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Categories Featured in this Issue  Business -- General DMERCs Legislative -- HME Private Duty Prospective Payment System - PPS RHHIs Regulatory -- HHA Regulatory -- HME Trade Associations Utilization
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Issue Date January 7, 2000 Volume XXV, No. 2 Headline Associations to HCFA Fix PPS assumptions, LUPAs, 50/50 split ...and more If comments on the proposed PPS regulations by five national and six state home health associations are any guide, HCFA won't have trouble identifying where the industry believes plans for home health prospective payments need changing. Targeted by just about all of the associations are HCFA's tentative budget neutrality formula for setting per-episode rates and its low-utilization payment adjustments (LUPAs) when patients receive four or fewer visits per episode. As for the proposed 50-50 per-episode payment split, nearly all of the 11 associations have urged HCFA to raise the amount it pays at the start of an episode to between 75% and 90% of the total episode payment. Most of the associations also have asked HCFA to prevent cash-flow interruptions for HHAs when the scheduled transition from cash-based payments to prospective payments occurs virtually overnight on Oct. 1. Opposition to the requirement that physicians affirm each patient's case-mix category, or "home health resource group" (HHRG), also is nearly unanimous. For Associated Home Health Industries of Florida (AHHIF), in fact, the physician requirement is concern No. 1. "Physicians are already nervous about ordering Medicare home health services due to the heightened publicity from HCFA about its increased fraud and abuse," wrote AHHIF Executive Director Gene Tischer. "This mandate would act as a severe prior restraint on physicians signing plans of treatment and reduce drastically the availability of services to beneficiaries." Not everything the associations wrote about the PPS proposals was negative. The Visiting Nurse Associations of America, for one, believes that "with a few important adjustments," PPS will enable HHAs to reverse the inefficiencies encouraged by interim payment limits and "once again...reach out to all home health beneficiaries to improve their health and quality of life." Comments among 350 received The association opinions were among 350 comment letters HCFA estimates it received to its PPS proposal by last week's December 27th deadline. The volume of comments suggests that at least some modification of the original proposal is needed. But Bob Wardwell, head of HCFA's PPS task force, continues to offer no clues about how the final PPS regulations his agency has promised to deliver by July might differ from the proposed version. He did, however, tell ...hhl that he and his colleagues are "impressed with the thoughtful analysis and level of detail" in many of the comment letters. Association comments very detailed
The comments submitted by associations offered detailed analysis on several key points
Categories Prospective Payment System - PPS | Regulatory -- HHA | Trade Associations Headline MedPAC agrees with HCFA plan for no PPS transition, but urges other changes The Medicare Payment Advisory Commission, in comments on the proposed PPS regulations, has endorsed HCFA's plan for a 100% shift to prospective payments on Oct. 1. Out of concern that PPS could deprive sicker beneficiaries of the home health benefit, some MedPAC members originally wanted a transition to PPS involving a blend of current cost-based payments and prospective payments. But they ultimately agreed with HCFA that by preserving interim payment system inequities, such a blend would do more harm than good. The influential advisory panel's Dec. 27 letter does urge HCFA to consider basing future PPS payments on a blend of capitated prospective rates and standardized visit rates by discipline. Such a mixture would reduce PPS incentives for HHAs to "provide a small number of visits above the [LUPA] threshold to generate a payment for the entire episode," the MedPAC letter maintains. At the other end of the episode, it will reduce the incentive to "stint on services," MedPAC believes. In addition, the commission wants HCFA to consider higher LUPA rates for low-utilization episodes. Because PPS must be budget neutral, such an increase would decrease standard episode payments and thus "reduce the incentive for HHAs to provide five visits to qualify for the total episode," MedPAC suggested. As indicated by previous statements of commission members, MedPAC also urged HCFA to drop the proposed requirement that physicians must affirm the accuracy of each patient's case-mix adjustment, or home health resource group (HHRG). At MedPAC's Dec. 9 meeting, commission members agreed physicians would have no way to determine the accuracy of how many activities of daily living (ADLs) the patient was able perform -- B. Schorr Categories Prospective Payment System - PPS | Regulatory -- HHA Headline Graham-Field mired in investigations, lawsuits Lawsuits and investigations, several of which are still ongoing, have been a consistent problem facing troubled HME manufacturer/distributor Graham Field, and still could significantly damage the now bankruptcy-protected company. GF has been plagued by at least one lawsuit throughout 1998 and 1999. In total, the company's Sept. 30, 1999, SEC filing makes mention of four suits filed in 1998, followed by another one in 1999 and ongoing SEC and Florida Grand Jury investigations. In two of the legal cases, the company has already agreed to settlement amounts. But, GF says it now lacks the funds to pay up on the larger one of them. The Bay Shore, N.Y.