Home Health Care Saves $7,313 Per Patient Over Hospitalization After ER Visits

Yet another study has found that home health care has the potential to drastically reduce health care spending and lower readmissions for patients following emergency room visits.

Patients in the study who received home health care in-home immediately after going to the ER had a total 90-day cost of $13,012, compared to $20,325 for patients who were treated in the hospital. Additionally, home health patients were less likely to be admitted to the hospital, at 23.7%, compared to a 33% readmission rate for the in-patient cohort.

That’s according to recent findings published in The American Journal of Accountable Care.


Meanwhile, emergency room visit rates were comparable among those treated at home versus in a hospital 90 days out. In other words, patients who received care at home immediately following an ER trip were just as likely to end up back in the ER compared to those who stayed in the hospital following a health care crisis.

To gather the findings, researchers from La Jolla, California-based West Health Institute — a nonpartisan nonprofit focused on lowering health care costs and helping seniors age in place — analyzed claims from 5% of total Medicare fee-for-service beneficiaries nationwide from Jan. 2012 to Dec. 2013.

Patients were all treated either at home or in hospital following ER visits and had congestive heart failure, chronic obstructive pulmonary disease (COPD), urinary tract infection, pneumonia or cellulitis.


However, only 354 of about 18,000 eligible patients in the study received home health directly following ER visits, which came as a surprise to researchers.

“One of the most striking results from this was … how infrequently this option was actually used,” co-author Tyler Kent told Home Health Care News. “I think our work here helped distinguish there are benefits to [receiving home health following ER visits]. If home health was set up more quickly, perhaps more people could be affected by the option.”

Currently, most people who visit the ER are either admitted to the hospital or go home and follow up with their primary care physician later.

But the $7,313 cost savings and the 6.3 percentage points difference in readmission rate for patients treated with home health care provides a promising alternative, the researchers note.

“If acute home-based care options were available to all emergency physicians across the nation for just these 5 conditions, this could account for an annual savings of $3.7 billion in total costs, $3 billion in Medicare savings, and $520 million in patient OOP expenses,” the researchers wrote. “This suggests that programs that support more acute care at home could have a major impact on lowering healthcare costs.”

Since 2012, hospitals have been held liable for avoidable readmissions for patients with pneumonia, heart failure and COPD, along with other select conditions. Higher hospital readmissions are met with financial penalties from Medicare.

Results of the study suggest home health could help hospitals save money and could especially benefit accountable care organizations and Medicare Advantage patients, who are even further encouraged to save money to combat the rising costs of health care nationwide.

“The findings suggest that risk-bearing healthcare organizations could use home-based alternatives to hospital admission as a means of providing high-quality care at a lower cost,” the researchers wrote.

Such recommendations also have positive implications for home health agencies, who are increasingly being sought after to partner with hospitals and health systems.

The growing number of workforce hurdles and regulatory complexities within the home health industry are often driving those alliances.

Rather than operating their own home-based care services, hospitals are turning to home health agencies to increase efficiencies, thus creating many opportunities for home health organizations to grow their businesses.

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