On April 13, 2018, Home Healthcare News published a blog post outlining a recent announcement by CMS, which will allow for Medicare Advantage plans to contract for non-medical home care services for their insured beginning in 2019. This announcement is an acknowledgment of the value that non-medical home care providers offer to seniors in support of managing their chronic conditions and maintaining overall wellness. The new coverage will result in more seniors receiving personal care services in their homes, which is then expected to reduce acute episodes and reduce services delivered in higher-cost settings.
The eligibility of non-medical home care services under Medicare Advantage plans is expected to drive patient volume within the sector. Many franchisors and independent home care operators will be working to position themselves as preferred providers with Medicare Advantage plans. Those same operators must also be prepared to deal with higher levels of record keeping and oversight in order to comply with the Medicare Advantage program requirements, in addition to rate negotiations with the large, for-profit Medicare Advantage insurers. The economic impacts of the roll-out for non-medical home care providers are yet to be determined, but there will be stiff competition among providers to demonstrate their value to the Medicare Advantage insurers.
For those seeking to enter or expand in the non-medical home care sector as a franchisee, now is the time to discuss this development with your franchisor. Understand your franchisor’s strategy at the corporate level for competing in the new Medicare Advantage landscape starting in 2019. In addition, understand that serving a larger Medicare Advantage population may impact your top line potential as well as your operating margins. The 19 million (and rising) seniors insured under Medicare Advantage plans represent a giant opportunity and place a bright spotlight on the non-medical home care industry. The change will necessitate strategic planning on the part of franchisors and home care providers to position themselves for success in 2019 and beyond.