Discharges to Skilled Nursing Remain Steady, But Home Health Gains Ground

Hospitals continue to discharge a fairly consistent share of their patients to skilled nursing facilities, but home health has seen a spike in admissions amid a shifting reimbursement landscape and changing consumer preferences.

Acute-care hospitals released 22% of their patients into skilled nursing facilities during the first quarter of 2018, according to data released Wednesday from Excel Health, an Atlanta-based data analytics firm. SNFs led the pack among post-acute care settings, with home health agencies accounting for 20% of hospital discharges. Hospices and inpatient rehabilitation facilities (IRFs) took in 4% of discharges each, with long-term care hospitals seeing just 1% of patients.

That leaves 49% of hospital patients who are discharged without any post-acute care instructions, with that percentage climbing into the 60% range in the less-populous western states — with higher discharge recommendation rates in the East, Excel observed.

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While those percentages have remained static over recent quarters, Excel noted that home health agencies have seen a “dramatic increase” in admissions growth between 2016 and 2017, with a particularly rough flu season generating demand for the services. Though Excel was careful to note that the trend may be temporary, and not necessarily representative of a sea change in preferences, home health agencies enjoyed a 1.8% boost in admissions in the fourth quarter of 2017.

But Excel also predicted that the upcoming Patient-Driven Payment Model for skilled nursing facilities could only accelerate this trend when the new structure takes effect in fall 2019.

“As SNF stays become shorter due to Patient Driven Payment Model’s (PDPM) therapy adjustment factors, and with continued focus on avoidable hospital readmissions from SNFs, we may see a shift in Medicare expenditures, with more patients being referred to home health following rehabilitation stays,” the company noted in its report.

Medicare Advantage on the rise

Excel also observed an increase in Medicare Advantage penetration during the first quarter of 2018, with 20.5 million of the nation’s 58 million total Medicare enrollees, or about 35%, participating in the managed program. That’s up from the 19.5 million figure in the fourth quarter of 2017, and running slightly above traditional estimates that have placed the overall rate of Medicare Advantage enrollment at around 33%.

Minnesota leads the nation at 58.4% Medicare Advantage enrollment — well ahead of second-place Hawaii at 45.8% — with significant penetration in Western states such as Oregon and California.

The trend is partially the result of changing demographics within the baby boomer population. Excel divides that demographic into two sub-groups: older “leading-edge” boomers, born between 1946 and 1955, and their younger “trailing-edge” counterparts, born between 1956 and 1964.

The latter group has more familiarity with Medicare Advantage plans and generally want more from their government-sponsored health care benefits. For instance, Excel cited a recent survey that found 78% of “leading-edge” boomers were satisfied with Medicare benefits and services — while 58% of the trailing-edge group had at least some dissatisfaction with it. And as more and more trailing-edge boomers age into the Medicare system, their voices and preferences will be amplified.

“Trailing-edge baby boomers are known to have more exposure to managed care plans and options that will drive their selection of benefits,” Excel noted. “They are more likely to initially subscribe to a Medicare Advantage plan offering than their older counterparts and are also more likely to change plans to fit their evolving expectations.”

Written by Alex Spanko

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