Wednesday, August 15, 2012

Over 2000 Hospitals to be Penalized for High Readmission Rates

According to a report from Kaiser Health News, more than 2,000 hospitals — including some nationally recognized ones — will be penalized by the government starting in October because many of their patients are readmitted soon after discharge, new records show.

Together, these hospitals will forfeit about $280 million in Medicare funds over the next year as the government begins a wide-ranging push to start paying health care providers based on the quality of care they provide.

Here are some key points from this report:
  • Nearly 2 million Medicare beneficiaries are readmitted within 30 days of release each year, costing Medicare $17.5 billion in additional hospital bills.  
  • A total of 278 hospitals nationally will lose the maximum amount allowed under the health care law: 1 percent of their base Medicare reimbursements. 
  • 1,933 hospitals will receive penalties less than 1 percent.
  • Massachusetts General Hospital in Boston, which U.S. News last month ranked as the best hospital in the country, will lose 0.5 percent of its Medicare payments because of its readmission rates, the records show.
  •  The smallest penalties are one hundredth of a percent, which 50 hospitals will receive.
  •  The penalty will be deducted from reimbursements each time a hospital submits a claim starting Oct. 1. As an example, if a hospital received the maximum penalty of 1 percent and it submitted a claim for $20,000 for a stay, Medicare would reimburse it $19,800.
  • 1,156 hospitals where Medicare determined the readmission rates were acceptable will not lose any money.
Where do your local hospitals fall in this list?  What can you do to help them reduce readmissions?  This data may be helpful to you in preparing your next presentation to the C-Suite officers at your local referring hospitals.  

What has been your experience in having conversations with your local hospitals about reducing readmissions?  What results have you achieved in developing strategic alliances with them?  We'd love to hear your comments.

Nurses Indicted for Receiving Kickbacks for Home Health Medicare Referrals

Chicago - August 13, 2012 - A home health care agency in suburban Lincolnwood, two nurses who are part owners of the company and a third nurse affiliated with them, along with two marketers, were indicted on federal charges for allegedly participating in a conspiracy to pay and receive kickbacks in exchange for the referral of Medicare patients for home health care services, federal law enforcement officials announced today. 

Defendants Marilyn Maravilla and Junjee L. Arroyo, both part owners of Goodwill Home Healthcare, Inc., and three other defendants allegedly conspired to pay and receive approximately $400,000 in kickbacks to themselves, nurses, marketers and others for the referral and retention of Medicare patients that enabled Goodwill to bill Medicare approximately $5 million.

Also indicted were Ferdinand Echavia, a licensed nurse who referred patients, and Jean Holloway and Rakeshkumar Shah, both of whom marketed Goodwill’s services to Medicare patients.  The 29-count indictment was returned by a federal grand jury last Thursday and unsealed on Friday following the arrests of Holloway, 41, of Bellwood, and Shah, 46, of Des Plaines.

The information about this indictment should cause all owners, CEOs, and administrators of home health agencies and hospices to review the methods they are using to compensate and pay incentives to employees and non-employee marketers. This is only an indictment and has not yet gone to trial, so we'll need to watch and learn more specifics about what these home health agency owners were actually doing that caused the Office of Inspector General for HHS, the United States Attorney for the Northern District of Illinois, and the FBI to investigate this home health agency.  The case falls under the umbrella of the Medicare Fraud Strike Force, which expanded operations to Chicago in February 2011, and is part of the Health Care Fraud Prevention & Enforcement Action Team.

We'll watch for more details, and lessons you can learn from this case about what to do and not to do in compensating sales and marketing staff in home health and hospice.

Top Techniques for Recruiting Nurses and Therapists

By Stephen Tweed

Before the economy crashed in the fourth quarter of 2008, one of the biggest challenges facing CEOs of home health agencies and hospices who wanted to grow their business was the shortage of nurses and therapists.  We were seeing dozens of agencies who were in a position to grow, but didn't have the clinicians to meet the need.

