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Home Care – The Next Frontier for Value-Based Payments

With value-based payments now in home health, VBP for home care is the next logical step


March 15, 2023 – Value-based payment models are slowly transforming the healthcare industry. Instead of paying for the number of services provided under a fee-for-service (FFS) model, VBP models pay for outcomes. That means providers get rewarded for their quality of care and health outcomes. 

Recently, CMS expanded the Home Health Value-Based Payment (HHVBP) Model nationwide, as there are promising signs that quality of care will improve while driving down costs. 

As value-based payments creep into the home health industry, non-medical home care seems like the next logical frontier. In this blog, we are going to look at how value-based payment models can transform home care. A home care VBP model can improve quality of life for seniors, incentivize compassionate care, and give consumers a voice that they may not have had previously. This is a win for consumers and needs to be seriously considered by CMS and providers. 

Choosing the Right Quality Measures for Home Care VBP Model is Key

One of the biggest challenges with implementing value-based payment programs into home care is what measures to use when tracking outcomes. Home care has always been rooted in improving the quality of life and independence of those receiving services, and it is important to include measures that motivate home care agencies to adhere to that. 

For non-medical home care services, one way to do this is through a consumer survey. The Home Health VBP model uses the Consumer Assessment of Healthcare Providers and Systems Home Health Care Survey (HHCAHPS) to do this. This brief survey measures the experiences of people receiving home health care from Medicare-certified home health agencies. 

The great thing about utilizing CAHPS is that is gives consumers a voice. Their care matters most, and a consumer survey allows individuals to comment on the respect with which they are treated, how informed they are, and other essential factors of care that might not be captured if only using quantitative measures. This vulnerable population often lacks the ability to provide input, but a CAHPS survey encourages it, while incentivizing providers to provide compassionate care. 

Taking that into consideration, CMS could implement something like the HHCAHPS for a home care VBP model. Taking relevant examples from the HHCAHPS survey, questions for a Home Care CAHPS could include: 

  • In the last 2 months of care, how often did caregivers from this agency treat you as gently as possible?
  • In the last 2 months of care, how often did caregivers from this agency listen carefully to you?
  • In the last 2 months of care, how often did caregivers from this agency treat you with courtesy and respect?
  • Using any number from 0 to 10, where 0 is the worst home care possible and 10 is the best home care possible, what number would you use to rate your care from this agency’s caregivers?
  • Would you recommend this agency to your family or friends if they needed home health care?

Questions that specifically address issues like social isolation, confidence living independently at home, and quality of life can also be added into the survey for further insight into the home care agency’s performance.  

By utilizing a consumer survey and asking questions that account for client perception, home care agencies will not just be able to bill for hours of service, no matter the quality. Instead, a VBP model that uses a CAHPS survey as a quality measure incentivizes home care agencies to provide quality and respectful care to clients, as their opinion is ultimately tied to the agency’s bottom line.  

Social Determinants of Health Cannot Be Ignored

Social determinants of health (SDoH) also need to be addressed when developing quality measures for a home care VBP Model. Social determinants of health are conditions in the places where people live, work, and learn that affect a variety of health and quality-of-life risks and outcomes. These non-medical factors include things like economic stability, housing, transportation, food security, nutrition, social interaction, and community engagement, among others.

Research shows that SDoH can be just as important or more important than healthcare or lifestyle choices in influencing one’s health. Many studies estimate SDoH account for somewhere between 30% and 55% of health outcomes. Home care agencies are in a unique position where they can address non-medical social determinants of health as they have a first-hand view of the day-to-day life and environment of their members. 

One social determinant of health that home care agencies and caregivers are in a prime position to address is access to healthy foods. Diet is strongly linked to health and as we age, our nutritional needs change. A recent study from Home Care Pulse showed that a staggering number of clients reported their caregivers didn’t even have basic cooking skills. Beyond this, our aging population deserves to have home cooked meals that are not just nutritious, but also enjoyable to eat. Many of these individuals cannot cook for themselves or have very limited ability to do so. A VBP model including quality measures that address nutrition would benefit clients by incentivizing home care agencies to hire those with basic cooking skills or provide culinary skill training courses. This won’t just impact health, but it also improves their quality of life.

