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New Models Show How Home Health Can Improve Care & Reduce Costs

Published by Morning Consult
Teresa Lee
July 22, 2016

Although surgeons have been performing total joint replacements for at least a hundred years, many of the most remarkable advances have emerged in just the past decade. New artificial joint materials, surgical techniques, and treatment protocols have transformed what was once a brutal surgery with significant recovery time into a far more manageable procedure and recovery.

Innovation is also thriving for new payment models, including the Centers for Medicare & Medicaid Services’ newly introduced Comprehensive Care for Joint Replacement (CJR) model. Implemented in April, the CJR model requires that Medicare make a single payment for all services provided during a 90-day episode of care. With that singular payment in mind, providers must work to maximize outcomes, minimize complications and avoid expensive hospital readmissions.

Data released last month show that post-acute care provided in the home setting has the potential to successfully reduce costly hospital readmissions for patients following joint replacement surgery.

The recently released analysis by Dobson DaVanzo & Associates examined how patients fared in various post-acute settings, following their lower extremity joint replacement (LEJR) and hospital discharge. The results were positive both for Medicare, and for patients – who widely prefer home health to other post-acute settings.

Across all post-acute care settings and areas of the country, Medicare paid approximately $5,000 less when patients were first discharged to home health care compared to other post-acute settings. Additionally, while readmission rates for a select group of patients (those with a major joint replacement without major complication or comorbidity) typically average eight percent, patients receiving home health care immediately after an acute stay saw a readmission rate of just five percent compared to 12 to 15 percent for patients receiving rehabilitation in facility-based settings.

It’s good news, but not a tremendous surprise for home health care providers. For years, skilled home health providers have paved the way for today’s model of clinically advanced, cost-effective, patient-preferred care. More than 3.5 million Medicare beneficiaries depend on home health care as they recover from injury or illness, including many who have difficulty accessing outpatient care or who need intensive assistance with an acute or chronic health problem.

The trend towards providing more cost effective care in the most appropriate setting is catching on across the healthcare system, and Dobson DaVanzo’s analysis underscores how game changing it can be – especially when combined with new payment models such as CJR.

With CJR being tested in 67 metropolitan statistical areas, home health providers have shown themselves to be valuable partners and effective providers, and with more than 400,000 LEJR procedures performed on Medicare beneficiaries annually in the U.S., costing Medicare more than $7 billion for the hospitalizations alone, the need for cost-effective care options couldn’t be more timely.

Given the remarkable advances we’ve seen over the past century when it comes to joint replacement surgeries, the future is anyone’s guess. One thing is certain: controlling costs for a growing number of Medicare beneficiaries who require LEJR will depend a great deal upon smart partnerships, innovative treatment models, and thoughtful care transitions. Skilled home health providers are excited to be an important player in the next generation of care.