Return‐on‐Investment (ROI) Analyses of an Inpatient Lay Health Worker Model on 30‐Day Readmission Rates in a Rural Community Hospital

Purpose The purpose of the study was to assess the return‐on‐investment (ROI) of an inpatient lay health worker (LHW) model in a rural Appalachian community hospital impacting 30‐day readmission rates. Methods The Bridges to Home (BTH) study completed an evaluation in 2015 of an inpatient LHW model in a rural Kentucky hospital that demonstrated a reduction in 30‐day readmission rates by 47.7% compared to a baseline period. Using the hospital's utilization and financial data, a validated ROI calculator specific to care transition programs was used to assess the ROI of the BTH model comparing 3 types of payment models including Diagnosis Related Group (DRG)‐only payments, pay‐for‐performance (P4P) contracts, and accountable care organizations (ACOs). Findings The BTH program had a –$0.67 ROI if the hospital had only a DRG‐based payment model. If the hospital had P4P contracts with payers and 0.1% of its annual operating revenue was at risk, the ROI increased to $7.03 for every $1 spent on the BTH program. However, if the hospital was an ACO as was the case for this study's community hospital, the ROI significantly increased to $38.48 for every $1 spent on the BTH program. Conclusions The BTH model showed a viable ROI to be considered by community hospitals that are part of an ACO or P4P program. A LHW care transition model may be a cost‐effective alternative for impacting excess 30‐day readmissions and avoiding associated penalties for hospital systems with a value‐based payment model.