“People have estimated that out of all the people who need palliative care, how many actually get it? It’s about 5%.”
Empassion <a href="https://healthylife7.com/empowering-health-professions-education-in-africa/” title=”Empowering Health Professions Education in Africa”>Health‘s approach to home-based serious illness care generated nearly $60 million in net Medicare savings in the most recent yearly data from the high-needs ACO REACH program. Co-founder and CEO Robin Heffernan, Ph.D., recently spoke with Healthcare Innovation about what it takes to succeed in the CMS program and the company’s work with Medicare Advantage plans. HCI: Could you tell us a little bit about your background and the founding of Empassion? What was the health system need you saw and the market opportunity for the company?Heffernan: I’m actually a chemical engineer by training, but mostly I have done startups. For the last 15 years I’ve been focused on starting and growing businesses that are focused on our most vulnerable patients — Medicare/Medicaid duals, and a host of services to try to keep those people healthy at home. I’ve done a transportation benefit management business, meal benefit management business, home health DME [durable medical equipment], and then a couple of analytics companies. We started Empassion three years ago and it grew out of work we were doing in that home health DME business. When someone got discharged from the hospital, we would help coordinate their DME. Oftentimes, patients would have a good PCP or they’d have a specialist, but if they had serious illness and things were deteriorating, they didn’t have enough support. No one was talking to them about palliative care or hospice care. We would find a lot of our patients were ending up crashing into hospice at the last minute. Their family would be exhausted. They’d be really disappointed.HCI: And the patient would probably be in and out of the hospital or the emergency room a lot, I bet. Heffernan:100% right. I mean, if you have end-stage lung issues and you get short of breath all the time, and you get really anxious because you can’t breathe, you call 911. They come and and take you in the ambulance to the ED, and then someone looks at you at the hospital. You look really sick. They admit you right away, and then you’re there for a week, getting pricked and prodded and given lots of different tests. You come out and you’re worse off because you’ve been bedridden for seven days. You end up going to a skilled nursing facility, and nobody wants that.But to avoid it, you have to talk about how to get in front of this. What palliative does really well pre-hospice is have the conversation with the family and the patient about the likely trajectory of this illness. They give them medications in these proactive packs. So when you have shortness of breath, you can take this inhaler and call us before you call 911. They do advanced care planning, so the patient and the family are on the same page. If you have an issue, do you want a breathing tube? Do you want a feeding tube? We thought that there’s a business to be made solely focused on palliative and hospice care, so we started the business. We were fortunate to get four contracts from CMS to be part of their high-needs ACO REACH program in 2023 and 2024.HCI: Did you need to have that kind of alternative payment model in place from CMS to make it work?Heffernan: Because I’ve sold to payers for all these other services, I know that the payer sales cycle for an MA plan is 18 months. It doesn’t matter what you’re selling them, it’s 18 months. So yes, we wanted a way to get into the market quickly while we were doing the MA sales, and we knew CMMI was going to put out this test program. We applied for these licenses, and that allowed us get out there, build the network, demonstrate the model works, while we were going through the sales cycle with our traditional customers. Now we have the breadth. We have MA plans. We have risk-bearing kidney programs and cardiology programs and primary care. But it takes a while to sell to those groups.HCI: You created four high-needs ACO REACH programs. What was involved in building them?Heffernan: You have to identify participant providers who will work with you. We did four regionally focused ACOs. We don’t need to go create new palliative providers. They exist out there. The same with primary care. The hard part is to find the people who are really good at this, and help them be in these models. Frankly it’s hard for them to do it themselves because there’s so much paperwork, right? There’s a bunch of capital reserve that you have to put up for CMS. You have to take full downside risk. So the liability is challenging for them. What we had to do was build this network of all these groups who wanted to work with us in the program. Our job was to manage the administrative contracts. We did a bunch of analytics for these groups, and helped them manage their patients. Some of them have thought about population health, but normally, they just see the patient, do the service, bill for the service. So the the hard part is how do you pick the groups that are good? It’s coming out more and more in all these different services that there are lots of maybe fraudulent/maybe just wasteful providers out there, right? So you have to avoid those. Find the good ones. They’re excited to do the work they’re doing and actually make more money when they deliver better outcomes.HCI: What are some tools and resources that you provide to them? Heffernan: We’d run analytics on their patients and help them risk-stratify. Who do we think before you even go see them is the sickest in your panel, so you can prioritize your time on them. After every visit we would help them with appropriately documenting the visit. Or now that we have updated metrics on the patient, what do we think is their new risk level? Are they at risk for hospitalization in the next week? Do we think this person is going to die in the next six to 12 months? They can use that to allocate resources. Then we would get claims from CMS about the medical expense of these patients every week, every month. We would process those claims and then be able to tell the providers very simply: you’re either helping reduce hospitalizations, or your patients are still really costly, or your patients are using more SNF than the average in this area. We would do a bunch of analytics around their claims, and we would help them do care coordination with a PCP. If they wanted to get this patient meals, we had a meal vendor where where they could help order meals.HCI: What were some of the results in this most recently released data from the high-needs ACO REACH that you guys were able to achieve? Can you highlight a few data points?Heffernan: Yes. We served about 12,000 patients. Their gross savings was $75 million. CMS takes their guaranteed 3% savings off of it, so our net savings was about $60 million, and that was almost entirely driven by reduced hospitalization events. If you look at all the programs, I think we had about a third of all the lives in all high-needs ACOs. We were the largest gross savings of anyone, and it’s a real testament to our providers where almost 35 different groups all saved money.HCI: If we took all the high-needs ACOs together, is that still only a tiny percentage of the need across the country for this kind of services?Heffernan: Super small. I mean, people have estimated that out of all the people who need palliative care, how many actually get it? It’s about 5%.
