Top 5 States for Home Health Revenue Growth

Home health care revenues declined slightly on a national basis for the third straight year in 2013, but a significant number of individual states bucked that trend.

From a peak of more than $19.5 billion in 2010, total home health agency revenues dropped to about $18.1 billion as of 2013, according to recently released data from market research firm Healthcare Market Resources.

But revenue streams are not drying up uniformly across the country. While 40% of states experienced an overall decline in home health revenues in 2013, one-quarter actually experienced an increase of greater than 5%.

The five states with the largest revenue increases in 2013 were:

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There are various reasons why revenue patterns vary so much from place to place, HMR noted in releasing these results. Referral patterns, the culture that exists at hospitals related to home health, and the perception of home health among various populations all differ. Revenue declines were not of this same magnitude—Tennessee experienced the largest decline, of 10.88%, followed by Kentucky at 8.27% and Louisiana at 7.19%.

However, there are reasons to believe that the overall trend of reduced revenues will get worse, according to HMR. Most agencies have exhausted the most powerful options for increasing revenues, such as through more accurately completing OASIS and improving scheduling. Regulatory pressures are increasing, which could constrain revenues as agencies have additional requirements (such as face-to-face documentation) and regulators more aggressively monitor and question Medicare claims. Cost rebasing also started last year.

The number of home health episodes has followed similar patterns as revenues, with the peak coming in 2011 (6.9 million) followed by slight declines in subsequent years. For 2013, episodes totaled about 6.7 million nationally. Still, four states experienced episode increases of more than 8% that year: Delaware, Iowa, Nevada and Idaho.

Not surprisingly, all five of the states with the largest 2013 revenue increases also were among the top states for overall home health growth in 2013, as identified in a previous HMR report.

Written by Tim Mullaney