By Anastasia Gnezditskaia
The trend of at-home treatment, or hospitals-at-home, is gaining pace. Care services currently provided in the patients’ home settings, originally dominated by acute care, later expanded to other services such as skilled nursing and home infusion. In terms of numbers, the US home healthcare services market is expected to grow 73% by 2029. Currently valued at $88.5 billion in 2021, is projected to grow to $94.2 billion in 2022 and $153.2 billion by 2029.
The trend was initially driven by the desire of baby boomers to receive treatment in the comfort of their homes, and not in a nursing or senior facility.
It got a further push during the pandemic when the reality of at-home care became a necessity for all health systems as acute-care facilities got overfilled during the first wave of the COVID-19 spread. Yet, in some cases, this model worked so well that a few institutions pursued it beyond the pandemic.
The most obvious plus of this model is the cost advantage, as in-home care is driven by the elimination of the fixed costs associated with operating brick-and-mortar hospitals. Studies have shown such a model delivers savings of 30% and more per admission.
“We believe the overall trend for comprehensive acute care in the home is growing primarily because of aging baby boomers and the rising number of patients with chronic conditions. These issues are compounded by staffing shortages and high levels of physician burnout in our hospitals,” says general partner at Confluence Healthcare Partners Hayes Woollen.
Other factor that gave rise to the popularity of hospitals at home is the structure of federal programs as programs such as Medicare and Affordable Care Act (ACA) set limits on the payout on services, which motivates hospitals to control their own costs.
Johns Hopkins was among the first in the country to develop this model, which was originally focused on treating elderly patients who either refused to go to the hospital or were at risk of hospital-acquired infections.
What’s in it for hospitals?
For hospitals, this new way of delivering in-home care represents both a challenge and an opportunity.
First, hospitals are challenged as their revenue might be affected by the reluctance of payers to reimburse providers for delivering services in home settings. The Centers for Medicare and Medicaid Services (CMS) and most private payers were reluctant to pay for hospital care delivered at home, a situation that that has changed during the pandemic when more than 140 hospitals across 66 health systems were approved by CMS to provide hospital services in a home setting.
Because of COVID-19, patients and providers have quickly embraced telehealth, and there were signs that the “stay at home” attitude may make at-home care mainstream. Yet, in many instances, such a model is still implemented only by a handful of providers who control all or some of their funding.
“Hospital revenue will decline,” says chief executive officer at the Village Health Bob Trinh. “I would expect that there is lower reimbursement for at-home care than there is for in-patient care. If the hospitals can be the ones that provide the at-home care, then that would help mitigate the loss of revenue from the transition.”
The reality of lower revenue is not the only challenge associated with at-home care. Hospitals also have to – or maybe already have – invest in skilled nursing staffing, physician telehealth and other technologies for delivery of services and supplies such as oxygen, as well as manage nursing schedules.
These technologies boost the development and use of platforms for home-care delivery. They started off with “virtual urgent care” and now have moved on to cover virtual longitudinal care, primary and specialty care, as well as remote patient monitoring and self-diagnostics. They also offer options to experiment with a hybrid, or combined online and offline model. Remote monitoring, providers talking to providers, patient portals for interacting with nurses, handling refills, scheduling visits, reviewing test results, personal health apps, and personal health records – this is but an incomplete list of services and products provided by such digital platforms.
Convenient as they are, these platforms, if used on a wider scale, represent a tectonic shift from the old model, in which hospitals and doctors were in control of the treatment process, in terms of facilities and schedule. In short, in the longer run such platforms might threaten the dominance of hospitals and doctors in the provision of care.
Will this model gain a wide following?
A majority of healthcare specialists we talked to believe this trend is still in the early stages.
“I think Hospital at Home is still very early,” says Trinh. “Most people really don’t know what that means or what criteria is met for a patient to be cared for at home instead of an inpatient facility. I just know that given the lower cost setting, it’s something that many organizations are interested in as long as the patient receives the same quality care.”
Nonetheless, with a number of factors supporting this trend, it is unlikely to stop and will eventually result in a significant share of healthcare services provided at home, as an option.
“The average length of stay continues to rise and more hospitals will need to find ways to care for patients in the home. We expect to see a significant increase in the transition from in-patient care to at-home care within the next three years as reimbursement for virtual care visits and remote monitoring continues to improve,” Woollen said.
While generally on the rise, in-home care is expected to gain the most ground in those settings where federal payment programs, as well as payor-controlled medical groups and value-based contracts dominate.
“My guess is that [at-home-care model] will face resistance in most states as hospitals and health systems continue to fight to keep fee-for-service as the prime payment model,” says Terence O’Brien, president and CEO at O’Brien Healthcare Consulting.
“Where Hospital at home programs will develop a bit of a following is where Medicare accountable care organizations (ACOs) and Medicare Advantage push full risk. It’s only where the economics are driven by non-hospital types like payor-controlled medical groups that I think it may prosper.”
