Up to $265 billion worth of care services for Medicare fee-for-service and Medicare Advantage beneficiaries could move from traditional facilities to the home by 2025. This is according to a new report from management consulting firm McKinsey & Co.
The $265 billion represents up to 25% of the total cost of care, the report found. It marks a three- to four-fold increase in the cost of care being delivered at home today for this population, according to the report.
While traditional home health remains the largest segment, emerging home care subsegments such as home infusions, home-based dialysis, primary home care and hospital-at-home are growing fast, another recently released McKinsey report found. Consumer preferences are accelerating the push to home, and growing incentives across the healthcare industry are encouraging the shift. The Centers for Medicare & Medicaid Services’ recent regulatory changes also are expected to further drive momentum, according to the report.
The pandemic has catalyzed the move to home care, according to McKinsey. COVID-19 forces include the growth in virtual care, more baby boomers and families evaluating their options and leaning toward home, the emergence of new technologies and capabilities such as remote patient monitoring and a growing investment in the digital health market.
To help accelerate the adoption of care-at-home service, McKinsey recommends that home care providers, technology companies and investors develop business cases for investments in new areas such as primary telehealth care, in-home dialysis and remote monitoring; evaluate opportunities for partnerships with providers and technology companies; and implement theses with providers and technology companies creating new offerings.