2015 Continuing Industry Change

Agencies that succeeded in 2015 did so by increasing their census, focusing on quality, and forming new alliances.  These alliances include other providers and joining ACOs to take advantage of the potential windfall in meeting the demands of the Affordable Care Act (ObamaCare).

2015 brought about continued refinements of PPS and decreased reimbursement.  Agencies that have been able to continue to grow and succeed have adjusted their operating model to not only adjust to lower reimbursement, but also by focusing on quality.  In 2016, we will see the first pilot program for Value Based Purchasing ramp up by collecting data in 9 states. While the data is just the beginning, we are entering a new era in home health – play for pay. Whether the pilot is an actual success or not, time will tell, but we can surmise that this type of model will likely become part of the large system.

Big data has come to home health.  While agencies have always used data to track metrics and benchmarks, this era of using data to publicly rate your agency against others is new and here to stay.  The introduction of the Star Ratings on Home Health Compare continues to make agencies receiving 4 or 5 stars standout and will continue.  Agencies that continue to be average with a rating of 3 stars, are starting to take notice and shifting resources to focus more on quality. Those agencies with less than 2 stars or no data at all are going to be on the losing end of the new system.  With room to improve, agencies must realize that data is going to make or break them.

Consolidation and closure – two words that usually make any business owner step back for a second and think.  For home health agencies, 2015 has been another record year for trading ownership from the local agency to the master chain organization.  Agencies with less than 50 patients are most susceptible to closure, not only in 2015, but in 2016 as well.  Due to the ever increasing demands of referral sources to partner with quality driven agencies, smaller agencies need to be prepared.

No longer can an agency operate on outdated methods of operations or structure.  For the independent agency to stay independent, you must focus on innovation and using that innovation to focus on your mission: delivering care to patients in their home while making a profit.  Agencies that are not turning a profit in 2015 need to review their financial situation from administration to clinical operations.  Again, what may have worked 10 years ago or even 5 years ago, is not working in 2015, nor is it going to work in 2016 and into the future.

In addition to declining reimbursements and new models of care, agencies must also be aware that multiple investigative compliance units are on the prowl.  Most agencies do no operate on a platform of intentional fraud. However, to the black and white compliance auditors, who only makes money when they detect fraud, the circumstances for a very reputable agency can quickly turn bad.  Agencies who have been focused on providing care without scrutinizing quality may fall into the category of unintentional fraud. Unintentional fraud occurs when an agency doesn’t realize that their quality assurance and compliance is not fully up to date or being enforced.  While the care may have been necessary for patients and actually occurred, if your documentation can’t substantiate that care or the medical need for it, your agency is in trouble. The practice of contracted compliance officers has already begun in certain parts of the country. With little or no warning, the compliance officers show up your agency’s office, go to a physician’s office and visit a patient.

While 2015 has been good for some agencies and not so good for others, 2016 is just a few days away at this point.  While time is limited, options and actions are not.  Home Health Today is going to focus on continuing ways to improve your agency throughout 2016 in order to help you succeed.  Also, as a selected subscriber of Home Health Today, you can expect continued special offers that allow you to receive the services your agency needs while freeing up cash flow to focus on competitive advantage and innovation! We look forward to 2016’s journey with you and wish you, your family, and your agency the best in 2016!