The Next Decade of Healthcare Is Primed For Seismic Disruption By Hospital-At-Home

Starting in the 1800s, house calls from physicians were the norm. Traveling was too difficult for sick patients and house calls eliminated most of the healthcare costs of a standard visit. Until the 1940s, house calls were the primary modality of care. Physicians would travel with their medical supplies on foot or by horseback to treat patients in their homes. By 1942, the demise of the house call took effect when the percentage of GPs in America fell to below half. By the 1960s, physicians began sending patients to emergency rooms, using offices, and becoming more specialized. The decline continued through 1980, a year when only 0.6% of patient visits occurred in the home. Two decades later, the emergence of COVID-19 as a global pandemic revitalized the house call, giving rise to virtual models of health care delivery including acute hospital care at home.

The hospital-at-home model enables patients to receive acute-level care in the comfort of their home versus a hospital. Research has shown that hospital-at-home can improve the triple-aim and reduce health disparities. Hospital-at-home gained the greatest momentum in 2021 due to the launch of the “Hospitals Without Walls” program in March 2020. This later expanded into the Acute Hospital Care At Home program eight months later.

In today’s modern era of healthcare, the house call is making a comeback with the help of technology including telehealth, proprietary EHR platforms, remote patient monitoring devices, portable diagnostic imaging equipment, and more. There are 84 systems, 188 hospitals in 34 states approved for the Acute Care at Home waiver program that allows Medicare payments for additional services provided in the home. Home health care providers are increasing their involvement with a number of emerging models that organize and pay for care differently under the Patient Protection and Affordable Care Act, such as Accountable Care Organizations and bundled payment arrangements. The evolution of start-ups and pre-existing hospital-at-home programs like Biofourmis, Contessa, Current Health, DispatchHealth, and Medically Home are shaping the market and reaching new frontiers of virtual care. Forrester interviewed each of these vendors as part of our research.

Acute care will happen at home first for patients, hospital second 

By the next decade, hospital care will be limited to the completion of invasive procedures, the treatment of intensive care patients, and individuals that cannot possibly have home health care. This includes patient populations that lack access to broadband internet and a safe home environment for care delivery. As utilization of physical assets decreases, hospital closures will continue at a rapid pace, and health insurers will quickly swoop in to buy up assets to control the cost of care for their members.

Hospital-at-home care is a matter of patient-centricity and necessity

The American healthcare system has reached a critical tipping point in the management of clinical practices for hospitalized patients. The surge of the adult population will significantly challenge the American healthcare system, ultimately escalating the demand for more hospital-at-home programs.

  • Hospital expenditures composed 31.4% of 2019’s $3.8T spend. Hospital expenditures grew 6.2% to $1.19 billion in 2019, a 4.2% increase from 2018. In 2016, there were 7 million hospital stays in the U.S., with a rate of 104 stays per 1,000 population. This resulted in over $417 billion in spending with a mean cost per stay of $11,700. The 20 year trend of rising hospital expenditures is expected to continue.

 

  • Every year approximately 400,000 hospitalized patients experience some type of preventable harm including medical errors which cost approximately $20 billion. On any given day, 1 in 31 of U.S. hospital patients has a health care assocaited infection. This contributes to $28.4 billion in direct medical costs and an additional $12.4 billion in costs to society attributed to premature deaths and lost productivity.

 

  • The growth of an aging American population will compound this staggering dilemma in health care. In less than two decades, older adults are projected to outnumber children for the first time in U.S. history. Starting in 2030, the elderly will comprise 21 percent of the population. The US Census Bureau projects by 2060, nearly one in four Americans will be 65 years and older, the number of 85-plus will triple, and the country will add a half million centenarians.

The past 20 months were a catalyst for change that justified the rationale for avoiding hospital stays whenever possible. The lessons learned by hospital facilities during the pandemic echoed the importance of surge planning along with a need for establishing an alternate method of delivering hospital-level care. Ecosystem stakeholders are reaping the benefits of moving care back to the home including cost savings, patient satisfaction, and improved outcomes. The expansion of coverage by government and commercial payers will continue to usher in a home-based future for the chronically ill and the elderly.

Hospital-level care at home will continue to improve a multitude of patient outcomes.

The benefits of hospital-at-home care include improved mortality, decreased readmissions, decreased length of stay, significant cost reduction, improved functional recovery, overall positive evaluations, lower levels of family member stress, and increased patient satisfaction. In the future of healthcare, the hospital-at-home model will be the most innovative and pragmatic solution for mitigating spiraling healthcare costs, an insurmountable influx of patients, the spread of infectious disease, and the safety of patients and hospital staff.

This past year, Forrester’s healthcare team interviewed the industry’s leading hospital-at-home vendors and virtual care innovators. Our upcoming research will help your organization prepare for the shift of acute care into the home with the right virtual care strategy and technology. Stay tuned as we dive deeper into the future of hospital-at-home and provide valuable insights as the hospital-at-home market increases in size and maturity. Are you ready for the most monumental disruptor of the healthcare industry?

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