In its initial announcement, the U.S. Centers for Medicare & Medicaid Services (CMS) went out of its way to clearly state its new hospital-at-home waiver program was not designed for home health agencies.

But that doesn’t mean there isn’t any upside for them, industry insiders say.

Unveiled on Nov. 25, CMS’s new hospital-at-home waiver program gives approved acute care facilities more freedom to provide — and get paid for — medical services in the home setting at a time when in-patient capacity is severely limited.

A record-high 96,039 COVID-19 patients were hospitalized in the U.S. as of Monday night, according to data from the COVID Tracking Project.

“CMS believes that treatment for more than 60 different acute conditions, such as asthma, congestive heart failure, pneumonia and chronic obstructive pulmonary disease (COPD) care, can be treated appropriately and safely in home settings with proper monitoring and treatment protocols,” agency officials noted in their announcement.

At least seven confirmed hospital systems have received hospital-at-home waivers.

While home health agencies have experience caring for patients with these and other complex conditions, they are somewhat restricted from taking ownership of a CMS-approved hospital-at-home program of their own.

“A program does not have to be physically administrated within a hospital, but a hospital must accept responsibility for the program in order to satisfy the Conditions of Participations for this level of patient care,” CMS noted. “Additionally, the program must be integrated within a hospital to a sufficient degree to ensure that rapid escalation of care is seamless.”

That language suggests there may be ample hospital-at-home opportunities for home health agencies that are already housed within larger health systems, though that size of that group continues to shrink. In the late 1990s and early 2000s, many hospitals decided to close their agencies or spin them off as freestanding entities, partly due to reimbursement pressures.

Home health operators with pre-established joint venture relationships with health systems may likewise be well-positioned for the hospital-at-home opportunity, according to Stephens Inc. analyst Scott Fidel.

And that group, in contrast, is rapidly growing.

“Just conceptually, the most logical area that we would think about as being an opportunity here would be around areas where there’s already momentum around JVs,” Fidel told Home Health Care News.

Staffing shortages

Fidel — a veteran health care analyst who was brought in to lead Stephens’ health care services division in 2018 — described the hospital-at-home waiver news as an “encouraging” common-sense response to ongoing COVID-19 challenges.

“My gut reaction is that this is CMS trying to respond as actively as they can to the impact of COVID,” Fidel said. “I think these are changes to regulatory structures that they can deliver relatively easily to compensate for some of the pressures acute care hospitals are facing.”

Most headlines focus on bed capacity, but many hospitals are dealing with some degree of staffing shortages, too. In fact, a mid-November tally conducted by STAT and the American Hospital Association found that hospitals in at least 25 states were critically short of nurses, doctors and other staff members.

That situation has only grown more dire since then, with Thanksgiving travel and family gatherings projected to cause an even large spike in new infections.

One of the latest White House coronavirus task force reports sent to states included a warning that “the COVID risk to all Americans is at a historic high,” NBC news reported.

“Hospitalizations themselves are now reaching record levels from during the crisis,” said Fidel, who follows the managed care space as well as the post-acute and acute care sectors. “And there just seems to be a lot more pressure on staffing, in particular. I think staffing is the real big story here, frankly.”

With the staffing shortages, hospitals with new CMS waivers may look to enlist home health agencies as they shift patients into the home setting.

Agencies have historically faced their own staffing challenges, but their ability to care for new  patients is currently greater than that of hospitals.

Additionally, industry data on patient volume and new admissions suggests home health agencies are hovering around pre-pandemic norms — not record-breaking figures.

“Then connecting into that home health staffing apparatus, to me, it feels like there is still capacity,” Fidel said. “Home health volumes have improved quite markedly in terms of a recovery, but we’re still really just sort of back to pre-COVID levels. It feels like there’s a lot more volume, a lot more capacity that home health agencies can take on at this point.”

Putting ‘meat on the bone’

Apart from getting a piece of hospital-at-home action for staffing support, home health agencies may also eventually see a trickle-down effect as hospitals deliver more services in the home.

“I think the other area that we’ve also gotten some feedback from the companies on, where they see an opportunity, is just around whether this could actually end up supporting or codifying more of an ability for these types of services in the home to actually get reimbursed,” Fidel said.

For now, most agencies are in “wait-and-see mode,” however.

More information on the hospital-at-home waiver program will likely emerge in weeks to come, especially as more hospital systems complete the application process.

“There’s a lot of meat that needs to be put on the bone,” Fidel said. “As I’ve done checks with some of the home health companies about this, that’s the type of feedback that I’m getting from them already. I think everyone is encouraged by the thrust of what CMS is announcing here, but it still does feel quite preliminary.”

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