Make the most of Medicare reimbursement

HouseCalls relates own learning experiences

Adding a primary care practice to your home care services may be complicated and expensive at the beginning. But there are some strategies that can make the whole learning curve a lot shorter than it otherwise might be.

For instance, it’s important to know exactly what sort of services and procedures will be covered under the Medicare Part B Physician Fee Schedule, which would be the primary reimbursement for such services, says Lynn T. Rinke, RN, MS, executive vice president and chief operating officer of The Visiting Nurse Association (VNA) of Greater Philadelphia. The VNA formed a separate business, VNA HouseCalls, in order to begin offering primary care services to homebound patients.

The Baltimore-based Health Care Financing Administration (HCFA) published in January 1998 the Medicare Part B Physician Fee Schedule, which included changes that improved reimbursement for home care physician visits. The number of current procedural terminology (CPT) codes went from six to nine, and reimbursement rates rose from the previous range of $45-$98 to a range of $46 to $173 per visit. In January 2000, the new Medicare Part B physician schedule of fees increased again to a range of $61 to $200 per home visit.

HCFA changes no help

"None of HouseCalls’ patient visits results in the lowest payment because all of the patients have complex cases," Rinke says.

"You go see a doctor because you have a sore throat, and the doctor looks at your throat, writes a prescription, and you leave," she explains. "That type of simple intervention never occurs with our patients because they are all old with multiple morbidities, so our visits tend to average $150."

HouseCalls physicians and nurse practitioners have learned to bill for every single reimbursable intervention and service they provide. For example, the psychiatric nurse will bill for a behavioral therapy intervention that she provides to a moderately complex patient who has a clinical psychiatric disorder.

"There are four or five behavioral interventions and probably 40 other procedures we can do in the home and bill for," Rinke notes.

It’s important to keep in mind that the allowable reimbursement for nurse practitioner services is less than it is for physicians, but this doesn’t have to be a financial problem so long as all options are explored, she adds. For example, a nurse practitioner is paid 85% of what’s allowable for physicians for general medical services. However, for psychiatric visits, the nurse practitioner receives only 66% of what the physician would have received.

Discovering untapped revenue

"At the beginning — because we didn’t know what we were doing — a lot of psychiatric nurse visits were billed just for behavioral interventions, which is the 66% reimbursement," Rinke says. "Then we asked the nurses what else they do when they make one of these visits, and we learned that they do an evaluation and management visit, as well as the intervention."

These extra services were potential untapped revenue because those services could be billed at 66% of what the physician would have received.

HouseCalls also bills for care plan oversight, which generates $100 per month per case, and a little less than one-third of patients receive care plan oversight, Rinke says.

Then, starting this year, the business can start billing for physician sign-off on the patient certification or recertification for traditional home care services. An estimated 95% of the HouseCalls patients will have at least one episode of home care within the year, Rinke says.

Now Medicare will pay physicians $75 for every certification and $60 for every re-certification they sign, she explains. "This is a brand new revenue source."

By HouseCalls’ 11th month of operation the practice was generating enough revenue to cover its costs. The goal is to have it make a profit or break even, when taking all overhead and other expenses into account, by the third year, Rinke says.

Also, HouseCalls should do very well under the prospective payment system (PPS), she notes.

"These patients are the patients you want in PPS because most of these patients should have six 60-day episodes in a year," Rinke says. "They are sick and with PPS, we want these patients because HouseCalls’ referrals to the VNA will be on average much more profitable than the average referral from a local hospital."

A future source of revenue potentially will be managed care organizations, which could benefit from having lower long-term costs in managing the care of patients with chronic and comorbid conditions.

It costs insurers about $500 just for an ambulance trip when one of these patients has an exacerbation of a chronic condition. HouseCalls could, for about the same price per visit, prevent multiple emergency room visits and hospitalizations, Rinke predicts.

In a couple of years HouseCalls should have ample data to prove that theory, she adds. "It may cost an HMO $7,000-$8,000 a year to have a person by our primary care patient, but that’s nothing compared with one hospitalization."

• Lynn T. Rinke, RN, MS, Executive Vice President and Chief Operating Officer, The Visiting Nurse Association of Greater Philadelphia, One Winding Drive, Monroe Office Building, Philadelphia, PA 19131. Telephone: (215) 473-7600.

• Frances Weaver, PhD, Deputy Director of the Health Services Research and Development Center and Research Associate Professor at the Institute for Health Services and Policy Research, Northwestern University; Hines VA Hospital, HSR&D 151H, VA Hospital, Hines, IL 60141. Telephone: (708) 202-8287, ext. 25866. n

Mental health resources

For more information on mental disorders, contact the following organizations:

• National Alliance for the Mentally Ill, Prince Georges County chapter — Agnes Hatfield, who works with this organization, says it has fact sheets available on different mental disorders and coping strategies. P.O. Box 959, Greenbelt, MD 20768. Phone: (301) 925-7373. Web: www.nami.org.

• American Psychiatric Association — this professional organization also has fact sheets for consumers and ordering information for useful reference books. Web: www.psych.org.

• American Association for Geriatric Psychiatry — provides consumer information on depression and other mental disorders, ordering information for publications, and information on geriatric psychiatrists available locally. Web: www.aagpgpa.org.

---