Social integration and community engagement are also non-medical factors that can really affect health. There is sound evidence that adults who are lonely or socially isolated put their health at risk. Social isolation increases the risk of dementia by 50%, the risk of heart disease by 29%, and the risk of stroke by 32%. It is also associated with higher rates of depression and anxiety among older adults. 

Unfortunately, according to a National Academies of Sciences, Engineering, and Medicine (NASEM) report, nearly one-fourth of adults aged 65 and older are considered to be socially isolated. Our aging population is often faced with the loss of a spouse or friends, which can drastically reduce their social interactions. Regular companionship and compassion can not only increase their quality of life, but also reduce the negative health impacts of social isolation. To remedy this, home care agencies can provide companion services to reduce social isolation. 

Through a value-based payment model, home care agencies are incentivized to address certain non-medical social determinants of health. Currently, home care agencies bill on a per-hour basis for the various services provided. But through a VBP model that provides incentives based on the outcomes achieved—reduced social isolation, better nutrition, et cetera—agencies are encouraged to address SDoH and keep their clients living happily and independently at home as they deserve.

The Importance of Care Coordination Highlights Need for Value-Based Payments

The aging population often presents a complex set of needs. Besides medical needs, this group faces issues like social isolation, mobility, poor hygiene, and lack of transportation, among others. As we noted in the section above, the problem is that these non-medical needs have a big impact on overall health outcomes. That is why care coordination and integration are crucial for keeping these individuals aging comfortably and living independently at home. 

This presents a unique opportunity for the home care industry because home care agencies and caregivers have unique insight into the homes of their clients. The industry standard is 44 hours of care a week, with caregivers in the home interacting with clients daily. They see when clients seem depressed or aren’t eating. They also witness physical evidence that something needs to be addressed medically, such as rapid weight loss, a decrease in mobility, or an increase in pain. 

In addressing care coordination and integration, value-based payment programs are the best way to incentivize providers. The goal of home care agencies is to provide quality non-medical care that keeps their clients living independently at home. That is what most our aging population wants. While home care agencies strive to deliver this outcome, they also need to make money to keep their doors open. 

VBP models motivate home care agencies to provide whole-person care and address non-medical needs that impact health outcomes. In a typical FFS model, caregivers and home care agencies wouldn’t get rewarded for these types of services and offerings. But under a VBP model where outcomes like remaining independently in the home and quality of life are measured, there is an added incentive beyond enhancing the health of their clients. 

Advocates Perspective

The home health industry is already under a value-based payment model through the CMS Expanded Home Health VBP model. In looking at the evidence, the home care industry should be next. Consumers can benefit from a home care VBP model that improves their quality of life and incentivizes agencies to help them maintain independence at home and remain an active member of the community. These types of payment models encourage agencies to focus on care coordination and integration, as well as providing the compassionate care that our aging population deserves. It can also lower costs at a time when home care costs are rising over five percent a year. However, the transformation to a VBP model for home care needs to be slow and deliberate. Like the HHVBP model, the viability of such a model should be tested to ensure that objectives can be met, and stakeholders need to be included in the program design process.  


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About the Author

Fady Sahhar brings over 30 years of senior management experience working with major multinational companies including Sara Lee, Mobil Oil, Tenneco Packaging, Pactiv, Progressive Insurance, Transitions Optical, PPG Industries and Essilor (France).

His corporate responsibilities included new product development, strategic planning, marketing management, and global sales. He has developed a number of global communications networks, launched products in over 45 countries, and managed a number of branded patented products.

mandy sahhar

About the Co-Author

Mandy Sahhar provides experience in digital marketing, event management, and business development. Her background has allowed her to get in on the ground floor of marketing efforts including website design, content marketing, and trade show planning. Through her modern approach, she focuses on bringing businesses into the new digital age of marketing through unique approaches and focused content creation. With a passion for communications, she can bring a fresh perspective to an ever-changing industry. Mandy has an MBA with a marketing concentration from Canisius College.