Podcast - Innovations and Insights in the Palliative Care Space

Morgan Ribeiro: Welcome to Counsel That Cares. This is Morgan Ribero, the host of the podcast and a director in the firm's healthcare practice. Today, I am joined by Daniel Patten, a partner in the firm's Healthcare Regulatory & Enforcement practice, and Spencer Freeman, chief strategy officer at Gentiva. In this episode, we are continuing a series of conversations we've had over the last two years regarding value-based care across a variety of segments of the healthcare industry, and today we are going to focus that conversation on the space of palliative care. Before we get any further, welcome to the show, Daniel and Spencer.

Spencer Freeman: Thanks, Morgan. Happy to be here.

Morgan Ribeiro: Great, so before we really get into the meat of our conversation, would love to just hear from both of you about your practice areas and the work that you do in the value-based care space. Daniel, I'll start with you.

Daniel Patten: Yeah, so my practice is helping providers, suppliers, any downstream vendor, technological company, anything in that sort that's a non-payer, negotiate and come up with arrangements with payers. Outside of the fee-for-service world where there's a boilerplate contract, a lot of these contracts are much more nuanced and bespoke, and just trying to help think through, with the legal hat on, what's getting caught up in fee-for-service concepts, how do we make sure that this program can last as long as we want? The data considerations, everything to just try to help make a program successful. And I try to keep my business hat off while I do that. So that's where I've gotten to know Spencer and learn about his knowledge in this area, and I thought it would be a great addition to this. And we can get over to you, Spencer, to introduce a little bit about your role.

Spencer Freeman: Yeah, thanks, Daniel. So I spent about the last 10 years in some version of value-based care, whether that be kind of on the operating side or the investing side. Local to Nashville, I kind of started my career at a company called naviHealth and spent a little under five years there across finance and business development roles kind of within business development, also including new solutions development. That business was sold to Optum in early 2020. And so at that time I transitioned into a related company, but still kind of in the value-based, post-acute space, a business called onehome. They did home health, DME, home infusion, U.M. [utilization management] and benefit management, but also their pretty integrated approach with providers. And so we actually would own home health, DME and home infusion pharmacies. And so we would go partner upstream with health plans and then kind of do both the care and benefit management side, but also try to manage a lot of patients through our own provider network. After leaving that organization, I joined Clayton, Dubilier & Rice, which is a mega cap private equity fund. Part of the practice is focused on healthcare, and the firm has been really investing behind value-based care thematically for a number of years now. And then most recently and currently, I'm in Gentiva, which is actually a CD&R portfolio company and specifically kind of moved over about 18 months ago to help stand up a value-based palliative business inside of Gentiva, which is the nation's largest hospice platform.

Morgan Ribeiro: So needless to say, you both have a lot of experience and expertise to bring to this conversation. Spencer, it would be helpful to hear a little bit more about Illumia, which is this division within Gentiva that you've mentioned, and the business model. Can you tell me more specifically about the company's services and what you offer to different customers?

Spencer Freeman: Yeah, absolutely. So for those that are not familiar with Gentiva at large, it was actually part of Kindred at Home formerly. So Kindred at Home at one time was a publicly traded business that was the largest home health and hospice — or you can just think of home care in general — company. Humana and a couple of private equity firms took it private — I believe it was in like the 2018 time period — and a little bit into that whole period, Humana decided that they wanted to retain the home health assets, but divest the hospice assets. And so at that time they ran a process and then CD&R, the firm I worked for, ultimately ended up acquiring the hospice assets from Humana and Gentiva was actually one of the legacy brand names of one of hospice companies that Kindred had bought. And so rebranded to Gentiva kind of to pay homage to one of the legacy brands, but really central to CD&R's thesis when we first started looking at the business was, OK, you've got the nation's biggest hospice business, best management teams in the sector, the biggest footprint. But what's a differentiated way that we can grow this business beyond kind of just the traditional ways that you would grow hospice, which would primarily be through continuing to gain new referral sources and kind of just expand your boots-on-the-ground staff. And given the firm's heavy value-based care kind of tilt and preference to investing behind value-base theses, we looked at the business and we looked at what a lot of kind of home-based, value-based care delivery models were doing and thought, wow, like, wouldn't it be something special if you could build a more robust palliative offering and do so in a value-based construct inside of the nation's largest hospice business. And so we kicked tires on that for a long time while diligent in the asset, talked to the management team, and they had a lot of energy around it. And so really the day that we purchased the business from Humana, we kind of were endeavoring to do this.

