Home-based primary care program saves more than $6,500 per Medicare beneficiary

CMS program demonstrates practices can provide quality home-based primary care while saving Medicare money

An experimental CMS program proving home-based primary care shows that it can save more than $6,500 per Medicare beneficiary while still delivering quality results across six areas of measure.

The Independence at Home demonstration project selected primary care practices to provide home-based care to chronically ill Medicare patients for a three-year period. Participating practices made in-home visits tailored to an individual patient’s needs and coordinated their care.

Practices that met performance targets for three of the six quality measures while also generating Medicare savings received an incentive payment after meeting a minimum savings requirement. The six quality measures were:

  • Follow-up contact within 48 hours of a hospital admission, discharge, or emergency department visit
  • Medication reconciliation in the home within 48 hours of hospital discharge or ED visit
  • Annual documentation of patient preferences
  • All-cause hospital readmissions within 30 days
  • Hospital admissions for ambulatory care sensitive conditions
  • Emergency department visits for ambulatory care sensitive conditions.

Participation in the demonstration was voluntary for Medicare beneficiaries.

According to CMS, home-based primary care allows health care providers to spend more time with their patients, perform assessments in a patient’s home environment, and assume greater accountability for all aspects of the patient’s care. This focus on timely and appropriate care is designed to improve overall quality of care and quality of life for patients served, while lowering health care costs by forestalling the need for care in institutional settings.

The goal of the test was to determine whether home-based care can reduce the need for hospitalization, improve patient and caregiver satisfaction, and lead to better health and lower costs to Medicare.

Practices that reduced their beneficiaries’ Medicare expenditures sufficiently below their spending targets share in a portion of the difference between the expenditures and the spending target, referred to as an incentive payment. A practice’s incentive payment is adjusted based on its performance on the quality measures.

In year seven of the demonstration, CMS found that expenditures for IAH practices’ beneficiaries were approximately 18% below their spending targets – the equivalent of $42.3 million, with an average reduction of $6,585 per beneficiary.

All 10 IAH participants (nine practices and one consortium) reduced the per-beneficiary-per-month expenditures relative to the practice’s spending target. A total of 6,436 beneficiaries were enrolled in the demonstration at 10 participating practices. All 10 IAH participants met three or more of the six quality measures; three of those practices met the performance thresholds for all six quality measures.