Nursing home volumes taking longer to recover than home health

Even as home health providers had recovered most of the volume lost during the pandemic by July, a new study finds skilled nursing volumes had not seen nearly the same improvement.

The analysis by consultancy Avalere Health found the skilled nursing industry suffered a bigger volume hit than home health providers at the height of the COVID-19 pandemic and patients are taking longer to return to nursing homes. In July, skilled nursing facilities were taking in 34% fewer Medicare fee-for-service patients from hospitals compared with a year earlier. Home health’s volumes from hospital discharges, meanwhile, were down just 1.8% in that time.

The pandemic has prompted people to avoid residential facilities for older adults, including skilled nursing facilities, and the trend could stick around even after the pandemic subsides. COVID-19 exposed longstanding infection control and staffing problems in skilled nursing facilities and other long-term care facilities.

Early on in the pandemic, there were significant restrictions on getting into skilled nursing facilities, said Fred Bentley, an author of the study and managing director at Avalere.

“But above and beyond that, there is increased concern on the part of patients, family members and clinicians around, ‘Does it make sense to send the patient to a SNF? Is it possible to send them home instead?'” he said.

Both skilled nursing and home health providers started to see volumes plummet in February as their major referral source—hospital inpatient discharges—also dried up, Avalere found. Hospital inpatient discharges were down 4.3% year-over-year in February, bottoming out at -33.5% in April and recovering to -19.3% in July.

Avalere’s findings show home health enjoyed a sharp recovery starting in May, when volumes from hospital discharges were down just 6.8%, compared with a low of -23% in April. In June, those volumes were actually up 4.6% over June 2019.

It’s been a much different story for skilled nursing facilities. While they also bottomed out in April at -36.4% of prior-year volumes, the recovery hasn’t been nearly as dramatic. Discharges to skilled nursing facilities were down 35.1% year-over-year in May and down 25.4% year-over-year in June, before dropping again the following month.

In the short run, it appears home health providers are picking up patients that otherwise would have gone to nursing homes, Bentley said. It’s too early to say whether that trend will persist long term. For some very complex patients, he said skilled nursing facilities have capabilities and clinical expertise to manage their needs that home health providers do not.

The baby boomer generation is also nearing its peak healthcare utilization years, with signs pointing to a fairly sick elderly population who will need the services skilled nursing facilities provide, Bentley said.

“It is very premature to think this is a fundamental realignment that’s playing out in terms of where patients go for post-acute services,” he said.

Avalere’s findings mirror hiring trends in both sectors. Employment in skilled nursing facilities was down by an estimated 7.7% in August from January. Home health hiring was down 3.6% in that time.

Depending on continued COVID-19 surges in some areas, Avalere said it’s possible some post-acute providers won’t see their volumes completely recover in 2020 or even into 2021.

To perform the study, Avalere used clearinghouse data from Inovalon that represents up to 7% of total Medicare fee-for-service volume nationally.

The findings underscore that nursing homes and other congregate settings will continue to face serious financial strain without additional support from policymakers, the American Health Care Association/National Center for Assisted Living said in a statement. The AHCA/NCAL is a trade group representing the long-term care industry.

“These sustained declines in new patients, coupled with historic Medicaid underfunding and exorbitant resources being dedicated to fight COVID, mean many nursing homes may be forced to close, threatening access to seniors and individuals with disabilities,” the statement said.

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