And as you mentioned, we have since coined this line of business inside of Gentiva Illumia Health, but it really started as kind of a concept and just an idea on a napkin, if you will. And maybe just to pull the thread on the business and the model for just two seconds. Palliative care — and folks that are maybe less familiar with it — has been the wild west in healthcare for a long time. Palliative care is actually not a defined CMS benefit. And what I mean by that is there is no Medicare fee schedule for it. So generally fee schedules obviously dictate the care that's delivered because you have to meet the requirements in order to build the code. But palliative has kind of been in this gray area for a very long time. It means slightly different things to different people because the lack of the fee schedule. And the defined benefit, there is no ubiquitous definition of "this is what palliated means." We actually joke in the industry that if you've seen one palliative model, you've seen one, because they tend to differ depending on who's administering it. But that lack of kind of defined benefit, defined Medicare payment rails has really led it to be an incredibly under-proliferated sector of healthcare, despite being something that most providers and physicians in particular really unanimously agree is a massive benefit for patients because there is hospice, which is Gentiva's core business, is almost the opposite. It's probably one of the most clear-cut defined benefits. It has a single payment model or payment rate rather. And then people I think pretty consistently understand that that's usually targeted for patients with a six-month prognosis or less. And so palliative can extend the year, year and a half, two years, generally thought of as some fixed time period pre-hospice. And there's just a bunch of patients that fall into needing additional support and care in that part of their continuum that has traditionally just been underserved. And so I can certainly elaborate more on that, but that was really I think the thing that we were trying to go solve.

And given the lack of a kind of reimbursement schedule or a defined benefit, we decided to make it our own and say, OK, what is being done today in fee-for-service over the small subscale that exists of community fee-for-service palliative providers. And then we looked at it and said, well, how do we think this care should be delivered to meet the needs of this population? And if we can devise kind of a payment mechanism in order to kind of get reimbursed for the value we think that this additional service is going to provide, then it can be something that we offer at scale across our whole footprint, hopefully one day, and help to kind of meet some of that gap in patient care that exists.

Daniel Patten: One thing I think is really important to anyone listening, you hear palliative care, post-acute, hospice, home health. You know, when we're talking fee-for-service, yes, a lot of these conversations are sector-specific or methodology-specific. I think the value-base, I think, is a little different, right? When I hear Spencer talking, it's saying, we see all these fee-for-service markers, the episodes, visits, things like that. There's all this time in between where care can be provided, right? And so, at the highest level, I think can be applied to any, really any providers, when you see those values in between those typical fee-for-service opportunities, there's a lot of value there, right? And it doesn't have a name, it doesn't have a code attached to it, there's no model attached to it, it's really, "How do I connect those dots?" Which really, it can apply anywhere. So I just wanted to point that out, I think this is so much broader than just the post-acute world.

Morgan Ribeiro: Yeah, completely agree with that, and I think Spencer, just to kind of elaborate on some of what you provided and that very helpful overview of what the company does, but also just addressing and really stating what that need is out in the market. What are some of the core services that you all are providing?

Spencer Freeman: Yeah, absolutely. So, I think we've gone to market, to maybe start there, very specifically to serve risk-based primary care physicians. We actually don't have any direct health plan on the Medicare Advantage side yet, or we don't any contracts on the MA side yet. And so we've really built the model to be an extension of kind of PCP care and bring that into the home. And again, I mean, we built this for a very vulnerable population that generally only applies to four, maybe five percent of a Medicare population and to really build and target it around patients with a 12- to 18-month prognosis. And so we looked at that population and obviously one of the things, and this kind of builds on what Daniel was saying, that's actually quite challenging about palliative care in particular or end of life care is it's not threaded to one disease category. It's not a kidney care company where you're looking at patients that all have CKD or ESRD, or it's not an oncology company, right. So you have to be, I think, broad enough in your care delivery model to address the unique patient needs that are going to vary a lot, I think especially compared to a lot of higher acuity, higher intensity home care delivery models, but then at the same time have care pathways that kind of meet their specific needs. And so we've really tried to thread that needle as best as we can.

