Partnering with Home Health Agencies – Real-time data analytics is essential

By Chris Attaya
April 11, 2018 Hospitals/ACOs

It's important that your partner has the tools to be successful

For hospitals to correctly maximize their Medicare reimbursement, partnering with the optimum post-acute care (PAC) home health provider is essential. The Centers for Medicare and Medicaid (CMS) penalizes hospitals for Medicare readmissions. Most readers are familiar with the Hospital Readmission Reduction Program (HRRP), where up to 3% of hospitals’ Medicare revenue is potentially affected by the results of their readmissions rates for 6 diagnostic penalty groups.1

Readmissions penalties are also manifested in other ways, from increased financial risks for patients in the Comprehensive Care Joint Replacements (CJR) or Bundled Payments for Care Improvement (BPCI) models, to Hospital Value-based Purchasing (HVBP) and Accountable Care Organizations (ACO), where the cost of care (whether Medicare Spending Per Beneficiary or total cost of care) affects hospitals’ revenue through readmissions.

Predictive analytics

CMS believes that a large percentage of readmissions are avoidable. Officials estimate that, of the $26 billion annual cost for Medicare readmissions, $17 billion is potentially avoidable.2

Hospitals have difficulty tracking and managing patients after discharge. Many consultants and software companies are trying to fill the void by expanding care transition services, patient tracking, and patient coaching and education. A best practice is to use real-time predictive analytics to help identify patients at high risk for readmission. An algorithm in the decision support software to identify patients at high risk of readmission is essential to manage the many patient characteristics considered during the discharge process.

Software vendors will use historical data to run regression analysis on patient characteristics that ended in a readmission. At Strategic Healthcare Programs (SHP), we look at millions of records each year from the Home Health Agency Outcome Assessment Information Set (OASIS) to correlate the patient characteristics that led to a transfer or discharge to an acute care hospital (readmission).

Analyzing 10M Medicare records in the last 5 years, SHP determined that patients at high risk accounted for 3.7% of all patient assessments. These high risk patients had a readmission rate of 25.7%. This compares to the standard national rate of 12.5% for all patients in the same time period. That’s a high rate for a small subset of the patients who hospitals have referred to home health.

Aligning Incentives

Home Health Agencies (HHA) desire to be good long-term partners to their referring hospitals by providing consistent, high-quality care. In referring your patients to HHAs, identify providers who use industry best practices and real-time data to keep patients from readmission. The industry literature is replete with best practices, such as patient tele-monitoring, front loading of visits, and patient engagement solutions. The key is find agencies with industry best practices and the ability to act on their real-time data.

CMS is adding incentives for HHAs to improve their readmissions performance. Today, HHA 30-day readmissions and 60-day hospitalizations are publicly reported on the CMS website Home Health Compare. The 60-day hospitalization measure is one of 9 quality measures used to calculate an HHA’s Quality of Patient Care star rating. Although the HHA revenue is not negatively affected, as are hospitals faced with HRRP, agencies’ top line revenue can be influenced by patient and medical provider impressions of quality, as interpreted by their ratings.

The 60-day Hospitalization rate is also one of the 17 measures used in a nine state Home Health Value-Based Purchasing (HHVBP) pilot. The possibility of bonuses and penalties under HHVBP is driving more alignment of incentives in keeping readmissions low similar to hospitals.

Starting in October 2018, CMS will calculate a home-health-specific Medicare Cost per Beneficiary like CMS calculates now for HVBP, plus a metric measuring Discharged to Community that will compare the ratio of discharged patients who stay out of the hospital for 30 days after their home care discharge. It will likely not take too long for CMS to include these new measures in their value-based reimbursement models and programs. The more that readmission penalties and incentives are aligned, the higher the likelihood that a reduction in readmission rates will be achieved. A win-win is always the best approach in meeting the common goal of reducing readmissions.

Data on correlations

With more than 4500 agency locations nationwide, we analyzed SHPs readmission data for the last 5 years (CY12-16) and presented this information in a webinar entitled, “A Deep Dive into the Data behind Hospital Readmissions.” SHP examined some correlations of patient characteristics that led to hospital readmissions. The data may provide insights that could help lead to more opportunities for collaboration with your partners.

Front loading of Home Health start of care visits within a 60-day episode is often considered a best practice in home care. By analyzing the number of visits that were provided in the first 7 days after discharge from the hospital, we noted the following trend in readmissions rates:

Table 1

# of Visits 1 2 3 4 5 6 7
SHP National Benchmark Rate 36.4% 15.5% 11.4% 10.7% 10.6% 9.9% 9.8%

The readmission rate was based on care provided by any discipline in the first seven days of home health care. The rate drops precipitously through the first three visits and then begins to flatten out with each additional visit. Evidence-based best practice suggests that for most patients at least 3 visits be made in the first week. According to the VNAA Blueprint for Excellence,3 best practice may also include front loading the first two visits within the 48 hours after the hospitalization— especially important given the amount information a clinician needs to collect at the start of care, and the patient teaching necessary in those first two visits.

The number of days that pass from the hospital discharge to the HHA start of care also influences the readmission rate. (See table 2.) Although “same day” admits have the highest rate, likely due to the acuity of patients who need to be seen immediately, after one day, each additional day between the hospital discharge and the HHA start of care shows an increased readmission rate.

Table 2

Same Day One Two Three Four Five
14.1% 12.1% 12.9% 12.9% 13.3% 13.3%

Another interesting correlation relates to multiple OASIS items on the behavioral or mental status of the patient. Readmission rates increase rapidly as patients’ cognitive impairments, depression, and confusion scores increase (See table on PHQ-2 screening for depression). Agencies need to be sensitive to changing readmission risks of their patients and take appropriate action to mitigate those risks.

Table 3

M1730 – PHQ-2 Score for Depression Re-hospitalization Rate
Depressed - 0-1 day 11.7%
Depressed - 2-6 day 15.9%
Depressed - 7-11 day 17.2%
Depressed - 12-14 day 17.6%
Depressed - Unable to respond 17.3%


The CMS imperative of reducing avoidable readmissions helps reduce unnecessary cost, enhance patient satisfaction, and improve overall quality. With CMS incentives increasingly directed at reducing readmission rates, hospitals can maximize their Medicare reimbursement by selecting a PAC home health care provider that uses actionable, real-time analytics.


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About the Author
Chris Attaya
Chris Attaya
Vice President, Product Strategy
With more than 28 years of experience in the home health and hospice industry, Chris is responsible for product development and helping clients achieve increased operational and financial performance.