HCI: Wow. Well, if the payers see the the benefit, then there’s a huge market opportunity there, right?Heffernan:Yes, and we’re seeing more and more of them actually. Serious illness management has become a category for them.HCI: ACO REACH is evolving into the LEAD model. What does that mean for your company?Heffernan:We actually decided to sell our licenses to one of our provider partners. Now we work with them as a partner. What we found was the model was becoming more about home-based primary care and less about palliative and hospice. We still serve these lives, but we serve them as a partner of a primary care provider because that’s their major job. I think it will still be very good.HCI: You mentioned earlier having kidney care and cardiology programs. Are there tie-ins to other alternative payment models there, or is that working with MA plans?Heffernan:We work with the MA plans, but we also have Strive Health as a partner, for example. We work downstream of Strive and that’s been working really well. We do that with some home health players as well. We announced a partnership with Karoo Health recently. There are these great specialty groups or primary care, and then when the patient truly hits that last year of life, then they flow the patients to us and we manage them.HCI: Are you starting to get more contracts with the MA plans?Heffernan:We are. At this point, we’ve served over 60,000 lives, and we’ve repeatedly showing about 35% reduction in total cost of care. We’re bringing down hospitalizations by 50% and our quality scores continue to be super high. We have a 98% quality score in ACO REACH. We get that with our MA plans, so it’s been good. It’s just a matter of slowly getting more and more of these lives.HCI: Is there anything else that you’d like CMS or CMMI to do that would bolster this segment of care?Heffernan:We still believe that hospice should be carved into the MA plan. You have more than half of all Medicare lives in these MA plans, so it’s very odd that for the majority of these patients, CMS says to the MA plan that they are responsible for them all the way until the end — but then when they actually get really sick, give them back to us. CMS ran a demonstration project with the hospice carve-in and it did not go well. It did not go well specifically because they didn’t say you could create a preferred hospice network. They let the patient go to any hospice, wherever, and then you had to pay for it, and of course, what’s coming out now is there are a bunch of fraudulent hospice groups. So patients went to bad hospice providers, and they cost money and they revoke, and it was a bad experience. But some payers are saying that if they brought that program back, but allowed us to create a preferred network on hospice, this would do really well.HCI: How hard is it to distinguish lousy or even fraudulent hospice care from good care?Heffernan: It’s not hard. We’re working with CMS’s fraud department right now because we created Empassion Assured. We’ve been looking at six or seven metrics that hospices report, and from that you can easily say this person is in the bottom 25% in a county, or they’re in the top 25% or they’re somewhere in the middle. And the distinctions between the bad apples and the good apples are extreme. If you look at something like hospice revocation rate — how many times does someone enroll in hospice, but they didn’t really know what they were enrolling in, and they have an event and they revoke. With the bad apples, it can be 70% of the time the person is revoked, while the good ones are like 10% or less. So this is a no-brainer. It’s just a matter of getting that information into the referral workflow.HCI: Is there a chance that in their efforts to combat fraud CMS is painting with too broad a brush and capturing people who aren’t actually fraudulent? Heffernan: I think they’re really just pulling out providers who are obviously not seeing any patients or they’re billing for thousands of patients, and they have two providers. So they’re clearly not seeing them. They’re not paying the bills. They’re not reporting the metrics. I think it’s your blatantly bad actors at this point. The problem I do see is in some of these states they’re shutting down access to establishing new hospices. There are some really good local groups who want to establish a new hospice, and they can’t do that right now.HCI: Looking ahead, is there anything else that you want to mention?Heffernan:From a regulatory standpoint, there are some bills in Congress around adding palliative care as an actual benefit, either to the home health billing structure or to the hospice billing structure, Right now, if an MA plan wants to do palliative care, they can do it as an optional add-on. It’s not a required benefit like home health, for example, I think if it was a required benefit, it would certainly show the value of this. But then they’d also have to work through these kinks as well: how do you authorize someone to be eligible for palliative care? Who’s going to qualify to be an eligible provider of palliative care? So there’d probably be some short-term hiccups, but we think that could be an interesting benefit as well.
