Enhabit Adapts Case Management Model to Stem Turnover in Acquired Hospice Agencies

Enhabit Home Health & Hospice (NYSE: EHAB) is adapting some aspects of how they integrate newly acquired hospice assets.

Early on the company would implement a set of processes that were symmetrical with those in its home health business, but agencies in its hospice segment experienced some difficulties with those transitions. This contributed to a spike in turnover, which in turn slowed Enhabit’s rate of growth, CEO Barbara Jacobsmeyer said at the Credit Suisse Annual Healthcare Conference.

“On the hospice side, we’re moving to what we’re calling a ‘case management model.’ Historically, when the company would make an acquisition for hospice, they would move everything to a type of home health productivity management,” Jabobsmeyer said. “What we heard loud and clear from our hospice branches was that they needed to run differently than home health.”


From that feedback, the company learned that bringing a home health type of model into hospice realm meant nurses were on 24/7 call in a way that was unmanageable with their available workforce, Jacobsmeyer explained. This led some employees from acquired agencies to leave the company post-acquisition.

Enhabit’s has been aggressive growth since the home health and hospice provider spun off from Encompass Health (NYSE: EHC) in July. The company has earmarked $50 million to $100 million annually to fuel transactions, with 60% to 70% of its pipeline weighted toward hospice, Jacobsmeyer previously told Hospice News.

Recent transactions include the purchase of Caring Hearts Hospice in Texas and the acquisition of Arizona-based Unity Hospice earlier this month.


Enhabit also planned to add 10 new home health and hospice locations each year, again with a heavy lean towards hospice, Jacobsmeyer noted in a recent earnings call.

Enhabit operates 251 home health locations and 100 hospice sites across 34 states. Of these, 86 hospice locations are co-located in markets where the company has an established home health presence.

Enhabit’s labor force numbers more than 10,000 employees across its entire footprint, but the company continued to battle workforce pressures during the third quarter.

The need to engage more contracted clinicians drove up labor costs in Q3. Rising prices also contributed to a higher spend on its fleet of company vehicles, as well as mileage reimbursement, according to its third quarter earnings report. These expenses have jumped approximately $2 million year over year, the company reported.

But Enhabit is beginning to see labor trends swing in a positive direction, including a 10% reduction in clinician turnover, inclusive of part-time employees. The company hired 55 full-time nurses in Q3.

Ensuring a sustainable workforce is among the pillars of Enhabit’s M&A strategy, according to Jacobsmeyer. Reorienting its hospice case management model will be part of its approach to transitioning staff in future acquisitions.

Enhabit has already begun to pilot this strategy in some of its markets, rehiring back five nurses that had left the company citing caseload issues, Jacobsmeyer said. The company is conducting further analysis before it implements the case management model across its footprint, which is expected to begin towards the latter half of 2023. 

“Moving to this care management model is going to allow [nurses] to better manage a caseload of patients. We’re also going to have on-call and triage nurses to help them,” Jacobsmeyer said at the conference. “Running [this model] is going to really help us as we look forward to the future and how we’re going to manage costs.”

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