Home Healthcare:
Friend or Foe?

By Teri L. Lanza

Understanding, Selecting and Collaborating With an Agency

When Mrs. Smith, a resident at your assisted-living facility, suffers a fall and a broken hip, her family is concerned that she should have more support than your staff's usual assistance with her activities of daily living (ADLs). They don't wish to relocate her to a nursing home, but your caregivers are not certified to administer medical assistance. As a manager or operator of assisted living, you must admit a need: the occasional provision of additional support services to your residents. Collaboration with a home-health agency (HHA) can meet that need, keeping your beds occupied and your residents properly cared for.

According to a research report released by the American Seniors Housing Association in the summer of 1997, Managed Care Flexes Its Muscle: Capitation Infiltrates Long-Term Care, home healthcare is the fastest-growing component of the long-term-care continuum. The report claims that because home- and community-based support services are efficient and low-cost ways of caring for the elderly and disabled, and because these individuals prefer to receive assistance and healthcare within their homes and communities rather than a hospital or other facility, HHAs are on the rise. The National Association of Home Care reported in 1997 that approximately 18,500 such agencies were serving seven million individuals.

So, the question begs to be asked: If HHAs are helping older adults to remain independent in their homes for longer periods oftime,does this detract business from assisted living? Ultimately, are HHAs friends or foes of the industry as a whole? Other questions must be addressed regarding the relationships and responsibilities between an assisted-living facility and a home-care agency. While the relationship can be seamlessly symbiotic in the proper arrangement, it offers some legal and financial challenges.

Friend or Foe

Dee Stoffer, president of Healthcare Consultants Inc. in Nashville, Tenn., explains that as a result of Medicare regulations established by the Balanced Budget Act of 1997, reimbursement for home-health services has been significantly diminished. Financial-cost limits on individual Medicare beneficiaries prevent some providers from furnishing services, which could be good news for assisted living.

"Home healthcare should be viewed as an ally because the Medicare regulations have changed significantly," says Stoffer, who believes that assisted living will grow as a result. Once an HHA has reached its reimbursement limit for a particular client, it will look to networking resources for referrals so that they may discharge the client effectively, Stoffer explains. HHAs can become a great source of referrals for assisted living in this scenario. Although reimbursement for healthcare is, at present, in a stage of transition, the currently reduced limits may steer Medicare clients toward assisted living's doors.

Todd Wiebush, president of Capital Health Management Group in Charlotte, N.C., explains that in the past, the home-health and assisted-living industries operated in a vacuum. While there was contact in the referral of patients back and forth, this relationship was incidental. "They were not strategic partners--assisted-living communities were just viewed as another site for home-health visits," he says. "And home healthcare was probably just viewed as another service by assisted living. There was not the recognition of the potential value added of having a relationship between the two providers. That has changed dramatically over the last few years."

But while a relationship between the two industries has developed, it has also become more complicated, Wiebush says. "In some markets, assisted living and HHAs are starting to choose sides and partner, because home healthcare can be a great system for assisted-living residents, if there's a good relationship between the two." At the same time, home healthcare can be viewed as competition. "If we can keep clients in their homes with our services, then they aren't in the assisted-living facility."

Medical vs. Social Models

Molly Micelli is president of Lifestyle Options, a Schaumburg, Ill.-based provider of assisted-living services. Because her company is not an HHA, it does not offer skilled care. According to Micelli, this fact works in favor of assisted-living facilities. "When you work with a Medicare-certified agency, such as an HHA, the mindset is a medical model," she says. "It is not always a good match to have a medical model of healthcare and a residential model of service--it's a social vs. a medical model." And different models may mean differing philosophies of care, which can present difficulties in the assisted-living environment. But the opposing scenario may not be a solution to a crisis of conviction.

According to Kathleen Dodd, president and chief executive officer of The Corridor Group Inc., a healthcare-consulting company based in Overland Park, Kan., assisted living should be structured on a social model. "What is creating some problems for assisted living today is that, depending upon what services are being offered, there's a gray area, an overlap of care," she says. "If assisted living would maintain its social model, it would be fine, but a lot of facilities seem to be moving into a medical model. You create a whole new set of problems in trying to incorporate healthcare into assisted living, because there is a risk factor--which is getting higher every day--of Medicare payments being denied.

