HealthcareWhy hospital-at-home keeps growing, despite Medicare, payor obstacles

Why hospital-at-home keeps growing, despite Medicare, payor obstacles


More than 400 hospitals and hospital systems have hospital-at-home programs, despite uncertainty over what future reimbursements might look like under Medicare. 

Hospital-at-home has exploded since the COVID-19 pandemic and is expected to grow 50% over the next few years due to an increase in the number people over age 65, including 72 million baby boomers. Hospitals say treating patients at home can reduce healthcare costs and improve patients’ emotional well-being as they recover with family and friends.

Here is what you need to know about the growing hospital-at-home trend.

What is hospital-at-home?

Hospital-at-home allows patients who need acute care to receive treatment in their homes, rather than in a hospital. Providers use remote patient monitoring to keep an eye on patients’ vital signs. They also rely on laptops or other mobile devices to communicate with patients and caregivers. Congestive heart failure, pneumonia and COVID-19 are a few of the illnesses often treated through the model. The program allows hospitals to free up beds for the sickest, more costly patients, while still providing care to other patients at home at a reduced cost to providers and the payers.

Is it a new care model?

Hospital-level treatment at home has been around since the 1970s in the United Kingdom, Canada and Israel. It came to the U.S. in 1995 when Johns Hopkins School of Medicine and Public Health in Baltimore piloted hospital-at-home. Johns Hopkins found the program reduced inpatient stays and lowered overall medical costs by a third. By 2002, Johns Hopkins, Presbyterian Health Services in Albuquerque, New Mexico, and a half dozen Veteran Administration medical centers began offering the care model.

What impact did the COVID-19 pandemic have?

The pandemic accelerated the care model’s growth. In March 2020, the Centers for Medicare and Medicaid Services launched the Hospital Without Walls initiative to help hospitals overwhelmed with COVID-19 patients increase capacity. Eight months later, CMS expanded the program as Acute Hospital Care At Home, giving hospitals greater flexibility to treat patients at home and receive the same reimbursement rates as patients in hospitals. By the middle of 2021, nearly 170 hospitals and health systems in 29 states offered hospital-at-home. Today 406 hospitals and health systems in 33 states offer the program. Congress extended the reimbursements until the end of 2024. 

What are the requirements of hospital-at-home?

CMS requires hospitals to carefully screen patients for medical and non-medical factors, such as suitability of the home. Patients are typically enrolled in the program from emergency departments or inpatient beds by a physician. They must be evaluated daily by a doctor or advanced practice nurse either in-person or virtually. Patients must also be evaluated remotely or in-person twice a day by a registered nurse or a paramedic. Hospitals must provide an on-demand connection to a nurse or physician at a command center who must be able to respond within 30 minutes if a patient’s physical or mental health is deteriorating. Providers must also be able to connect patients to other necessary services, such as meals, pharmacy and laboratory tests.

Who are the key players?

Johns Hopkins, Rochester, Minnesota-based Mayo Clinic, Oakland, California-based Kaiser Permanente and Cleveland, Ohio-based Cleveland Clinic are among the largest hospital systems offering hospital-at-home. A handful of companies partner with hospitals to provide one-stop shopping to set up the programs. Those companies include Boston, Massachusetts-based Medically Home and Biofourmis, as well as Nashville, Tennessee-based Contessa Health, which is a unit of Amedisys. Those companies coordinate staffing, provide command centers, remote patient monitoring and offer a variety of other turnkey solutions.

What is the market’s growth potential?

Healthcare research firm Chilmark forecast the hospital-at-home market would grow from approximately $200 billion in 2023 to $300 billion by 2028. Chilmark analyst Elena Iakoveva said technology and healthcare disrupters, including Amazon and Best Buy, could add hospital-at-home services to their healthcare offerings that include One Medical and Current Health, respectively. 

What might slow its growth?

There are no guarantees Medicare and private health insurers will continue to reimburse hospitals at the same rate for patients receiving care at home versus the hospital. The concept also faces barriers in rural areas that often lack reliable internet service to connect patients to medical staff. And the nursing shortage could make it difficult for hospitals to deploy enough clinicians to make the necessary visits, especially to remote areas. While nurses in hospitals can care for several patients at one time, nurses deployed to homes may only care for four or five patients a day. Patient preference and safety are two other challenges. Many patients still would rather receive care in a hospital and others may not have in-home support from family caregivers to safely stay at home. Some family members who act as caregivers may also lack the skills necessary to help care for a very sick patient.



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