Presented by. M. Aaron Little, CPA William Simione, III. Agenda Sunday, July 28, 2013, 9:00 a.m. 3:00 p.m.

Transcription

1 Tom Boyd, MBA, CFE Principal Boyd & Nicholas, Inc. Rohnert Park, CA Presented by Melinda Gaboury, COS-C Chief Executive Officer Healthcare Provider Solutions, Inc. Nashville, TN M. Aaron Little, CPA William Simione, III Director Principal BKD, LLP Simione Healthcare Consultants, LLC Springfield, MO Hamden, CT Agenda Sunday,, 9:00 a.m. 3:00 p.m. 9:00 a.m. Current Medicare reimbursement issues (Gaboury) 9:25 a.m. Billing oversight and compliance processes (Gaboury) 10:20 a.m. Break 10:35 a.m. Using the Medicare cost report as a management tool (Boyd) 11:05 a.m. Essential management benchmarking data (Little) 12:00 p.m. Lunch 1:00 p.m. Reporting Medicare organizational changes (Boyd) 1:15 p.m. Achieving compliance in organizational changes (Simione) 2:00 p.m. Feasibility analysis practices for business expansion (Simione) 3:00 p.m. Adjourn

2 Current Medicare Reimbursement Issues & Billing Oversight & Compliance Processes Home Health PreConference 2013 Current Reimbursement Issues Base rate of $2, (increase from $2,137.73) BUT Proposed 2014 Payment Rates Home Health CMS s proposed rebasing changes are the most complex factor of the new rule. As stated in the proposed regulation: rebasing must be phased-in over a four-year period in equal increments. So, starting with the 2014 proposed HHPPS rule, CMS has chosen to begin this four-year process with a -3.5 percent rebasing adjustment in This 3.5 percent reduction is based on CMS projection of an average home health margin of percent in 2013 (the difference between the average national episode revenue in home health and the average national episode cost) using 2011 Cost Report Data. This data appears to be skewed and is under intense review. Labor Rate Increase from to percent changing the non-labor rate from to (good for agencies whose wage index is 1.0 or greater) 1

3 Current Medicare Reimbursement Issues & Billing Oversight & Compliance Processes Proposed 2014 Payment Rates Home Health CMS arrived at its CY 2014 proposed case mix weights by dividing the CY 2013 case mix weights (which are the same weights as those finalized in the CY 2012 rulemaking) by To offset the effect of re-setting the case mix weights such that the average is 1.00, CMS increased the proposed CY 2014 national, standardized 60-day episodic payment rate by the same factor used to decrease the weights (1.3517). The proposed rule suggests that the rebasing of the HHPPS payment rates and case mix weights do not require a case-mix creep adjustment. Case Mix Weight Changes 2012 Weight Weight Variance In Payment 1AFKS AFLS AFMS BHLS BHMS CFKS CFKS CGKS CHKS

4 Current Medicare Reimbursement Issues & Billing Oversight & Compliance Processes Case Mix Weight PROPOSED Changes 2014 Weight Weight Proposed AFKS AFLS AFMS BHLS BHMS CFKS CFKS CGKS CHKS LUPA FINAL Proposed HHA $ $ $ MSS $ $ $ OT $ $ $ PT $ $ $ SN $ $ $ SLP $ $ $

5 Current Medicare Reimbursement Issues & Billing Oversight & Compliance Processes Non-Routine Medical Supplies FINAL Nonroutine Medical Supplies Severity Level Points 2013 FINAL Urban 2014 PROPOSED Urban 1 0 $14.56 $ $52.68 $ $ $ $ $ $ $ $ $ Case-Mix Reform Proposed case-mix refinement Expanded set of case-mix variables 153 case mix groups weights changed on all CMS states that Category 1 codes likely reflect conditions the patient had prior to the home health admission (for example, while being treated in a hospital setting). Conditions coded under this category are anticipated to have progressed to a less acute state, or are completely resolved for the patient to be cared for in the home setting, thus meaning that another diagnosis code would likely have been a more accurate reflection of the patient s condition in the home. 4

6 Current Medicare Reimbursement Issues & Billing Oversight & Compliance Processes Case-Mix Reform CMS proposes to remove Category 2 codes from the HHPPS Grouper based upon clinical judgment that the condition would not require home health intervention, would not impact the home health plan of care (POC), or would not result in additional resource use when providing home health services to the patient. There are 170 ICD-9-CM codes that CMS proposes to remove from the HHPPS grouper, effective January 1, Finally, the proposed rule confirms that ICD-10-CM diagnosis codes are set to be adopted by October 1, 2014 for use by entities covered under the Health Insurance Portability and Accountability Act of 1996 (HIPAA), such as home health agencies. Therapy FINAL 2013 CMS proposes that if a qualified therapist missed a reassessment visit, therapy coverage would resume with the visit during which the qualified therapist completed the late reassessment, not the visit after the therapist completed late reassessment. CMS proposes that if multiple therapy disciplines are involved, if the required reassessment visit was missed for any one of the therapy disciplines for which therapy services were being provided, therapy coverage would cease only for that particular therapy discipline. CMS proposes to revise the assessment timing for individuals receiving more than one type of therapy. The reassessment could occur during the 11 th, 12 th, or 13 th visit for the required 13 th visit reassessment and on the 17 th, 18 th, or 19 th visit for the required 19 th visit reassessment. 5