So, said another way, we built a model that is nurse practitioner-led. We have a team of NPs and RNs, which are the kind of the tip of the spear for the model. And so they are the ones that actually are delivering the in-person care in our patients' homes, and they're supported by a remote care management team comprised of RN case and care managers as well as social workers. And then kind of an umbrella that sits over the whole model is medical directors, and they help, as I was mentioning before, design the care pathway and tweak care plans that are bespoke to whatever a patient's needs are. Candidly, a lot of these patients have multiple comorbidities and chronic diseases, so it's not even as simplistic as saying we're treating one thing. To give you an example, 40 percent of the patients on our panel have five or more chronic conditions. Diabetes being something that might be very consistent across them, but it's just one of the many things that we're treating them for. As part of the model, and when we looked at this patient population, one of things that is very evident is there's a lot of unnecessary hospitalizations. And so we felt like the only way to attack that was actually being able to have 24/7 on-site care in the home. And so, we staffed this model with a 60-minute or less ability to get in the home. And we really educate and talk to our patients and their families. If you have an acute exacerbation or something that you feel you would traditionally call 9-1-1 for, if you feel that it's not life-threatening, consider calling us first and we'll be in your home within an hour. And that's quite effective, obviously, at keeping this patient population healthier in their home.

Because we've gone to market, like I said, with the risk-bearing primary care physicians, we really rely on them heavily to refer patients on their panel. Again, they're fully at risk for these patients, so we're very aligned. They effectively have become the health plan by taking full upside and downside risk on their patients. And so they generally love our model and know that these patients need more care than they can deliver when they're with them in their clinic. And so we do leverage a data science algorithm and we get historical claims data from our risk-based PCP partners who are getting it from CMS or their MA plans upstream, but candidly differentiated, I think, from a traditional payer services model where you would use those claims to attribute a patient population to you. We are really relying on our PCP partners to actually refer who they believe is clinically appropriate. And so we put a lot of time and energy into fostering that relationship with our PCP partners, and we think that there's nothing that replace the physician and patient relationship and they're sitting across from these patients, many of them they've had on their panel for a very, very long time. And the best algorithm in the world is not going to be better at getting the right patient to us based on what that physician is observing.

So that's just a few of the pieces, and the last thing I would say is the really unique thing that we got energized around back when I was still at CD&R and we were even just ideating on the possibility of building a value-based business like this inside of the nation's biggest hospice is the ability to care for that patient all the way through expiration. And so what I mean by that is, we manage them in Illumia Health, which is the palliative model I just described, but when a patient becomes clinically appropriate transition to hospice, it's patient and family choice, but they do have the option to transfer to Gentiva's hospice, and the ability to manage a patient under one umbrella, we've seen firsthand, creates much better outcomes and a really, we think, improved patient and family experience. Just to give you one example of that, on the last visit that they receive under the Illumia Health banner, when they're in that palliative part of the episode, we're able to send the hospice nurse out with the palliative nurse and so it kind of takes some of the edge off and, I think, some of the scariness of transitioning to a new care team. We're able share clinical documentation on that patient so the hospice team is not coming in blind, and so I think we just feel really, really proud of the ability — this is such a fragile time in a patient and family's life, and to be able to have one provider that when we start caring for mom, dad, or grandma or grandpa, we're with you, and we're there until the end, and that's been really special to see come to life.

Morgan Ribeiro: Are you all employing these RNs and NPs, or what does that relationship look like?

Spencer Freeman: We do, yeah, it's an entirely W-2-based model. And so when we go and start working with a new risk-based primary care partner, we will, generally we already have hospice in the market because we're in almost everywhere in the country, not everywhere, but almost. And then we will — might sound a little jargony, but I always word it as like — we'll bring the value-based capacity to the market. So we'll launch a big hiring campaign and hire the social workers. Generally, we have medical directors that are kind of already available and kind of can sit across multiple markets. But yeah, we will go into the market and hire based on what we think the census and the volume end up being.

