Medicare Home Health Is Not Just Post-acute: Nearly Half Of Episodes Are Community-entry

While home health is often discussed as a post-acute Medicare benefit, nearly half of patients are admitted through the community rather than after a hospital discharge.

These findings suggest that current payment systems may not constrain service provisions for community-entry patients, according to a new study published in Health Affairs. 

“Our findings reveal a fundamental tension between policies that favor postacute care and the reality of Medicare home health use, which serves a substantial population with clinical and demographic profiles that differ from those of postacute care users,” the study’s authors wrote.

Researchers based the study on Medicare administrative data from 2017, 2019 and 2021, identifying home health episodes and admission sources.

The study found that community-entry prevalence varied greatly by geography. In 2019, prevalence varied from 30% to 60% based on location. From 2017 to 2021, all states except Texas saw increases in the number of community-entry episodes. 

“Our analysis demonstrated a positive correlation between changes in community episode shares and spending over time,” the authors wrote. “States with the smallest growth in their community share of episodes experienced the steepest decreases in home health spending per beneficiary.”

Researchers also found that community-admitted patients had a distinct clinical profile, with higher rates of Alzheimer’s disease and dementia, depression and cognitive impairment. These patients were also more likely to receive longer spells of care with multiple care episodes. 

The implementation of the Patient-Driven Groupings Model (PDGM) impacted home health trends. Before implementation, in 2019, community entry accounted for 49% of episodes, 48% of spending and 43% of beneficiaries. In 2021, these proportions reached well over 50% of episodes.

The study’s findings led to researchers to conclude several policy implications, including that current payment systems may be insufficient for a population with different medical need, and that PDGM’s approach of classifying later episodes in postacute spells as “community entry” for payment purposes could complicate attempts to align payments with patient demographics and complexity.

Additionally, researchers concluded that current quality metrics may need to be evaluated to emphasize outcomes important for community-entry patients.

“More broadly, these findings raise important questions about how community-entry home health care fits within the larger landscape of long-term care and support services,” the study’s authors wrote.

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