Millions of working age Americans undergo ambulatory surgery or inpatient hospitalization each year and are mostly discharged home to recover [1]. Over one third of patients and their families face daunting challenges as they transition into the home-based recovery process. In addition to struggling to overcome physiological challenges, the lack of critical behavioral health support at home often results in readmissions and lost productivity. According to Bailey et al (2019) [2], re-admissions cost self-insured employers $80 billion annually, of which 50% are preventable.
Most employers understand that inpatient admissions are the biggest driver of healthcare claims costs. However, few dedicate resources to improving employees and dependents recovery post-discharge as a standalone target for care management, despite the proliferation of disease management programs in place for specific conditions such as diabetes, mental health, or maternity. Using a national claims database, we aimed to understand post-discharge patient transitions and the costs related to these transitions from the employer perspective.
Methodology
This study analyzed a sample of administrative claims data from the 2015-2016 IBM MarketScan dataset consisting of 3.5 million commercial members nationwide. MarketScan is a large, well-respected, widely-used, nationally representative database sourced from large employers and health plans. The database contains eligibility, utilization, and cost data for employees, spouses, and dependents covered by employer-sponsored private health insurance.
Our objective was to understand patient journeys and related costs post-discharge from inpatient admissions. We defined the term “readmissions” broadly to include all admissions that occur within a 12 month period following the initial admission. Our analysis entailed the following steps. We first identified members with inpatient stays during calendar year 2015. The member’s discharge date from their (first) inpatient stay is the member’s index date. We then tracked all the member’s care settings (Skilled-nursing Facility; Home health; home). Finally, we recorded each member’s experience including cost, presence of mental health or substance use issue, and sites of service utilized during the following 12 months post-index date. Each patient experience is divided into 3 periods: 1- 30 days, 31-90 days, and 91-365 days.
Results
Analysis of MarketScan data of 3.5 million commercially-insured individuals found healthcare expenditures to be costly, totaling $16.4 billion annually or $455 per member per month (PMPM). Four percent of the population had inpatient stays, and the average cost of admissions (allowed charge) was $20,670.
Figure 1 illustrates the membership and cost distributions for all patients post-discharge. Of the four percent of members who are admitted per year, seventeen percent (17%) undergo re-admission within 12 months post discharge. However, these readmitted patients account for nearly two-thirds of the cost of all discharged patients during those 12 months. On the other hand, two-thirds of discharged patients remain in the home / self-care setting post discharge, and account for less than twenty percent of the total cost.
Figure 1: Relative frequency and costs post-discharge
Figure 2 below shows the patient journey of a patient discharged home. The analysis shows that eighty percent (80%) of discharged patients (112,241 total represented by the green bar) are discharged to home (without home health support). During the first 30 days post-discharge over fifteen percent (15%) of these patients transition to other settings of care as indicated by the orange and red bars. Over the balance of the year more patients transition and escalate to costlier settings, resulting in transitions of forty percent (40%) of the patients initially discharged home. Only sixty percent (60%) of patients discharged home remain home without transitioning to a more-intensive place of service.
Figure 2. Patient Pathways: Patients Discharged Home
On an annual basis, approximately one-third of patients discharged from a hospital have a mental or behavioral health condition. Furthermore, half of patients (2,504 out of 5,481) readmitted within 30 days of discharge have a mental or behavioral health diagnosis.
Figure 3 shows the relative cost of the transitioning patients. The green bars (aggregate cost of patients discharged home who do not transition) are now relatively minor compared with those of transitioning patients (orange and red bars). This pattern is most significant when analyzed over 365 days – patients that are re-admitted cost $1.2 billion in aggregate, compared to patients who remain at home costing $0.6 billion.
Figure 3. Cost Accumulation: Patients Discharged Home
Discussion
Our analysis demonstrates the cost imposed on employers by readmissions. Although members with follow-up admissions represent a small fraction of members, they represent a significant proportion of costs.
Patients that are discharged home are often left to their own devices. A portion of these patients have follow-up admissions and are an obvious target for focused intervention. The problem for employers is the current fragmented care and lack of care coordination when patients are discharged from the hospital. Exacerbating the issue is the lack of effective mental and behavioral health solutions post-discharge. These factors drive disproportionally high cost for patients who don’t recover well or get readmitted.
Investment in effective patient-oriented interventions that augment care management has proven to achieve positive outcomes and reduce cost for employers [3, 4]. Follow-up phone calls that assist patients in scheduling their next appointments or help them order their medication have been demonstrated to decrease readmissions by 50% [5, 6]. Lower rates of preventable readmissions reduce the healthcare expenditure burden borne by employers and other stakeholders.
Conclusion
Hospital readmissions impose considerable cost on an employer and diminish productivity. More than a third of patients discharged to their home will transition into higher-cost settings over the course of a year, driving over fifteen percent (15%) of the cost of care of the entire employer population. Given evidence-based approaches to reduce readmissions, it is important for employers to prioritize recovery and readmissions as a key area to target care management efforts and implement effective post-discharge interventions to mitigate readmission rates and healthcare spending.
REFERENCES
1. Elflein J. Total hospital admissions in the United States 1946-2018. . 2020 [cited 2020 Jul 2 2020]; Available from: https://www.statista.com/statistics/459718/total-hospital-admission-number-in-the-us/.
2. Bailey MK Weiss AJ Barrett ML Jiang J. Characteristics of 30-Day All-Cause Hospital Readmissions, 2010-2016. 2019; Available from: https://www.hcup-us.ahrq.gov/reports/statbriefs/sb248-Hospital-Readmissions-2010-2016.jsp.
3. Leppin AL Gionfriddo MR Kessler M Brito JP Mair FS Gallacher K Wang Z Erwin PJ Sylvester T Boehmer K Ting HH Murad MH Shippee ND Montori VM, Preventing 30-day hospital readmissions: a systematic review and meta-analysis of randomized trials. JAMA Internal Medicine, 2014. 174(7): p. 1095-1107.
4. Burke RE Guo R Prochazka AV Misky GJ, Identifying keys to success in reducing readmissions using the ideal transitions in care framework. BMC Health Services Res., 2014. 14: p. 423.
5. Kirkham H. S Clark B. L Paynter J Lewis G. H and Duncan I, The effect of a collaborative pharmacist–hospital care transition program on the likelihood of 30-day readmission. AM. J. Health System Pharm., 2014. 71: p. 739-45.
6. Mitchell SE Gardiner PM Sadikova E Martin JM Jack BW Hibbard JH and Paasche-Orlow MK, Patient Activation and 30-Day Post-Discharge Hospital Utilization. J Gen Intern Med., 2013. 29(2): p. 349-55.
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