Financing of Pediatric Home Health Care

Abstract

In certain situations, home health care has been shown to be a cost-effective alternative to inpatient hospital care. National health expenditures reveal that pediatric home health costs totaled $5.3 billion in 2000. Medicaid is the major payer for pediatric home health care (77%), followed by other public sources (22%). Private health insurance and families each paid less than 1% of pediatric home health expenses. The most important factors affecting access to home health care are the inadequate supply of clinicians and ancillary personnel, shortages of home health nurses with pediatric expertise, inadequate payment, and restrictive insurance and managed care policies. Many children must stay in the NICU, PICU, and other pediatric wards and intermediate care areas at a much higher cost because of inadequate pediatric home health care services. The main financing problem pertaining to Medicaid is low payment to home health agencies at rates that are insufficient to provide beneficiaries access to home health services. Although home care services may be a covered benefit under private health plans, most do not cover private-duty nursing (83%), home health aides (45%), or home physical, occupational, or speech therapy (33%) and/or impose visit or monetary limits or caps. To advocate for improvements in financing of pediatric home health care, the American Academy of Pediatrics has developed several recommendations for public policy makers, federal and state Medicaid offices, private insurers, managed care plans, Title V officials, and home health care professionals. These recommendations will improve licensing, payment, coverage, and research related to pediatric home health services.