Medicare report on “hospital at home” leaves many unanswered questions

October 14, 2024

Almost no one wants to spend an unnecessary night at the hospital. Good medical care at home can keep patients away from hospital “superbugs”, allow them to recover in a familiar environment, and lower total costs. Further, avoiding the capital expense of building new hospital beds can help control future health care costs.

“Hospital at Home” grew from a few small pilots to a large number of providers during the pandemic, as hospitals ran short of beds, equipment, and staff. Most hospital at home admissions are in the Medicare population, and the Centers for Medicare and Medicaid Services (CMS) just released its report on results of home hospitalization in this population.

Home hospital patients were overwhelmingly White and were only half as likely to live in rural areas compared to all hospitalized Medicare beneficiaries. Those receiving hospital care at home were only half as likely to be on Medicaid, which can be a proxy for more severe illness, less social support, and nursing home residency. Average risk scores for those hospitalized at home were 10% lower. Home hospitalizations mostly fell into a few categories of care, including respiratory conditions, circulatory conditions, renal conditions, and infectious diseases.

The good news is that mortality rates were lower in the hospital at home group than for inpatients. There were higher readmissions for more complex patients treated at home, but lower readmission rates for those with low complexity. Home hospitalizations were slightly longer than inpatient stays, and the total cost was substantially less for the thirty days following hospitalization.

CMS concludes that it was unclear whether Medicare achieved cost savings with this program because those receiving hospital at home services were highly selected. A small randomized controlled trial in an elderly population previously demonstrated 38% cost savings, and those who received hospital care at home had fewer labs, imaging tests and readmissions, and spent less time being sedentary. 

Implications for employers:

• Patient selection for these programs is critical. While hospital at home could lower total costs, it could also raise costs if these intensive services are applied to patients who otherwise would have gone home with less intensive follow-up. Programs like this can only lower medical costs if they are substitutes for expensive services.

• Most hospitals so far have targeted hospital at home services to Medicare beneficiaries. This report is not likely to encourage private insurance companies to expand coverage for the commercial population.

Here’s a link to an article on adoption of clinical delivery transformation from my colleague Patricia Toro, MD MPH and I last fall.

Thanks for reading.  You can find previous posts in the Employer Coverage archive

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Illustration by Dall-E

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