Homeward moves into rural Minnesota in partnership with Blue Cross plan

A year after launching, rural healthcare startup Homeward has expanded into its second state in partnership with Blue Cross and Blue Shield of Minnesota.

Beginning this spring, Blue Cross Medicare Advantage members residing in 24 Minnesota counties outside of the Twin Cities metropolitan area will have access to Homeward’s services such as in-home visits, community-based visits and telehealth.

For Homeward CEO and co-founder Jennifer Schneider, M.D., the move into Minnesota is a bit of a homecoming. Schneider, a health tech veteran and former Livongo executive, grew up in the small town of Winona, Minnesota. She was diagnosed with Type 1 diabetes at a young age and experienced firsthand the lack of primary and specialty care that millions of families across rural America deal with every day. 

By partnering with the largest health plan in Minnesota, Homeward aims to take on current inequities of rural healthcare, Schneider said. In the U.S., 80% of rural counties lack a sufficient number of primary care providers, according to the National Rural Health Association’s Policy Institute.

According to a 2022 report from the Minnesota Department of Health, only 20% of healthcare providers serve rural Minnesota communities, with more than a quarter of rural physicians planning to leave the workforce within the next five years. And approximately 40% of all Blue Cross members reside outside of the Twin Cities area.

Homeward will have a full-risk value-based arrangement for Medicare Advantage members, meaning payment for care is 100% tied to improving health outcomes and reducing the total cost of care, according to executives.

"There's a pretty desperate need for new innovative care models in rural markets," Schneider said in an interview. "The care that we're delivering to our members, they love it because we've developed a model that is convenient and consistent for them and that includes having community care in our mobile vans, that includes in-home care where we're visiting people in their homes and virtual care where we can access people all the time."

Homeward launched a year ago at the ViVE 2022 digital health conference focused on value-based contracts with health plans in rural markets. The startup has secured $70 million in funding so far, backed by General Catalyst, Arch Venture Partners and Human Capital. Heavyweights in the health tech investment world also are backing the company: Lee Shapiro and Glen Tullman, co-founders of 7wireVentures, a well-known early-stage healthcare venture fund. 

Homeward also inked its first value-based care partnership with Priority Health to provide medical care to Medicare Advantage members in rural Michigan. The two organizations work to provide care to members in 14 Michigan counties.

Last June, Homeward landed a big partnership with retail pharmacy Rite Aid to provide primary care services on-site at up to 700 Rite Aid pharmacy locations in rural communities.

In Minnesota, Homeward is working with Blue Cross to identify qualifying patients who are not currently engaged to receive the care they need or have known gaps in care. So far, the two organizations have identified 10,000 members in rural Minnesota who fit into this segment, according to Blue Cross.

"These are individuals who might be diabetic and haven't had their A1C levels checked in a certain period of time or haven't been in for an annual physical or an annual wellness visit. So those are the types of gaps that we're looking for to help us identify those that might benefit the most," said Mark Steffen, M.D., senior vice president and chief medical officer at Blue Cross and Blue Shield of Minnesota.

The insurer serves a total of 2.5 million members in all 50 states.

Over time, Homeward and Blue Cross plan to continue expanding the offering to additional Minnesota counties.

There are many healthcare disparities facing rural communities and it's a sizable problem. About 60 million people, or 1 in 5 Americans, live in rural America. 

The startup aims to "re-architect" rural healthcare, Schneider said.

Homeward delivers a hybrid model of technology and services to increase access to primary care and specialty services. Homeward employs a multidisciplinary care team, available both virtually and on the ground via mobile care units, with in-home remote monitoring that keeps patients connected to their care teams. These teams conduct physical exams, perform diagnostic tests and integrate with regional health systems, local physicians and specialists to provide care coordination, referring members to local in-person services as needed, Homeward executives said.

Through partnerships with regional health systems and providers, Homeward coordinates high-quality referrals and additional support post-discharge.The company also pledges to recruit locally and in a manner that supports local workforces, including existing clinics and hospitals in the areas it serves, executives said.

"We work with existing providers in the network and the goal there is to actually make healthcare better and not compete and take resources away but actually be added in," Schneider said.

Healthcare is local, Steffen points out. "Having individuals who are actually embedded in these communities, I think really helps them understand how they can best support individuals to garner better health," he said in an interview.

Homeward takes accountability for outcomes and cost of care, which allows the company to deploy services and technology in ways that wouldn’t be possible in a traditional fee-for-service model, according to Schneider.

[Value-based arrangements] "allow us to put our investments where people need it on a population level," she said. "It's a combination of being able to do some really heavy intensive in-home care and some lighter touches virtually but being able to do that at the level of the need of the patient, rather than at the need of the level of the business."

With the Homeward partnership, Blue Cross and Blue Shield of Minnesota sees an opportunity to collaborate around value-based care, according to Steffen.

"We firmly believe value-based care providers will support our members and get better outcomes. Homeward is actively pursuing those value-based care contracts. The other unique feature was that they really built their model around the rural population, which you don't see that often in the spectrum of care providers," Steffen said in an interview. "I think it brings a different mindset from a design standpoint that I think was innovative in how they did it and supported it with some of the newer capabilities that we see around data and analytics."

The insurer will track healthcare quality outcomes and total cost of care to measure the success of the partnership, Steffen said.

While access to reliable broadband internet continues to be a challenge in rural areas, Homeward has taken some lessons learned from virtual chronic care provider Livongo on the technology front.

"Broadband is a nice-to-have, not a need-to-have," Schneider said. "We're able to do telehealth visits vis-à-vis audio-only, not necessarily having a video. Livongo had zero Wi-Fi connectivity; it was all done through cellular towers. The ability to transmit pockets of data to do remote monitoring for chronic conditions does not require broadband connectivity."

Homeward's focus on rural areas represents an "enormous market opportunity," as rural markets represent more than 60 million individuals yet it remains largely untapped by value-based care providers, given the unique needs of the market and its patients, according to William Blair analyst Ryan Daniels.

"Moreover, we see the space as an emerging growth area for managed care plans, so we view the growth of Homeward as symbiotic with major plans (i.e., they can grow together with each enabling the other to thrive in the rural marketplace)," Daniels wrote in an analyst note about the advanced primary care space.