How a Shift Towards Home Health Could Lead to More Incomplete Referrals and Wider Disparities

By Berna Demiralp, PhD, Marie Steele-Adjognon, PhD and Lane Koenig, PhD

A growing share of Medicare beneficiaries are discharged to home health care to receive post-acute care at home after their acute care hospital stay. MedPAC reports that between 2012 and 2017, the percentage of hospitalized Medicare fee-for-service beneficiaries discharged to home health care increased from about 16% to 18%, and the two-percentage-point increase accounted for the majority of increase in discharges to all post-acute care settings. While home health use has increased over the last several years, nearly 1 in 3 Medicare beneficiaries who are referred to home health care after hospital stay do not receive home health care, according to our recent study published in JAMDA: The Journal of Post-Acute and Long-Term Care Medicine.

The study focuses on hospitalized Medicare beneficiaries within select Medicare-Severity Diagnosis Related Groups (MS-DRGs) who are referred to home health care after hospital stay, identified as those with a discharge destination of home health care on the hospital claim. We track the patients’ post-hospital health care utilization to see whether the patient actually started home health care within 7 days of being discharged from the hospital. We find that 29% of the study population had an “incomplete home health care referral”; that is, they did not receive home health care, even though the hospital claim indicated that the patient was discharged with home health care.

After documenting the prevalence of incomplete referrals to home health care, the study then compares beneficiaries with complete home health referrals to those with incomplete home health referrals. Our findings revealed racial/ethnic and socioeconomic disparities between patients with complete and incomplete home health referrals; patients with incomplete home health referrals were more likely to be non-white, dual eligible, from non-rural communities, and have higher prior utilization of health care and more comorbidities.  Furthermore, patients with incomplete home health referrals had higher readmission rates, higher mortality rates, and lower total spending over the one-year period following hospitalization compared to patients with complete referrals.

The COVID-19 public health emergency accelerated the shift in post-acute care towards home health care as nursing facilities struggled with infection control. This growth in home health care after hospitalization is good for both patients and payers, if outcomes are no worse. It allows the patient to receive care at home, the preferred setting for treatment among older patients, and can lead to lower healthcare costs as it substitutes for institutional post-acute care. However, an increase in home health care referral after hospitalization may also exacerbate disparities in accessing care, an implication of the study findings. As patients are more frequently referred to home health care after hospitalization, non-white and dual eligible patients may be at greater risk of incomplete home health referrals. This can also lead to greater disparities in outcomes as the cost of the incomplete home health referrals to beneficiaries are higher readmission and mortality rates. Policymakers and researchers must consider reasons for incomplete home health referrals and design policies that ensure that Medicare beneficiaries who are referred to home health care after hospitalization actually receive the prescribed care.

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