Health care comes home for savings - includes related articles on finding the right home care agency, and the importance of accreditation

Business & Health, Nov, 1989 by Linda Puig

Health care comes home for savings

Advances in technology are making it possible for patients to be treated in the comparatively inexpensive comfort of their own beds, instead of in a high-cost hospital setting.

Joanne Pettitt's newborn seemed fine until one hour after birth, when the baby girl turned blue. That was the start of a heart-rending health care saga in which Nicole, now 3 1/2, so far has undergone 20 surgeries, has survived eight respiratory arrests, and sometimes seems to spend more time in the hospital than out of it.

Nicole was the victim of multiple birth defects in six separate categories. Ordinarily, she would have been confined to a hospital during the entire course of treatment. Instead, thanks to a home health care program arranged by Pettitt's employer, Illinois Bell, Nicole was able to go home between surgeries.

The program worked to everyone's advantage. Nicole received professional care in a "normal" home setting, albeit under the supervision of a nurse backed up by the latest in portable medical equipment. Pettitt, who lives in the Chicago suburb of Evergreen Park, was able to return to work and thus maintain her medical insurance. And self-insured Illinois Bell kept an already astronomical bill for Nicole's treatment from going even higher.

Illinois Bell's Senior Director-Benefits Bill Watson estimates that the company saved at least $240,000 on Nicole's treatment by using home health services.

In addition, says Nicole's mother, "I saved money for the company they don't even know about because I refused to let some unnecessary medical procedures happen. Also, I was back on the job quicker with home nursing care and there were fewer days that I had to leave early."

Employers turn to home care

The Pettitt case shows how employers are using home health care to cut costs and get workers back to the office sooner. In the past five years, a significant number of medium to large employers have added home health benefits. According to a 1988 U.S. Bureau of Labor Statistics survey, the percentage of workers covered for home health has increased from 37 to 76 percent in just five years.

This article explains what home health care is all about and employers' role in setting up a program. It examines some successful company-sponsored and HMO programs in operation around the country. Also discussed are what should and shouldn't be covered, how to protect your workers and their families from unscrupulous home health agencies, and how to avoid liability.

Why the home health boom?

One reason for the increasing interest in home health care is advanced technology. More and more machines and procedures are available for home use. These include oxygen tents, breathing monitors, phototherapy for jaundiced babies, infusion pumps for medication, implantable catheters, and kidney dialysis--all of which can be administered more cheaply and comfortably at home.

"Home care as a form of health care delivery has tremendous cost savings potential," says John Sforza, executive director of the Miami-based Florida Health Coalition, a group of employers. "It's a well-documented fact that many health care services can be provided less expensively, and more comfortably, in patients' homes rather than in the hospital. But," he warns, "as with any product or service, true cost savings don't happen if quality drops along with the price tag."

In fact, as the industry progresses, employers are looking for ways to make informed choices about quality home care--to lower the potential for fraud, abuse, mismanagement, and substandard treatment through careful screening and professional accreditation.

What is home health care?

Home care comprises the medical and social, or "custodial," services available to recovering, disabled, and chronically ill people. Services can be provided by visiting nurse associations, private and hospital-based agencies, nursing homes, rehabilitation facilities, or equipment companies.

The Washington-based National Association for Home Care estimates that 10,848 such agencies were in business last year. Americans spent $6.8 billion on their services in 1988, more than doubling the $3.3 billion spent in 1983. The home care trade organization projects spending on home care will shoot up to $14.2 billion per year by 1995, says Lauren Sims, NAHC's communications director.

What's usually covered?

Most employer-sponsored home health care benefits cover professional home services, such as skilled nursing care, therapies (physical, occupational, speech), and medical equipment and supplies, says Daniel R. Thomas, an assistant director of the Insurance Managed Care and Provider Relations Division of the Health Insurance Association of America. Some policies also cover visits by health aides and physicians.

Relatively few policies, however, cover the social and custodial services that are usually provided by paraprofessionals, Thomas says. Those include: homemaker and personal care, home-delivered meals, heavy and light chores, companion services, transportation, social day care, protective services, and respite care. Because of the current crisis in runaway health costs, Thomas doesn't expect these items to be added to employer-sponsored coverage in the near future. "Frankly, I would think we would be lucky to maintain the kind of coverages that we have. I tend to think that so long as services like homemaker services are not considered absolutely essential, they're probably not going to be covered."