-based home medical equipment manufacturer/distributor said in its SEC filing that it notified the court in October 1999 of its inability to pay the $10 million it had agreed to as part of the settlement of a class action lawsuit back in August 1999. GF's other settlement was for $87,500 to end allegations of unfair competition and wrongful appropriation of business opportunities in connection with the company's hiring of a certain officer and employees of JOFRA Enterprises, Inc. Graham-Field and some of its employees are defendants in the following, separate, ongoing disputes
SEC & Grand Jury still asking questions Graham-Field still faces uncertainty related to investigations by both the Securities Exchange Commission and the U.S. Attorney for the Southern District of Florida. The SEC launched a formal investigation into accounting errors and irregularities in Graham Field's 1996 and 1997 financial disclosures after a March 1999 audit caused GF to significantly restate earnings. Earnings for both 1996 and 1997, as well as for the first, second and third quarters of 1998 were restated. The SEC has subpoenaed documents related to its investigation. In Florida, Graham-Field is a target of an ongoing grand jury investigation launched in connection with alleged unauthorized diversion of medical products intended for sale outside the United States into U.S. markets. Neither investigation has been resolved and the company says it cannot yet assess the potential financial impact. Graham-Field, which filed for Chapter 11 bankruptcy protection two days after Christmas, is trying to right itself after a four-year financial slide. GF officials were unable to respond to ...hhl's calls by press time. For the nine months ended September 30, 1999, it reported revenues of $228.1 million, and a net loss of $41.1 million. -- P. Lott Categories Regulatory -- HME | Business -- General Headline Private duty dilemma Job options in booming economy shrink supply of HH aides The booming U.S. economy means more Americans can afford private duty home care these days. But it also means more and more Americans, from New Jersey to California, can't find agencies able to admit them because the home health aides they need are finding better jobs in other occupations. There also are growing local shortages of nurses, especially ones that specialize in pediatrics, according to a nationwide survey conducted last fall by the Visting Nurse Assns. of America. One cause lower nursing school admissions. But of the two problems, the shortage of private duty aides -- whose responsibilities range from homemaker/companions to certified nurses aide -- is far more critical, agency administrators tell ...hhl. Visiting Nurse Services of the Treasure Coast, the private duty unit of the Visiting Nurse Assn. of Florida, is all too typical of HHAs caught in the unwelcomed employment squeeze. Over the last two months alone, the agency has had to turn down 10 separate requests for 24-hour-a-day care because it lacks the aides to do the necessary home care shifts. While the VNS of the Treasure Coast's understaffing problem cropped up a year ago, "it's getting worse," says Administrator Bob Quinn. $8.00 - $8.50 an hour isn't enough In line with the 30 or so other HHAs in its area, Visiting Nurse Services of the Treasure Coast currently is paying its private duty aides $8.00 - $8.50 an hour. The problem is "they're also getting that in the malls," along with health and other benefits his agency can't afford, Quinn reports. Moreover, compared with helping infirm patients to bathe, dress and use the toilet, those retail jobs "are less intense work," he notes. Short of an economic slowdown, relief from the current shortage of home health aides isn't in sight, predicts Peter Buerhaus, director of Harvard's Nursing Research Institute. Because those who might have worked as home health aides now have other job options, "economics have tightened up for home health agencies," Buerhaus says. While the Harvard Nursing Research Institute lacks figures for 1999, Buerhaus is hearing "consistent reports" of aide shortages in Colorado, Texas and elsewhere. The shortages are in spite of the fact that the real earnings of home health aides rose in 1998 for the first time in the seven years Buerhaus has been monitoring them, he says. Traditional recruiting methods not working One sign of a worsening problem Aide recruitment techniques no longer work the way they once did. That's certainly been the experience of Caregivers of Southwestern