Health Economic Analysis of an All-Virtual, At-Home Acute Care Model.

Importance: An all-virtual, at-home acute care model, called Safer@Home, was found to enable an average 4-day reduction in hospital length of stay. The program is not currently reimbursed. Objective: To estimate costs and savings associated with the Safer@Home program from a hospital and payer perspective. Design, Setting, and Participants: This retrospective, economic evaluation analyzed costs associated with the Safer@Home program at a large, academic, public, level I trauma hospital near downtown Los Angeles, California, between September 2022 and August 2023. Patients with 1 of 10 protocolized diagnoses were eligible for the program. Data analysis occurred from January to July 2024. Exposure: Patients who presented to the hospital and were enrolled in an all-virtual, at-home acute care program called Safer@Home were compared with matched controls with similar diagnoses who received entirely in-hospital care. Main Outcome and Measures: The primary outcome was estimated net hospital and payer cost with the program vs without. Revenue from third-party payers was compared with hospital variable costs. Results: A total of 876 patients receiving care in the Safer@Home program (541 male [61.8%]; mean [SD] age, 54 [15 years]; mean [SD] expected mortality, 1.6% [4.7%]; mean [SD] case mix index, 1.27 [0.66]) were compared with 1590 matched control patients (901 male [56.7%]; mean [SD] age, 52 [20] years; mean [SD] expected mortality, 1.9% [5.9%]; mean [SD] case mix index, 1.26 [0.59]). Safer@Home enabled net hospital savings of $5.60 million, calculated as variable costs saved minus revenue lost, for the enrolled patients. Overall savings were due to net savings for Medicaid ($8380 per patient) and unfunded patients ($10 934 per patient), but net losses were due to significant loss of revenue for Medicare (-$4143 per patient) and commercially insured patients (-$25 999 per patien). Modeling demonstrated that revenue based on payer mix, rather than avoided variable hospital costs, was the primary factor of net hospital savings and losses. Absent reimbursement, the program was cost-saving to payers in all modeled scenarios. Creating reimbursement rates of 50% to 60% of hospital costs would enable the program to be cost-saving to both the hospital and payers, across payer mixes. Conclusions and Relevance: In this economic evaluation study, an all-virtual, at-home acute care program was associated with both hospital and payer savings; however, in the absence of reimbursement, it was only cost-saving to hospitals for Medicaid-funded or uninsured patients. These findings suggest that payer reform is needed to enable program generalization.