Humana to Build Up In-Home Services, Focus on Social Determinants

Expanding health care services in the home setting will be a key priority during 2020 for Louisville, Ky.-based Humana (NYSE: HUM), as will an intensified focus on social determinants of health.

A Humana spokesperson told Hospice News that hospice services would be a part of this effort.

“The next phase beginning in 2020 is to provide more care services in the home, including acute care and primary care in the home,” Humana CEO Bruce Broussard said during a Q4 earnings conference call. “So that we may begin to generate meaningful trend benders for our health plans in the future while improving clinical outcomes for our seniors.”

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Social determinants of health will be another key focus for the company in 2020, particularly through its rapidly growing Medicare Advantage business. The company is among the biggest Medicare Advantage payers, adding 525,000 members during 2019.

“We remain committed to improving the life of those we serve through our social determinants capabilities, which positions us strongly to serve the vulnerable populations, Medicare and Medicaid, and provide us with the experience needed to meaningfully participate in the [Medicare Advantage] value-based insurance design program and Medicaid procurements,” Broussard said.

The company in 2019 doubled the scale of its social determinants of health screenings to more 1 million and connected those in need to community resources, with plans for further growth in 2020, according to Broussard.

Strong performance in Humana’s hospice and home health holdings, particularly Kindred at Home, as well as its recent acquisition of Enclara Healthcare helped bolster the company’s robust fourth quarter 2019 earnings, along with the significant growth in its Medicare Advantage and Medicaid business.  

The company in partnership with private equity firms TPG Capital and Welsh, Carson, Anderson & Stowe in 2018 closed a $4.1 billion acquisition of Kindred Healthcare, one of the largest hospice providers in the country. .

On the heels of the Kindred transaction, Humana and the same private equity partners went on to acquire North Carolina-based Curo Health Services for $1.4 billion.

Enclara provides pharmacy services and pharmacy benefit management almost exclusively to hospice providers. The Humana transaction included the company’s subsidiaries Enclara Pharmacia, GuidantRx and Avanti Health Care Services. Financial terms of the transaction were not disclosed.

“The platform, which serves more than 450 hospice providers serving 97,000 patients, expands [Humana’s] comprehensive care continuum strategy to include hospice pharmacy services, enhances mail-order capabilities, and expands [electronic medical records] and mobile medication management capabilities,” Frank Morgan, managing director of Healthcare Services Equity Research at RBC Capital Markets, indicated in a note provided to Hospice News.

Humana’s health care services segment’s GAAP segment earnings rose 5% to $789 million in Fiscal Year 2019, compared to GAAP segment earnings of $754 million in FY 2018. The company attributed this to higher earnings from the company’s pharmacy and clinical operations; and higher earnings from Kindred at Home operations, according to its Q4 earnings conference call.

Analysts expect continued growth in the Kindred at Home segment, perhaps accelerating in 2020 as Kindred’s 2019 results were somewhat weighed down by the company’s Homecare Homebase integration.

“Humana continues to build out its primary care and other health care services platforms, providing an integrated clinical platform to deliver care and improve the health of its plan members,” Morgan indicated in a note. “Recent results have benefited from operational efficiency initiatives undertaken in recent years, which provide the opportunity for strong leverage on topline growth.”

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