The home health care market size is expected to surpass $662.67 billion by 2027 from $264.87 billion in 2020, according to a report published by Precedence Research. A rapidly aging population, as well as the growing trend of nuclear homes, contribute to the growth of the home health care market. How did home care come about?
Home Care in the 1800s
In the 19th century, hospitals were a last resort for those who were ill, giving birth, or dying and without family or caring neighbors to help. Those with the financial means who needed assistance would pay for doctors, nurses, or midwives to come to the patient’s home, according to a home care history synopsis by Penn Nursing at the University of Pennsylvania.
By the end of the century, charitable organizations known as “Visiting Nurse Associations“ (VNAs) across the United States were forming to send trained nurses into the homes of the poor who were sick to provide care and prevent the spread of their dangerous, contagious diseases. Deciding which of the chronically ill patients to treat and for how long became a challenge to the financial viability of these VNAs. The answer: limiting care to those who could be quickly returned to the care of their families through good nursing.
Insurance Steps In
The Metropolitan Life Insurance Company (MLI) in 1909 began providing coverage for home nursing care to its policyholders. In providing coverage for such care, the insurer would increase an insured’s lifespan, which would result in fewer death claims, ultimately lower premiums, and attract more policyholders. In 1916, 221,566 policyholders received more than one million nursing visits. Over the years, however, as the chronically ill did not become well, it increasingly became a challenge to determine how to pay for long-term day care.
But by the 1930s and 1940s, a shift began to take place as the demands of the chronically ill were squeezing hospital capacity and home care began to be viewed as a preferred lower-cost alternative to hospital care. The challenge remained as to how to pay for home care. After decades of study and experimentation, it was determined that only in cases of serious illness where coverage was limited to brief acute episodes was home care a reasonable benefit to include in insurance programs. Caring for the chronically ill at home remained a private/family responsibility.
Medicare and Home Health Care
In the 1960s, home care was included in Medicare, Medicaid, and the Older Americans Act. At that time, Medicare covered only medically necessary, intermittent skilled care for the homebound acutely ill following hospitalization and was not intended to alleviate the growing burden of chronic disabling illness. The federal government collected funds and redistributed that money to individuals to subsidize their purchase of home care services in the private market through intermediaries.
Over the years, legislative, judicial, and regulatory changes have resulted in the expansion of home-care benefits. By the 1990s, Medicare was extended to also provide long-term care to the chronically ill.
Home Health Care Today
Medicare continues to make changes to its home health care program, including overhauling the home health payment system and changing its telemedicine regulations for home health care during COVID. Additional legislation was also introduced last year with the Choose Home Care Act to modernize and strengthen the Medicare program.
Home health care today is typically less expensive, more convenient, and more effective than treatment obtained in a hospital or skilled nursing facility (SNF). In addition, a patient’s options for receiving home health care services are nearly limitless. Care may range from nursing to specialized medical treatments such as diagnostic workups, depending on the circumstances.
Also, as the majority of individuals want to age in place and remain at home, home health care has become the more viable and preferable option if and when care is required. This includes help with daily living activities such as bathing, dressing, or feeding as well as medical care.
Manchester Specialty Programs specializes in providing agents and brokers with totally integrated business insurance solutions to meet the needs of Home Care, Allied Health, and Human/Social Services organizations. For more information about how our products and services can help protect your insureds and how we recognize accredited firms, please contact us at 855.972.9399.
Source: Precedence Research, Penn Nursing, University of Pennsylvania