Home health care in the United States traces its roots to the 1890s, when trained nurses began making house calls to sick and impoverished families in New York City’s immigrant neighborhoods. What started as a small, volunteer-driven effort has grown into a global industry valued at roughly $227 billion in 2025, but the core idea has remained the same for over 130 years: bringing medical care to people where they live.
The 1890s: Visiting Nurses on the Lower East Side
The earliest organized form of home health care in America began in 1893, when two nursing school graduates named Lillian Wald and Mary Brewster moved to the Lower East Side of Manhattan. The neighborhood was one of the most densely packed in the world, home to waves of Jewish, Irish, Italian, and Chinese immigrants living in cramped tenement buildings with little access to medical care. Wald and Brewster went door to door, providing bedside nursing, delivering sterilized milk and ice, dispensing medicines, and connecting families with hospitals and jobs.
By 1895, they had established the Henry Street Nurses’ Settlement, which became a model for the entire country. The settlement didn’t just treat illness. Its backyard was converted into the largest playground on the Lower East Side, with priority given to disabled children and those recovering from illness. By 1917, the Henry Street nursing service was providing bedside care to nearly 33,000 patients and visiting 21,000 sick children in their homes each year. Wald is widely credited with pioneering the concept of public health nursing and with advocating for health care equity and mixed public-private funding, issues that remain central to home health policy today.
Medicare Changes the Game in 1965
For most of the early and mid-20th century, home nursing remained largely a charitable and community-based effort. That changed dramatically in 1965, when Congress passed the Social Security Amendments that created Medicare and Medicaid. For the first time, the federal government would pay for home health services for eligible elderly and disabled Americans. This single policy shift transformed home care from a patchwork of local programs into a regulated, reimbursable segment of the health care system. The number of home health agencies began to climb as providers realized there was now a reliable funding stream.
Congress continued to tinker with the rules. The Omnibus Reconciliation Act of 1980 made several changes to Medicare’s home health provisions, though analysts at the time predicted the practical impact would be modest. More significant was the Balanced Budget Act of 1997, which tightened reimbursement rules and led to a sharp contraction in the number of home health agencies operating nationwide. Many smaller agencies couldn’t survive the lower payment rates and closed, consolidating the industry.
Hospice Care Comes Home
A parallel movement was unfolding for patients at the end of life. In the late 1960s, Florence Wald, then Dean of the Yale School of Nursing, began pushing to reform how America cared for the dying. Inspired by the hospice model developing in England, she stepped down from her academic post and partnered with a group of reformers in New Haven, Connecticut, to build what became Hospice, Inc., one of the first modern hospice programs in the United States. These early hospices grew out of community volunteer efforts and focused on providing comfort care in patients’ own homes rather than in hospitals. The movement gained federal backing in 1982 when Medicare began covering hospice benefits, cementing home-based end-of-life care as a standard option.
Technology Enters the Home
The idea of monitoring patients remotely has a longer history than most people realize. NASA was testing remote medical monitoring on animals during space program flights as early as 1967. The first technology specifically designed for home health care appeared in 1991, when researchers developed a system called “The Electronic House Call,” widely considered the first tele-homecare platform. Over the following decades, remote monitoring expanded to include devices that track blood pressure, blood sugar, heart rhythm, and oxygen levels from a patient’s living room, sending data back to clinical teams in real time.
COVID-19 Accelerates the Shift
The pandemic compressed years of gradual change into months. In March 2020, as hospitals filled beyond capacity, the Centers for Medicare and Medicaid Services launched its “Hospital Without Walls” initiative, using emergency waiver authority to suspend rules that had previously required nursing services and registered nurse availability on hospital premises around the clock. The agency also waived physical environment and safety code requirements that had made it legally impossible to deliver inpatient-level care in someone’s home.
By November 2020, CMS had launched the Acute Hospital Care at Home initiative, which allowed certain Medicare-certified hospitals to treat patients who would otherwise need a hospital bed entirely in their homes. Patients received the same intensity of care, including intravenous medications, regular monitoring, and physician oversight, without ever being admitted to a facility. The program demonstrated that for selected patients, home-based acute care could be safe and effective, and it pushed policymakers to consider making some of these flexibilities permanent.
The Industry Today
Home health care is now one of the fastest-growing segments of the health care economy. The global market is projected to grow from about $246 billion in 2026 to roughly $518 billion by 2035, an annual growth rate of 8.6%. Several forces are driving that expansion: aging populations in wealthy countries, patient preference for recovering at home, advances in portable medical technology, and persistent pressure to reduce hospital costs. The services delivered at home now range far beyond what Lillian Wald could have imagined, from wound care and physical therapy to chemotherapy infusions and post-surgical recovery, but the underlying principle she established on the Lower East Side in 1893 hasn’t changed. For many patients, the best place to heal is the place they already are.