Home Health Agencies Are Missing Out on $2.5 Billion in Revenue

The home health care industry is missing out on billions in revenue from patients who are recommended for care after a discharge from a hospital—but never receive it.

The opportunity to capture these patients and provide home health care services represents about $2.5 billion, according to Excel Health, which provides health care analytics in the home health, hospital and hospice sectors.

“Where the hospital team thinks the patient is going is not always the case,” Ian Juliano, CEO of Excel Health, said during a webinar on October 26 that was put on by industry association ElevatingHome.

$2.5 billion left on the table

Almost 40% of patients with home health instructions did not receive home health care, according to findings from Excel Health, which drew from the CMS Chronic Conditions Warehouse claims data.

When that’s multiplied nationally by the average billing per encounter, the result is approximately $2.5 billion.

Patients who were recommended for home health care did not follow through for a number of reasons that add up to $2.5 billion in revenue opportunities, including:

    • Insufficient understanding of the home health value proposition
    • Breakdowns in communication between the hospital clinical team and discharge planners
    • Labor shortage for discharge planners
    • Insufficient followup

“You get the impression this is a broad systemic problem with a lot of gaps in the process,” Juliano said.

While $2.5 billion is a big grab for home health care providers, it’s not just a matter of money, Juliano noted. It’s also about optimizing outcomes and making meaningful changes in hospital performance. National home health adherence was found to be 68%, and adhering patients were 29% less likely to be admitted, compared with non-adhering patients.

Another recent study similarly revealed that patients who refuse home health care services are more likely to be readmitted after a discharge.

Orthopedics have the edge

The findings show there is room for improvement for home health care to capture more vulnerable patients, but medical diagnostic categories also play a role in home health admittance rates.

Patients discharged after orthopedic procedures were admitted to home health at a rate of 82%, compared with 67% of cardiac patients and 63% of respiratory patients, according to Excel’s findings.

“The orthopods have developed very strong relationships with post-acute providers, the vast majority of them home health providers, and those relationships are resulting in discharges directly to home health from the inpatient stay, with the expectation on the part of the surgeons for how the home health agency and how the therapy team is going to deliver care,” Sharon Harder, vice president of product development at Excel Health, said during the webinar.

Written by Maggie Flynn

Maggie Flynn
Business reporter
When she's not working, Maggie enjoys running, reading, writing and sports, in no particular order. Favorite things include murder mysteries, Lake Michigan and the Pittsburgh Penguins.