M-RCBG Associate Working Paper No. 45

Transitional Care Models for the Elderly: Exploring Potential for Pay For Success (PFS) Opportunities for Third Sector Capital Partners

Ashley Zlatinov



Transitional care, defined as the health care system in which a patient’s care shifts from one care setting to another, is often poorly managed in the United States, leading to diminished health and high costs. Nearly one in five Medicare patients discharged from the hospital—approximately 2.6 million seniors—is readmitted within 30 days, at a Medicare annual cost of $15-26 billion. Officials estimate that up to $17 billion dollars a year comes from avoidable hospital readmissions. While hospital readmissions have declined over the past few years due to federal involvement and incentives (Appendix A), much more can be done to coordinate care, improve outcomes, and understand drivers of impact.

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