Medicaid presents expansion opportunities
Waiver programs can help your business grow
Private duty providers seeking expansion opportunities may consider their state Medicaid waiver programs. With many states increasing eligibility and expanding programs through various demonstration projects, more business is available.
To succeed, however, interested providers must attain a certain volume and not scrimp on services for a needy and often difficult-to-serve patient population, sources advise.
r Provide case management services.
Many companies only think of providing patient care to Medicaid-waiver patients, but depending on the programs and requirements in your state, you may also consider case-managing patients. States typically pay separately for the service, although some will only allow a provider to perform either case management or patient care, but not both.
Resources for Seniors, a Raleigh, NC-based home and community-based provider is the lead agency and case manager for its county's Community Alternative Program (CAP), says Fred Johnson, vice president. Resources for Seniors became the lead agency when the county decided to privatize the program about three years ago.
"The case management rates aren't that great, but once you hit a certain volume, you make money," says Johnson. The company accepted financial risk for the contract's first two years, assuming it would cover the cost of expansion through case managers' billable hours and negotiated a contract long enough to cover its costs, he explains. The company also incorporated enrollments and appropriate billable hours into case managers' evaluations. Those strategies paid off, as the CAP now serves 167 people, up from 70 when Resources for Seniors took over, and the service is profitable.
r Seek grant funding.
Resources for Seniors received a small grant to help with the public-to-private case management transition. It used the funds to automate case management notes, which lowered overhead and made the program more efficient and cost effective, Johnson reports. After Resources for Seniors became its county's lead agency, a North Carolina-based foundation gave start-up grants to providers in other counties throughout the state to establish similar models, he adds.
r Know your service costs.
Providers must thoroughly review budgets and know what a program will cost before entering it, advises Carolyn Briethaupt, vice president and chief operating officer of Houston-based MCH Services, which provides pediatric Medicaid waiver services in several states. "You have to look at what it will take, what the status of your current cases are, and the current staff available," she adds.
Some states specify the level of nursing service and link it with reimbursement, thus increasing providers' financial risk. For example, if a state deems that a certain case requires LPN skills, it will usually only reimburse at LPN rates. If you can only staff the case with RNs or mostly RNs, you will suffer losses, she explains.
With such tight margins, it helps to look for other ways to cover expenses. MCH Services' clinical managers may occasionally fill shifts on such cases, Briethaupt says. "You have to make sure that staff cost you less than what you charge, but if they are PRN without benefits, you can have some difficulties with staffing consistency, and retaining personnel," says Nancy Woods, RN, specialty services director for Contin-U-Care Home Health in Chattanooga, TN. Some organizations pay staff lower rates on Medicaid waiver cases, but "we try not to pay differently," Briethaupt adds.
r Obtain patient volume.
"If you don't have a plan to get volume, you won't be successful. You can't do this piecemeal and come out OK," says Judy Morris, RN, director of professional services at Continuing Care in Harrisonburg, VA. With burgeoning numbers of beneficiaries, sometimes that boils down to knowing the program and referral sources. (See related story on Medicaid waivers, p. 123.)
While some organizations use case management contracts to feed their home care operations, Resources for Seniors emphasizes client freedom of choice, and case managers rotate agencies. The current tight labor market often determines agency selection. "The company that has a [home health aide] in that part of the county [gets the case]," says Johnson.
r Serve patients well.
"You have to make sure you can provide the same type of care to these patients as you would to private pay patients because they deserve the same care," says Briethaupt. Patients' home environments do present service challenges, though. "Especially with mentally disabled populations, [it is a challenge for] staff to accept parents reactions [to certain events] because the staff wouldn't react the same way. But it's not that [parents or families] don't care; they've just developed coping mechanisms over the years," explains Woods.
r Abide by regulations.
You must be familiar with both the programs and their regulations, advises Sharon Newton, RN, BA, CDMS, assistant director of state programs for Garland, TX-based Outreach Health Services. And that is becoming more difficult, sources report.
"The rules and regulations for waivers are getting as difficult as Medicare. You have to go through a lot of hoops for less reimbursement," says Morris.
Woods agrees. "Waiver programs have a higher regulatory standard than is typically private duty. There are more audit functions. We have a complete medical record and billing audit on all charts, and they are strict," she says.
Providers wary of entering the Medicaid waiver market should think twice, sources advise. Despite its challenges, "the care can be very rewarding," says Woods.
And it is a potentially long-term revenue source. "The need is always there," says Newton.
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