A recent industry report examined how the pandemic affected home health and how the industry will cope in the coming years. It provides useful predictions and insights on how certain strategies will help the industry and its players succeed.
With already less than a year until 2023 and all the significant changes underway, agencies need to gather as much insight and direction as they can to move forward with more certainty. While the demand for home health was high during the pandemic, the capacity of the industry could not keep up due to several factors like staffing challenges and rising care delivery costs. Some agencies engaged in consolidation and other mergers and acquisitions (M&A) activities to cut costs and increase volume.
Industry Forecast and Insights
- Greater opportunity for mergers and acquisitions
There is a new emphasis on home-based care, therefore many organizations are eyeing the post-pandemic period as conducive for acquisitions. As the market is gearing up for this opportune business climate, the motivation for companies to compete on what value they bring also intensifies. Agencies planning to get acquired are focused on their specialization to set them apart from the competition within the niche market they serve.
- Medicare Advantage will take off
Since Medicare Advantage covers extra benefits that Original Medicare does not cover, it is helping to push the industry in the right direction as enrollment in home health rises. Home health agencies are seen as a lost-cost provider of specialized care compared to other relative care settings. Providers’ data also encourage market competition of being a preferred provider as it highlights which entities Medicare plans will want to work with. Moreover, Medicare Advantage adoption continues to expand to suburban markets making rural areas a highly competitive market for patients.
- The staffing crisis continues
Since the onset of the pandemic, around half a million employees left healthcare. As a response, providers are applying different techniques to address this issue. Employers are adjusting job descriptions early in the application process to help pick the right people, are listening to employees to alleviate skill gaps and establish career growth opportunities, and are targeting qualified candidates by re-engaging past employees to return to their former roles to make for an easier onboarding process.
The Silver Lining
Although faced with challenges, home health has promising opportunities as well for the coming year, especially in terms of business growth and payment incentives. The key is to strategize toward optimizing the workforce and other resources to allow more focus on bolstering patient care services and pursuing business objectives. A proven effective way to do this is to leverage support mechanisms, such as tech solutions and outsourcing to cover back-office functions in support of in-house clinicians who would subsequently be empowered to deliver quality patient care.