7 Current Medicare Reimbursement Issues & Billing Oversight & Compliance Processes New Codes for Billing HH July 2013 EFFECTIVE DATE: July 1, 2013 (HH episodes beginning on or after this date.) IMPLEMENTATION DATE: July 1, 2013 HHAs must report where home health services were provided on home health claims, using the Q codes: Q HOME Q5002 ASSISTED LIVING FACILITY Q5009 NOT OTHERWISE SPECIFIED Home Health PreConference 2013 Billing Compliance Oversight 6

8 Current Medicare Reimbursement Issues & Billing Oversight & Compliance Processes Billing Performance Job Descriptions: Do they exist for all positions? Do Employees have a copy? Do Employees truly understand what they are responsible for? Are positions over/under-staffed? Develop measures to monitor staff performance Review measures in team meetings Set reasonable expectations/goals Require staff to be accountable Deal with low performance Set limits for time allowed to perform at these levels Reward high performance Who Does What? Billers Collectors Cash Posters Managers/Supervisors Do you have separate designations or does one person wear all four hats? Does each employee understand his/her responsibilities? Who is the leader/manager/supervisor? Is there required reporting in place to monitor progress? 7

9 Current Medicare Reimbursement Issues & Billing Oversight & Compliance Processes Prebilling Audit Audit 100% of Charts Catch Compliance Issues Catch Issues Associated w/pps Avoid unnecessary denials Who should conduct these audits? Billing or Clerical Staff are sufficient it is not a clinical audit Prebilling Audit When do we conduct these audits? End of episode no need to audit prior to end of episode or discharge What do you need for audit? Patient Chart Audit Tool Trial Bill (Pre-bill) 8

10 Current Medicare Reimbursement Issues & Billing Oversight & Compliance Processes Prebilling Audit Face To Face Compliance Quick Review of 485 All Blanks Completed, Signed & Dated by Clinician Signed & Dated by Physician Supplies ordered on 485 Supplemental Orders Signed & Dated by Physician Clinical Note for every visit Frequency & Duration Match Visits provided Therapy ReAssessment Visits Correct G code usage Supplies billed correctly OASIS transmitted to the state Recommendations Recommend that Agencies do the following: Send Billers/Collectors to Billing Workshops at least once per year Join List Serves/Participate in Webinars/Teleconferences frequently Have someone in agency closely monitor the Medicare MAC websites/newsletters Update PreBilling Audit Tools as necessary Have peers within agency randomly pull prebilling audits and double check the accuracy Billing/Reimbursement Review by Third Party at least every two years 9

11 Current Medicare Reimbursement Issues & Billing Oversight & Compliance Processes Faculty Contact Info Melinda A. Gaboury, COS-C Chief Financial Officer Healthcare Provider Solutions, Inc. 810 Royal Parkway, Suite 200 Nashville, TN

12 Medicare Cost Report NAHC Financial Management Conference & Exposition Using the Medicare Cost Report for Management Information, Benchmarking and Competitive Knowledge Presented by: Thomas E. Boyd, Principal Boyd & Nicholas, Inc. Benchmarking & Productivity Evaluate Your Data Illuminate the Results Improve Your Business 1

13 Medicare Cost Report THE MEDICARE COST REPORT CAN BE USED FOR BENCHMARKING DATA A COMPLETED AND ACCURATE MEDICARE COST REPORT will permit an organization to benchmark their PPS data against the information provided by ALL the cost reports for the nation and for their state. Management Use of Cost Report The MCR is NOT just a compliance requirement that must be filed with CMS but can be a valuable tool to assist in budgeting, pricing and strategic analysis. Direct and indirect costs by discipline (per hour and per visit) Fixed and variable costs Non-routine medical supplies 2

14 Medicare Cost Report NAHC Cost Report Data Compendium (All States) Item Number: M-083, All States The NAHC COST REPORT DATA COMPENDIUM is an in-depth analysis of Medicare cost reports filed by home health agencies since the beginning of the HH PPS payment system in October NAHC has acquired over 20,000 filed cost reports to develop this Compendium. Cost reports contain a wealth of data. For purposes of this compendium, NAHC used data on per unit costs, supply costs, service utilization, and Medicare PPS episodes. In addition, overall HHA cost and revenue data is used to calculate overall financial margins. The geographic location of the HHA and its categorizations also is utilized. The Compendium is a valuable tool for providers of services, consultants, health policy planners, home care advocates, investors, and trade associations looking to gain an understanding of the financial status of home health agencies. FOIA Freedom of Information Act 3

