Community-Entry Home Health Made Up Nearly Half Of Home Health Episodes And Spending In Traditional Medicare, 2017–21

Medicare home health care is often characterized as a postacute care benefit, yet community-entry users—those admitted without a preceding hospitalization—account for nearly half of all spending and episodes in traditional Medicare. Using Medicare administrative data from 2017, 2019, and 2021, we analyzed differences between community-entry and postacute home health users. Community-entry beneficiaries were older; were more likely to be dually eligible; and had substantially higher rates of cognitive impairment, Alzheimer’s disease, and depression compared with postacute users. Despite these clinical differences, visit patterns remained similar between groups. We documented significant state-level variation in community-entry prevalence, with changes in community-entry share that were positively associated with changes in overall home health spending. Our findings reveal a fundamental tension between policies that favor postacute care and the reality of Medicare home health use, which serves a substantial population with clinical and demographic profiles that differ from those of postacute care users.