Recognizing the need for a streamlined home care supply chain network, Cardinal Health, Inc. (NYSE: CAH) launched Velocare in 2022. Since its first pilot, Velocare has experienced significant growth.
At the same time, Cardinal Health is making great strides in its overall mission to be a champion of home care.
Overall, Velocare technicians deliver hospital-grade products and services to patients’ homes. The company touts her ability to make these deliveries within two hours.
Velocare officially launched its first post-pilot customers in March 2023. Since then, the company has partnered with home health programs at 12 hospitals and health systems in Portland, OR; Atlanta; Knoxville, Tennessee. New Haven, Connecticut. such as Boston.
“I would say there is no typical customer that we work with,” Alex Hoopes, senior director of strategic execution for Velocare at Cardinal Health, told Home Healthcare News. “We work with large academic medical centers. We work with nonprofit and for-profit organizations. We work with health systems that have accepted their first home-based patients. We have been able to step in and support several home hospital programs that have been up and running for some time and are the perfect partner to help them step into a higher stage of growth.”
Cardinal Health, based in Dublin, Ohio, is a distributor of pharmaceutical products and a manufacturer and distributor of medical and research products. The company’s home division provides direct-to-home delivery and distribution services in the home medical equipment (HME) sector, as well as home health care and hospice.
Overall, Hoopes attributes Velocare’s growth to the widespread adoption of the hospital-at-home model.
“As the population ages, especially the baby boomer generation, more patients, especially in urban areas, are requiring more advanced treatments,” he said. “Many hospitals are facing very serious capacity issues. We often hear stories of patients who essentially have to be admitted to the ER because there are no beds available. We are looking for ways to increase capacity faster and on a more cost-effective schedule than building another building.”
More specifically, Hoopes points out that VeroCare addresses many of the pain points that health systems experience when trying to launch and expand home health programs.
“Many goods and services need to be delivered outside the four walls of a physical hospital, so this model helps us keep costs down and improves supply chain reliability to ensure they get where they need to go.” We can dramatically improve quality.”We need to arrive on time so that the patient’s care plan can be carried out exactly as intended,” he said.
Velocare is expanding beyond health systems and hospitals to payers who are considering home health care as an effective way to provide direct care, promote patient outcomes, and address the high costs associated with traditional inpatient care. It is also attracting interest from people.
Still, home hospital is a dynamic model that changes rapidly. This means Velocare needs to be able to adapt quickly to change.
“I think it provides some good growing pains for us,” Hoopes said. “It’s important to understand how we can continue to scale what we do to provide more value and more support to the health systems we work with.”
Mr. Hoopes is also looking ahead to what the market will look like after the Centers for Medicare and Medicaid Services’ home acute hospital care waiver expires at the end of the year.
“I think toothpaste has run out of tubes. Home hospital stays are here to stay,” he says. “The fact that we have to do a renewal at the end of this year and we don’t know what that renewal will look like is something we are all dealing with.”
Despite the uncertainty about the future of the waiver program, Cardinal Health has plans to expand VeroCare.
Part of that means growing with Velocare’s current customer base.
“Many of the programs we currently work with are still in their early stages, and we plan to be quite aggressive in pushing the number of patients we accept through this care model and expanding our census. We want to grow with our existing customers, and most importantly,” Hoopes said.
Overall, Velocare has made 7,800 in-home deliveries.
Velocare is also focused on geographic growth. Hoopes said the company wants to achieve more density in markets where it already operates.
Cardinal Health’s home solutions business moves front and center
While Velocare is growing, Cardinal Health’s home solutions business is also expanding as part of a recent organizational restructuring.
The company’s home solutions business was previously part of its medical-surgical division. This segment now has its own umbrella.
“That’s a euphemism for saying home is important,” Rob Schlisberg, president of Cardinal Health’s home solutions business, told HHCN. “We continue to look for ways to advance that care and want to be a key player and enabler.”
One way Cardinal Health has been working is to expand into diabetes. The company sees this as a major business opportunity.
Ultimately, Cardinal Health is working to establish itself as a leading advocate for the HME industry.
“We need stronger voices in the HME industry,” Schlisberg said. “We are trying to have a louder voice. We serve on certain committees within AAHomecare. We lobby from below the hill. We want to ensure that the value that HME itself provides is recognized.”
Robert Holly contributed to this report.