15 Medicare Cost Report Direct Cost Per Visit SN $ $ $ PT $ $ $ OT $ $ $ ST $ $ $ MSW $ $ $ HHA $ $ $ Salaries of worksheet A, column 1, lines 6-11, divided by the visits of worksheet S-3 Part 1, column 5, lines 1-6 Total Cost Per Visit Nevada National SN $ $ $ $ $ PT $ $ $ $ $ OT $ $ $ $ $ ST $ $ $ $ $ MSW $ $ $ $ $ HHA $ $ $ $ $ Worksheet C, Part 1, column 4, lines 1-6 4

16 Medicare Cost Report Statistics - Average Visits Per Episode Nevada National SN PT OT ST MSW HHA Worksheet S-3 Part IV, visits column 7, divided by total episodes of lines 45 & 46 column 7 Visits Per Full Episode Nevada National SN PT OT ST MSW HHA Total Worksheet S-3 Part IV visits column 1 divided by total episodes column 1 line 45 5

17 Medicare Cost Report Episodes By Type Full w/o Outliers Full with Outliers LUPA PEP Your Agency 84.83% 3.27% 8.97% 2.65% Nevada 82.91% 3.22% 10.24% 2.71% National 80.59% 4.00% 11.38% 2.29% Average Per Episode Nevada National Revenue $ 3, $ 3, $ 2, $ 2, $ 2, Cost $ 2, $ 2, $ 2, $ 2, $ 2, Profit $ $ $ $ $ Visits

18 Medicare Cost Report Payment Per Full Episode Nevada National $ 3, $ 3, $ 2, $ 3, $ 2, Worksheet D Part II line 12.01, total of columns 1 & 2 divided by Worksheet S-3 Part IV, column 1 line 45 Cost Report Indicators Profit By Episode Type Full w/o Outliers Full with Outliers LUPA PEP Total Revenue $600,270 $26,195 $14,789 $8,353 $649,607 Cost $444,324 $35,096 $12,822 $5,755 $497,997 Profit $155,946 ($8,901) $ 1,967 $2,598 $151,610 7

19 Medicare Cost Report Cost Report Indicators Cost Analysis Capital Costs $ 55,500 Plant Operation / Maint $ 10,400 Administration $ 464, % Total Overhead Costs $ 530, % Direct Costs $1,222, % Total Costs $1,752,764 Total Patient Revenue $1,809,392 Admin Costs as % of Revenue 25.66% All Costs from Worksheet A column 10 Cost Report Indicators Medicare Profit Margin Medicare PPS Reimbursement $649,607 Medicare PPS Cost Visit Cost $491,437 NRS Cost $ 6,560 Total Cost $497,997 Medicare Profit Margin $151,610 Medicare Margin % 23.3% PPS reimbursement from Worksheet B Part II total of lines 28 columns 1 & 2 PPS costs from Worksheet C Part IV line 19 column 6 8

20 Medicare Cost Report ZPIC REQUESTS COST REPORT INFORMATION FROM HOME HEALTH AGENCY Home Health Alert, Volume April 10, Contact Information Tom Boyd, MBA, CFE Principal Boyd & Nicholas, Inc

21 Essential Benchmark Data Pre-Conference 2 Essential Benchmark Data CPAs & ADVISORS 9:00 a.m. 3:00 p.m. Washington, DC M. Aaron Little, CPA BKD, LLP Director mlittle@bkd.com OBJECTIVES 2 1

22 Essential Benchmark Data OBJECTIVES Evaluating home health (HH) performance using key metrics Comparing HH performance using key benchmarks 3 EVALUATING PERFORMANCE 4 2

23 Essential Benchmark Data EVALUATING PERFORMANCE Identify key metrics Gather raw performance data Measure performance data Compare performance results Examine processes driving performance Implement action & accountability plan 5 EVALUATING PERFORMANCE Identify key metrics 6 Are metrics meaningful, objective & measurable, & comparable? Is data available & obtainable? Are data management requirements sustainable? Gather raw performance data Internal data Billing, accounting & operations systems, CASPER, cost reports, etc. External data Publicly available &/or reported data, benchmarking & market analysis vendors, government or advocacy organizations, etc. 3

24 Essential Benchmark Data EVALUATING PERFORMANCE Measure performance data Are industry benchmarks available? Relevant & comparable to your organization? Do personnel know how to measure & manage performance data? Compare performance results Is data comparable? Are data sources comparable? Are time periods measured comparable? 7 EVALUATING PERFORMANCE Examine process drivers What are processes responsible for performance? What are primary improvement opportunities? How will action plan address opportunities? Implement action & accountability plan What are reasonable timelines & performance milestones? What will be used to monitor & manage accountability? With what frequency will performance be monitored? 8 4

25 Essential Benchmark Data COMPARING PERFORMANCE 9 COMPARING PERFORMANCE Quality Financial & cash flow Volume Revenues Expenses Compliance 10 5

26 Essential Benchmark Data QUALITY Patient perception & satisfaction HH Consumer Assessment of Healthcare Providers & Systems (CAHPS) data Publicly reported & quantifiable Available to all Medicare providers How often HH team gives care in professional way? How well did HH team communicate with patients? Did HH team discuss medicines, pain, & home safety with patients? How do patients rate overall care from HH agency? Would patients recommend HH agency to friends & family? 11 QUALITY Outcome & Assessment Information Set (OASIS) data Outcomes Publicly reported & quantifiable Available to all Medicare providers How often patients got better at walking or moving around? How often patients got better at getting in & out of bed? How often patients got better at bathing? How often patients had to be readmitted to hospital? Outcome-Based Quality Improvement & Outcome-Based Quality Monitoring 12 6