Then the market tumbled, the economy sagged, unemployment sky rocketed, and very quickly health care professionals stayed put in their current jobs.  As turnover shrank, home health agencies no longer faced the extreme pressure of the nursing shortage.  Many agencies were still needing to hire more PTs, OTs, and STs.

While the staff shortage has not returned to the level that is had been in 2008, we project that you will see turnover increase in home health care and hospice as the economy recovers.  One survey we saw suggested that a significant number of employees are currently dissatisfied with their current job, and will change jobs as soon as the economy recovers enough to give them some level of confidence.

What does that mean for home health and hospice?  It means we need to be prepared for the potential of higher turnover, and put in place process for recruiting, selection, and retention of critical staff members including nurses and therapists.  We'll address retention and selection in future posts, but in this article I want to talk with you about your strategies for recruiting clinicians.

Back in 2006, Leading Home Care conducted an industry wide survey of owners, CEOs, and administrators of home health and hospice organizations to identify the recruiting methods they were using, and the methods they found most effective in finding high quality applicants.

At that time, the Top Ten Techniques were:
  1. Employee Referral Program
  2. Networking in your community
  3. Your agency's web site
  4. Daily and weekly newspapers
  5. Telephone recruiting
  6. Continuing Education courses
  7. Your company's electronic newsletter
  8. Direct Mail Post Cards (to state RN Licensure list)
  9. Your company's paper newsletter
  10. Advertising in church newspaper
Since then, we have monitored the techniques our clients and seminar participants are using, and we have conducted interviews to keep on top of this subject. While these top ten are still very relevant, we see local and national job web sites going up in importance.  Sites like and seem to be working well for some people.

However, we have also see a number of companies fall into the trap of only using online recruiting sites, and forcing all applicants to go through an electronic application process.   This puts up a big barrier to entry, and eliminates many high quality applicants.

The thing we know about recruiting clinicians is that the very best ones are already happily working for someone else.  They are not reading the job ads in the paper, or searching online job sites.  To find them, you'll need to use other approached like your employee referral program, networking, and direct mail.

Once you have filled the funnel a regular stream of high quality applicants, the next step is to put in place a selection process to choose only the best candidates.  More on that in a future post.

What are you seeing in your recruiting of clinicians?  What's working for you?  What's not working?

We'd love your comments.

How Much Will Health Care Reform Cost Your Consumers?

By Stephen Tweed

Sitting on at airplane this afternoon on my way to Atlanta, I saw an interesting tid bit under the title, "Notable and Quotable".  The writer, Jonathan Tobin, said "there may be some voters who are indifferent to the impact on the economy of health care reform... But will they stand for an increase in the price of Pizza".

Then he goes on to quote our neighbor here in Anchorage, KY, John Schnatter.  John is Papa John of Papa John's Pizza.  John says Healthcare reform will cost his company 11 to 14 cents per pizza, and 15 to 20 cents per order filled.  John says that "the Obamacare government surcharge will be passed on to consumers".

That raises the question of how much the new law will add to the consumer's cost of a Big Mac, or a Coke?  Tobin suggests that this across-the-board surtax on virtually all expenditures will hit the poor a lot harder than the rich.

So what impact will this have on us in home health care, hospice, and private duty home care?  Well first, the cost to provide insurance for our employees will go up.  Then the cost of everything we buy will go up.  In home health and hospice, we won't be able to pass it on to consumers, because Medicare and Medicaid pay the bills.  Half of the cost of health care reform is being paid for through reductions in payments to health care providers including $500 billion in Medicare cuts.

For private duty home care, the added costs can't be passed on to Medicaid Waiver, so they will be passed on to private pay consumers.  How much more will you have to charge per hour to pay for the added costs?

Reading this brief quote from Papa John has causes me to question how much cost we will have to pass on to you, our consumer, when you attend a seminar, when you attend your state association conference, when you register for a webinar, or when you buy an eBook.

When you throw a pebble in a pond, the ripples continue out to the edges of the pond.  What will be the ripple effect of paying 15 cents more for Pizza to cover the cost of healthcare reform?

I'd love your comments on this concept.