Independence at Home Evaluation (IAH) Demonstration - Year Seven Evaluation Report

The Independence at Home (IAH) Demonstration is a congressionally mandated test of whether a payment incentive for providing home-based primary care reduces health-care spending and improves the quality of care for eligible fee-for-service Medicare beneficiaries. To be eligible to enroll in the demonstration, beneficiaries must have had at least two chronic conditions, required help from another person with at least two activities of daily living, have been admitted to a hospital in the last 12 months, and have used acute or subacute rehabilitation services in the last 12 months. Participating home-based primary care practices can earn incentive payments if their patients’ Medicare spending is less than a given spending target and if they meet the standards for selected quality measures. IAH began in 2012 with 18 practices, 14 of which were included in the evaluation. Year 7 was 2020, the first year of the COVID-19 pandemic. In Year 7, 10 practices participated in the demonstration, together serving approximately 5,000 eligible beneficiaries.

Because of substantial changes in health-care delivery during the COVID-19 pandemic, there are plausible reasons to believe that home-based primary care from IAH practices was more effective during the first year of the COVID-19 pandemic than in earlier years. IAH likely reduced total spending in Year 7 by $459 per-beneficiary-per-month (10.7 percent), or $22.6 million in aggregate and $4.2 million after accounting for incentive payments. Lower spending on hospital admissions partly drove the total spending reduction and fell the most for beneficiaries who needed help from another person with all or nearly all activities of daily living, such as feeding and dressing.