27 Essential Benchmark Data Outcomes 80% 60% 40% 20% 0% Rehospitalization Ambulation Transferring Bathing Patient Satisfaction 90% 85% 80% 75% 70% Professionalism Communication Meds, pain, safety Care rating We're recommended 13 State Nation Per Centers for Medicare & Medicaid Services (CMS) Home Health Compare website QUALITY Other metrics to consider Admission response time Referral intake time Referral source satisfaction Impact of telemonitoring or other specialty programs, etc. Post-discharge patient activities Disease-specific outcomes Specialty-specific program outcomes 14 7

28 Essential Benchmark Data FINANCIAL & CASH FLOW Benchmark sources BKD analyzed & compiled Medicare cost report data obtained directly from CMS Freestanding & hospital-based agencies Excludes skilled nursing facility-based agencies Fiscal years ended in FINANCIAL & CASH FLOW Strategic Healthcare Programs, LLC (SHP) analyzed & compiled Study conducted by SHP of its user database to determine its Benchmark Leaders Based on outcomes & compliance indicators Benchmarking Leaders financial performance then analyzed by BKD using Medicare cost report data OCS HomeCare Elite Study conducted by OCS to determine its HomeCare Elite Based on outcomes & financial indicators Top 100 agencies HomeCare Elite Medicare cost report data analyzed by BKD 16 8

29 Essential Benchmark Data FINANCIAL & CASH FLOW Margins Gross margin Margin after direct costs Data not available for hospital-based agencies Medicare margin Includes traditional Medicare only Excludes Medicare Advantage Based on average episode payment & average episode cost 17 FINANCIAL & CASH FLOW Overall margin Includes all payers & programs HH, hospice, private duty, etc. Data not available for hospital-based agencies Cash flow Days in accounts receivable (AR)/days sales outstanding (DSO) Data not available for hospital-based agencies 18 9

30 Essential Benchmark Data FINANCIAL & CASH FLOW OCS Top SHP/BKD 1 Nation 2 Metric Median Best 25% Median Best 25% Median Best 25% Gross margin 3 52% 61% 47% 55% 51% 61% Medicare margin 19.7% 29.0% 20.9% 28.3% 10.5% 23.3% Overall margin % 19.2% 7.5% 18.4% 2.8% 10.8% Days in AR Per BKD study of 2011 Medicare cost report data of OCS HomeCare Elite Top 100 & SHP Benchmark Leaders 2 Per BKD study of Medicare freestanding & hospital-based cost reports with fiscal years ended in Data only available for freestanding agencies FINANCIAL & CASH FLOW Other metrics to consider Profitability Margins by program, i.e., HH, hospice, private duty, etc. Margins by payer, i.e., Medicare, Medicaid, commercial, etc. Earnings before interest, taxes, depreciation & amortization (EBITDA) Return on assets Liquidity Current ratio Quick ratio Leverage ratio 20 10

31 Essential Benchmark Data FINANCIAL & CASH FLOW Cash flow Percent of AR older than 90 or 120 days Collections as a percent of net revenues Write-offs as percent of net revenues Average days to bill Medicare requests for anticipated payments (RAPs) Medicare final claims Non-Medicare claims 21 VOLUME Net revenues Includes all payers & programs Data not available for hospital-based agencies Visits Includes all HH visits Patients Includes all HH unduplicated patients Data not available for hospital-based agencies 22 11

32 Essential Benchmark Data VOLUME Medicare patient percentage Traditional Medicare only Data not available for hospital-based agencies Medicare episodes Traditional Medicare only Medicare revenues Traditional Medicare only 23 VOLUME OCS Top SHP/BKD 1 Nation 2 Metric Median Best 25% Median Best 25% Median Best 25% Net revenues 3 $2.1 mil. $3.5 mil. $3.3 mil. $7.4 mil. $1.4 mil. $3.2 mil. Visits 10,115 16,643 19,263 39,965 9,062 19,432 Patients , Medicare patients 3 78% 94% 64% 79% 86% 100% Medicare episodes , Medicare revenues $1.3 mil. $2.3 mil. $2.2 mil. $3.3 mil. $0.9 mil. $2.0 mil Per BKD study of 2011 Medicare cost report data of OCS HomeCare Elite Top 100 & SHP Benchmark Leaders 2 Per BKD study of Medicare freestanding & hospital-based cost reports with fiscal years ended in Data only available for freestanding agencies 12

33 Essential Benchmark Data VOLUME Other metrics to consider Current census Volume by program & payer & by diagnosis/disease Number of referrals by source & by diagnosis/disease Number of new admissions vs. readmissions Number of non-admissions Market assessment 25 REVENUES Visits Percent of traditional Medicare visits Medicare low utilization payment adjustments (LUPAs) Medicare episodes per patient Average Medicare case-mix weight Includes full episodes only Excludes LUPAs, partial episode payments, & outliers 26 13

