Introduction
Hospital at home is one of healthcare’s most promising care delivery innovations. Yet adoption remains stubbornly limited across the United States. Most hospitals and health systems still lack a formal program — even though the CMS waiver enabling acute hospital-level care at home has been in place since 2020. Clearly, something needs to change.
Austin Kilaru, MD, a senior fellow at the Penn Leonard Davis Institute of Health Economics in Philadelphia, outlined four concrete strategies to boost adoption. His recommendations, released on April 29, offer a practical roadmap for hospitals, payers, and policymakers alike.
What Is the Hospital at Home Model?
Hospital at home is an acute care delivery model that allows patients to receive hospital-level treatment in their own residences. Instead of occupying an inpatient bed, patients use remote monitoring devices and receive regular clinical visits at home. Consequently, they avoid the risks of hospital-acquired infections and experience greater comfort during recovery.
Furthermore, studies consistently show that hospital at home patients achieve comparable or better clinical outcomes than those treated in traditional settings. They also report higher satisfaction scores. Despite these advantages, scaling the model has proven difficult for most health systems.
Why Adoption Remains Low
Several structural barriers limit growth. First, startup costs are significant. Building a hospital at home program requires technology infrastructure, staff training, logistics coordination, and robust telehealth capabilities. Second, reimbursement models typically pay per patient served — not for the upfront investment required to launch the program. Third, payer coverage remains fragmented. Medicare supports the model under the CMS waiver, but Medicaid and commercial insurers often do not.
Together, these challenges create a difficult financial case for administrators. Rural hospitals and safety-net providers face even steeper obstacles. Without targeted policy changes, hospital at home will remain a niche program rather than a mainstream care delivery option.
Way 1: Simplify the Care Model
Allow Flexible, Lower-Intensity Options
The first recommendation from Dr. Kilaru is to simplify how the model operates. Currently, many program designs require full replication of inpatient hospital services at a patient’s home. This approach creates enormous logistical complexity. Moreover, it raises costs and strains staffing resources.
Instead, health systems should adopt flexible, lower-intensity versions of hospital at home. Increasing the proportion of virtual care and reducing mandatory in-person visit frequency can make programs far more manageable. Not every patient needs the same level of in-home clinical presence. By tailoring care intensity to individual patient needs, hospitals can serve more patients at lower operational cost.
This simplification also removes a major barrier for smaller hospitals. A rural critical access hospital, for example, may lack the staff to run a full-intensity program. A more flexible model opens the door for those organizations to participate.
Way 2: Invest Upfront, Not Just Reimburse Later
Reform Payment to Cover Startup Costs
The second strategy addresses the financial mismatch at the heart of hospital at home adoption. Current reimbursement structures pay hospitals for each patient they treat. However, they do not cover the substantial costs of building the program in the first place.
Dr. Kilaru recommends creating payment models that include startup funding — not just per-patient reimbursement. This is especially critical for rural hospitals and safety-net providers. These organizations serve high proportions of Medicaid and uninsured patients. They operate on thin margins and cannot absorb large upfront capital expenditures without dedicated financial support.
Therefore, policymakers should consider grants, bridge financing, or enhanced initial payment rates for new hospital at home programs. Doing so would level the playing field and dramatically expand the number of participating health systems.
Way 3: Align Payers to Support Scale
Bring Medicaid and Commercial Insurers Into the Model
The third recommendation targets payer alignment. Currently, hospital at home reimbursement flows primarily through Medicare. As a result, hospitals face a difficult choice. They can enroll only Medicare-eligible patients, or they can run parallel programs with different rules for different payer categories. Neither option supports efficient scaling.
Dr. Kilaru urges bringing Medicaid and commercial insurers into the hospital at home reimbursement ecosystem. When payers align around a common model, hospitals can build programs designed to serve all patients — regardless of insurance type. This consistency reduces administrative complexity and makes the financial case much stronger.
Additionally, broader payer participation signals long-term program sustainability. Administrators are far more willing to invest in hospital at home infrastructure when they know the revenue stream is not dependent on a single federal waiver.
Way 4: Build Integrated At-Home Care Episodes
Move Beyond Hospital Replacement to Bundled Models
The fourth and most transformative recommendation shifts the conceptual framing of hospital at home entirely. Most current programs position the model as a direct substitute for inpatient admission. Dr. Kilaru argues this framing limits the model’s true potential.
Instead, he recommends moving toward bundled care episodes that integrate both acute and post-acute care at home. Under this approach, a patient’s hospital at home stay does not end at discharge. Rather, it transitions seamlessly into home-based rehabilitation, remote monitoring, and follow-up care — all within a single coordinated bundle.
This integrated episode model delivers two key benefits. First, it improves clinical outcomes by eliminating care transitions that often cause readmissions. Second, it lowers total cost of care by replacing expensive fragmented services with a coordinated at-home pathway. Ultimately, this approach makes hospital at home a vehicle for total episode value — not simply an acute care workaround.
The Road Ahead for Hospital at Home
Hospital at home holds real promise for transforming care delivery. Nevertheless, systemic barriers have kept adoption narrow for years. Dr. Kilaru’s four strategies — simplifying the model, funding startup costs, aligning payers, and building bundled episodes — offer a clear path forward.
Healthcare leaders, policymakers, and payers must act together. No single stakeholder can drive the change alone. However, with the right policy environment and financial incentives, hospital at home can evolve from a niche waiver program into a core pillar of American healthcare delivery.
