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Role of Inpatient Rehabilitation Hospitals During the COVID-19 Pandemic


Short-term acute care hospitals (STACHs), which typically discharge more than 40% of their Medicare FFS patients to post-acute care, have faced enormous pressures in managing not only patient surge volume during the COVID-19 pandemic, but also an overall increasingly more complex population. This more acute patient mix has renewed demand for multispecialty post-acute care regimens that integrate medical, rehabilitative, and behavioral health care. Long-Term Acute Care (LTAC) hospitals and Inpatient Rehabilitation Hospitals (IRHs), as well as Skilled Nursing Facilities (SNFs), all offer these capabilities, but in varying degrees. The pandemic has presented an opportunity to investigate how the differences among these post-acute care settings have influenced their respective roles during the public health emergency.


ATI Advisory previously performed research assessing the role of LTAC hospitals during the COVID-19 pandemic. This work reflects on the contributions that IRHs have made within the backdrop of an evolving patient and payer landscape affected by a global pandemic, and highlights the benefits IRHs have conferred throughout the public health emergency. Our research was informed by Medicare FFS claims data analysis (100% Medicare FFS Part A claims incurred January 2019 – November 2020 and paid through December 2020) as well as interviews conducted with a range of STACH and IRH clinicians and executives knowledgeable about the full payer experience.

Overall, we found that IRHs rapidly adapted their hospitals to serve COVID-19 patients, have served as a critical post-hospitalization setting, and continue to serve clinically complex patients, including those recovering from the debilitating effects of severe COVID-19 infections as well as those requiring intense medical and rehabilitative care. Regional health demands have influenced the prevalence of each of these three themes, and highlight the ways in which local circumstances have informed the public health response. Flexibilities such as prior authorization relief periodically offered by managed care plans, as well as federal waivers available since the declaration of the public health emergency, appear to have supported local care efforts by reducing typical barriers to inpatient rehabilitative care and enabling faster, and more patient-centered decision-making. Medicare FFS claims data analysis showing sustained elevated IRH patient case mix index (an indicator of patient severity) in 2020 suggests that the federal waivers and prior authorization relief have been used appropriately. Our work also includes market-specific case studies that highlight the various ways IRHs assisted their STACH partners, supported in part by these flexibilities.   


In time, the demands of the public health emergency will diminish, but our nation can use the many challenges of the pandemic to inform how to build new post-acute care models that – even if using the home as the center of care – can also effectively integrate the existing public health infrastructure made up of specialty hospitals. Attributes that are emblematic of IRH care, such as strong infection control (national IRHs reported <1% of discharges to their hospitals contracted COVID-19), multidisciplinary expertise (that was further honed through admitting STACH patients earlier and expanding staff experience through significant acute care exposure), and beneficial outcomes (between March – November 2020, more than three-quarters of IRH patients were discharged to the community, including home and home health), have become even more critical during the pandemic. As policymakers and payers consider more home-based models, such as Hospital at Home and SNF at Home, it is critical that these constituents support the public health infrastructure made up of specialty hospitals and institutions that provide life-saving medical care and rehabilitation to thousands of patients every year.

Note: Claims analysis for this report reflects data through November 2020, is preliminary, and will be enhanced significantly as additional months of data become available.


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