34 Essential Benchmark Data REVENUES Average therapy visits per Medicare episode Traditional Medicare only Includes physical therapy (PT), occupational therapy (OT), & speech therapy (ST) Average of all episodes Average Medicare episode payment Traditional Medicare only Includes all payment adjustments 27 REVENUES OCS Top SHP/BKD 1 Nation 2 Metric Median Best 25% Median Best 25% Median Best 25% Visits 10,115 16,643 19,263 39,965 9,062 19,432 Medicare visits 84% 96% 69% 79% 86% 100% Medicare episodes , LUPAs 5.1% 2.8% 9.5% 5.1% 6.5% 2.9% Episodes per patient Case-mix weight Therapy visits per episode Average episode payment $2,648 $3,148 $2,708 $3,141 $2,670 $3, Per BKD study of 2011 Medicare cost report data of OCS HomeCare Elite Top 100 & SHP Benchmark Leaders 2 Per BKD study of Medicare freestanding & hospital-based cost reports with fiscal years ended in

35 Essential Benchmark Data REVENUES Other metrics to consider Revenues by program & payer/plan & diagnosis/disease Average payment per episode per referral/admission source Average payment per visit &/or per patient For all per-visit payers/plans Average payment per Medicare episode dimension Clinical, functional & service utilization Nonroutine medical supplies Average case-mix weight & payment adjustments per clinician 29 EXPENSES Cost per visit Includes hospital-based overhead Visits per Medicare episode Includes all episodes Cost per Medicare episode Includes hospital-based overhead Labor costs as a percent of revenues Includes compensation, contract labor & benefits 30 15

36 Essential Benchmark Data EXPENSES Administrative & general (A&G) costs as a percent of revenues Hours per visit Includes all personnel hours worked Total hours A&G hours 31 EXPENSES OCS Top SHP/BKD 1 Nation 2 Metric Median Best 25% Median Best 25% Median Best 25% Cost per visit $125 $101 $136 $116 $136 $106 Hours per visit Visits per episode Cost per episode $2,196 $1,888 $2,127 $1,900 $2,405 $1,953 Labor percent of revenues 3 68% 61% 72% 64% 75% 65% A&G cost percent of revenues 3 36% 32% 35% 26% 39.2% 30% A&G hours per visit Per BKD study of 2011 Medicare cost report data of OCS HomeCare Elite Top 100 & SHP Benchmark Leaders 2 Per BKD study of Medicare freestanding & hospital-based cost reports with fiscal years ended in Data only available for freestanding agencies 16

37 Essential Benchmark Data EXPENSES Discipline-specific drill-down Visits per episode Cost per visit Without hospital-based overhead Direct Indirect Hospital-based overhead Hours per visit Visits per day per full-time equivalent (FTE) 33 EXPENSES Skilled Nursing OCS Top SHP/BKD 1 Nation 2 Metric Median Best 25% Median Best 25% Median Best 25% Visits per episode Cost per visit 3 $142 $97 $135 $118 $137 $107 Direct only $74 $50 $78 $62 $69 $50 Indirect $52 $37 $56 $39 $63 $43 Overhead $42 $29 $34 $25 $43 $28 Hours per visit Visits per day Per BKD study of 2011 Medicare cost report data of OCS HomeCare Elite Top 100 & SHP Benchmark Leaders 2 Per BKD study of Medicare freestanding & hospital-based cost reports with fiscal years ended in Data only available for freestanding agencies 17

38 Essential Benchmark Data EXPENSES Physical Therapy OCS Top SHP/BKD 1 Nation 2 Metric Median Best 25% Median Best 25% Median Best 25% Visits per episode Cost per visit 3 $134 $110 $141 $118 $159 $126 Direct only $72 $60 $81 $70 $83 $69 Indirect $54 $34 $56 $37 $72 $46 Overhead $30 $18 $32 $25 $36 $24 Visits per day Per BKD study of 2011 Medicare cost report data of OCS HomeCare Elite Top 100 & SHP Benchmark Leaders 2 Per BKD study of Medicare freestanding & hospital-based cost reports with fiscal years ended in Data only available for freestanding agencies EXPENSES Occupational Therapy OCS Top SHP/BKD 1 Nation 2 Metric Median Best 25% Median Best 25% Median Best 25% Visits per episode Cost per visit 3 $135 $107 $139 $113 $158 $124 Direct $77 $60 $76 $64 $80 $64 Indirect $55 $31 $59 $38 $73 $47 Overhead $26 $16 $31 $24 $37 $24 Visits per day Per BKD study of 2011 Medicare cost report data of OCS HomeCare Elite Top 100 & SHP Benchmark Leaders 2 Per BKD study of Medicare freestanding & hospital-based cost reports with fiscal years ended in Data only available for freestanding agencies 18

