. But every time you squeeze it, something else blows up. That’s the hard part, if you think about it only in a silo.
And that’s where I see the health plans starting to move. They’re not looking for just small point solutions, that are risk-based, that are going to solve one piece of the problem. They’re recognizing that, yeah, you may lower my home health cost, but now my readmissions are spiking. I think the plans are absolutely starting to put those pieces together and have a more holistic view.
The goal is to shrink the balloon, and not just squeeze it.
What makes a post-acute provider or home health provider a good partner to work with?
It comes down to that patient focus, and it comes down to the quality.
I’ll use a home health nursing agency, for instance. If they’re sending good quality nurses to provide good care to the patients, and they’re basically doing it as necessary, we’re going to work great together. And they’re going to be happy with the relationship.
If they’re trying to squeeze 10 visits instead of six, trying to maximize dollars, then it becomes a little bit more adversarial, because in those cases where we’re being forced to say no more, anybody who hears no more, it’s going to change the tenor a bit.
Our goal is not to deny claims, and there are plenty of denial shops out there. That’s not us. We do deny claims, but the goal is to get the claims to get the patient the care they need. If the provider has a track record of doing the right thing, we try to get out of the way.
So, in terms of what makes a good provider for us to work with, it’s about if you’re trying to do right by the patient, and in that case, we’ll happily pay you a fair price and try to make things as administratively easy as possible.
Where are the areas you think Walgreens is going to help in the future, specifically?
Things like medication therapy management, medication reconciliations. We do that today. We’ve historically had our nurses do that work with our patients. It is the No. 1 cause of hospital readmissions. It’s a big piece of our readmission avoidance program.
Leveraging Walgreens pharmacists to do those reconciliations and the medication management, their pharmacists are so much better positioned to do that, they have more information, they’re able to not just look at the drugs, but they’re able to provide more guidance. They’re able to identify more issues, they’re able to get the information back to the medical records much easier than we are because they’re already set up to do that. And Walgreens has tens of thousands of pharmacists. Put that all together and that’s a value add for us.
Another big one is the brand. Walgreens has just one of the most amazing brands out there. Everybody knows Walgreens, everybody trusts Walgreens. When it’s Walgreens calling the patient, our engagement levels with that patient are dramatically better. We’ve always had better engagement rates than the plans. Because as much as everybody likes their health plan, people don’t always trust their health plan. We’ve been able to come as more of an independent outside entity, we get more trust from the patients that way. And Walgreens coming in takes it to a whole other level. That brand awareness and trust is hugely valuable. We’re just scratching the surface on how we leverage that to provide better services.
The post CareCentrix CEO: Health Plans Should ‘Want More Home Health Care’ appeared first on Home Health Care News.
