Enhabit Poised for Growth as Medicare Advantage Penetration Increases & Payment Landscape Shifts
Enhabit Home Health & Hospice is strategically positioning itself for notable growth, fueled by the increasing popularity of Medicare Advantage (MA) plans and a proactive approach to payer negotiations.as more beneficiaries opt for MA, securing favorable contracts with these plans is becoming paramount for home health agencies – and Enhabit is delivering.
Navigating the Medicare Advantage Landscape
The company has spent the last two and a half years diligently negotiating contracts with MA plans to ensure fair reimbursement for the vital services they provide. This effort is already yielding positive results, driving both growth and improved revenue per visit, particularly outside of conventional Medicare.
“To be considered a full-service provider to our referral sources, we must be able to accept the majority of payers,” explains Barb Jacobsmeyer, EnhabitS outgoing CEO. “This has been about securing contracts that pay us fairly for the services we provide, and we’re seeing the results of that.”
Currently, Enhabit operates 249 home health locations and 114 hospice locations across 34 states. Jacobsmeyer will be stepping down in July 2026, or upon the appointment of her successor, leaving a company well-positioned for continued success.
Rising Hospital Acuity Drives Demand for Home Care
The demand for home-based care is also increasing alongside rising hospital acuity rates. MA plans ofen favor home care over more expensive options like inpatient rehabilitation or skilled nursing facilities.
This creates a critical opportunity for agencies like Enhabit.
* Increased Patient Flow: Hospitals are seeking efficient discharge options for MA patients.
* Cost-Effective Care: Home health provides a more affordable option to institutional settings.
* Timely intervention: Prompt initiation of care is crucial for positive patient outcomes.
“There are many patients on the hospital side of MA that need to be moved out,” Jacobsmeyer emphasizes. “We need to educate discharge planners that we want all patients, not just some, because that impacts our ability to provide quality care.”
strategic Payer Negotiations: Walking Away to Win
Enhabit has demonstrated a willingness to prioritize value over volume, even if it means temporarily sacrificing census. In 2024, the company strategically walked away from contracts with several MA payers when negotiations stalled.
This bold move,while initially causing a dip in patient numbers,ultimately led to a double-digit percentage increase in payments from one major payer. This highlights a key principle:
* Value-Based contracting: Prioritizing contracts that reflect the true cost and value of home health services.
* Discipline in Negotiations: Being prepared to walk away from unfavorable terms.
* Long-Term Sustainability: Focusing on financial health to ensure continued quality of care.
Looking ahead: A Strong Foundation for the Future
Jacobsmeyer believes her successor will inherit a company with a significant competitive advantage. enhabit’s focus on clinical excellence and its ability to attract and retain skilled clinicians will be key differentiators.
“We are in a position to differentiate ourselves from a clinical experience,” she states. “If we can pull more clinicians,we’re going to pull more market share. There’s a lot of opportunity for Enhabit as we look to the future.”
The company is optimistic about the potential impact of proposed changes to the Medicare home health payment rule, which could further unlock growth opportunities. By continuing to prioritize strategic payer relationships, clinical quality, and a commitment to timely care, Enhabit is well-prepared to thrive in the evolving home health landscape.
Original source: https://homehealthcarenews.com/2025/09/enhabit-forecasts-growth-opportunities-if-medicare-home-health-payment-rule-goes-through-as-proposed/