Healthcare Horizons

Disruption Alert: Mayo’s Hospital at Home Program

By Dawn Carter

Mayo Clinic recently published some surprising results from its hospital at home program featuring centralized care for nearly 700 patients separated by more than 1,000 miles. Beyond the encouraging clinical and business results, we see the likelihood for large-scale disruption in the healthcare industry.

The Background

Academic medical centers were early adopters of hospital at home, so prior studies of the model have focused on urban settings. But with hospital facilities scattered across several states, Mayo Clinic wanted to see if its branded approach, Advanced Care at Home (ACH), was scalable and effective in both urban and rural communities.

Like other hospital at home programs, Mayo’s ACH model features four basic components: 1) regular home visits by doctors and/or advanced practice providers during the most acute phase of a patient’s care; 2) additional in-person support by community-based care providers – RNs, paramedics, radiology technicians, and more; 3) a personalized technology suite set up in the patient’s home;  and 4) a digital platform tying the pieces together.

Mayo’s main differentiator in this study was redefining “home visits” for physicians and APPs. Rather than physically showing up in a patient’s living room, providers based in a Florida command center conducted virtual visits several times a day. Some patients were nearby, in the greater Jacksonville area, but others were located more than 1,400 miles away.

Other “hybrid” programs have incorporated some level of virtual care, but providers and patients were physically located in the same geographic area. As far as I can tell, Mayo is the first to experiment with a hospital at home program that provides virtual care over a vast distance – and the implications are huge.

The Results

For this study, Mayo enrolled 408 home hospital patients in urban Jacksonville, FL, and 278 patients in rural Eau Claire, WI. Outcomes were similar – and encouraging – across both settings:

In general, those outcomes compare favorably with traditional inpatient care, but Mayo’s ACH model, like other hospital at home programs, is more efficient for staffing and overhead.

As NPR noted in a recent story, Mayo’s virtual command center in Jacksonville is staffed with just 20 doctors and nurses to care for up to 150 patients at a time. “By comparison, the gleaming white hospital across the street is 20 times bigger and operates with eight times the health care staff — but can treat only double the number of patients.”

Mayo underscores the affordability argument in its study:

“The patient volumes seen by providers are greater than what was previously reported in other hospital-at-home models. These findings may lead to this model being more affordable than traditional inpatient care or previous hospital-at-home programs. Additionally, there are significantly less fixed costs in operating a home hospital program than a physical hospital would incur.”

Three Lessons from the Mayo Study

Regardless of location, patients’ health outcomes were largely the same, which suggests that virtual visits are just as safe and effective as physical visits. I predict that could fundamentally disrupt the healthcare industry within a decade – but first, here are three more immediate takeaways:

First, re-think your assumptions about acuity. Historically, most hospital at home patients have been admitted for conditions such as COPD or moderately severe infections, but Mayo’s ACH program has raised the acuity bar. As the authors point out:

“With our hospital at home model, we were able to go beyond typical diagnoses seen in home hospital models and treat increasingly acute patients in their homes, such as bone marrow transplant patients on day-1 following transplant.”

Second, consider a strategy for reduced length of stay. Most hospital at home programs are billed as a way to keep patients out of the hospital entirely, but Mayo also had notable success at shortening the stay of patients who spent “at least one midnight” in a brick-and-mortar facility.

When acute home patients reached a stability level that would qualify them for discharge from a physical facility, Mayo offered the option of continued “restorative care” with regular check-ins from the command center team. Nearly 8 in 10 took the offer, which indicates “patients’ desire to have an ongoing connection to their healthcare team along their healthcare journey,” according to the study.

For health systems where length of stay is an issue, hospital at home might be part of the answer.

Finally, don’t discount hospital at home programs in rural areas. Mayo’s study suggests that patients in rural and urban areas will benefit almost equally from hospital at home programs – with little difference in cost.

Rural providers have sometimes assumed that a more far-flung population would make these programs financially untenable, but that assumption is based on physical visits to the home. With a hybrid program like ACH, where the most expensive professionals are making virtual rounds, the cost of providing in-home hospital care is less sensitive to population density.

(Mayo isn’t the only provider testing rural hospital at home programs. On June 22, I’ll be part of a NOSORHpanel discussing early results from a multi-year study at Appalachian Regional Healthcare in Kentucky. I’ll have more to share on that soon.)

What’s So Disruptive About Hospital at Home Programs?

Since at least 2008, the “triple aim” of the U.S. healthcare system has been a better patient experience, better population health, and lower costs. Hospital at home programs satisfy at least two of those aims, because delivery costs are lower, and most patients prefer to receive care in their home. (I’d say the jury is still out when it comes to population health.)

Hospital at home programs currently operate under a waiver that expires in 2024. If studies continue to show that the model can reduce costs while achieving health outcomes that are better than brick-and-mortar facilities, I’m certain that Washington will create a permanent authorization.

Once that happens, I think the healthcare map could get fundamentally redrawn as hospitals rush to affiliate in a hub-and-spoke system – a term that appears often in the Mayo study:

“This hub-and-spoke mechanism of the home hospital model used at Mayo Clinic promotes both safety and scalability. The vendor-mediated in-person medical supply chain can be established separately from the central institution housing the command center, covering a much larger geographic area or even different cities.”

