U.S. Department of Health and Human Services

Study of Medicare Home Health Practice Variations: Final Report

Executive Summary

Angela G. Brega, Ph.D., Robert E. Schlenker, Ph.D., Kamal Hijjazi, Ph.D., Susannah Neal, M.A., Elaine S. Belansky, Ph.D., Sylvia Talkington, R.N., Anne K. Jordan, Ph.D., Jeff Bontrager, B.A., and Colleen Tennant, M.S.P.H.

University of Colorado, Center for Health Policy Research

August 2002

This report was prepared under contract #HHS-100-95-0045 between the U.S. Department of Health and Human Services (HHS), Office of Disability, Aging and Long-Term Care Policy (DALTCP) and University of Colorado. For additional information about the study, you may visit the DALTCP home page at http://aspe.hhs.gov/daltcp/home.htm or contact the ASPE Project Officer, Andreas Frank, at HHS/ASPE/DALTCP, Room 424E, H.H. Humphrey Building, 200 Independence Avenue, SW, Washington, DC 20201. His e-mail address is: Andreas.Frank@hhs.gov.

This report was produced as part of the "Study of Medicare Home Health Practice Variations," funded by the Office of the Assistant Secretary for Planning and Evaluation (ASPE), Department of Health and Human Services (Contract No. 100-95-0045). This document represents the final report for the study and integrates several project deliverables (13.2a, 13.2b, 13.2c, 13.4, 14.9, 14.10, 14.11, 14.12, 14.13, 14.14, 14.15, and 14.16).

A. BACKGROUND

The main goal of this study was to examine how patient, provider, agency, and market/regulatory factors relate to variations in home health care practices and how practice patterns relate to outcomes for Medicare beneficiaries. Five important aspects of home health practice, covering both direct care provision and care coordination, were selected for examination. The four measures of direct care investigated were (1) the average number of visits provided to a patient per day (i.e., visit intensity), (2) the duration of the home health episode (length of stay), (3) the total number of disciplines involved in patient care, and (4) the number of alternative services provided during the episode of care.¹ The amount of feedback received by the primary home care provider from other agency personnel regarding a patient's care plan and discharge was examined as a measure of care coordination.² The three key research questions were:

1. What is the actual practice of home health care, in terms of type, amount, and decision making (e.g., care planning, care coordination)?
2. How are decisions about care made in light of Medicare coverage rules?
3. What elements of practice are associated with long lengths of stay in the Medicare home health benefit?

In addition, although the study was not originally intended to address issues related to the Balanced Budget Act (BBA) of 1997, the timing of the project allowed for an examination of the impact of the Interim Payment System (IPS) and other policy changes that occurred prior to the implementation of the Medicare home health Prospective Payment System (PPS) in October 2000.

The objective of this report is to summarize the findings from the quantitative and qualitative methods used to answer the key study questions. The report provides a description of the states, agencies, and patients that participated in the study. Quantitative data are used to (1) examine the influence of patient, provider, agency, and market/regulatory factors on practice patterns, (2) explore the impact of practice patterns on length of stay, and (3) identify the effect of practice patterns on patient outcomes. Practice patterns and decision making in home health care are explored using data from focus group and case study interviews. Finally, qualitative data regarding provider perspectives on IPS, a major provision of the BBA, and other changes in the field of home health care are summarized.

B. FINDINGS

1. Key Features of Study States, Agencies, and Patients

Study States: Eight states were chosen for participation in the study on the basis of their home health visit volume, defined as the average number of visits per Medicare beneficiary receiving home care per year in 1995. Four low-volume and four high-volume states were selected. The four low-volume states selected were Minnesota, New Jersey, Oregon, and Pennsylvania and the four high-volume states were Georgia, Massachusetts, Mississippi, and Texas.

Descriptive information about the states shows variation within each state volume group, but greater variation between the two groups. Further, although visit volume (visits per beneficiary per year) has decreased in both the low- and high-volume states, the percentage reduction in visit volume is only slightly higher in high-volume states than low-volume states. Some key differences between the states in the high-and low-volume groups are the following:

• On average, a slightly larger percentage of the population is 65 years old or older in the low-volume than the high-volume states.
• In low-volume states, a slightly smaller percentage of the age 65 and older population lives in poverty than in the high-volume states. Likewise, a smaller percentage of Medicare patients are covered by Medicaid in the low-volume than the high-volume states.
• A larger number of people aged 65 and older per 1000 has difficulties with mobility/self-care in the high-volume than the low-volume states.
• The high-volume study states have many more home health users per 1000 among their Medicare beneficiaries than do the low-volume states.

Study Agencies: Agencies were randomly sampled from the eight states and invited to participate in the study until the target agency sample of 56 agencies was reached. During the course of data collection, several agencies discontinued their participation in the study (often due to the greater financial stringency under IPS) or failed to submit useable longitudinal data. Of the 56 agencies recruited for participation in the study, 44 contributed data to the final sample used for analysis purposes.

