As we turn the corner on 2020, it’s time to look ahead. What opportunities can your organization leverage in 2021? What challenges should you be ready to tackle? We’ve gathered insights from our HHAeXchange leadership team to give you a comprehensive picture of what’s to come in the homecare industry this year.
Before we dive in to our 2021 predictions, let’s reflect on last year’s trends and consider their ongoing impact in light of the pandemic. While the impact of COVID-19 was not something we could have predicted, much of our 2020 forecast was on target:
- The shift to value-based care – While we expected the transition from fee-for-service to value-based care models to grow in 2020, this concept took on greater urgency as homecare visits dropped sharply due to coronavirus safety concerns.
- Greater collaboration between payers and providers – As we anticipated, more organizations adopted new technologies in 2020, and as a result, we’ve witnessed a stronger alignment between these two partners over the last year.
- An increased focus on caregiver well-being – This was a high priority for many homecare agencies heading into 2020, and the pandemic made it clear that protecting caregivers’ physical, mental, and emotional health is non-negotiable.
- Downward pressure on State Medicaid Global Spending Caps, leading to rate cuts – Unfortunately, our expectation was accurate, and COVID put even more pressure on state budgets. Already struggling, state budgets were hit hard by the unexpected health crisis.
- Continued growth of consumer-directed programs – These programs increased even faster than we predicted due to COVID-19. Many states gave participants more flexibility in choosing family caregivers to limit the potential for virus spread.
It should come as no surprise that the global pandemic will continue to drive changes in the homecare industry. Whether it’s the shift away from facility-based care or the rapid adoption of new technologies, 2021 will undoubtedly be a transformative year.
Here are our 2021 homecare predictions:
Prediction #1 – A Shift from Facility-Based Care to Homecare
The high risk of COVID-19 transmission in long-term care facilities sparked a broader conversation about whether individuals would be better served in home and community-based settings. With so many vulnerable populations living in close proximity and workers moving from room to room, managing infections remains a challenge. Shockingly, according to the New York Times, 38% of pandemic deaths are attributed to residents in long-term care facilities.
It’s clear that homecare must be an integral part of the solution. In addition to providing a safer way to receive care, the expansion of homecare would lessen the strain on an overburdened U.S. health care system. Fortunately, this shift is already underway. Catalyzed by COVID-19, there is more awareness than ever before on the benefits and importance of homecare as a way to manage overall population health and wellness.
With COVID accelerating greater growth for homecare, we believe 2021 will be the start of a “care evolution,” where the norm of facility-based care is replaced by care at home.
Prediction #2 – The Move to Self-Direction
The growth of self-directed services is yet another care evolution accelerated by COVID-19. In 2020, many states created more flexibility in their Medicaid programs, allowing participants to select family members as caregivers. States are already seeing this option as a “win-win.” In addition to the benefit of reducing the virus’ spread, most participants prefer care from a trusted family member or friend. Plus, for those who need care only at particular times or in short periods, it’s a highly efficient option. Paying family caregivers also pulls workers (who may not have otherwise chosen to work in personal care) into a tight labor force.
With HHAeXchange’s acquisition of self-direction leader Annkissam, we gained even greater insights into this trend. Data from Annkissam’s software showed a 20% growth in self-direction for the first nine months of 2020, an increase over prior years of about 7.5%. We expect self-directed programs to continue growing, and continue to become an established strategy for states to manage health care costs.
Prediction #3 – State Medicaid Budget Cuts
Managing health care costs will be a high priority in 2021. Even before COVID-19, many states were challenged by massive Medicaid deficits. Now, with millions of Americans unemployed or facing significant income losses as a result of the pandemic, this problem is compounded by growing Medicaid enrollment.
Given these factors, experts project state budget shortfalls to total $555 billion through fiscal year 2022. Without additional federal aid, states will likely make cuts going forward. We expect to see more difficult conversations around Medicaid eligibility and benefits in 2021, as well as innovations to address this funding reality.
Prediction #4 – Electronic Visit Verification (EVV) Compliance Drives Better Care and Cost Savings
One of the ways states expect to rein in Medicaid costs is through electronic visit verification (EVV). The Congressional Budget Office (CBO) anticipates that EVV will save states $290 million over a 10-year period by reducing inefficiencies and fraud.
EVV will allow all stakeholders to analyze participant services, ensuring they align with service plans and authorizations. Most importantly, this new transparency and access to data will improve quality of care by confirming appropriate service delivery, identifying gaps in care, and preventing adverse health events.
Now that the 21st Century Cures Act deadline has passed and agencies across the United States have begun successfully implementing EVV, we expect to see the benefits of this system becoming apparent in 2021, both in financial and quality of care measures.
Prediction #5 – Focus on Value-Based Care Through Social Determinants of Health
With EVV deployment mostly underway, Medicaid Managed Care Organizations (MCOs) will likely shift their attention to advancing value-based care in 2021. Look for even more discussions about how to move from transactional reimbursement (i.e., per visit) to pay for performance (i.e., reduced ER visits and hospitalizations). In particular, we expect that capturing social determinants of health will become a critical element of this approach due to its importance in predicting and preventing adverse health events.
Fortunately, homecare is uniquely suited to meet this need. Caregivers are the windows into patients’ health and the state of their homes. Their frequent interactions with patients make it possible to monitor social and environmental changes as well as health trends that could indicate a worsening condition. With the right caregiver training and homecare technology, agencies can collect this vital data and demonstrate value to payers. Putting this infrastructure in place should be a high priority in 2021.
Prediction #6 – Recognizing Homecare Aides as Key Members of the Overall Care Team
The continued emphasis on value-based care has led to a broader recognition of the caregiver’s essential role within the overall care team.
Providing professional development to caregivers is crucial — both for capturing data accurately and retaining quality employees. HHAeXchange conducted a study earlier this year with All Metro Health Care and found that training caregivers on how to observe and report changes in the patient’s condition helped caregivers feel more empowered on the job, led to better retention and improved morale, and allowed for patient escalations to be avoided.
Given these trends, and current staff shortages, we expect to see increased wages and more career growth opportunities for homecare aides in 2021.
Prediction #7 – Growth of eLearning for Caregiver Training
Not surprisingly, there has been a significant market shift to eLearning as the standard practice for caregiver training and in-service requirements in 2020.
Home health agencies are realizing that online training results in significant savings compared to traditional face-to-face training. Most importantly, eLearning creates almost immediate patient care improvements. Plus, it fits the work and life schedules of overburdened caregivers, providing easy access to meaningful information and knowledge forums.
As with many of the positive changes prompted by the pandemic, we anticipate the homecare industry will continue moving in this direction.
Clearly, we’ll see the effects of the pandemic throughout 2021. While the new coronavirus vaccines give the world hope, flexibility, innovation, and resilience are still necessary to weather the challenges ahead.
To navigate a tumultuous year, we expect there will be a lot of innovation, especially from key Medicaid players to keep participants out of long-term care facilities and prevent deep cuts that would devastate communities. Value-based care will continue to pave the way for both efficiencies and improved patient outcomes. Within the context of the pandemic, technology will be a driving force in making it possible to provide quality care.
More than ever, it’s critical for payers and providers to collaborate and adopt technologies that create transparency, alignment, and real-time communication.
HHAeXchange sends our gratitude to providers, payers, and homecare aides for their hard work this past year. We have faith that with the distribution of the vaccine in 2021, we will emerge stronger and better prepared for the future.