"Surveyors have been a little more aggressive over the last 12 months about looking into these relationships, and they're saying, 'No, you're already being paid by Medicare or Medicaid, and this is double-dipping.'" Dodd explains that, depending upon how an assisted-living facility has licensed itself, bringing in an HHA is like sending home care into a nursing home. "It just doesn't work," she says. When both the HHA and the assisted-living facility are billing a client's Medicaid or Medicare number for the same service, you have trouble.

Wiebush agrees: "A Medicare-certified agency should not be providing home-health services in an assisted-living facility and billing Medicare for them, because that's a duplication of services. In today's reimbursement and regulatory environment, you've got to be super clean in any financial dealings."

Assisted living was born out of a social model of care, and may do best to stay that way, according to Dodd, who says that assisted-living communities are better off looking at collaborative efforts with certified HHAs than adopting a medical model for themselves. "I would not encourage an assisted-living facility to get into a Medicare model," she says. "It's high-risk, it's very expensive and they would benefit more from looking at private-duty services. If the facility wants to be licensed, they shouldn't be Medicare licensed, because that's where you run into trouble." Dodd recommends setting up contracts with outside providers for those home-health services you wish to offer. As long as assisted living works within a social model and outsources for medical services, HHAs cannot be viewed as competition, she adds.

Services and Benefits

HHAs provide a full range of services that can be employed by assisted living and other long-term-care settings, including skilled nursing, certified home-health aids, physical therapy, speech therapy, occupational therapy, social workers and rehabilitation services. Every agency offers different services, so be sure to select one that provides everything your community will need, including supplies, recommends Stoffer.

The benefits of HHAs for assisted living are equally wide-reaching, the most obvious being decreased resident turnover and higher occupancy. When it is unnecessary for residents to switch facilities due to episodes of acute illness or injury, it is not only convenient for them, it is beneficial for the community. In addition to allowing residents to receive care in their home, HHAs lend a community clinical expertise. "Agencies typically have more experience dealing with higher-acuity patients and frequently have disease-specific knowledge and resources to help a resident recover in the home," says Wiebush. An agency can also assist in designing a long-term-care plan to meet the current and ongoing needs of a facility's residents.

"A lot of times a fall might trigger hospitalization in an assisted-living residence," says Stoffer. "This is where the rehabilitation services of an HHA are beneficial." The agency will not only provide a physical-therapy assessment, but can advise in adapting equipment for the purpose of facilitating ADLs and provide guidance of the care plan to the care workers. An HHA can also address the question as to whether the injured person can remain in a residential setting comfortably, or if they should be transferred to other long-term-care accommodations, which can be a relief to the assisted-living director who no longer has to be the one to advise the family of the necessity to relocate. Finally, an HHA can provide an objective, professional advisement in the determination of a resident's transfer to another facility.

Additional benefits to utilizing an HHA in your facility are supplemental and temporary staffing, medications management, convenience and marketing. "The provision of supplemental services to your residents can be used as a marketing draw," says Stoffer, who notes that many facilities include this additional service in their brochures. "Seniors like this component, because it's there if they need it--it provides a certain amount of security."

Selecting an Agency

Choosing an agency to work with can be tricky, especially when there are so many in the current market. While some assisted-living facilities opt to create their own HHAs within their communities, and while a venture of this nature can be a great new source of financial and operational benefits, it is not advisable to make the attempt until the community has been able to conduct a resident survey, community-needs assessment and thorough market analysis. Since the procedure for undertaking such a project is too lengthy to include here, suffice it to say that the possibility remains. For anyone wishing to read more on the topic, Stoffer has written a technical-assistance brief, "Starting a Medicare Certified Home Health Agency: A Practical Guide," which can be obtained from the American Association of Homes and Services for the Aging; phone (202) 783-2242; Web www.aahsa.org.

