Below includes directly quoted transcriptions from parts of McKinsey’s article, so the below content is attributable to McKinsey and its authors Oleg Bestsennyy, Michelle Chmielewski, Anne Koffel, and Amit Shah. PlanEasy has only reorganized and highlighted what it believes are key parts of the article. Please see the full article in full for completeness and proper context: From facility to home: How healthcare could shift by 2025
Up to $265 billion worth of care services for Medicare fee-for-service and Medicare Advantage beneficiaries could shift to the home by 2025
How the COVID-19 pandemic has catalyzed Care at Home
- Growth in virtual care
- More patients with post-acute and long-term care needs may be evaluating their options
- Emergence of new technologies and capabilities
- Growing investment in the digital health market
Care at Home may deliver more value and higher-quality care
- Care at Home could leverage digitally enabled interventions to address the physical, behavioral, and social needs of patients
- Care at Home could generate substantial value for stakeholders, but the benefits and costs may vary
- Potential benefits and costs for Care at Home by segment:
Potential benefits and costs for Care at Home by segment:
1. Payers
Potential benefits: Lower medical costs from reducing preventable adverse health events and leveraging a lower-cost site of care; Revenue benefits from enhancing quality performance, improving clinically appropriate and accurate risk coding, and improving patient experience
Potential costs: Reimbursement for Care at Home services; Potential induced demand through more convenient care
2. Healthcare facilities
Potential benefits: Any savings opportunities from value-based payment arrangements or reimbursement for any Care at Home services if provided; Margin benefits from freed-up capacity if it currently does not exist for patients who need facility-based care
Potential costs: Potential lost reimbursement or lower reimbursement if Care at Home provided instead of care in a facility; Any costs to partner with other providers to deliver Care at Home services or to deliver them internally if provided
3. Care at Home providers, technology companies, and investors
Potential benefits: Potential to capture substantial market opportunity
Potential costs: Investment costs; Variable costs from delivering Care at Home products
4. Patients
Potential benefits: Reduction in preventable adverse health events; Closure of care gaps from enhanced care; Lower-cost site of care; More convenient care
Potential costs: Limited
Where care could shift from traditional facilities to the home
- 1. Services with capabilities in place that may benefit from scaling
- 2. Services where capabilities exist that could be stitched together into a comprehensive offering
- 3. Services with some capabilities but others that could be further developed
Factors that could affect adoption
- First, stakeholders will need to evaluate which services can be delivered at home to treat patients’ physical, behavioral, and social needs effectively
- Second, adoption could depend on the economic viability of Care at Home
- Third, physician awareness, perceptions, and capabilities may be factors. Physicians could learn about the capabilities of Care at Home, investigate case studies and results of how high-quality care
- Finally, adoption will depend on how patients feel about Care at Home. Patients could be made aware
How to accelerate growth:
1. Payers
- Develop a value-backed Care at Home strategy
- Redesign benefits to support direct delivery of Care at Home
- Create awareness and provide training and education to providers
- Develop a network of high-value Care at Home providers and technology companies, as well as community-based organizations
- Expand reimbursement policies
- Adopt utilization-management policies
- Leverage care management to raise awareness of Care at Home options with members
2. Healthcare facilities and physician groups
- Create value-backed Care at Home strategy
- Develop Care at Home clinical models to deploy with patients
- Establish partnerships with other providers or technology companies that can provide Care at Home or enabling services
- Establish contracts with payers to ensure that Care at Home services are reimbursed in an economically viable way
- Develop analytics to identify patients who would benefit from Care at Home
3. Care at Home providers, technology companies, and investors
- Develop business cases or investment theses
- Evaluate opportunities
- Implement theses
ABOUT THE AUTHOR(S)
Oleg Bestsennyy and Amit Shah are partners in McKinsey’s New York office, Michelle Chmielewski is an associate partner in the Chicago office, and Anne Koffel is a partner in the Boston office.
This article was written in collaboration with the McKinsey Clinical Center of Excellence, with substantial input from Omar Kattan and Jordan VanLare. The authors also wish to thank Rafael Mora and Yuqi Shi for their contributions to this article.
These materials do not constitute legal, medical, policy, or other regulated advice and do not contain all the information needed to determine a future course of action. This report and its findings are meant to be an analysis of trends seen in pre-acute, acute, and post-acute care and are not meant to reflect or imply preference of any particular model. While Care at Home is one growing option in pre-acute, acute, and post-acute care, care delivered in facilities will continue to have value and may be the right choice for individuals and their families.