Daniel Patten: So Spencer, I have a follow-up question for you. So this makes a lot of sense. We won't call it plug and play, but a provider that has a risk pool, sees this great opportunity, Illumia could provide for a panel of patients. That makes sense in a vacuum, right? But the space is becoming more crowded. You have more competitors. You have other types of kind of risk-based support or care managers out there, a lot times over the same patient, right. So we're carving up these panels And it's only going to get more crowded, right? How do you think through that? When you were doing the doodles on the back of the napkin, is this something where there needs to be a kind of proof of concept, proof of value early? How objective is that? Just kind of walk me through how you think about this market — I guess what I'm saying, at the end of day there's a certain dollar amount in savings and we got to divvy that out amongst several different people. How are you claiming your piece of that savings and feeling confident as we kind of march forward?

Spencer Freeman: That's a great question, Daniel. And I think you're hitting on probably something that's on a lot of people's minds that have spent any time in value-based care, and I'll try to be somewhat succinct, but I do have a lot of thoughts on this one. I think you've seen a shift, and in my 10-ish years in my career in this space, I think it started off if you could go to an MA plan, and at that time, I think most value-based care companies were primarily built around Medicare Advantage. My background actually started more in what I would call service category management, meaning naviHealth, for those not familiar, managed post-acute care spend and full risk. And they did that across an entire Medicare Advantage book of business, usually at a state level. The second company I worked at called onehome was very, very similar. And so it was sub-capitation for a subset of services or a piece of the care continuum, i.e. post-acute care. naviHealth being facility-focused in post-acute care and onehome being home-based post-acute care-focused. But that's very differentiated from, I think, some of the other companies that were coming up at the same time, which I would probably say is a Landmark, an Aspire Health, today would be like a Monogram. And those are total cost of care, patient criteria-based attribution models. Monogram being disease-specific, Landmark being kind of like cohort-specific based on really high acuity and kind of home-based needs being the qualifiers, and then Aspire probably being most similar to what we're doing. It was really targeting patients that were palliative-esque.

So you kind of have these two worlds, but I think at the time this was a new landscape, I'm talking seven, eight, nine, 10 years ago. And if you were willing to come to them and take risk on either a service category or a population that they were struggling to manage, and especially if you were willing to guarantee them savings, usually that was a conversation they were willing to have. And a lot of those companies that have done really great work and helped kind of forge what the industry is today, I think, pioneered that. I think you have seen a slight shift in that really post-COVID, that payers don't have that mentality anymore of we're going to slice and dice our patient population up 10 different ways. It becomes really, really hard, to your point, to attribute value to one program if a patient isn't overlapping, and for the actuaries that are trying to reconcile these risk contracts, it becomes a really, really hard exercise. And we ran into this when I was at naviHealth and onehome to where, OK, you work with a health plan and they have Landmark in place. Well, our Landmark patients carved out of naviHealth contract. When we were trying to take SNF and ERF and LTCH risk on all patients or vice versa, we kind of included and then billed as a claim against Landmark. And so, there's a lot of confusion and a lot of attribution issues and probably some health plans would even say that they potentially double-paid some of these vendors at times.

And so really I say all that to kind of tee up that I think MA plans at large have kind of probably limited patients to deal with that today. And really one of the fundamental things that I would bet on over the next five to 10 years to continue to accelerate is they love, from what I've seen, to be able to effectively delegate risk to a PCP for a patient on their panel. It's the most logical way to attribute risk: You're the physician of record, you are kind of the patient's care quarterback, and I have seen effectively any PCP organization that is willing and able to take risk to generally be able to go get it from any MA plan. And so that actually folds into, I really believe, the next five to 10 years. Yes, there's still going to be a market to go direct to MA plans and with a model that works and makes sense and maybe there are ways to avoid some of the pitfalls — risk of multiple vendors taking risk or attribution on the same patient, that's happened in the past — but I really think that companies in this space are going to have to get better and better about saying, OK, traditionally, we thought of value-based care as being, working with an MA plan directly, well now a lot of the patients are going to be in risk arrangements with PCPs, so how do I go to the risk-based physician market and add value to them and almost be sub-delegated or sub-capitated for a specific either disease category or service category in the same way that people thought about it going direct to MA plans? And so that really formed a lot of our thinking and thesis of, we think the market will continue to head this direction and accelerate with PCPs taking risk for their Medicare patients on their panel.

