Since the pandemic, there has been a shift in various activities moving to the home. Work, exercise, and even doctor’s appointments can all now be done effectively in our own homes. With recent advancements in technology, there is also a movement to treat certain hospital patients in the comfort of their own home. “Hospital-at-home” is an idea that allows hospitals and physicians to treat patients remotely rather than in a traditional hospital setting. Although this idea has evolved in the past few years, there are still several concerns to address.

In the hospital-at-home method of care, there are three groups of stakeholders involved. The hospital, the payers, and the patients. For hospital services to be effectively rendered in a home setting, each group of stakeholders needs to benefit financially and operationally.

Hospitals: How are they affected?

During the pandemic in 2020, CMS launched the Acute Hospital Care at Home waiver program to allow hospitals to deliver care to patients in their homes if they were experiencing a shortage of beds or material, and receive the same level of reimbursement as if care had been provided in a hospital setting.[i] Since then, hospital-at-home has gained popularity, with 308 hospitals in the United States utilizing the waiver program by December 2023.[ii] Still, that reflects only 5%[iii] of hospitals in the country, leaving plenty of room for additional growth. For hospital-at-home to be adopted more broadly, several criteria must be satisfied from the hospitals’ perspective, including permanent adoption of reimbursement pathways for this type of care. However, the current waivers are set to expire at the end of 2024. Before hospital-at-home is implemented nationwide, there needs to be a more permanent solution than the COVID waivers have provided. Otherwise, health systems may be reluctant to invest in the infrastructure necessary for an effective hospital-at-home program.

There are two ways a patient may be admitted for at-home care if the hospital participates in hospital-at-home. If the patient arrives at the emergency room or ambulatory facility with one of the illnesses targeted for hospital-at-home, the hospital staff may evaluate whether the patient is a good candidate for the program. If so, and if the patient’s home is determined to be a suitable environment with water, electricity and air conditioning, and appropriate caregiver support if deemed necessary, the hospital staff will discuss the proposed at-home treatment plan with the patient. Once the patient is home, hospital staff connect with the patient daily until they are deemed suitable for “discharge.” Often, this includes remote monitoring of the patient’s condition using equipment provided by the hospital for the duration of the home-based “hospitalization.”

The other method of admitting a patient for hospital-at-home occurs after a treatment or surgical procedure. When a patient receives treatment in the hospital or other facility, they may be evaluated for at-home care for the post-op recovery or monitoring period. This allows the patient to recover in their own home, with daily check-ins from hospital staff.

Healthcare providers and hospital staff have expressed concerns with the speed and efficiency of these methods of admitting a patient to hospital-at-home. The admission process needs to be timely and efficient; otherwise, it will not work – especially in the fast pace of an emergency room environment where beds need to be turned quickly.

Payers: How are they affected?

From a payer’s perspective, the hospital-at-home care model holds many financial benefits. It requires less facility capacity, fewer materials, and lower overhead costs than traditional inpatient care. However, for a patient to qualify for hospital-at-home care, it must be clinically appropriate, and the payer must be willing to pay for care in a home setting. Further, providers will not want to assume the liability risk of placing a high-risk patient in a home setting without appropriate supervision or caregiver support. If payers do not reimburse at-home care at similar rates as traditional hospital care, health systems will not invest in the technology, equipment, and resources to implement hospital-at-home programs despite it being a less expensive avenue for providing patient care.

Patients: How are they affected?

Lastly, and arguably most importantly, how are patients affected by the hospital at home model? Every hospital and doctor wants to have happy and healthy patients, and treating patients in the comfort of their own home has proven to have a positive impact on their overall experience. In addition to an overall better experience, patients who have received hospital-at-home care have also exhibited lower mortality rates, lower skilled nursing facility usage, and low readmission rates in the months following their treatment.[iv] For eligible patients, hospital-at-home allows them to be in their own bed, surrounded by family, friends, and pets. This can be a positive environment for most patients compared to the atmosphere of a hospital, which might be considered unpleasant or uncomfortable to some. The need to balance patient comfort with the immediate availability of care resources when needed is critical to deciding when it is appropriate for a patient to receive care in this setting.