In this instance, the Mayo “hub” owns two hospitals 1,400 miles apart, and each oversees a complex supply chain providing “last mile” services at their end of the spoke. But the “spoke” hospitals don’t have to be owned Mayo. With the right contractual agreements, any local facility could affiliate with a distant command center to offer hospital at home without a long ramp-up period or a large technology investment.

Essentially, any local ED could become the “front door” to a massive virtual hospital. Local providers would admit patients and administer all the vendor contracts needed to deliver in-home support, but most high-salaried professionals would be located off-site (and largely off the income statement).

Pressures Above and Below

Why would smaller hospitals and health systems decide to become just another part of the “medical supply chain”? Though there might be significant resistance, I can imagine both bottom-up and top-down pressures to adopt the hub-and-spoke model.

Starting from the bottom, I expect to see pressure from consumers. Consumerism is one of the biggest drivers of healthcare transformation, and a key part of the Ascendient Healthytown model. We know that most consumers would prefer to stay out of the hospital, so if they have the option of a home admission or a brick-and-mortar admission, which are they likely to choose?

If hospital at home hasn’t yet achieved high consumer demand, that’s partly because in-person models are difficult to scale. For instance, Presbyterian Medical Group has been offering hospital at home since 2008, yet it’s managed to reach only a few thousand patients because care can be provided no more than 25 miles from a brick-and-mortar hospital.

Hybrid hospital at home could make such limits obsolete. With private equity investing heavily in technology platforms – and big names like Mayo already on board – I believe hybrid models could expand quickly once the waiver issue is resolved.

For instance, Mayo boasts a network of three dozen independent hospital affiliates, many in remote places like Billings, MT, or Yuma, AZ. Those providers may not have the resources to stand up a full-fledged hospital at home program, but what if they could simply plug into the existing hub of their network partner?

Suddenly, tens of thousands of new patients would have a viable option for in-home care, and that could immediately pressure nearby competitors: If a Montana resident lives halfway between emergency departments in Billings and Bozeman, but only Billings offered the possibility of hospital at home, which ED is she likely to choose?

As for top-down pressures, I think the big “hub” systems will actively recruit smaller providers for the simple reason that “spokes” can provide them with a whole new patient population for more expensive services. They Mayo study was fairly explicit about the potential of virtual handoffs for tertiary care:

“The virtual physician capability of this program creates a mechanism to potentially transfer a patient from one group of virtual providers to a separate group of more specialized virtual providers. For example, a rural physician could transfer oversight of their home hospital care to a physician more commonly staffed at a tertiary care center that may have more subspecialized expertise than the original provider, all while the patient remains at home in the home hospital model of care and they do not need to physically transfer to a different location for more specialized care.”

This creates an interesting scenario, to my mind. Today, the most vulnerable hospitals are usually the smallest ones, often located in rural areas. The size of their market doesn’t merit new investment, but without investment they continue to lose market share. That’s a death spiral that might be interrupted with the expansion of hybrid hospital at home programs.

If giant systems, eager for more tertiary patients, start actively recruiting struggling hospitals into their hub-and-spoke networks, that could be great for the little guys, who would save thousands of dollars on every admission while cutting the overhead costs of physical space.

But if patients opt to “stay local” with a hospital at home program, it could put mid-market tertiary providers at risk. The longstanding pattern has been for better-insured patients to bypass their local hospital due to concerns about quality of care. What happens if that pattern is reversed? If a patient believes he can get Mayo-level care in his town of 15,000, why would he drive an hour to check into a tertiary hospital with no name-brand cachet?

It’s hard to know exactly how all of that will land, but a nationwide hub-and-spoke system does seem fundamentally different from what we have today, so winners and losers are inevitable.

Conclusion

 I’ve used the word “quickly” several times, but of course, that’s a relative term in healthcare. I think very little will happen before hospital at home wins permanent authorization – probably late in 2024 – and then there will be lingering questions of reimbursement and state regulations.

Still, I think hospital at home programs will grow very quickly once the structural issues are resolved. This is a model that seems to show promise for almost every stakeholder group in healthcare, so payers, providers, and technology companies will all push for expansion.

How can smaller hospitals and health systems prepare? I think the first thing is to check some assumptions at the door:

• Don’t assume hospital at home won’t work in your area.
• Don’t assume you can’t afford it.
• Don’t assume you have to do it by yourself.

Technology-enabled partnerships will bring hospital at home within reach for every community – but the key will be finding the best partner before your competitor does. Start now to strengthen your ties with local services like EMS and home health; they’ll be crucial allies when partners come calling.

Think too about your numbers: Model what your finances would look like with X savings for Y admissions. Look at your current admissions and your bypass rates for key services, then model the financial impact of incremental improvements. Research the tertiary revenue that your primary service area is funneling to other systems – that’s money that a “hub” provider would love to capture.

And if you need a thought partner as you consider the implications of hospital at home in your local market, don’t hesitate to contact us here at Ascendient.

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