Some of the nation's largest hospital systems are turning to a startup to help them deliver at-home hospital care to patients who otherwise would have been admitted.
Ascension, CommonSpirit and Highmark Health are some of the organizations that have signed joint venture deals with Nashville-based Contessa over the past few months.
It's a move that may seem at odds with the traditional business model of hospitals, but it's one way providers are trying to get ahead of the curve as pressure mounts to reduce the cost of care and as reimbursement is increasingly tied to quality. It also fits the trend of care moving out of the pricey hospital setting.
Historically, health systems have worried about "heads in beds," Amber Sims, chief strategy officer with Saint Thomas Health in Tennessee, part of Ascension, told Healthcare Dive. Nationally, Ascension is working to find new business models that will transition one of the nation's largest health systems into the future, she said, and this is one of those projects.
The joint venture with Contessa allows clinicians to care for the sickest patients in the hospital while moving those who don't require continuous monitoring to their homes. With patients at home, hospitals are not providing meals or housekeeping services, potentially lowering overhead costs.
Medical complications are the primary areas of Contessa's clinical focus for at-home patients, Contessa CEO Travis Messina told Healthcare Dive. Some of those complications could include diverticulitis, pneumonia, congestive heart failure and asthma.
Pittsburgh-based Highmark Health is the latest system to sign on with Contessa, inking a deal last week.
The joint venture serves two purposes for Highmark Health: It keeps people out of the hospital who don't need to be there and it alleviates congestion at busy hospitals, Tony Farah, executive vice president and chief medical officer for Highmark, told Healthcare Dive.
"It really decompresses those hospitals and doctors to be able to take care of the sicker patients, which is what you really want to accomplish," Farah said.
Highmark, which is first rolling out the program at one center before implementing it across the rest of its facilities throughout 2020, said it expects to see larger volumes of at-home patients among Medicare beneficiaries. The service will become available to those beneficiaries during the first of the year.
Contessa's technology can flag up to 150 diagnoses that can be treated at home. After further evaluation, a medical team decides if the move home is appropriate. Contessa establishes the reimbursement arrangements with payers for the services and technology it brings to its partner health systems. The health systems use their own clinicians to dispatch to a patient's home.
Messina said Contessa's biggest competitors are health systems doing this on their own.
Highmark executives said they were initially surprised at how many patients were flagged as potential candidates for at-home care, even among the commercial population of patients.
"It is a significant percentage of patients who would fit those criteria if you think about it. Because a lot of patients who end up hospitalized, regardless of whether it's a community hospital or a quaternary care center, end up being in the hospital for just a few days," Farah said.
Messina was also struck by how many patients could be treated outside the hospital. While working for Vanguard Health Systems, which was later acquired by Dallas-based Tenet Health, Messina noticed that at least 40% of the system's admissions were for medical complications that didn't need round-the-clock monitoring.
He felt those figures represented an opportunity to try something new, but wasn't sure he could scale an at-home solution.
When the Bundled Payment for Care Improvement program launched, Messina knew the idea could be scaled. He started writing the business plan in January 2014, a year after that program was started, he said.
His idea first attracted four primary investors: Martin Ventures; Charlie Martin, chairman and CEO of Martin Ventures; Blue Cross Venture Fund; and Noro-Moseley Partners of Atlanta.
Typically, Contessa signs joint venture deals with its health system partners, creating a new business in which each entity has an ownership stake, Messina said, likening it to how hospitals partner with ambulatory surgery centers.
Payers have agreed to pay a fixed price for a 30-day period, or bundle of services, and the JV assumes the risk. Anything beyond that fixed price is absorbed by the JV.