What is perhaps more practical, and certainly less time-consuming and financially challenging, is to contract out to an existing HHA and allow its staff to provide Medicare services to your residents. As an assisted-living facility director, you can lease office space to such an agency, accruing additional revenue in the collection of rent. But how do you choose which agency to lease to? Since your facility will have to work collaboratively with the HHA, selection should be made carefully. The following are some guidelines for the selection process:

• Philosophy. According to Micelli, a facility should begin its selection process by looking at its own philosophy of care. "Each facility is very different," she says. "The place to start is to look at what you, as a facility, have as a goal. Then you determine if this is what you want to accomplish, and what services you will need." A matched philosophy between your facility and the HHA will reduce the possiblity of conflicts down the road.
• Credentials. An HHA should be Medicare-certified and licensed to provide medical care. But, as Wiebush points out, accreditation for HHAs varies by state, with only some requiring licensure. In those states that don't require licensure, says Micelli, it may be advisable to select an agency that is accredited by the Joint Commission on Accreditation of Healthcare Organizations. Even though this is not a requirement for such agencies, it speaks well of their qualifications.
• Financial Stability. Make sure the agency you choose has a sound financial standing. "What you want to do, particularly in today's homecare environment, is make sure that the agency is financially viable," Wiebush says. "You don't want to be paired up with a company that isn't going to be in the business in six months." Even though there is no direct financial relationship between the assisted-living facility and the HHA, you don't want to have to sacrifice a good working relationship.
• Reputation. According to Dodd, an assisted-living facility should look for an agency that has been in the community, has a track record, provides good services, and has a way of credentialing its employees and assuring quality. "Make sure, if you're going to work with an HHA, that you get someone who knows what they're talking about," she says.
• Micelli says to look for experience. "In assisted-living 10 years ago, we were all kind of new, and what I knew, you knew, and so did the guy down the street. Not anymore. Look for someone who has some real depth of experience. You need someone with a track record who can provide good client references. It's no longer acceptable to be learning together. It was years ago, but that's no longer the case."
• It is advisable to ask for references, to network in the community to learn more about the agency and ask your residents' physicians for their personal recommendations. You can also contact your state to find out how each agency has surveyed, says Wiebush.
• Interview. Stoffer recommends developing a series of questions for home-health coordinators and interviewing at least three different ones. Ask questions such as: What ADLs do you provide? What is your philosophy of care? What additional services do you provide? What is your protocol for dealing with particular problems or issues? How long is your typical plan of care? Will you do insurance investigation for those clients with supplemental insurance? What is your level of patient satisfaction? Do you do criminal checks on your staff? Any question that will assist the community director in determining how the agency manages its business and its clients is pertinent and valid.

The Bottom Line and the Dangers of Kickback

While an assisted-living facility cannot tell its residents which HHA to use--even when it rents space to one on the premises--and while any HHA may approach your community for the purposes of educating your residents, there will be instances when an agency may offer free services to your community in hopes of earning referrals. This practice, known as "kickback," is defined by Stoffer as "monies and/or services received by an organization or individual in return for Medicare referrals." The practice is not advisable, however mutual the benefits may seem.

Weibush points out that participation in dealings of this nature are of great risk to both parties, since there is often Medicare money changing hands. Dodd agrees that the exchange represents a faulty philosophy: "I don't care how you write it in a contract, you're talking about giving a referral in exchange for dollars, and that is totally unacceptable."

In her article "Home Care: Be Informed," Stoffer points out that under an anti-kickback statute outlined by Safe Harbor Rules and Regulations, it is illegal to "knowingly and willfully solicit, receive, offer or pay anything of value to induce, or in return for, referring, recommending or arranging for the furnishing of any item or service payable by Medicare." It is also important for an assisted-living facility to make clear to the HHA what services it already provides to its residents so that there is no duplication of aid, which would result in the billing of both Medicare and the resident for the same service.

The inclusion of home-health services into an assisted-living facility not only provides the agency with more business, it improves the community's bottom line by allowing residents to remain in a residential setting even during episodes of injury or illness. The presence of an HHA, provided as an additional service to your residents, can be a real asset to your facility. Concerns over competition can be alleviated when the HHA is approached as a collaborative partner.

"Everybody is trying to find another nickel," says Dodd. "But homecare is going to grow, and it's going to survive." The question should not be one of beating or joining. When you consider the quality and range of services your community provides for its residents, it becomes a question of options: The more your facility offers, the more likely you are to attract, and keep, your residents--a situation that not only improves your bottom line, but your community and professional standing as well.

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