Referrals are the “lifeblood” of home health providers, but the referral landscape is becoming increasingly challenging, requiring providers to re-strategize and differentiate.
To grow in a rapidly evolving referral environment, including the rise of Medicare Advantage and reimbursement pressures, healthcare providers must find ways to accommodate diverse patient populations and stand out to potential referral partners.
According to Rexanne Domico, president and CEO of Interim HealthCare, the referral landscape has changed in part due to increased automation that facilitates referrals to specific health care providers. Overall, it's becoming increasingly difficult for providers to build relationships.
“If you're looking for high volume referrals, the biggest hurdle in many places is access,” Domico said at Home Health Care News' FUTURE conference. “It's a lot harder to get into a hospital. It's a little harder to work in any facility than it used to be. But I think there's still a lot of room to bring really good data back to referral sources and to build healthy relationships with people you have the opportunity to work with and help make a difference.”
Interim HealthCare, based in Sunrise, Florida, operates more than 300 franchise locations across the United States and provides home health care, senior care, hospice, palliative care, pediatric care and medical staffing services. The company's franchises provide 25 million hours of home care to 190,000 people each year.
As providers build relationships with referral partners, they are also alert to changing trends affecting the home care industry as a whole and need to renegotiate referral strategies in light of the pressures shaking the industry.
“We're all competing to even get into the hospital and get five minutes of attention, just to get them to say yes to working with us,” said Brent Korte, CEO of FrontPoint Health. “It's a different environment and it's evolved a lot. The fact that we're competing for Medicare patients who are going to have a 6% cut is even more ominous.”
Frontpoint Health, backed by Cimarron Healthcare Capital and Tacoma Holdings, provides home health, hospice, palliative care and personal care services across 176 counties in Texas.
Strategies to build trust and differentiate
To stand out to referral partners, providers need to stand out from the crowd and demonstrate their value. Korte said key elements of building referral relationships include building trust and achieving low readmission rates.
Additionally, success in the current referral environment requires an element of respite care.
“Referrals say, 'Don't cherry-pick,'” Korte says. “But the truth is, we can't do business without respite care. Even our company, which is built on Medicare Advantage, has to provide some respite care. So what we're doing is saying yes and doing it in a way that everyone we work with says… 'They're actually adding value to me and my day.'”
Brent Korte, CEO of Frontpoint Health
Saying “yes” to patients is important to Linden, Tenn.-based Perry County Home Health, CEO Matt Sevier said.
“Even if we have to say no to a patient, we want to provide an immediate alternative so that the case manager knows what to do instead of calling another provider, so that the case manager sees the patient as a resource that they can deploy resources to (get to know the patient),” Sevier said.
Perry County Home Health provides home nursing care and physical therapy in Perry County, Tennessee.
Dr. Domico said that while starting treatment quickly is one way providers can stand out, goals like starting treatment within 24 hours aren't always realistic or even preferred by patients. Currently, managed care patients typically begin treatment in about three days, and traditional Medicare patients typically begin treatment in two days, he said. Providers that can begin care sooner will have an advantage over their competitors.
“Think about what really makes you special in your market,” Domico said. “If possible, think about how you can leverage efficiency and technology and always talk about it.”
Rexanne Domico, President and CEO, Interim HealthCare
Providers also need to be visible in their communications with referral partners. Healthcare providers not only need to do what they tell their partners to do, but they also need to communicate when a patient has a problem. Domico said the most important call a provider makes to a referral partner is the one where the provider apologizes to the patient and has to tell the partner that something went wrong.
“These calls are difficult, but incredibly effective,” she says. “In the businesses that we work in, things don't always go the way we expected. Or they might not have opened the door for us. Or they might not have been there when we said we would be there. Just being in front of those things is so important.”
The future of home medical referrals
Providers are strategizing how to differentiate themselves from competitors and build and maintain referral partnerships, while also preparing for key trends.
Health care providers need to address the trend of home health being undervalued, Korte said. Sevier said home health care providers have come to be seen almost like vendors, limiting access.
Additionally, all health care providers, regardless of size, need to prepare for the widespread adoption of Medicare Advantage, Korte said. If healthcare providers focus only on remaining traditional Medicare patients, they will find those patients increasingly out of reach.
“The big wave is 100% approaching,” he said of Medicare Advantage. “Are we going to surf it? Are we going to let it sit right on top of us? If you're not ready, and the strategy is sound, if you take the rest of Medicare, (those) apples are going to be out of reach quickly.”
Despite tight reimbursement margins, Sevier said he is leaning toward the Medicare Advantage trend and prefers to accept Medicare Advantage over traditional Medicare.
“The idea is that when you're in an area with less competition, there's less competition,” Sevier said. “There's no shark in the water. With traditional Medicare, you're (competing) with sharks because everyone's competing for a smaller and smaller pie. So with Medicare Advantage, you don't have that problem. There are fewer people willing to take on ever-growing numbers of patients.”
Matt Sevier, Perry County Home Health CEO
Home health providers must constantly focus on improving processes to maintain referral relationships while adapting to changing trends.
“It's really important to think about how we can do all of these things better,” Domico says. “How can we get people through the referral process faster and more efficiently and provide factual information about how they are doing? Referral sources will care about that, and payers will care about that.”
