4.3 Million Patients Turned Away Annually from Home Healthcare

More than 4 million patients are being turned away from home health services each year, according to a new analysis from Homecare Homebase (HCHB), revealing a deepening access issue in the industry that could only get worse by proposed Medicare payment cuts.

Based on data from 44% of all Medicare home health claims, HCHB’s findings reveal a significant drop in referral-to-admission rates, driven largely by staffing shortages and stagnant reimbursement.

The CDC reported in 2020 that there were roughly 11,400 home health agencies in the U.S. As of January this year, Market.us Media also reported that about 12 million Americans receive home healthcare services each year.

Homecare Homebase revealed over 4 million patients are denied home health services annually, highlighting critical access issues and the impact of proposed Medicare cuts.

“HCHB data shows a sharp decline in patient access, with referral-to-admission rates dropping from 74% pre-PDGM (Patient-Driven Groupings Model) to about 64% today, and those not being admitted due to staffing shortages doubling since before 2020,” Luke Rutledge, president of HCHB, told Managed Healthcare Executive. “Alarmingly, HCHB data show that 4.3 million home health patients are being turned away each year, a staggering reflection of the widening care gap.”

To better understand and respond to this trend, HCHB developed new tools designed to ground policy discussions in real-world data rather than assumptions.

This effort supports the company’s goal of providing policymakers, providers and advocates with evidence-based insights into how proposed cuts may affect home health agencies and the patients they serve.

In the analysis, assumptions made by CMS are challenged, including claims that providers are inflating diagnoses to increase reimbursement under the PDGM.

To build this analysis, HCHB drew from a dataset that includes nearly half of all Medicare home health claims across the U.S.

The data was also supported by the Home Health Impact Model and a suite of Advocacy Dashboards, all built into the company’s analytics platform. These tools use de-identified client data to evaluate how proposed rate changes may impact agencies financially and operationally. The dashboards provide both big-picture trends and specific performance indicators—such as labor costs, case-mix weights, per-visit rates, diagnosis behavior and other key drivers of agency viability.

Data revealed three main areas of concern: reduced access to care, widening financial pressure on providers and a lack of evidence supporting CMS’s justification for payment cuts.

As mentioned by Rutledge, one of the most immediate findings is the significant decline in referral-to-admission rates, which fell from 74% before PDGM to about 64% today. This 10-point drop is largely attributed to staffing shortages, which have doubled their impact on admissions since 2020. Combined, these factors are resulting in more than 4.3 million patients being turned away from home health services each year.

In addition to access challenges, the finances of many home health agencies—especially small or rural ones—are under increasing pressure.

While labor and operational costs have climbed, it was revealed that Medicare reimbursement rates have remained mostly flat. Smaller agencies, which lack the scale and infrastructure of larger providers, are particularly vulnerable. Many also face the added challenge of serving more patients under Medicare Advantage plans, which typically offer lower reimbursement than traditional Medicare.

At the same time, one of CMS’s main intentions for the proposed 6.4% payment cut is not supported by the data, according to HCHB’s findings.

A review of claims found no major difference between the diagnoses recorded at intake and those on final claims. This challenges the idea that providers are coding in ways just to raise payments.

In response to these findings, HCHB is joining forces with national advocacy organizations to bring this evidence to CMS during the comment period before the rule is finalized.

As agencies across the country brace for potential cuts, the data from HCHB reveals what’s happening in real time—assisting to ensure that reimbursement policies don’t reduce access to care for those who need it most.