And so we wanted to go to market first with designing a model to say, if we can work and figure out how to kind of activate the proximity that that physician has to their patient, one, we think that can create better economics and better clinical outcomes for the patient, but two, we think that's more challenging because you have this intermediary that you're working with, and through rather than just getting attribution and then effectively trying to do patient enrollment and engagement through a patient engagement team that's doing cold outreach and mailers and trying to get in front of a patient any way they can. And so I think it requires more elegance and it requires more of a soft touch because you have to understand the physician group you're working with, understand the capabilities they have, understand what patients and what their local community looks like. And then ultimately be a value add to them as well, because I think more of them are going to hold the premium dollar for patients moving forward.

Morgan Ribeiro: So, Spencer, you've mentioned something a couple of times that I feel like comes up in every conversation around value-based care, which is the importance of data. And it's not that there is any kind of — I think there's an overabundance of data, right? It's just how do you sort of analyze that and use the data to inform decision-making and sort of evolve the model as you go. And so, I think you guys are investing in building out your data analytics team, but I'm curious if you could talk a little bit more about the use of data. What do those roles look like, what kind of data are you capturing and how are you really utilizing that information?

Spencer Freeman: Yeah, it's a great question. I mean data is probably the most important thing in an e-value-based arrangement, both, I think, to know who you want to manage and be able to identify that patient cohort, and then to build a measure on any value you're creating on them or, I guess, lack thereof in a less fortunate scenario. And so, yeah, we built out, and that was a new muscle to build with inside of Gentiva, despite it being the nation's largest hospice and knowing this patient population very well, to use our business as an example, we did not have the value-based care expertise or infrastructure in the business. And so that has been something I've been really kind of head-down focused on for the last year and a half, is just kind of standing that up. And it was everything from building more of a modern data warehouse that could handle large payer files and really large data sets with claims data, HIE data and other sources, all the way through having a data engineering team that could standardize and clean it and run it through a data model to produce the data into a workable format. Because that is unfortunately something I think this industry still has not totally cracked, is how to have really clean data and interoperability across systems and health plans and what have you. And so you, as the vendor, have to, I think, kind of own a lot of that, and it's not an easy feat, unfortunately.

But yeah, we do leverage both claims data as well as third-party commercially available data. We work with a couple of vendors to get additional pharmacy and lab data on patients that we have on our panel. We use ADT data to be a leading indicator for what we believe our inpatient utilization is going to look like. But yeah, I mean, effectively, it's kind of a multi-pronged process to where we ingest the data, we analyze it, and every month we generate a list of patients that we believe may be appropriate for our model. We share those with our physician partners, and it's a recommendation list. It's not a, you have to send us these. It's, this is what the data is saying, but by all means, please use your clinical judgment. And then we really also use it to drive performance management. So, like I said, we get real-time leading indicator data. We know from the baseline that we have built up through claims analysis and agreed upon with our partner what our targets are. So, what we're measuring against in our business in particular, it's primarily inpatient utilization and hospice utilization, because those are the two big needle movers for this population.

And so we're using data and we're working at sharing that back in joint operating committees and even ad hoc meetings with our partners, if we notice that metrics aren't trending well in a specific market. And then we ultimately build our care interventions and how we're delivering care to go move the needle on things that we know are driving that utilization. To give you an example, if an oncology patient or we notice that a cohort of our oncology patients are experiencing a lot of inpatient utilization due to nausea from chemo drugs, we will build a specific intervention around how we think we can go treat nausea more effectively in the home. And then we monitor how inpatient utilization trends after we make that tweak to our care delivery model. So it's really just all the way through, I think, both setting up what are our targets through measuring performance and then allowing you to make real-time adjustments. It's kind of a lifeblood of the business.

