House calls are back – and hospitals see them saving Medicare money
3rd January 2017 · 0 Comments
By Mark Taylor
Contributing Writer
(Special from HFMA Healthcare Business News and New America Media) — Even as hospitals continue to search for ways to fund home independence programs for patients, Congress is considering a nationwide expansion of one such program.
Thomas Cornwell, MD, leads an interdisciplinary team of primary care providers who are part of a national movement reviving an old care-delivery model with a modern twist, the physician house call visit.
Cornwell coordinates care with cardiologists, physical therapists and other healthcare providers and case manages to manage patients’ entire care process.
Cornwell, CEO of the Home Centered Care Institute (HCCI) and founder of HomeCare Physicians Northwestern Medicine, has made more than 32,000 house calls over 23 years.
ACA Program Helped 10,000, Cut Costs
Cornwell said the Independence At Home (IAH) demonstration program launched by the federal Centers for Medicare & Medicaid Services (CMS) through the Affordable Care Act (ACA) has bolstered the movement. The IAH served 10,000 beneficiaries at 15 sites around the country starting in 2012. Several studies found IAH reduced costs by 10 to 15 percent among patients whose average annual healthcare costs exceed $50,000 per year.
Cornwell said the programs saved CMS $35 million over the first two years and returned $17.5 million in shared savings to providers. In a recent study, authors found that if the program went national and treated only one million of the two million beneficiaries qualifying for such services, it could save Medicare up to $30 billion over 10 years.
Last July, Congress voted to extend the demonstration project for another two years. A U.S. Department of Veterans Affairs (VA) study found savings averaged $5,000 per patient per year. VA family members rated it higher than any other VA clinical program.
To qualify for the IAH program, Medicare beneficiaries must have two or more chronic illnesses expected to last more than one year, a functional disability that prevents them from performing two activities of daily living, such as bathing or using the toilet, and a hospitalization or skilled nursing facility admission within the past year.
“These are the sickest of Medicare’s patients,” Cornwell said. “And if you can make a 10 percent cut in those costs, you can have a large impact on the Medicare budget by more effectively caring for a small fraction of the Medicare population.”
Some Hospitals Win, Others Don’t
Cornwell said a recent House Calls conference in Chicago attracted top regional hospitals and health systems seeking to develop their own programs.
“Most have an accountable care organization (ACO) and are looking for cost savings and nothing has been shown to reduce hospitalizations and readmissions like medical house calls. Those systems see a role for this program in the future of value-based healthcare,” said Cornwell. “As a home-based provider, if I can prevent a hospitalization, I can share in those avoided payment savings. This turns the whole payment mechanism on its head and shows why House Calls is becoming an economically viable model.”
Kristofer Smith, MD, a senior vice president at Northwell Health Solutions in Long Island, N.Y., cautioned that not all hospitals should expect to make money from house calls programs. Northwell, which treats 350 IAH patients and another 800 whose house calls visits are paid through customary Medicare fee-for-service plans, earns little from treating IAH beneficiaries and loses money on its other house calls patients.
“It’s hard to see how advantageous this could be for many hospitals,” Smith said in an interview. “You may generate downstream revenue by using your home health or hospice program, but you still lose money from the hospital utilization revenue you’re not getting. The Medicare shared savings gets you closer to breaking even, though.”
Peggy Tighe, an attorney and lobbyist with the Washington, D.C., law firm Powers Pyles Sutter & Verville, said a pending Senate bill to expand the demonstration program nationally has broad support from Republicans, Democrats and Independents.
“If you keep this group of people out of hospitals, you’re going to save money,” Tighe said in an interview. They’re the most expensive people to take care of and doctors get next to nothing for doing it. This bill could change that. This clearly is going to be a win.”
Tighe said provider associations support the legislation, which would make the IAH house calls program a permanent Medicare benefit.
“It’s obvious that this is saving money and should be offered to more people in more places,” Tighe said.
More Efficient Care
Eric De Jonge, MD, director of geriatrics and co-founder of the 17-year-old Medical House Call Program at MedStar Washington Hospital Center, said in an interview that patients receiving house calls get higher quality services, with improved health outcomes and fewer emergency-department visits and hospitalizations.
“If a hospital doesn’t have a house calls program, it should at least explore how it would impact them. It should be challenged to think about how it’s now providing care to this group of patients requiring complex care outside of the four walls of the hospital,” De Jonge said.
De Jonge noted another silver lining for hospitals is that if they take on more responsibility for these patients, it makes them more efficient. Keeping those generally low-margin medical admissions at home where they can be managed more efficiently frees up beds that allow a higher proportion of complex and more lucrative patients having procedures who truly do belong in the hospital.
A house calls programs allows patients to stay home and maintain their independence and dignity, De Jonge said.
“The VA study did show a substantial decrease in long-term nursing home placement, which can save state Medicaid programs a lot of money. The nursing home placement rate for our Washington, D.C., patients is less than five percent per year, compared to an expected rate of 15 to 20 percent for this high risk population” De Jonge said.
How to Fund It
De Jonge said that MedStar financial executives recognized that fee for service reimbursement alone would not fund a comprehensive House Calls program, but would require diverse revenue streams to cover the costs that Medicare fee-for-service does not, such as staff driving time. The shared savings under the Medicare demonstration project provides funding, as does Medicaid. Social workers are funded through Medicare and Medicaid for elderly patients with disability waivers.
“And we’re also funded through Medicare Advantage plans that pay per patient per month fees to achieve these results for high cost patients. Finally, we depend on grants, donors, and foundations for start-up funding. Ultimately, you can’t rely on philanthropy because it needs to be sustainable,” De Jonge said. “You need to seek out every financial engine to make it sustainable.”
Mark Taylor wrote this story for HFMA Healthcare Business News with support from the Journalists in Aging Fellows Program of New America Media and The Gerontological Society of America, with support from The Retirement Research Foundation. Health Care Business News is a publication of the Healthcare Financial Management Association.
This article originally published in the January 2, 2017 print edition of The Louisiana Weekly newspaper.
