Question: A health system has instituted a new program designed to provide more frequent in-home hemodialysis to renal disease patients in an effort to prevent readmissions. The overall costs of the program include equipment, staffing, training, and physicians providing in-home care, but do not include the actual costs of dialysis or penalties for readmissions. A comparison of the average costs and outcomes based on the observations of 2,012 patients with renal disease indicated that the costs for in-home dialysis was $17,000 per patient per year versus $4,000 per patient per year for dialysis at the clinic. The rate of readmissions was 1.2 for the clinic patients and 0.8 for the in-home patients. Using the incremental net benefit calculation and a willingness to pay of $30,000 per readmission avoided, is in-home dialysis cost-effective? If not, how much would the hospital have to be willing to pay in order for it to be cost-effective?

HINT: Keep in mind that reducing readmissions is a positive benefit, so you will need to covert the readmission rate to a "not readmitted" rate for the calcuations.

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