39 Essential Benchmark Data EXPENSES Aide OCS Top SHP/BKD 1 Nation 2 Metric Median Best 25% Median Best 25% Median Best 25% Visits per episode Cost per visit 3 $54 $41 $57 $46 $55 $41 Direct $27 $21 $30 $24 $27 $20 Indirect $24 $14 $24 $16 $26 $16 Overhead $13 $5 $12 $8 $16 $10 Hours per visit Visits per day Per BKD study of 2011 Medicare cost report data of OCS HomeCare Elite Top 100 & SHP Benchmark Leaders 2 Per BKD study of Medicare freestanding & hospital-based cost reports with fiscal years ended in Data only available for freestanding agencies EXPENSES Other metrics to consider Transportation expenses Per visit, personnel, patient Costs per referral/admission source & diagnosis/disease Supply costs per patient & per diagnosis/disease Productivity standards Per visit vs. per case-load 38 19

40 Essential Benchmark Data COMPLIANCE Payment per episode Case-mix weight Therapy visits per episode Episodes per patient Outliers LUPAs Outcomes 39 COMPLIANCE Metric Provider OCS Top SHP/BKD 1 Nation 2 Average episode payment $3,502 $2,648 $2,708 $2,670 Case-mix weight Average therapy visits per episode Episodes per patient Outliers 1.7% 0.4% 0.5% 0.8% LUPAs 6.5% 5.1% 9.5% 6.5% Ambulation 3 55% Not available Not available 58% Transfers 3 67% Not available Not available 55% Bathing 3 70% Not available Not available 66% 40 1 Per BKD study of 2011 Medicare cost report data of OCS HomeCare Elite Top 100 & SHP Benchmark Leaders 2 Per BKD study of Medicare freestanding & hospital-based cost reports with fiscal years ended in Per CMS Home Health Compare 20

41 Essential Benchmark Data COMPLIANCE Other considerations Frequency of additional development requests & denials Regulatory survey results Program integrity actions Patient &/or personnel complaints Average Medicare payment per beneficiary Frequency of Medicare HIPPS codes 41 MANAGING PERFORMANCE 42 21

42 Essential Benchmark Data Patient Satisfaction & Clinical Outcomes 100% 50% 0% Professional care Patient rating Patient recommendations Rehospitalizations Ambulation Transfers Bathing Census YTD non-admits YTD patients YTD episodes ,000 1,500 Case-mix LUPAs Episodes/patient Pay per episode Cost per episode $0 $1,000 $2,000 $3,000 $4,000 55% Census Mix 4% 45% Medicare Revenue Mix 31% 4% 65% Medicare 2% 16% 75 days YTD visits YTD non-medicare 0 5,000 10,000 15,000 20,000 Visits Per Episode Skilled Therapies Aides Total Per-visit revenue Per-visit cost $0 $50 $100 $150 $ Us Them State Nation 44 22

43 Essential Benchmark Data

44 Essential Benchmark Data Pre-Conference 2 Essential Benchmark Data CPAs & ADVISORS 9:00 a.m. 3:00 p.m. Washington, DC M. Aaron Little, CPA BKD, LLP Director mlittle@bkd.com 24

45 Attachment A

46 Formula Key Current Ratio = Total Current Assets / Total Current Liabilities Quick Ratio = (Cash + Accounts Receivable) / Total Current Liabilities Gross Profit Margin = Gross Profit / Sales Net Profit Margin = Adjusted Net Profit before Taxes / Sales Inventory Days = (Inventory / COGS) * 365 Accounts Receivable Days = (Accounts Receivable / Sales) * 365 Accounts Payable Days = (Accounts Payable / COGS) * 365 Interest Coverage Ratio = EBITDA / Interest Expense Debt-to-Equity Ratio = Total Liabilities / Total Equity Return on Equity = Net Income / Total Equity Return on Assets = Net Income / Total Assets Fixed Asset Turnover = Sales / Gross Fixed Assets Sales per Employee = Sales / Total Employees (FTE) Profit per Employee = Adjusted Net Profit before Taxes / Total Employees (FTE) Profit Growth = (Current Period Adjusted Net Profit before Taxes - Prior Period Adjusted Net Profit Before Taxes) / Prior Period Adjusted Net Profit before Taxes Sales Growth = (Current Period Sales - Prior Period Sales) / Prior Period Sales

47 Attachment B

48 Sample Home Care & Hospice Overall Financial Dashboard Monthly Dashboard Prior Key Performance Indicators Year January February March April May June July August September October November December YTD Target Profitability Contribution Margin % Home Health 38.0% 40.7% 56.0% 36.9% 48.4% 31.7% 34.9% 47.9% 43.4% Hospice 29.6% 23.5% 28.2% 30.8% 45.5% 44.7% 35.8% 33.7% 35.8% Private Duty 24.4% 22.2% 33.0% 33.6% 43.8% 50.1% 38.9% 45.5% 42.2% Net Profit % -3.3% 4.3% 27.5% -1.3% 35.3% 2.7% 1.3% 10.2% 11.6% EBITDA % -2.0% 5.7% 28.8% 0.1% 36.5% 3.9% 2.4% 11.0% 12.8% Return on Assets -4.2% 0.5% 3.2% -0.1% 3.9% 0.3% 0.2% 1.4% Return on Net Assets -18.6% 2.0% 13.9% -0.6% 15.6% 1.1% 0.6% 5.2% Cash Flow Days in AR AR over 90 Days 41,096 45,976 53,603 42,552 26,267 15,868 63,839 81,061 Cash Collections as a % of Revenue 79.9% 77.4% 79.0% 106.3% 87.1% 71.3% 60.2% 78.3% 79.2% Days to RAP Billing Liquidity Current Ratio Quick Ratio Leverage Ratio 22.5% 22.6% 25.9% 22.3% 20.3% 19.7% 18.8% 22.4%