The study agencies reflected a variety of important agency-level factors, providing a cross-section with regard to three factors that were hypothesized to play a critical role in the practice of home health care:

• The final sample of 44 agencies had good representation of agencies in both the high-volume and low-volume states (41% and 59%, respectively).
• More than half of the agencies were nonproprietary or government agencies (66%). The remaining 34% were proprietary agencies.
• The sample had nearly equal representation of hospital-based and freestanding agencies (48% and 52%, respectively).

Study Patients: The final patient sample included 684 patients, contributing a total of 732 complete episodes of care. Patients enrolled in the study reflected a variety of important variations in their conditions and living situations.

• The study patients were quite elderly, with an average age of 78 years.
• The majority of patients were White and female.
• Despite their age, 80% of the study patients lived in their own homes.
• Nearly all patients had family members or other persons who provided them with some assistance.
• Slightly over 81% of patients had been discharged from an inpatient facility within two weeks of beginning home care.
• The majority of patients (95%) had only a single episode of care during their time in the study.

2. Practice Variations in Home Health Care

Quantitative analyses were conducted on longitudinal data for congestive heart failure (CHF) and diabetes mellitus patient episodes to examine (1) the effect of patient, provider, agency, and market/regulatory factors on home care practices, (2) the influence of practice patterns on episode length, and (3) the impact of home care practices on patient outcome. The following are the key findings from the multivariate analyses:

• Patient complexity, functional status, and diagnoses were important predictors of visit frequency, the number of disciplines and alternative services included in the patient's care, episode length, and the amount of feedback a care provider receives from other agency personnel about the patient's care plan.
• Care providers with more years of experience in home health care tended to have patients with significantly longer episode lengths than did less experienced providers.
• Agency ownership and type were strong predictors of home care practices. Proprietary agencies appeared to counterbalance visit intensity and length of stay, providing their patients with more frequent visits over shorter episodes than did nonproprietary agencies. These agencies also made greater use of alternative services.
• Freestanding agencies provided both more frequent visits and longer episodes of care than did hospital-based agencies.
• States that had been identified based on 1995 data as providing a large number of home care visits per patient appeared to continue to utilize home care resources more heavily than did states with lower visit volume (e.g., more frequent visits, more disciplines involved).
• Agencies appeared to counterbalance frequency of visits and length of stay, such that episodes involving more frequent visits were significantly shorter than episodes with less frequent visits.
• Episodes of care that involved more disciplines were significantly longer than those involving fewer home health disciplines.
• Patients receiving more frequent visits experienced marginally better outcomes of home care than did patients with less frequent visits.

3. What is the Actual Practice of Home Health Care?

The focus group and case study interviews were conducted to examine home health care in greater depth than was possible with the primary data sample. Key findings regarding service provision, and care planning and coordination are summarized here.

Service Provision:

• Often, elderly recipients of Medicare home care services are complex patients, many having been recently discharged from hospital care. According to focus group participants, patients just released from the hospital often are sicker than other home care recipients and frequently require complex or high-tech services.
• Home care nurses engage in a wide variety of activities as part of providing skilled nursing care, including assessment of patients' medical conditions and needs, education of patients and their families, development of the care plan, management of the medications, completion of required forms, documentation, coordination of the patients' support networks, psychological counseling, and coordination of care across disciplines.
• The family support system is of great importance to elderly home care patients. Family members provide assistance with activities of daily living (ADLs), instrumental activities of daily living (IADLs), environmental support, and psychological support. In addition, they often are heavily involved in the patients' home health care activities (e.g., present at visits, involved in the development of the plan of care). The presence of a family support system is an important factor affecting nurses' decisions about the frequency of visits a patient needs.
• Patients and/or their families often refuse to accept the services of home health aides and medical social workers. Usually, patients who refuse services have family members who are willing and able to provide for the patients' needs.

Care Planning and Coordination:

• The role of the primary nurse in the process of developing the patient's care plan varies from agency to agency. At some of the case study agencies, primary nurses have a great deal of control over a patient's care plan. However, many agencies involve nursing supervisors in the development of patients' care plans. Although the sample size was small, the case study interviews suggest that primary nurses have greater control over the development of their patients' care plans in low-volume states and in nonproprietary agencies. Administrator Questionnaire data corroborate these findings and also suggest that primary nurses have greater control over their patients' care plans in hospital-based than freestanding agencies.
• Physician involvement in home care appears to be minimal in most cases. Generally, the patient's plan of care is developed independently by home care agency staff based on their initial assessment of the patient's needs. The care plan often has little resemblance to the physician's initial referral, which rarely specifies the types of visits needed and the frequency with which they should occur. Nurses usually communicate with their patients' physicians only at milestone time points, such as recertification and discharge, or when the patient's condition changes. Contact between home care nurses and physicians is nearly always made indirectly through the physician's nursing staff.
• Home health agency case conferences are a main mechanism through which home care providers of different disciplines stay in contact about their patients.
• Discharge planning begins very early in the home care episode, often at the first visit. Nurses cited a number of factors they consider in determining a patient's readiness for discharge: homebound status and other Medicare eligibility requirements, stability of the patient's medical condition and medication regimen, attainment of educational goals, the patient's endurance, and the patient's ability to manage his or her medications.
• In preparation for discharge, primary nurses work to identify resources to assist with the patient's continuing needs following discharge, such as transportation and meal preparation.

