CMS Home Healthcare Policy Reduced Hospital Readmissions

Health Payer Intelligence

- The CMS post-acute care transfer (PACT) policy and the use of home healthcare helped reduce hospital readmissions for recently discharged patients and lower hospital expenditures, according to a study published in the American Journal of Managed Care.

The CMS PACT policy aims to prevent overpayment to hospitals for stays that receive post-acute transfers during discharge. Post-acute transfers include discharges to a skilled nursing facility, hospice, long-term acute care hospital, or a discharge with provider orders for home healthcare within three days of discharge.

Under the policy, hospitals receive reduced payments for shorter-than-average patient stays that fall into certain diagnosis-related groups. 

To understand if home healthcare helped improve patient outcomes, researchers looked at patients who experienced discharges to home healthcare under the PACT policy in 2018. They gathered data on Humana Medicare Advantage members from claims submissions, CMS mortality data, enrollment files, primary care contracts, and program participation documents.

The researchers performed an instrumental variable analysis that considered hospital preference for discharge to home healthcare to control for confounding variables and produce the most accurate results.

The study included data from 19,231 patients; 4,160 received discharge to home healthcare, while 15,071 had a discharge to home.

Patients who received home healthcare saw better health outcomes compared to patients who did not, the study showed. Patients in the home healthcare group had a 60 percent smaller risk of readmission after 30 days. Readmission rates were lower for the home healthcare group at the 60- and 90-day marks as well.

Additionally, patients who received home healthcare experienced lower costs compared to patients who had a discharge to home, perhaps due to the reduced rate of hospital readmissions. Hospital spending for the home healthcare group was $239 less per patient, researchers found.

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