Home care comes of age: a place of its own in the continuum of long term care. (Home Care).

SIMPLY PUT, HOME CARE IS ASSISTED LIVING WITHOUT THE facility. But like any other aspect of long term care, it is a complex part of the continuum of care. It encompasses a range of services in three niches: therapy or durable medical equipment, managed or personal care, and certified agencies. The broadest niche is personal care. Paul Hogan, CEO of Home Instead Senior Care, an international company based in Omaha, Neb., and Joe Davis, president of Accent Care, which has franchises in California and Arizona, shared their insights with CLTC on where home care is coming from, where it is going, and what challenges are along the way.

Humble beginnings 

As little as five years ago, home care was a single industry that covered a spectrum of services ranging from companionship to help with household chores and errands to assistance with activities of daily living. But that is changing. "I think what we're starting to see now is two separate, distinct markets: Non-medical home care and medical home care," notes Hogan.

Within the continuum of long term care, non-medical home care ranked low because it didn't require skilled personnel. But given a choice, most seniors are looking to age in place at home, which is driving up the demand. "Personal care is a very viable option," Davis points out. Certified and state-licensed agencies are adding personal care to the services they offer because not only is it a very profitable product line, but public awareness of home care is increasing.

Traditionally, home care is a private-pay business and doesn't have some of the reimbursement challenges of facility-based care. Those providers that are Medicaid-certified, relied on a cost-based reimbursement system very similar to the one nursing homes once did. Home care is now working under the prospective payment system (PPS). Many companies have had financial difficulties due to the transition from cost-based reimbursement to PPS and were either sold or dosed down. Those companies that survived the transition are strengthening the industry.

Facility-based providers are not alone

The U.S. General Accounting Office's report on nursing home abuse may have given facility-based care a black eye, but home care also feels the punch. "Any time you have negative press about the frail elderly being taken advantage of, it touches all of us in long term care in a negative way," explains Davis. Even without a facility, the challenges are similar: rising insurance rates, lowering reimbursement rates, and too few high-quality workers.

In Hogan's opinion, a lot people who want to get involved in home care are staying away because of the prospect of increased regulations. Davis shares that opinion. "Because it's now on the radar screens of not only the consumers but also the people running operations, states that don't have regulations or oversight of these businesses will change that in the near future," he notes.

"There are certain things that do need to be increased," says Hogan. "For example, there are only 15 states in the country that require criminal background checks for this kind of business." On the other side, government could over-regulate the industry, as it did in the nursing home industry.

What lies ahead

Hogan sees home care becoming an even more important part of the continuum of care. "Driven by the shear growth of the senior population, the growth of our industry will keep pace with the growth of the population," he says. "I think the whole long term care industry is poised for a lot of growth and a lot of success," adds Davis.