Digital technology is making home healthcare a more viable option. Hospital systems and physician practices want to save costs by sending patients home sooner, while ensuring they get maintain proper medical care. But a RAND Corp. study says there are financial challenges, particularly for small and independent practices.
The health policy research program examined the experiences of a dozen primary care practices in Pennsylvania that took part in a recent medical home demonstration.
Medical home, or patient-centered medical home, is team- and outcome-based healthcare delivery model designed to provide comprehensive and continuous medical care to patients.
The researchers found that the greatest transformation costs involved adding new staff to help better coordinate patients’ care. And these substantial costs are not simply related to one-time start up costs. Grand Martsolf, the study’s lead author and a policy researcher at RAND, said the costs also include ongoing management. Further, he noted that the existing incentive programs to help practices set up home healthcare models might not work smaller health networks. He suggested that tailoring subsidies from payors could enable small and independent practices.
The research reveals that the median one-time cost of transforming into a medical home system was $30,991 per practice – equal to $9,814 per clinician and $8 per patient. Ongoing costs averaged $147,573 per practice per year – equal to $64,768 per clinician and $30 per patient every year.
It is worth noting that costs varied widely, with start-up costs ranging from $7,694 to $117,810 per practice and annual expenses ranging from $83,829 to $346,603 per practice. The cost per clinician was highest for small medical practices.
Some of the requirements for a successful medical home strategy include a high-functioning information technology systems, which the study identified as critical to providing patient care. However, only four of the practices interviewed had made ongoing investments in information technology specifically related to their medical home transformation.
In addition, care management activities, which typically involved hiring one or more care managers to better coordinate patient care, constituted the greatest share of ongoing costs. Only three of the practices surveyed expanded hours to improve patient access to care.
The study was published online in June by the Journal of General Internal Medicine.