Pennsylvania, located in Greensburg, 30 miles east of Pittsburgh. The private duty agency once could count on recruiting graduates of a three-month home aide course given by a local community college. Last year, though, when the college course wasn't able to attract students and was, therefore, not offered, the agency decided to invest in its own 80-hour course. The agency's bill came to $960 for each of the eight job candidates -- who included single welfare mothers and middle-aged widows -- who agreed to take the course in return for a commitment to provide 200 hours of (paid) aide work. Net result "As soon as they completed the 200 hours, they were all gone," says Mary Jane Helfrich, Caregivers of Southwestern Pennsylvania's chief financial officer. Helfrich has managed to maintain a force of about 30 "casual employment" aides who work eight to 40 or more hours a week at a rate of $7.50 an hour, plus any overtime. But she could use six more. "We can't grow our business because we can't hire the people to do it," she complains. More money? It's not that simple Paying aides more money undoubtedly would make HHAs more competitive in the tight job market. But agency managers contacted by ...hhl fear raising prices to cover their increased labor costs. "Unfortunately, the more we increase our costs, the more consumers will be forced to find services elsewhere," says Judith Clinco, president of Catalina In-Home Services, Tucson, Ariz. It could even become the case that private duty customers begin to directly hire their own full-time in-home helpers to avoid high agency costs, she notes. Clinco's certified nurse aides get $8.25 an hour, plus 75 cents more per hour for night and weekend duty. Their comparatively generous benefits package also includes a 50% company contribution to health insurance and one week of paid vacation after one year of service. But with local supermarket cashiers earning $10 an hour and fast food managers, $30,000 a year, Clinco remains 25 aides shy of the 100 or so she actually needs, she says. -- B. Schorr Categories Private Duty Headline Tight job market calls for imaginative recruitment methods When the going gets tough, it's time for HHAs to get creative. HHAs hard pressed to recruit home health aides in the current tight job market can't escape the fact that low unemployment invariably means high turnover of such workers, says Bob Fazzi, president of Fazzi & Associates, Northampton, Mass. Even so, there are recruitment strategies that work. Fazzi's advice to HHAs Look at your current worker population for clues about what neighborhoods are the best recruiting grounds. Then talk to priests, ministers and rabbis there for leads on possible job applicants, or place ads in papers serving those neighborhoods. Jack Pfeffer, president of Lifeline Home Health Services, Dallas, has stopped placing nurse and aide recruitment ads in the Dallas Morning News and making job fair pitches after finding them unproductive. Instead, he places his recruitment in ads in various local newspapers. Pfeffer's biggest success, however, has retaining those whom he hires. The privately held company has created an attractive employee stock distribution plan for those who work more than 1,000 hours annually. The agency will repurchase the privately held stock at updated prices, provided the employee has remains on the payroll at least five years. The stock plan and other staff retention policies have held departures among the HHA's 260 or so staffers at "half or less" of the industry norm, Pfeffer reports. Lining up government-funded training programs also can help, believes Joseph Campanella, executive director of the Home Care Council of New York City, which represents 60 organizations providing home care for about 65,000 mostly Medicaid patients annually. In 1999, he used a $300,000 federal-state worker retraining grant to provide 30 hours of basic classroom instruction, plus six additional hours in dementia care training to approximately 500 home care workers, most of whom were new recruits. The certificates the workers received made them "feel good" about their jobs, Camapanella says. -- B. Schorr Categories Business -- General Headline Still fewer home health jobs than in ’97, but rebounding The home health labor market appears to have turned the corner. According to new Department of Labor figures, the industry has recovered much of the ground it lost as a result of IPS-related job cuts As of Nov. 30, 1999, the preliminary count of home health workers stood at 663,300 -- only about 5% fewer than in January 1998, according to the Bureau of Labor Statistics. The November total -- which includes home health nurses, therapists and aides -- also represented a 1% increase from November 1998. HCFA's latest "Health Care Indicators" report notes that for the second quarter of 1998 (the latest statistics it references) home health employment dropped 3.3%, which was less severe than for the previous four quarters. The change suggests that the brunt of the industry's reaction to the interim payment limits imposed by the 1997 Balanced Budget Act "is attenuating," the report