49 Sample Home Care & Hospice Home Health Financial Dashboard Monthly Home Health Dashboard Prior Key Performance Indicators Year January February March April May June July August September October November December YTD Target Volume Census - Beginning of Period Admissions Discharges Census - End of Period Non-Medicare Payer Mix 35.3% 39.3% 35.1% 38.7% 29.1% 30.1% 35.6% 34.8% 34.9% Medicare Recertification Rate 13.6% 26.4% 22.2% 15.8% 19.2% 25.7% 20.1% 9.1% 19.5% Revenue Avg Medicare Payment per Episode $ 3,298 $ 2,288 $ 2,560 $ 2,484 $ 2,622 $ 2,835 $ 2,508 $ 2,693 $ 2,563 Avg Case Mix Weight % of Episodes Adjusted 24% 11% 15% 18% 20% 16% 17% 10% 15% Avg Non-Medicare Payment Per Visit $ $ $ $ $ $ $ $ $ Expense Gross Profit % 38.0% 40.7% 56.0% 36.9% 48.4% 31.7% 34.9% 47.9% 43.4% Visits Per Medicare Episode Overall Direct Cost per Visit $ $ $ $ $ $ $ $ $ Labor as a % of Revenue 85.3% 86.1% 63.8% 90.1% 75.9% 95.3% 93.0% 75.0% 81.2%

50 Attachment C

51 07/17/2013 Medicare Home Health Operations Detail Dashboard Report Peer Group Data 1 State Data 1 National Data 1 BKD Analysis of BKD Analysis of All United States OCS HomeCare Elite, SHP Benchmark Medicare Certified Measure Top 100 Leaders Agencies Lower Upper Lower Upper Lower Upper Quartile Median Quartile Quartile Median Quartile Quartile Median Quartile Number of Agencies Total agencies in peer group data: 88 Total agencies in peer group data: 65 Total agencies in national data: 9,510 Service Delivery Dashboards Total home health visits 5,815 10,115 16,643 11,165 19,263 39,965 4,213 9,062 19,432 Total visits for other services Total net patient revenue 4 $ 1,161,534 $ 2,123,723 $ 3,450,816 $ 1,914,427 $ 3,315,397 $ 7,440,538 $ 672,662 $ 1,445,622 $ 3,229,937 Total Medicare episodes , Total Medicare home health revenue $ 724,736 $ 1,252,870 $ 2,320,513 $ 1,356,623 $ 2,172,526 $ 3,994,875 $ 433,839 $ 939,215 $ 2,013,330 Total home health unduplicated patients , Total unduplicated patients for other services Payer mix, measured on total visits Medicare 69.1% 83.4% 95.5% 60.6% 68.5% 80.1% 63.0% 85.7% 100.0% Other 4.5% 16.6% 30.9% 19.9% 31.5% 39.5% 0.0% 14.3% 37.1% Payer mix, measured on unduplicated patients 4 Medicare 63.4% 77.7% 93.5% 53.7% 63.8% 78.7% 61.5% 86.3% 100.0% Other 6.6% 22.3% 36.6% 21.3% 36.2% 46.3% 0.0% 13.7% 38.5% Visits per Medicare episode (all episodes) Skilled nursing Physical therapy Occupational therapy Speech therapy Medical social services Home health aide Total visits per episode Total therapy visits per episode Visits per Medicare full episode (including outliers) Skilled nursing Physical therapy Occupational therapy Speech therapy Medical social services Home health aide Total visits per episode Total therapy visits per episode Visits per Medicare LUPA episode Health Care Group Questions? Contact M. Aaron Little at mlittle@bkd.com. 1 of 7

52 07/17/2013 Medicare Home Health Operations Detail Dashboard Report Peer Group Data 1 State Data 1 National Data 1 BKD Analysis of BKD Analysis of All United States OCS HomeCare Elite, SHP Benchmark Medicare Certified Measure Top 100 Leaders Agencies Lower Upper Lower Upper Lower Upper Quartile Median Quartile Quartile Median Quartile Quartile Median Quartile Service Delivery Dashboards (Continued) Number of episodes per Medicare patient Estimated number of hours per visit Direct nursing service (based on SN visits) Home health aide service (based on HHA visits) Administrative staff Total staff Estimated number of visits per day per FTE 5 Direct nursing service Physical therapy service Occupational therapy service Speech therapy service Medical social services Home health aide service Operating Dashboards Cost Per Visit Skilled nursing Salaries 4 $ $ $ $ $ $ $ $ $ Employee benefits Contract services Total labor Transportation Other direct costs Total direct care costs Indirect agency costs Total agency cost per visit Provider-based overhead costs Total cost per visit $ $ $ $ $ $ $ $ $ Health Care Group Questions? Contact M. Aaron Little at mlittle@bkd.com. 2 of 7