Daniel Patten: A reaction and observation from my point of view on the legal side is, Spencer is very sophisticated and understands this world, and I remember the first time I talked to him, I told him, I always tell people, bring and hire an actuary. And Spencer in my first conversation actually had an actuary on the phone. What I see a lot of times, what I advocate for my clients is, sometimes there's data you don't know you need, but you need to try to get as much as you can. You're kind of trying to hit a moving target. And with ransomware attacks and things like that, the health plans, systems, everyone's putting everything on lockdown. They're giving less and less opportunity to share things of that nature. And trying to kind of predict the future. If you look in the AI side, all these big LLMs are starting to be commoditized. Where's all the power, the juice? It's in the data. And so you see all these lawsuits in New York Times, the value of Reddit, or X, all these data warehouses. And I think people are going to get wise in realizing, hey, sometimes we just have a slush fund of data. You said you were going to use it, but you put it in your algorithm. We're going to see more regimented processes around actual use and auditing for that. But at the same time, there's this wave of patient data consumer privacy. HIPAA, I think it's going to be replaced eventually by these consumer protection laws that you see any time you're on a website. Allow cookies or not, they will know that your data is being used. And so what I think is, what Spencer is saying, is they've got such a head start and they're doing great in that area. Anyone that even is just getting started, it's not too late, but that should be a primary focus. Get as much data as you can. Realize you're going to be battling harder and harder in every single contract to really get what you want. So start today.

Spencer Freeman: I agree with that. And I think we've even gotten a lot of questions as we've gone through contracting with our partners. I mean, data is, it's almost viewed as an asset, which makes sense. And to your point, you do have to be an organization that is able to prove that you can protect that asset as it should be from, I think a lot of the cybersecurity risks that we're all facing in this day and age. But one of the ultimate ways I think we've been able to meet in the middle with our partners, is really prove value and what the data will allow us to do, to explain the algorithms you're using, to explain how it's going to impact the care model and what that ultimately means for their patients. And then obviously on the value-based kind of financial outcome side as well. And so we've really approached it more as a, we're partners in this, our goal is to treat these patients as effectively and efficiently as possible. And that's hard to do if you're flying blind. And I think most parties on the other side recognize that. And so it's more of rather than being binary — we're going to get it all or we're going to get nothing — just working together to be collaborative, to really enable what you're trying to do.

Morgan Ribeiro: Right, and Daniel, obviously, when you touched on HIPAA and some of the security concerns, but are there other legal issues that you think that should be considered as you're structuring these contracts and these relationships? I know maybe state-specific, but just kind of other regulatory considerations and these types of arrangements.

Daniel Patten: Yeah, I think there's always the clinical decision-making aspect, which I think is always present, always been there. But I really think more the IP side. If you look at IP rights, independent contractors generally have the right over their IP, like feedback given, and so I think what you're starting to see from regulatory side is the fight over who on something. So if I'm working to model using real-time data, and it's helping, let's say, train or retrain, modify, whatever is under the hood in an AI model. I think some other groups are, if someone's seen — the value of this kingmaker, right, some organization that's come along has kind of the secret sauce. That's really a culmination of a lot of others that have in a lot of contracts and a lot of practices, it's really important to understand that what we have, what we've learned is ours and that we have full right over that. I think that's something you're not seeing litigation on or a lot pushback now, because I think sometimes folks understand that or are still trying to get up to speed of how these things work. So even today, if that's not an issue, I think why it still should be a primary focus in these contracts is who has rights, what is my access? And then understanding — having a sophisticated actuary and the data science team need to be very clear, this is what we need, when we need it, when we dispose of it. So it can always be above board or if audited, it can pass that.

Morgan Ribeiro: Great. And then Spencer, you mentioned this earlier on, but obviously payers are an important piece of this equation. Can you tell me more about how you all are forming those relationships and what kind of data are they interested in seeing in order to solidify those relationships and ultimately sell your services to the payers?