says. Separately, the Labor Dept. projects that registered nurses and personal care/home health aides are among the 10 occupations expected to show the largest job growth in the 1998-2008 period. The number of working RNs will increase 22% over the 10-year period, to 2.53 million, and the number of aides will increase 58%, to 1.18 million, Labor predicts. In developing both figures, Labor's Bureau of Labor Statistics took into account the shrinkage in Medicare home health under the 1997 Balanced Budget Act, a bureau statistician says. Also, roughly two in five of the personal care/home health aides in Labor's forecast are "residential" aides, who work directly for individual patients rather than for HHAs. -- B. Schorr Categories Business -- General Headline Part B billing allows VNA to offer primary care services Imagine if your HHA could provide more patient care without coming close to hitting your IPS cost limits. Imagine not having to worry about the interim payment system limits, or OASIS. Imagine a reimbursement system where you were paid based on the complexity of the case, and amount of time and skill it required. Sound too good to be true? It's reality for the Visiting Nurse Assn. of Philadelphia, which began billing Medicare Part B for physician services in the home a year ago February. Stephen Holt, CEO of the VNA of Philadelphia said he first got the idea for starting a separate company called VNA House Calls last year when he and his staff tried to brainstorm IPS fixes. "There seemed to be so little we could do because home care is so dependent on everybody else. We can't diagnose patients ourselves. We can't develop our own plans of care. We can't even determine what medications are necessary. Then I started thinking, why not? Why can't home care have a part in primary care?" says Holt. Having physicians and nurse practitioners deliver care in the home allows the VNA to meet a dire need of patients. "Here we are in the middle of a city with some of the best teaching hospitals and physician practices in the country and our homebound patients can't get a physical or have their flu treated," explains Holt. Once the VNA began offering primary care at home, another big benefit emerged. House Calls bills for its physician and nurse practitioner services under the home care visit codes in Medicare Part B. That means the Medicare Part A home health Conditions of Participation, including the OASIS rule, do not apply to House Calls. It also means reimbursement as high as $154.51 per physician or nurse practitioner home care visit in the Philadelphia region. That's 11% more than received in 1999. And that reimbursement is only for the visit itself, notes Holt. If physicians or nurse practitioners perform other services -- such as administering shots or minor in-home procedures such as removing moles etc. -- House Calls bills Part B for those services under separate codes. (There are 7,000 Part B physician service codes.) Not only that, but, House Calls' visits do not count toward the VNA's IPS per-visit limits, because they are billed under Part B. The VNA has separately incorporated its House Calls program, in which three nurse practitioners and one physician serve 250 patients, says COO and program manager Lynn Rinke. But don't suggest that House Calls isn't home care. "The point is that this is what home care once was, could be and should be. It's just not what everyone thinks of as home care, " says Holt. He's right, says a HCFA spokesperson. Any corporation -- home care-affiliated companies included -- can apply for a Part B provider number and, if accepted, bill an intermediary for those services. Not that it was an easy process. It took several tries before Camp Hill, Pa.-based Xact Medical Services, the Part B fiscal intermediary for the Philadelphia area, even took the VNA's calls. "We kept getting, ‘Home health? You're calling the wrong place'" says Holt. Six months later, the VNA had a provider number and each physician and nurse practitioner had an identification number, says Rinke. "It wasn't really a complicated process, just a long one," she says. The hardest part convincing HCFA, intermediaries, and even fellow HHA administrators, that home health could bill for this service. Other benefits for House Calls
Getting doctors on board Not everyone is a fan of the program, however. Tim Cousanis, VP for Jefferson Home Care, Ardmore, Penn., an affiliate of Hallmark Health System, says a primary care service would never work for his agency because it's hospital-based. "We'd be co-opting our own services," he says.That has been an issue Rinke admits House Calls has had to overcome. "We try to be very doctor-friendly," she says, adding "we're very sensitive to the reaction of our patients' existing primary care physicians." -- J. Apter Editor's note Year 2000 home care visit and care plan oversight rates for all geographic areas are listed in ...hhl's Care Plan Oversight Handbook [H661HHL] Call 1-888-293-9383 to order. Categories Business -- General | Regulatory -- HHA Headline Home care market notes
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