FDA Announces Home Health Challenge to Reduce Readmissions

 The FDA has announced an innovation challenge for medical technology to be used in the home setting with the objective of reducing hospital readmissions. The READI-Home Innovation Challenge will accept up to nine applicant technologies. The FDA states that manufacturers of candidate products should explain “how the device is expected to significantly improve the benefit-risk profile of a treatment or diagnostic” compared with alternatives available for the relevant disease or condition. The readmission rates for patients with chronic conditions can reach 18.4%, creating a significant clinical and financial burden for patients, caregivers, and the healthcare system. 

In September 2023, the Agency for Healthcare Research and Quality (AHRQ) reported that circulatory system disease accounted for the largest share of hospital readmissions in 2020. The report also notes that readmissions in general were more than 12% more costly than the index admission, generating costs of $16,300 versus $14,500 for the index admission. The Centers for Medicare & Medicaid Services has worked for a number of years to reduce readmissions by various means with a particularly intense focus on disease categories such as circulatory system disease.

READI-Home, an acronym for Reducing Readmissions through Device Innovation for the Home, is an offshoot of the Home as a Health Care Hub program. Announced in April 2024, this collaboration was established to create a home health environment that allows patients with chronic conditions to access healthcare services without the need for an in-person clinical visit. The 2024 initiative was established with the objective of ensuring that multiple medical technologies can work seamlessly together to foster the patient's health, and called for development of a prototype home healthcare setting that provided the sought-after integration of multiple medical technologies.

The READI-Home challenge takes these ambitions a step further by explicitly emphasizing a reduction in avoidable readmissions. The READI-Home challenge is focused on proving home healthcare specifically for patients following an acute hospital stay, although the FDA's Center for Devices and Radiological Health (CDRH) did not provide a metric for reduction of readmissions. CDRH stated that the 30-day rate of readmissions for chronic conditions ranges from 2.8% to 18.4%, more than half of which were due to a healthcare event other than the reason for the index admission. The fact that these readmissions cost on average more than 12% more than the index admission “highlight[s] the need for innovative medical devices that support patient-centered care and reduce readmissions,” CDRH stated.

Patient interest in healthcare in the home would seem to support the objectives of the READI-Home program. A research letter published in the Journal of the American Medical Association (JAMA) states that a survey of patients suggests “substantial acceptability” of what the authors described as hospital-at-home care. The support did not waver after controlling for factors such as insurance coverage, sociodemographics, prior hospitalization or prior experience with telehealth services.

A key consideration for participants in the challenge is whether payers will agree to cover the related services. CMS drastically expanded its coverage of telehealth and telemedicine during the COVID-19 pandemic, although Congress has been reluctant to provide a permanent statutory authority for the entire range of services due to fears of fraud. However, Congress extended a related waiver in passage of the Consolidated Appropriations Act, 2026. The Acute Hospital Care at Home waiver extension is thus in force through 2030, a development that won the support of the American Medical Association.

Manufacturers who are interested in the READI-Home program can apply through Sept. 30, 2026. CDRH stated that it will notify the nine selected companies by no later than Dec. 4, 2026. The candidate devices must be designed for use by the patient or the patient's caregiver, and applicants are urged to provide evidence of reduced readmissions with their application packages.