Spencer Freeman: Yeah, it's a great question and has something we're actually contemplating real time in the business today because I think we have specifically gone to market specifically with risk-based primary care, like I mentioned. We were starting to pick our head up and say, OK, we're two years into this, we would like to start pursuing direct Medicare Advantage plan relationships. And so, when I think about going direct to a payer, which the last two businesses I worked in were what I would coin as more payer-services businesses, I think, what's important to them, which, is obviously similar, but slightly distinct from working with physicians directly, is I think you need a model that can move the needle in a way that hits their radar. And I think a lot of folks have looked at businesses over the years that are solving a very niche need. And when you think about all of the things, and I've actually spent time inside of Optum/United and Humana because they bought the two businesses I've been in. So I have a little bit experience of thinking from this side of just you have so much coming at you all the time.

And so I think it's yes, like what data do you need and what do you need to prove that your model or the population that you're focused on serving can kind of bend the cost curve and make a difference. But it's also that it applies in a way that's meaningful enough for them as a business to build a devoted bandwidth to it. And it's not to say that a meals-based or non-emergency medical transportation business doesn't have a lot of efficacy, but could that be packaged with something else in a way to where it's getting at more things that the payer's thinking about, because they're managing a lot on their side of the table. I think if you have a model that makes sense for an MA plan and is either really, really attacking a very high-cost population that maybe drives an outsized portion of the claims that they experience, or it's more of that like naviHealth model I mentioned that is lower utilization per patient, but it's something that you could ubiquitously apply across their entire MA book and an entire state, I think those are models that are really appealing to them.

And then from a sense of what they're looking for, we think of it as kind of clinical, financial and operational metrics. And I think clinical is relatively straightforward: Are you improving the lives of the patient and their family and be able to show that the outcomes are differentiated from what patients with similar diagnoses or diseases that are not receiving your care are experiencing? The financial side is a direct flow through the interventions you're providing, and the nice part about that one is medical claims are binary and if you have a benchmark that you're comparing to, it's pretty easy to say whether you're making a difference there. And then operationally, I think, is probably the most complex and bespoke to your business. For us, we're a home-based care delivery model. That obviously narrows it to what's the referral and how many patients are we actually going and seeing in their home? How long are they staying on our program? How many touches per month, both telephonically as well as in person are we performing? And that's for this specific population. As I mentioned, we're dealing with a ton of diseases, and so we can slice and dice it by a patient cohort we're managing that has a certain disease profile or look at it however kind of our partner wants to. But I think that that piece would be kind of bespoke to your business, but really knowing your KPIs and being able to kind of boil it down to a few metrics that if we perform well on these is, I think, really, really meaningful. This is more probably on the financial, but the operational certainly blends into it, is if we know that we're moving inpatient admissions, a percent of our patients that are expiring on hospice and the average hospice link to stay, all three in the right direction, then everything else in our business upstream of that is probably going pretty well.

Morgan Ribeiro: OK, so that's a very good segue into my last question for you, which is, I know you all are in the early innings of the company, but are there any sort of noteworthy wins that you would say you've already seen in the early stages of the company?

Spencer Freeman: Yeah, I think maybe just to build on that, we've been really pleased to see really impressive inpatient admission performance, which has exceeded my expectations. This population does have a lot of utilization and unnecessary utilization when they're treated well in the home. We actually got, to give maybe a tactical anecdote, just within the last month, a woman, a daughter actually, submitted a story to us about her mother. She lives in the Detroit metro area, which is one of our biggest markets. And she told us that her mother had been to the hospital 20 times in the two years prior to us starting caring for her mother, which was last summer. And since she hasn't been a single time. And so that's just a very meaningful thing to where — as she was sharing this story with us — that's 20 times this family's life was disrupted. The mother and the other siblings were at the hospital, worried about their mother. I think it's something that's so important for everyone in our industry to remember, these are real lives and these are people on the other end of all these metrics, that when they're moving the right direction, there's thousands of patients and families positively impacted. But yeah, I think that's a big one for us. We've seen it exceed 20 percent, reduction compared to a baseline, which was in some markets north of 30, which I think has been truly rewarding to see the fruit of our labor there.

