Home Health Beats Inpatient Care on Outcomes, Cost

Referring patients to home health care could yield better results than inpatient care, according to a study recently published in the journal Medical Care. The study is part of an ongoing effort to reduce costs across the health care system, and the latest findings spell good news for the home health industry.

With the cost of post-acute care services reaching $62 billion annually, what happens to a patient after leaving the hospital is crucial and increasingly coming under scrutiny. Post-acute care is the largest driver of overall variation in Medicare spending, the study noted, citing a report from the Institute of Medicine.

“Post-acute care is receiving increased attention from policymakers for a variety of reasons,” the study reads. “…Growth in spending for post-acute care is also accelerating faster than that of other health care services, causing some to suggest that post-acute care represents the next frontier for controlling Medicare costs.”


Currently, hospitals set the tone for how a patient will receive care after being discharged, whether through inpatient services at another facility or through home health care services.

The study noted there is little oversight for how hospitals make their decisions for a care plan, with huge discrepancies across the country for where patients are referred. For example, the study found that some hospitals refer less than 3% of patients to inpatient facilities, while others are closer to 40%.

The study also found that patients who were referred to home health care plans had better health outcomes. Hospitals that referred patients to inpatient facilities tended to have shorter lengths of stay and higher readmission rates, according to the findings.


“These findings suggest that some hospitals may be using post-acute care as a substitute for inpatient care,” Dr. Greg Sacks, the study’s lead investigator, a resident in general surgery resident at UCLA and a Robert Wood Johnson/Veterans Affairs Clinical Scholar, wrote in the study. “This might lead to patients being discharged from the hospital prematurely, which then results in higher readmission rates.”

However, study authors noted the reasons for early discharge and the association with inpatient post-acute care needed further study to explain the results.

As the Centers for Medicare & Medicaid Services (CMS) and Congressional members consider new incentive initiatives to reduce costs, better health outcomes from home health patients could potentially lead to more coverage for these types of services and agencies. CMS has already taken steps to incentivize post-acute care planning in low-cost settings with bundled payments and encouraging coordinated care.

The first step is creating effective discharge guidelines for post-acute care planning, as the study argues that a lack of guidelines will continue to create variation in care costs.

Written by Amy Baxter

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