Increasingly, Home Is Where Health Care Is : Health: ‘Graying’ of the population and spiraling hospital costs offer county home medical care providers a chance to share in multibillion-dollar industry.
With a growing elderly population requiring routine medical attention and with hospitals increasingly releasing patients sooner to curb spiraling costs, health care industry observers say, home medical care providers are heading for prosperous times.
The rush to provide home medical service and the chance to share in the annual multibillion-dollar industry is clearly evident in San Diego County, where industry observers say there are now at least 50 home medical care providers, up from the 10 firms at the beginning of the decade.
And, in San Diego, where the 65-plus age bracket is growing at an average annual rate of 11.5%--ahead of the nationwide rate of 10.8%--the home health care industry is expected to grow atan even faster pace than the national average.
Already, several private and hospital-based home health care firms in San Diego are experiencing a surge in business.
For example, when Sharp Memorial Hospital established its home health care department in July 1983, it had fewer than 10 staff members, according to Sandra Graack, a Sharp spokeswoman. Now, Graack says, the department has nearly 100 employees. Last month, the department conducted 3,500 visits, up from an average of 100 visits a month in 1983, she said.
Sharp Home Health Care operates a private, for-profit branch as well as a Medicare division, which provides including physical therapy, occupational therapy, social work, personal care and nursing. Revenue for the home care department’s private arm is expected to exceed $1.5 million this year, up from $1.1 million in 1988.
According to industry observers, recent federal efforts to rein in skyrocketing medical costs by establishing a Medicare reimbursement system called diagnostic related group (DRG) have spurred hospitals to shorten patient stays.
Under a DRG reimbursement system, Medicare has set standard fees for certain medical treatment. Medicare will only pay a set amount, for example, for heart attack treatment. Even if a patient requires additional care to recover from a heart attack, hospitals will only be reimbursed the designated amount.
“What that means is, hospitals have to get a patient through his attack, stabilize him and then get him out,” Graack said. “Because they don’t get reimbursed for anything beyond basic care, they have to get the patient out sooner. Otherwise their costs would skyrocket.”
“In the past,” Graack said, “if somebody went in for cardiac surgery, maybe he or she would stay in the hospital for three weeks. Now, they’re out in a week or 10 days. They’re coming out sooner, but coming home sicker. That’s where we come in.”
Industry observers, however, insist that it’s not just the bottom line to blame for ushering patients out of hospitals. Indeed, advances in medical equipment technology are permitting safe--and sometimes better--treatment at home.
“People are finally beginning to understand what can be done with home care,” Graack said. “In fact, physicians are beginning to refer patients to home care before their conditions become critical, often allowing them to avoid hospital stays altogether.”
Understanding and acceptance of home health care by the public and physicians will lead to greater use of such services, providers say. In fact, supporters say, their services offer significant medical advantages to their clients.
“Usually individuals are much more comfortable in their own home environment, and, from a mental standpoint, being at home with their family . . . often helps hasten the recuperative process,” said Frances Berger, a spokeswoman for Scripps Memorial Hospitals Home HealthCare. Scripps, one of the largest home care providers in the county, conducts about 5,000 visits a month.
“It’s also very important for older people to be able to maintain their independence and dignity,” said Terry Racciato, president and one of the founders of Special Care, a private, for-profit, home health care company established in 1986. The company has more than 350 staff members. It began with fewer than 60 employees.
Factors such as the “graying” of the American population and greater appreciation of home health care are benefiting related health care industries too.
Manufacturers of health care products, such as Baxter International, based in Deerfield, Ill., are experiencing an increase in business as well.
According to Geoffrey D. Fenton, a Baxter spokesman, the company, which posted revenues of $6.9 billion last year, divides its operations into four segments: hospital products and services; medical systems and specialties; industrial products; and alternate sites products and services.
“The fastest-growing segment was the alternate sites products and services,” Fenton said. For the first nine months of the current fiscal year, that segment posted sales of $1.1 billion, up 19% from the $893 million during the same nine-month period last year.
