In successfully reducing healthcare expenditures, patient goals must be met and savings differentiated from cost shifting. Although the Department of Veterans Affairs (VA) Home Based Primary Care (HBPC) program for chronically ill individuals has resulted in cost reduction for the VA, it is unknown whether cost reduction results from restricting services or shifting costs to Medicare and whether HBPC meets patient goals. Cost projection using a hierarchical condition category (HCC) model adapted to the VA was used to determine VA plus Medicare projected costs for 9,425 newly enrolled HBPC recipients. Projected annual costs were compared with observed annualized costs before and during HBPC. To assess patient perspectives of care, 31 veterans and caregivers were interviewed from three representative programs. During HBPC, Medicare costs were 10.8% lower than projected, VA plus Medicare costs were 11.7% lower than projected, and combined hospitalizations were 25.5% lower than during the period without HBPC. Patients reported high satisfaction with HBPC team access, education, and continuity of care, which they felt contributed to fewer exacerbations, emergency visits, and hospitalizations. HBPC improves access while reducing hospitalizations and total cost. Medicare is currently testing the HBPC approach through the Independence at Home demonstration.
Edes et al. (2014) studied this question.