Monday's Wall Street Journal featured a prominent article about home care, but it wasn't the story we would have hoped for. Instead of focusing on the opportunity for home care to increase patient satisfaction, lower costs as compared to hospital and nursing home stays, reduce the risk of infection, free up hospital beds, and create jobs, the Journal instead shared a story about how reimbursement incentives have influenced the delivery of care.
You can see the article, entitled Home Care Yields Medicare Bounty (by Barbara Martinez in the April 26th edition, by clicking on the image below:
The synopsis of the article is that Medicare reimbursement for Home Care Services was structured so that an episode of care with 10 or more visits paid the agency $2,200 more than an episode with up to 9 visits, and that research showed that when this provision was in place, that a lot more episodes had 10 visits than 9. Most of the data for the article came from Amedisys, but it was clear that the practice of "more 10 than 9" occurred industry-wide (sadly for Amedisys, their leadership in the industry made them easy to pick on).
As a taxpayer, of course I'm not happy that the industry opted for the reimbursement option that paid them more, but can you really blame them, or should we instead be looking at the reimbursement policy. To draw an analogy, movie theaters offer different sizes of popcorn where the small bag costs some crazy amount like $6.00 and the big bucket with twice as much popcorn costs $6.50. Are the buyers of the big bucket wrong to get more value by shelling out the extra 50 cents?
But there are several differences between the popcorn analogy and the Medicare example, as follows:
- With popcorn, the buyer got 100% more product for just over 8% more money, whereas with Medicare, the patient got 11% more service for 67% more money - the opposite of a volume discount
- With popcorn, the buyer made the decision and the buyer paid for it, whereas with Medicare the seller made the decision and the taxpayers paid for it
- If the buyer who set the policy of "We'll pay a lot more money for a little bit more product" had worked somewhere like at GE, they'd likely be fired
So shame on everyone... Yes it's likely that 10 visit episodes didn't deliver better care than 9 visit ones, so shame on home care. But shame on the policy makers who crafted the reimbursement, too.
As we've shared in previous posts, the definition of health care reform needs to be "Better Care at Lower Cost". And when this policy is applied, home care will deliver a win/win and the Journal will be able to tell a much more positive story.
Ankota provides software to improve the delivery of care outside the hospital. Today Ankota services home health, private duty care, DME Delivery and Home Infusion organizations, and is interested in helping to efficiently manage other forms of care. To learn more, please visit www.ankota.com or contact Ankota.