Skilled Nursing Admissions Drop Across the Country as Home Health Discharges Pull Ahead

In another sign of the shifting paradigm in post-acute care, home health agencies beat out the skilled nursing setting as the most likely post-acute referral destination — while SNF admissions dropped in all 50 states from last year.

That’s according to the 2019 Industry Trend Report from Trella Health, which analyzes Medicare Part A and B claims data for post-acute providers, including hospice, home health, and skilled nursing.

Specifically, the company found that 23.3% of inpatient discharges were coded for home health, compared with 21.1% referred to a SNF. This was the first reporting period where home health received a higher referral rate than SNFs since Trella began tracking episode discharges in the first quarter of 2018, according to the report.


“The decrease in SNF referrals reflects a broader trend within the industry,” the report said. “A lower percentage of inpatient discharges to skilled nursing and decreased SNF utilization over the past four quarters could portend continued challenges for SNF providers.”

SNF admissions declined on a year-over-year basis, dropping 9% from 627,302 in the first quarter of 2018 to 517,177 in the first quarter of this year. There were no states that had an increase of admissions to the SNF setting from the first quarter of last year, according to Trella.

Admissions dropped by roughly 14% or more in Minnesota, Washington, D.C., Vermont, New Jersey, and Wisconsin, with Minnesota seeing a drop in SNF admissions of 26.8%.


There was also a decline in SNF utilization, calculated by dividing the number of patients entering the SNF setting after an inpatient hospital stay over the most recent four quarters by the number of all inpatient discharges for those quarters.

From the second quarter of 2018 to the first quarter of 2019, SNF utilization came in at 25.1%, compared with 25.6% in the previous reporting period. Midwest and East Coast states had the highest utilization rates.

“The fact that both SNF admissions and utilization declined indicates fewer patients are being coded for skilled nursing and even fewer are using the care setting,” the report said.

The state of Connecticut had the highest rate of inpatient discharge to SNF at 30.9%, but Trella’s report noted that it was among the 10 states with the shortest average length of stay, at 24.9 days.

In terms of readmission rates, compared with average length of stay, Louisiana, Missouri, and Arkansas were in the top 10 for longest average length of stay and highest readmission rate, which could indicate a more medically complex or acute patient population, according to the Trella report.

The numbers come amidst a backdrop of thin SNF margins and the expense of maintaining typically older skilled nursing facilities, both of which Trella noted have been long-standing challenges for SNFs. And the challenges don’t stop there.

“Negative publicity in recent years has hurt SNFs’ reputation, and the industry’s shift to the Patient-Driven Payment Model (PDPM) could materially impact reimbursement rates for SNFs that are already struggling,” the report noted.

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