And then on percent of our patients that are expiring on hospice — at the end of the day, we are a hospice company, we think it's the richest and most robust benefit in the country and certainly that Medicare offers. And it's unfortunate that only about half of patients in this country today utilize it in their last days of life. And so we hope that that changes over the years, but we generally have targets that are upwards of the 70 percent to 75 percent range of our patients that we manage are actually expiring on hospice. And we've been able to see that come to fruition as well.

Morgan Ribeiro: That's great. I mean, both qualitative and quantitative, right? It's easy to kind of get bogged down in the data and looking at this as just numbers, but there's real-life stories and results that are coming through, so that's really meaningful and impactful. Daniel, anything else you want to add?

Daniel Patten: I got one more question. Since we're under a severe thunderstorm watch as we record this we'll make Spencer the weatherman. Spencer, what are some headwinds for value-based care right now? There's a lot going on in Washington. The M&A activity's been here and there. Do we need more consolidation? What do we need? You guys have had such great results, as you shared. That's an exciting story. What's preventing faster utilization of value-based care services, and just the industry exploding?

Spencer Freeman: It's a really good question, and something we think about a lot both when I was at CD&R as well as inside our business today is, how do we deliver a superior product? And when you take a step back and think of the whole landscape, I think there was, as I mentioned, this kind of massive runup pre-COVID of businesses springing up, valuations were very frothy and a lot of these companies were being backed with pretty attractive venture rounds, and at the end of the day, a lot of businesses, when you gave them enough time in the market, were struggling to prove that they really were moving the needle on patient outcomes or what have you, and I think there became a little bit of jadedness in the industry, especially from the health plans perspective — well, is this really improving patient care, or is this financial engineering? Are you cherry picking a patient cohort that you know you can make money on by tweaking this little thing, or they have an acute event and it looks like they're really sick and you take risk on them and then they regress to the mean because they just had a bad spell of utilization and hospitalizations?

And so, when I take a step back, like a lot of organizations that have endeavored down this value-based care path did so — and I've been a part of multiple of them, to be clear, and I think they've done a lot of good — but they did so as a standalone business model. Meaning they were formed and kind of purpose-built to go and attack something within this value-based space, and some of those have been more utilization management-focused businesses. Some of them have been kind of delivering care themselves and focusing on a specific patient population. But I think what we've been able to do at Gentiva — and what I would really encourage anyone in a big provider organization listening to this to think about — is, we built value-based infrastructure inside of a business that already knew this patient population intimately and knew how to care for them, and we took it and we said, we know this really, really well and we know what these patients need. We also know what we're limited by in kind of the Medicare reimbursement landscape that I articulated at the beginning of this discussion. And we were able to take a step back and say, we serve over a hundred thousand unique patients in our business every single year, what have we seen consistently that they need that they're not getting? Let's build a care model around that.

And then we went and we figured out the value-based kind of payment mechanism and how to contract for it in value to make sure that it was solvent and we could fund it, that it made sense as we would scale it and go to market. But I think starting from that first principle, we know how to deliver this care, we know how to build a business that meets a patient need because we've already been doing it. And then pulling value-based care on top of it, it's really resonated in the market, because I think when we're able to walk into a room with a potential partner and immediately have that, I would just say, credibility of we are the nation's largest end of life care company and we have brought value-based care expertise and we changed this, this, and this and we actually think it makes it even better, I think that has been kind of our edge as we've gone about this versus being a business that starts grassroots, is value-based care from day one and then also at the same time while you're building the business has to understand and build all the provider capabilities to actually manage the patient population. It can certainly be done and there's a lot of examples of companies doing it quite well, but you're effectively fighting a battle on two fronts, and I think we've been able to really narrow that and just focus on what we needed to get done to build on top of our existing business.

Daniel Patten: Yeah, that's really well said. The strategics are traditional, but they understand the care. The value base is a little more innovative in making that switch, but that's really well-said.

Morgan Ribeiro: Awesome. Well, thank you both, I've learned a lot.

Spencer Freeman: Yeah, thank you all. I had a great time and I really appreciate the opportunity.