The Key Questions

As hospital-at-home programs gain traction across the country, several questions and concerns remain unanswered and unresolved. For starters, how is quality and consistency of care affected through hospital-at-home? How can patients be effectively monitored in a home setting? How will hospitals ensure that the patients are getting precisely what they need at any given time? What is the burden on family members when patients receive care at home? Although studies have shown that hospital-at-home lessens the burden on family members as compared to traditional inpatient care, there are still several concerns that must be addressed before hospital-at-home is implemented throughout networks.[v]

Another fundamental question is whether hospital-at-home is a safe and financially viable site of service for providers. Two approaches to the cost structure of hospital-at-home have emerged from previous models. The “top-down” reimbursement approach incorporates hospital fixed and overhead costs, along with the patient’s direct expenses. While this approach allows hospitals to be reimbursed for the infrastructure required to implement a hospital-at-home program, it can be more costly to payers and patients who may not believe such costs are warranted when they are not in the hospital. The second approach, the “bottom-up” method, provides reimbursement based on resources directly utilized in the provision of care to the patient – similar to a home health model – and omits any hospital overhead or fixed expenses. While this is certainly a more cost-effective solution for payers and patients, it may not allow hospitals to adequately cover the investment required to develop and maintain the infrastructure that allows for home-based care.

Final Thoughts

Despite the challenges that hospital-at-home care faces, it is a trend growing in popularity due to scarce resources in hospital settings and an increasing desire by patients to receive clinically appropriate care at home. If done correctly this could be a “win-win” proposition, resulting in less costly episodes of care with quality outcomes. For those who have utilized this model, patient experiences are generally positive. It may be in the beginning stages, but this trend is worth watching as the U.S healthcare system struggles to find innovative ways to do more with less.

Kyle W. Kirkpatrick, FACHE

Partner – Director of Consulting Services

817.502.7731 | kkirkpaatrick@jtaylor.com

Kyle has over 25 years of consulting and operational experience working in healthcare and life sciences with public and private organizations across the nation. He is a former hospital CEO with experience running hospital groups, managing joint ventures, implementing new strategies, driving EBITDA enhancements, and creating positive organizational cultures. He has worked as a consultant within Big 4 firms focused on strategic planning, M&A, and operational improvements. He has strong project management experience to coordinate complex initiatives among multiple stakeholder groups.

Herd A. Midkiff, CVA

Partner – Consulting Services

817.546.7036 | hmidkiff@jtaylor.com

Herd has over 20 years of experience serving clients in the healthcare, non-profit, and investor-owned sectors. He has extensive experience in strategic planning, including joint ventures, business acquisition, due diligence services, and managed care contracting support. He also draws upon his healthcare and finance background to provide business enterprise and compensation valuation services. His clients include large multi-hospital health systems, physician-owned hospitals, entrepreneurs, and attorneys.

[i] Siwicki, B. (2023, August 28.) Will CMS’ Acute Hospital Care at Home waiver program become permanent? Healthcare IT News. https://www.healthcareitnews.com/news/will-cms-acute-hospital-care-home-waiver-program-become-permanent

[ii] Vaidya, A. (2024, January 10.) New research links Hospital-at-Home care to positive patient outcomes. mHealth Intelligence. https://mhealthintelligence.com/news/new-research-links-hospital-at-home-care-to-positive-patient-outcomes

[iii] Derived from data contained in the following source: American Hospital Association. Fast Facts on U.S. Hospitals, 2023. https://www.aha.org/statistics/fast-facts-us-hospitals#:~:text=There%20are%206%2C129%20hospitals%20in,hospitals%20in%20the%20United%20States.

[iv] Vaidya, A. (2024, January 10.) New research links Hospital-at-Home care to positive patient outcomes. mHealth Intelligence. https://mhealthintelligence.com/news/new-research-links-hospital-at-home-care-to-positive-patient-outcomes

[v] Leff, B., Burton, L., Mader, S. Naughton, B., Burl, J., Koehn, D., Clark, R., Greenough, W., Guido, S., Steinwachs, D., Burton, J. (2008). Comparison of Stress Experienced by Family Members of Patients Treated in Hospital at Home with That of Those Receiving Traditional Acute Hospital Care. Journal of the American Geriatrics Society, 56:117-123. https://www.hospitalathome.org/files/HaH%20Caregiver%20Stress%20JAGS%2008.pdf