Potentially avoidable hospitalizations of dually eligible Medicare and Medicaid beneficiaries from nursing facility and Home- and Community-Based Services waiver programs.

OBJECTIVES: Beneficiaries dually eligible for Medicare and Medicaid are of increasing interest because of their clinical complexity and high costs. The objective of this study was to examine the incidence, costs, and factors associated with potentially avoidable hospitalizations (PAH) in this population.

DESIGN: Retrospective study of hospitalizations.

SETTING: Hospitalizations from nursing facilities (NF) including Medicare and Medicaid-covered stays, and Medicaid Home and Community-Based Services (HCBS) waiver programs.

PARTICIPANTS: Dually eligible individuals who received Medicare skilled nursing facility (SNF) or Medicaid NF services or HCBS waiver services in 2005.

INTERVENTIONS: None.

MEASUREMENTS: Potentially avoidable hospitalizations were defined by an expert panel that identified conditions and associated Diagnostic Related Groups (DRGs) which can often be prevented or safely and effectively managed without hospitalization.

RESULTS: More than one-third of the population was hospitalized at least once, totaling almost 1 million hospitalizations. The admitting DRG for 382,846 (39%) admissions were identified as PAH. PAH rates varied considerably among states, and blacks had a higher rate and costs for PAH than whites. Five conditions (pneumonia, congestive heart failure, urinary tract infections, dehydration, and chronic obstructive pulmonary disease/asthma) were responsible for 78% of the PAH. The total Medicare costs for these hospitalizations were $3 billion, but only $463 million for Medicaid. A sensitivity analysis, assuming that 20%-60% of these hospitalizations could be prevented, revealed that between 77,000 and 260,000 hospitalizations and between $625 million and $1.9 billion in expenditures could be avoided annually in this population.

CONCLUSION: Potentially avoidable hospitalizations are common and costly in the dually eligible population. New initiatives are needed to reduce PAH in this population as they are costly and can adversely affect function and quality of life.