Healthcare Business News

Readmissions double Medicare patients' care costs: study

By Beth Kutscher
Posted: July 23, 2012 - 5:45 pm ET

Hospital readmissions more than double the cost of care for Medicare beneficiaries, according to an analysis commissioned by a group that represents home health providers.

The study was part of the Alliance for Home Health Quality and Innovation's Clinically Appropriate and Cost-Effective Placement research project, which looked at the impact of admissions and readmissions on Medicare expenditures.

About 22.4% of all episodes of care required at least one readmission, according to the analysis.

In the post-acute-care setting, the analysis found that patients with at least one readmission cost Medicare an average of $33,000 compared with $15,000 for patients who did not require a readmission.

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The likelihood of readmission increases with the number of chronic conditions that patients have, according to the analysis. At the same time, the cost of care is most affected by the severity of a patient's condition, not the total number of chronic illnesses.

The findings were true in the post-acute and pre-acute care settings as well as in the community-based setting.

“With clinically appropriate and effective care, patients have the potential to avoid some unnecessary admissions altogether, ultimately saving Medicare and taxpayers a significant amount,” said Teresa Lee, executive director for the alliance, in a news release. “Home healthcare combines the right mix of care management, prevention training and close observation to significantly reduce hospital admissions.”

Dobson DaVanzo & Associates, a healthcare consulting firm, conducted the analysis for the alliance, which represents both for-profit and not-for-profit home health companies.

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