Avalere Shows Home Health Interventions Associated with Lower Medicare Spending and...

Avalere Shows Home Health Interventions Associated with Lower Medicare
Spending and Re-Hospitalizations for Patients With Chronic Illness

WASHINGTON, May 11 /PRNewswire/ -- Medicare patients with diabetes, chronic
obstructive pulmonary disease, or congestive heart failure that used home
healthcare within 3 months of being discharged from a hospital cost the
program $1.71 billion less and had 24,000 fewer re-hospitalizations than
similar patients that used other forms of post-acute care over a two-year
period. The analysis, released today by Avalere Health, also found that if
cumulated to the full set of Medicare beneficiaries in the study group that
utilized other forms of post-acute care, the program would have saved an
additional $1.77 billion.

Home healthcare is one form of post-acute care, and is currently paid for by
Medicare if a beneficiary is unable to leave home without significant
assistance -- a criteria called "homebound." About 8.9 percent of Medicare
fee-for-service beneficiaries currently use home health services. To date,
little research has been conducted to compare the relative effects of
different forms of post-acute care.

Using a new analytic model built to assess this issue, Avalere estimates that
early use of home health was associated with a $1.71 billion reduction in
Medicare post-hospital spending over the 2005-2006 period. Avalere's model is
designed to control for clinical and demographic differences across patient
populations; the post-hospitalization period of care costs are statistically
significantly lower in every severity of illness category. Odds of hospital
readmission were also significantly lower for beneficiaries with any of these
three conditions who used early home health services.

Additionally, Avalere estimates that if all chronic care patients in the study
used home health services early in their period of care rather than other
post-acute care, Medicare could have spent an additional $1.77 billion less
over the 2005 and 2006 period.

"One of the cornerstones of achieving payment reform is to ensure patients
receive appropriate care in the most cost-efficient setting," said Alexis
Ahlstrom, a director at Avalere Health. "Our analysis shows that home
healthcare can be a prudent way to deliver post-acute care to certain Medicare
beneficiaries."

Approximately 86 percent of the Medicare population has one chronic condition,
66 percent have two or more chronic conditions, and 40 percent have three or
more chronic conditions. "Given the size of the chronic care Medicare
population, any serious effort to improve cost-effectiveness of Medicare
benefits will have to grapple with these patients," said Ahlstrom.
"Additional research should be done to determine the impact of home health on
non-chronic care patients."

The report, "Medicare Spending and Rehospitalization for Chronically Ill
Medicare Beneficiaries: Home Health Use Compared to Other Post-Acute Care
Settings," was prepared by Christine Aguiar, Alexis Ahlstrom, Zeynal Karaca,
Kevin Dietz, and Ellen Lukens, all of Avalere Health. The Alliance for Home
Health Quality and Innovation provided financial support for this research.
Avalere maintained sole discretion with regard to methods and interpretations
of findings, and the authors are solely responsible for the content of this
analysis.

Avalere Health is an advisory services company whose core purpose is to create
innovative solutions to complex healthcare problems. Based in Washington DC,
the firm delivers research, analysis, insight, and strategy for leaders in
healthcare business and policy. Avalere's experts span 125 staff drawn from
the federal government (e.g., CMS, OMB, CBO, and the Congress), Fortune 500
healthcare companies, top consultancies, and nonprofits. The firm offers deep
substance in areas ranging from healthcare coverage and financing to the
changing role of evidence in healthcare decision-making. Its focus on strategy
is supported by a rigorous, in-house analytic research group that uses public
and private data to generate quantitative insight. Through events,
publications, and interactive programs, Avalere also translates real-time
healthcare developments into actionable information.

Learn more at www.avalerehealth.net.

SOURCE Avalere Health

Lindsey Spindle of Avalere Health, +1-202-207-1337,
lspindle@avalerehealth.net