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Regulatory, staffing, and financial issues still key for HHAs
[Editor’s note: Hospital Home Health begins the year with a look at the challenges that will be faced by home health managers in 2004. With the passage of the Medicare Prescription Drug Improvement and Modernization Act of 2003 (HR 1) in the last days of November 2003, many issues that home health agency managers deal with will be related to this legislation. This month’s cover story introduces a few of the key issues addressed by this new legislation. Next month, we will discuss other demonstration projects included in HR 1, such as the homebound definition, collaboration with adult day care, reimbursement based upon performance, and employee background checks.]
If you are a roller coaster fan, then home health is the industry for you, because all of the experts interviewed by HHH agree that home health managers have experienced a lot of ups and downs and unexpected bumps and turns during the past several years. The good news is that many of these experts expect 2004 to be a little calmer. When asked to pull out their crystal balls and share some of their predictions for the home health industry in 2004, key leaders identified some of the major challenges that home health managers can expect in the upcoming year:
"I think that we’ll continue to deal with the same issues we faced during the past years, but I also think that the pace of changes will slow down and give us a chance to catch our breath and refine the processes we’ve put into place," says Greg Solecki, vice president of Henry Ford Health Care in Detroit. "Although we will have to continue to address the regulatory issues we’ve been facing, I don’t anticipate a great number of new regulations, primarily because 2004 is an election year," he explains.
"Congress will be distracted by the elections in 2004; and although refinements will continue to be made to the Medicare bill passed in late November 2003, I don’t anticipate introduction of new legislation that will relate to home health," says Ann B. Howard, director of federal policy for the American Association for Homecare in Alexandria, VA. The staff at the Centers for Medicare & Medicaid will be very busy implementing the various aspects of HR 1, including a number of items that will affect home health agencies, she says.
The most immediate financial repercussion of HR 1 is the reduction of the market basket update by 0.8% for each year for three years beginning in April 2004. "The reduction of the market basket update does mean that home health agencies will continue to pay rising costs for items such as salaries, liability insurance, and travel expenses without reimbursement that reflects these increasing costs," explains Joel Mills, president and chief executive officer of Advanced Home Care in Greensboro, NC, and chairman of the board of directors for the American Association for Homecare. "This means that we will have to continue to look for ways to improve efficiency within our agencies," he explains.
Some good news that comes with HR 1 is a one-year extension of a 5% rural add-on, Mills says. "This is positive news for rural home health agencies that must address greater travel costs than urban agencies," he continues. "Another positive aspect of the legislation is the elimination of the requirement to collect Outcome and Assessment Information Set data on non-Medicare and non-Medicaid patients. "The elimination of this requirement for private pay and managed care patients will help us by reducing some of the paperwork we have for some of our patients," Mills adds.
Another positive aspect of HR 1: There is no copay for home health patients, points out Seth Johnson, director of public policy for the American Association for Homecare. "The elimination of copayments from the legislation is the result of an amazing grass-roots effort by the home health industry," he adds. "The collection of a copayment would have created a tremendous administrative burden on home health agencies and would have placed an unrealistic financial burden on many home health patients," Johnson says. "Because home health receives patients after they’ve already paid copayments on hospital and physician visits, even a small home health copayment might have been too much for some elderly patients," he says. For this reason, many home health experts believe that a copayment would have reduced the number of patients able to benefit from home health, Johnson explains.
"The copay issue is not gone forever," says Solecki. "I believe that it will resurface any time we have Medicare-related legislation under debate. For now, we can enjoy a reprieve," he notes.
New CoPs welcomed
"We were very happy with the draft of the new conditions of participation [CoPs] for Medicare that were posted about two years ago, and we hope that the new conditions will come out in spring of 2004," says Val Dalton, BA, CHCE, vice president of Borgess Visiting Nurse Association (VNA) and Hospice in Kalamazoo, MI, and president of the Michigan Home Health Association.
Diane M. White, RN, BSN, MSN, vice president of clinical services for Borgess VNA, agrees. "We are measuring quality in so many different ways that it would be nice for the conditions to specify which quality measures are most important," she says. Since the current CoPs were in place, CMS has introduced Home Care Compare, which requires public reporting of quality measures, and CMS has introduced risk-adjusted outcomes measurement, White points out.
Quality and outcomes measurement will continue to be an important issue for home health, but agencies do need to find ways to be more efficient in gathering and reporting information, Dalton says.
While all agencies will be focusing on outcomes, some also will become more selective about the patients for which they market, adds Johnson. "Rather than the friendly competition we traditionally have seen in home health, I believe we will see agencies becoming more competitive and going after patients who are more profitable to their agency," he says. For this reason, the home health industry may start to see more agencies specializing in care of certain types of patients based upon an expertise the agency possesses as well as a higher profit margin for that particular disease state, Johnson continues.
Staffing still a challenge
Finding nurses not only will remain a key issue for many agencies, but the problem will get worse, Solecki says. "Not only are there fewer RNs in the workplace and graduating from nursing schools, but because many home health agencies require experience, we don’t have the option of hiring graduate nurses. We are also seeing an aging of our nurse employees as the baby boomers grow older," he explains.
The aging of the nursing work force has several implications for home health, Solecki stresses. "The stress of working in home health as an older employee will manifest itself in several ways such as early retirement or even work-related injuries," he says. Injuries can be stress-related or related to the physical demands of the job, Solecki adds. "We have nurses carrying laptops and other equipment into building without elevators; and as our employees age, we will see more workers’ compensation cases as these employees fall, strain backs, and injure themselves in other ways," he explains.
For these reasons, it is important that agency managers not only review their process for recruiting and hiring nurses, but also that they look at inservice programs on prevention of injuries, Solecki suggests. Agency managers also will want to evaluate new technology and equipment in terms of the physical requirements that it may place on field personnel, he adds.
[For more information about home health challenges, contact:
• Greg Solecki, Vice President, Henry Ford Home Health Care, One Ford Place, 4C, Detroit, MI 48202. Phone: (313) 874-6500. E-mail: email@example.com.
• Ann B. Howard, Director of Federal Policy, American Association for Homecare, 625 Slaters Lane, Suite 200, Alexandria, VA 22314-1171. Phone: (703) 535-1891. Fax: (703) 836-6730. E-mail: firstname.lastname@example.org.
• Joel Mills, President and Chief Executive Officer, Advanced Home Care, 200 W. Wendover, Greensboro, NC 27401. Phone: (336) 294-8822. Fax: (336) 272-8524.
• Val Dalton, BA, CHCE, Vice President, Borgess Visiting Nurse Association and Hospice, 348 N. Burdick, Kalamazoo, MI 49007.]