1. Informing Medicare Policy on Post- acute Care: The “Missing Million” AcademyHealth 2004 Annual Research Meeting Sharon Bee Cheng, MS Christopher Hogan, Ph.D. www.medpac.gov

2. 2 Key points Between 1996 and 2000, the number of beneficiaries who used home health fell by one million Across post-acute care, payment systems were changing. Fraud and abuse was reduced; eligibility changed. The greatest reductions in home health occurred among those with the lowest likelihood of use.

3. 3 Rationale A rapid, large decline in use of health care services could be indicative of access problems. As an agency charged with helping to assure Medicare beneficiaries’ access to care, we sought to understand the “missing million” phenomenon.

4. 4 Study questions What changes took place in the use of all post-acute care services from 1996 to 2001? Were certain types of vulnerable beneficiaries excluded from the home health benefit?

5. 5 Study Sample Used the 5 percent Standard Analytic File of Medicare fee-for-service claims for calendar year 1996 and 2001 for -Home health agencies -Skilled nursing facilities -Long-term hospitals -Rehab hospitals and units -Psychiatric hospitals and units

6. 6 Episodes of care All post-acute provider claims following the discharge date were part of the episode until the episode ended. Episodes end: With a break of at least 31 days,or Readmission to hospital, death, or hospice.

7. 7 Study design Identified all episodes by diagnosis related groups and then grouped them by their rate of use of any post-acute care in 1996. We then compared the rate of use for the groups in 1996 and in 2001.

8. 8 Conclusions Use of other settings increased or stayed the same as home health use declined. Those with more clearly-defined needs experienced less decline.

9. 9 Decline in post-acute episodes driven by home health Type19962001Change HH Only108,52959,101-46% SNF Only52,71067,64728% SNF + HH21,52318,745-13% LTCH, Rhb, Psy23,51731,16333% Other Mixed8,0369,37217%

10. 10 High-spending states had greatest declines Quintile of 1996 $$/ per capita Total per capita spending, 1996 Change 1996- 2001 High$1,454-29% 2$957-5% 3$789-3% 4$667 0% Low$535 18%

11. 11 Other demographics Mid-Atlantic states had the greatest increase in total post-acute spending; West South Central had the greatest decline Differences in the average number of days of post-acute care across urban and rural settings in 1996 narrowed in 2001.

12. 12 High-post-acute-use groups increased post-acute use in ‘01 Episodes in DRG with use ’96 Percent of use 1996 Percent of use 2001 Percent change Most episodes8284 +3 60-80 percent6865 -4 40-60 percent4741 -12 20-40 percent2922 -22 Few episodes139 -32 For post-acute use following hospitalization

13. 13 Reductions smaller for groups with high predicted home health use Percentile of predicted use Predicted use Actual useRatio, actual to predicted 50 th --- 60 th 4.51.50.34 60 th – 70 th 6.62.10.32 70 th – 80 th 9.23.60.39 80 th – 90 th 13.86.20.45 90 th – 100 th 25.213.70.54 For home health use not following hospitalization

14. 14 Next steps Add 2002 and 2000 claims Identify dually-eligible beneficiaries Compare outcomes across settings