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Projected Savings and Workforce Transformation from Converting Independence at Home to a Medicare Benefit

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Journal of the American Geriatrics Society

Published online on

Abstract

The Independence at Home (IAH) Demonstration Year 1 results have confirmed earlier studies that showed the ability of home‐based primary care (HBPC) to improve care and lower costs for Medicare's frailest beneficiaries. The first‐year report showed IAH savings of 7.7% for all programs and 17% for the nine of 17 programs that surpassed the 5% mandatory savings threshold. Using these results as applied to the Medicare 5% claims file, the effect of expanding HBPC to the 2.2 million Medicare beneficiaries who are similar to IAH demonstration participants was projected. Total savings ranged from $12 billion to $53 billion depending on the speed and extent of dissemination of HBPC among this IAH‐like population. Using a fixed growth rate, as hospitalists experienced in their first decade, 35% coverage would be achieved at the end of 10 years, with total 10‐year savings through IAH reaching $37.5 billion and $17.3 billion accruing to the Centers for Medicare and Medicaid Services as a net reduction in overall expenditures, with $12.6 billion from Medicare Parts A and B savings.