Patients in nursing homes after hospitalization have better outcomes at specialized facilities

A new study by LDI associate fellow Zachary S. Templeton and LDI executive director Rachel M. Werner finds that death and readmission rates are lower but stays are longer and Medicare costs are higher.

People who temporarily stay at a nursing home for short-term, post-acute care—rehabilitation and recovery after a hospitalization—may be better off at facilities that specialize in this service. They have lower rates of death and hospital readmissions than people who get post-acute care in less-specialized nursing homes.

A nursing home worker pushing a patient in a wheelchair.
Image: iStock/Wavebreakmedia

The better outcomes, however, come with a tradeoff of longer nursing home stays and higher spending by Medicare, according to a new study by LDI associate fellow Zachary S. Templeton and LDI executive director Rachel M. Werner.

In general, nursing homes care for two types of people. Some are short-term patients who need post-acute care after hospitalization for surgery, illness, or injury. They receive skilled nursing services such as wound care or physical therapy before returning home. Other patients are long-term residents of the nursing home who receive less intensive care involving help with daily activities.

Medicare mainly pays for short-term care and Medicaid pays, at a lower rate, for long-term care. Some nursing homes admit more short-term, post-hospitalization patients—and receive higher payments for them—so Templeton, Werner, and coauthors asked how post-acute care specialization affects patient outcomes and costs.

They used Medicare data on more than 12 million nursing home admissions from 2011 to 2018 to investigate hospital readmissions and deaths within 30 days of hospital discharge, and Medicare costs. Nursing homes mainly financed by Medicare were considered to specialize in post-acute care. Those mainly financed by Medicaid were considered less specialized.

Relative to patients at less-specialized facilities, patients at nursing homes specializing in post-acute care had 7% lower rates of death and 2% lower rates of hospital readmission. Patient stays in specialized nursing homes were 10% longer, though, by about three days. Their stays cost Medicare $1,200 more, for all payments within 90 days after hospital discharge, than patients in less-specialized facilities.

Supporting the results, the authors found that as individual nursing homes changed their level of specialization over time, patient outcomes and costs corresponded, with length of stay and costs rising and mortality and readmission declining as specialization increased.

The results highlight the complex balance that nursing homes and policymakers must consider when determining the mix of post-acute and residential services that facilities should provide.

This story is by Chris Tachibana. Read more at Penn LDI.