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Productivity Expectations, Within the Law

Vol. 17 •Issue 13 • Page 51
Home Health Forum

Productivity Expectations, Within the Law

I am the new owner of a Medicare-certified home health agency and am struggling to get my full-time and part-time hourly staff at an efficient level of productivity. How do I reimburse part-time therapists to maximize my profit margin and what productivity expectations should I have for the FTE rehab employees?

Home-care agencies across the nation have struggled with therapist reimbursement since the Balanced Budget Act Reform of 1997 altered the landscape of how Medicare-certified agencies are paid for their services.

Prior to 1997, home care was reimbursed on a fee-for-service basis. If a home-care patient received seven therapy visits, the agency billed Medicare for and received payment for those seven visits. If the patient was to receive 25 therapy visits, the agency billed and was paid for 25 visits.

The potential to provide a maximal amount of visits and achieve reimbursement was obvious; the skyrocketing costs of Medicare home health helped to prompt the budgeting reform.

Services as Necessary

With the goal of eliminating fraudulent or abusive practices, CMS developed a capitated reimbursement structure based on clinical activity.

This Prospective Payment System (PPS) was introduced to provide a capitated budgetary level to providing home-care services.

By denoting a HHRG-based reimbursement total for a specific clinical patient profile, Medicare was able to limit its costs for any 60-day certification period. A Medicare-certified home care agency would be able to provide services as it deemed necessary and retain any of the capitated after expense funds as profit.

This required the agencies to make sound and prudent decisions regarding not only the types of services provided, but also the intensity and duration of these services.

Agency-based inefficiencies in patient management can result in financial losses for the home care agency. Prior to PPS, CMS bore the fiscal brunt of poor service provision or unfocused clinical delivery; since PPS, Medicare-certified agencies are experiencing the lack of profit if they spend their capitated funds inefficiently.

Similar dynamics occur in the payments made by Medicare-certified agencies to their employed or contracted therapy staff. Any therapist paid on an hourly basis would certainly have a disincentive to provide efficient services on either a daily or per-patient basis.

A single visit and subsequent documentation that may also include interdisciplinary communication often results in more than two hours "on the clock."

Productivity Struggles

Salaried therapists offer agencies similar struggles with regards to productivity. Individuals who have income guaranteed can make 75-minute visits when a 50-minute, efficiently planned visit will suffice.

OASIS visits and documentation that may be concluded in two hours are often requiring up to four to five hours to complete when efficient models are not followed.

It is no surprise that a Medicare-certified home health agency may struggle with its rehab "bottom-line" considering the trends outlined above.

In our practice, we have expected salaried PT or PTAs to provide an FTE productivity level of five to six visits per day. Our office has been developed to support clinical staff whenever possible, including scheduling, equipment, communication, documentation management and so on. Part-time or contract rehab staff members are paid on a per-visit basis only.

Therapists should receive positive reinforcement to modify their approach to home care with these progressive practices in mind.

Rehab staff with concerns for caseload volume should be rewarded for efficient services by being assigned a greater proportion of the agency's therapy referrals.

These arrangements provide ongoing financial incentives for organized and efficient clinical services.

Visit totals and POCs are monitored for compliance and use of best practice guidelines by our progressive case-management system.

It is our experience that staff reimbursement models that incorporate the principles of the PPS reimbursement system serve to support a healthy financial outcome for the Medicare-certified home care agency.

Teri N. Thompson and Arnie Cisneros are both physical therapists in private practices with more than 30 years of home care experience; providing clinical services, management and consulting expertise. They also lecture for Encompass Consulting and Education, LLC, a rehabilitation consulting and education company. You may contact the authors at


is there any protection for therapist OTS and PTs that are forced into 100 percent patient productivity with zero time for documentation and other incidentals. This is happening in SNF .currently the agency is threatening pay cuts if we don't further up our caseloads and productivity. Does a therapist have any recourse
Is it legal for them to do this?
thanks for any information on this.

Alice  January 16, 2014


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