4. How are Decisions About Care Made in Light of Medicare Coverage Rules?

The focus group and case study interviews also provided important information about the decision-making process in home health care. This section highlights some key findings from these interviews.

• Recertification and discharge decisions are based on a number of factors, including patient factors (e.g., living environment), agency factors (e.g., supervision of decision-making process), and external factors (e.g., IPS, coverage rules).
• The patient's primary nurse usually makes the decisions about the care plan, although some agencies involve nursing supervisors and a multi-disciplinary team in the review of each patient's care plan. Nurses in low-volume states appear to have greater control over the decision-making process than do nurses in high-volume states. Supervisory staff appear to be more involved in the development of the patient's care plan in proprietary than nonproprietary agencies.
• There appears to be considerable confusion surrounding Medicare coverage rules. Nurses often are uncertain about the definition of "homebound," about what constitutes skilled nursing care, and about the appropriate use of Management and Evaluation (M&E). Nurses suggested that physicians seem to struggle with these concepts as well, sometimes referring patients who are not eligible for Medicare home health services.
• However, the focus group and case study interviews produced no evidence that the lack of clarity in coverage rules encourages home care providers to continue to provide services to patients who may be ready for discharge. Indeed, there was some suggestion from the interviews that this ambiguity may actually result in shorter episodes of care. Fear of Medicare review leads some nurses to opt for discharging a patient for whom it is unclear whether discharge or recertification is the correct approach. Further, it appears that agencies may avoid the use of services for which the coverage rules are ambiguous, such as M&E.

5. Provider Perspectives on the Interim Payment System (IPS)

This study was not originally intended to examine the impact of recent regulatory changes related to home health care. However, because the BBA was implemented prior to the major data acquisition phase of the project, the opportunity arose to obtain information about the impact of IPS and other recent changes in home health care. A number of important themes emerged across several methods used to examine provider perceptions of IPS and concurrent changes:³

• Interview participants reported that home care patients receive fewer services and are on service for shorter periods of time than they once were.
• The focus on reducing home health utilization has led to the identification and increased involvement of community and other outside resources early in patients' episodes of care.
• According to agency administrators, this increased emphasis on community resources has expanded the role of social workers in patient care. However, this finding is not consistent with recent work conducted by Abt Associates (1999), which indicated that more agencies have decreased (8.4%) than increased (4.2%) the involvement of social workers.
• Patient education intended to help patients and their families to provide for their own needs has become an increasingly important aspect of home care. According to many providers, this education must take place in an increasingly short period of time.
• Interview participants reported that agencies sometimes refuse high-need patients, such as chronic, complex, or rural patients. In particular, the respondents contend that access to home care services has been reduced for diabetic patients and patients who need daily wound care. Other studies have reported similar findings.
• Many interview participants noted that a large number of home care agencies have closed or merged with other agencies during the past few years.
• Many agencies have instituted cost saving measures, laid off staff, instituted additional case management procedures, increased nurse productivity standards, and changed their geographic service areas in an attempt to respond to IPS and other regulatory changes.
• Many agencies are pursuing ways to diversify their payer sources, seeking to shift their case load more toward Medicaid and managed care and away from Medicare.
• Agency administrators noted a reduction in physician referrals to home care.

C. CONCLUSIONS

The field of home health care has seen dramatic changes over the past several years. Since the collection of the data used in this study, several major regulations have been implemented that are expected to have a powerful impact on the practice of home health care. The implementation of the home health PPS in October 2000 has provided agencies with strong incentives to reduce the number of visits provided to patients and to find other means of minimizing the cost of care. These incentives have the potential to lead to underservice and poor patient outcomes. On the other hand, the 1999 implementation of OASIS data collection and transmission requirements and the more recent generation of case mix, adverse event, and outcome reports focus agency attention on the quality of care they provide, perhaps lessening the likelihood of underutilization of care. The findings from this study provide a baseline of information on practice patterns during the IPS period, allowing researchers to identify the impact of the implementation of PPS and other recent federal regulations.

NOTES

1. Alternative services represent those services coordinated by an agency, but provided by another organization in the community.

2. This variable reflects whether the primary care provider received feedback from other agency personnel regarding (1) the appropriate frequency of skilled nursing visits, (2) whether aide services should be provided, and (3) when discharge should occur.

3. The methods that obtained information on provider perceptions, noted earlier, were the focus group and case study interviews as well as interviews of state home care association representatives and study agency administrators.