Give staff ABCs of IPS
Shed some light on the darkness
No matter how many times you may have discussed the interim payment system (IPS) with your staff, it's probably time to have another meeting to update them on the subject. Adminis trators and education managers at several home care agencies say it's an ongoing process to teach staff how to become more efficient and get the same work done in fewer visits under the IPS.
"We try to impress on our staff that you have to get in there and get the job done as efficiently as possible," says Judy Hughes, RNC, BSN, assistant director of nurses and inservice director at Travertine Health Services Inc. in Sulphur, OK.
The Visiting Nurse and Hospice Services of Kalamazoo, MI, has focused on training staff to communicate clearly with patients that home care is not an endless service, says Jill Eldred, president and chief executive officer. "All RNs should help the family know upon admission that our goal is to teach and train them to take care of themselves. We assess what resources are required to take care of a patient. If someone needs two visits a day, we may or may not be able to do that. It's a day-by-day, hour-by-hour, decision-making process."
Beaumont Home Care in Sterling Heights, MI, has emphasized that quality is still a top priority as the agency cuts costs because of the IPS, says director Deborah Kleinhomer, MSN, RNC, CNAA, CHCE. She also is president of the Michigan Home Health Association in Okemos. "We did a reorganization of every position in the place, and that in itself has been stressful, but I do feel confident that our patient care has not changed,"she says. "Our May Press Ganey patient satisfaction survey results came back as 90.8%, which is outstanding, and it's up from 86.7% in April."
Kleinhomer, Eldred, and other home care experts offer these guidelines for educating staff:
1. Give them background information.
The Balanced Budget Act of 1997 changed the reimbursement system for Medicare home health services, moving it toward a prospective payment system (PPS). But until the PPS is implemented, home care agencies will be reimbursed under an IPS, which went into effect beginning on Oct. 1, 1997, depending on how an agency reports its fiscal year. The IPS will remain in effect, unless it's changed by Congress, until the PPS is implemented. Although the PPS was scheduled to start on Oct. 1, 1999, the Health Care Financing Admin is tration (HCFA) in Baltimore reports it will be delayed indefinitely.
"When the Balanced Budget Act first came out, I put together a full presentation on what IPS is and how it is intended to transition the industry to PPS," Kleinhomer says. "What IPS did was put the accelerator on the action. What I anticipated being an 18-month transition from cost-based care, the traditional method, to PPS, became a four-month transition from cost-based care to IPS."
Kleinhomer held several inservices and monthly team meetings, at which she discussed home care's history, using Beaumont Home Care's experience as an example of the industry's rapid growth. "Beaumont has grown fivefold, going from 50 employees to more than 230 in the last 15 years," she says. Between 1988 and 1997, Medi care spending for home health services grew from $2 billion to more than $17 billion, according to the Medicare Payment Advisory Commission. Since 1998, the number of beneficiaries receiving home health care has doubled, while the number of visits per user has more than tripled.
In some ways, the Balanced Budget Act is swinging the pendulum on Medicare reimbursement from one side to the other. Throughout most of its history, home care had been seen as a temporary service for educating patients and helping them return to independence, Eldred says.
That philosophy changed about 10 years ago. Medicare began to allow home care agencies to care for long-term, chronically ill patients, providing them with twice-daily visits by home health aides to assist with daily living activities, says Val Boosi, vice president of finance for the Visiting Nurse and Hospice Services. "We could suddenly care for chronically ill patients, and that's when the explosion in services occurred," Boosi says.
2. Explain how the new IPS cost limits work.
The growth trend will reverse under the IPS and then the PPS for most home care agencies, according to HCFA's own projections and an analysis conducted by the National Association for Home Care (NAHC) in Washington, DC. HCFA predicts that 65% of all home care providers will exceed their new per-visit cost limits. NAHC estimates the new IPS provisions represent a 21% reduction in cost limits. Under the IPS, agencies are reimbursed based on the lowest of these three factors, Kleinhomer says:
o They will be reimbursed for actual costs if those costs are lower than the Medicare limits.
o They will be reimbursed by Medicare's aggregate per-visit cost limits, which are the limits HCFA has established for a particular agency. Those rates are published annually by HCFA and differ per agency and region. The limits are calculated based on 105% of the median per-visit costs of freestanding home health agencies, using financial data from fiscal year 1994.
o They will be reimbursed by a per-patient or per-beneficiary cap, which is an aggregate per-beneficiary limit. This is a blended limit of 75% agency-specific data and 25% census-region data, using fiscal year 1994 as the base year. That's the way most agencies will be paid, she says.
One problem home care agencies face with the IPS is they won't know until the end of the year which of the three reimbursement factors will have the lowest cost, she adds.
3. Show the effects of IPS.
Kleinhomer told staff the IPS is causing the agency a 17% decrease in revenues. "Like it or not, we'll have to take a more business-like approach to care." (See related story, p. 121.) Change is a natural part of any industry's growth, she tells staff, making an example of the American auto industry: "In 1950, 76% of the cars sold in the United States were American-made. In 1980, 21% of the cars sold in the U.S. were American-made, so the car industry had to respond."
The IPS is putting some home care agencies out of business, Eldred says. "Some will find themselves in bankruptcy situations because the government didn't release the [per-beneficiary limits] formulas in time for them to plan."
The Visiting Nurse and Hospice Services has carefully examined every single expense line item, including medical supplies, telephone calls, and travel, to see where cuts can be made, Boosi says. However, 70% of the agency's costs are in salaries and benefits, so the agency cut its staff from 250 to 210 positions, Eldred says. "Morale is not very good because fear about job security is very high right now, and it's symptomatic of what's going on every place else," Eldred adds.
Boosi agrees. The agency's managers speak openly about the changes with staff at regular meetings, she says, and they meet with employees individually, but some still are scared.
"The only way we're going to turn this around is for Congress to understand how devastating this is to patients and to businesses, and we're doing everything we can to educate Congress about IPS," Eldred says.
William A. Dombi, vice president for law and director of the Center for Health Care Law at NAHC, said in a March address to Congress that about two-thirds of home care agencies were flying blind with the new per-beneficiary limits. Those agencies had to use the limits as of Oct. 1, 1997, or Jan. 1, 1998, even though the limits were not published until April 1998. Dombi also listed these potential effects of the IPS on home care:
o Home care providers will be forced to admit patients selectively. For example, beneficiaries who require high-intensity services for a short period or long-term patients who need services over an extended period will no longer be desirable for home health agencies to serve. Those types of patients include infected wound patients needing two or three dressing changes a day and multiple sclerosis patients needing extensive home care aide services to help with activities of daily living.
o Without home care, those patients could be admitted more frequently to the hospital, which would increase Medicare costs. Or they could end up in nursing homes at higher costs to state Medicaid programs.
o The agencies most affected by the IPS won't necessarily be the most inefficient. Any agencies serving more patients with greater care needs than they served in fiscal year 1994 will have difficulty adjusting to the lower reimbursement and still maintaining high quality care.
o The nation's sickest and most fragile patients may experience reductions in services or be shifted to less appropriate care settings such as emergency rooms, hospitals, and nursing homes.
"The inadequacy of the new reimbursement limits leaves providers with the Hobbesian choice of restricting access to their services or financially destroying the organization by delivering care to patients that push the agency's operating costs above the reimbursement limits," Dombi told Congress.
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