And then there were none.
It's really not quite that bad in home healthcare, yet the flurry of companies and agencies fleeing the field is alarming. Most of the 1,200 Medicare-certified home agencies that have left the business in the past year cited lower reimbursement rates and the forecast for tighter payment conditions.
Those remaining must become more nimble and look for ways to diversify into more promising, rewarding areas of post-acute care. And they must concentrate on efficiency, especially in monitoring administrative expenses and nursing visits.
Like other forms of patient care, home health is a victim of its own success and growth. In the past, home care was lauded as the sensible, economical alternative to costly inpatient hospital care. As the market expanded, Medicare home-care expenditures exploded to $18 billion last year, up from $3.5 billion in 1990. In response to the inflationary spiral, Congress built home health cost controls into the Balanced Budget Act of 1997.
Ultimately, Medicare will reimburse home health through a prospective payment system. Until then, per-patient caps on visits and total home health spending are rocking the industry, even though the terms were relaxed in the recently passed federal budget bill.
And it's not just the small, independent agencies that are bailing. Integrated Health Services is attempting to sell its home-care operations, while HealthSouth Corp. simply walked away from its nonhospital-based home nursing operations.
Yet home care does have a future if providers get their own houses in order. The best way for the industry to show commitment is by investing in outcome studies so home health agencies can find ways to improve quality and lower costs.