53 07/17/2013 Medicare Home Health Operations Detail Dashboard Report Peer Group Data 1 State Data 1 National Data 1 BKD Analysis of BKD Analysis of All United States OCS HomeCare Elite, SHP Benchmark Medicare Certified Measure Top 100 Leaders Agencies Lower Upper Lower Upper Lower Upper Quartile Median Quartile Quartile Median Quartile Quartile Median Quartile Operating Dashboards (Continued) Cost Per Visit (Continued ) Physical therapy Salaries 4 $ - $ - $ $ $ $ $ - $ 2.96 $ Employee benefits Contract services Total labor Transportation Other direct costs Total direct care costs Indirect agency costs Total agency cost per visit Provider-based overhead costs Total cost per visit $ $ $ $ $ $ $ $ $ Occupational therapy Salaries 4 $ - $ - $ $ 9.57 $ $ $ - $ - $ Employee benefits Contract services Total labor Transportation Other direct costs Total direct care costs Indirect agency costs Total agency cost per visit Provider-based overhead costs Total cost per visit $ $ $ $ $ $ $ $ $ Health Care Group Questions? Contact M. Aaron Little at mlittle@bkd.com. 3 of 7

54 07/17/2013 Medicare Home Health Operations Detail Dashboard Report Peer Group Data 1 State Data 1 National Data 1 BKD Analysis of BKD Analysis of All United States OCS HomeCare Elite, SHP Benchmark Medicare Certified Measure Top 100 Leaders Agencies Lower Upper Lower Upper Lower Upper Quartile Median Quartile Quartile Median Quartile Quartile Median Quartile Operating Dashboards (Continued) Cost Per Visit (Continued ) Speech therapy Salaries 4 $ - $ - $ $ - $ $ $ - $ - $ Employee benefits Contract services Total labor Transportation Other direct costs Total direct care costs Indirect agency costs Total agency cost per visit Provider-based overhead costs Total cost per visit $ $ $ $ $ $ $ $ $ Medical social services Salaries 4 $ - $ $ $ $ $ $ - $ $ Employee benefits Contract services Total labor Transportation Other direct costs Total direct care costs Indirect agency costs Total agency cost per visit Provider-based overhead costs Total cost per visit $ $ $ $ $ $ $ $ $ Health Care Group Questions? Contact M. Aaron Little at mlittle@bkd.com. 4 of 7

55 07/17/2013 Medicare Home Health Operations Detail Dashboard Report Peer Group Data 1 State Data 1 National Data 1 BKD Analysis of BKD Analysis of All United States OCS HomeCare Elite, SHP Benchmark Medicare Certified Measure Top 100 Leaders Agencies Lower Upper Lower Upper Lower Upper Quartile Median Quartile Quartile Median Quartile Quartile Median Quartile Operating Dashboards (Continued) Cost Per Visit (Continued ) Home health aide Salaries 4 $ $ $ $ $ $ $ $ $ Employee benefits Contract services Total labor Transportation Other direct costs Total direct care costs Indirect agency costs Total agency cost per visit Provider-based overhead costs Total cost per visit $ $ $ $ $ $ $ $ $ Overall agency cost per visit (all disciplines) $ $ $ $ $ $ $ $ $ Medical Supplies Non-routine medical supplies $ 0.71 $ 2.01 $ 3.27 $ 1.34 $ 2.34 $ 3.63 $ 0.94 $ 2.26 $ 4.16 Medicare Episode Payments Estimated average case-mix weight Average payment ratio Medicare episode mix by payment type Unadjusted episodes 87.1% 90.6% 94.1% 83.7% 86.5% 91.0% 83.7% 88.6% 93.1% LUPA episodes 2.8% 5.1% 9.1% 5.1% 9.5% 12.5% 2.9% 6.5% 11.0% PEP episodes 0.8% 1.6% 2.3% 1.6% 2.3% 3.4% 0.9% 1.8% 3.0% Outlier episodes 0.0% 0.4% 1.8% 0.2% 0.5% 1.3% 0.0% 0.8% 3.1% Average payment per episode by payment type Unadjusted episodes $ 2, $ 2, $ 3, $ 2, $ 3, $ 3, $ 2, $ 2, $ 3, LUPA episodes PEP episodes , , , , , , Outlier episodes 2, , , , , , , , , Health Care Group Questions? Contact M. Aaron Little at mlittle@bkd.com. 5 of 7

56 07/17/2013 Medicare Home Health Operations Detail Dashboard Report Peer Group Data 1 State Data 1 National Data 1 BKD Analysis of BKD Analysis of All United States OCS HomeCare Elite, SHP Benchmark Medicare Certified Measure Top 100 Leaders Agencies Lower Upper Lower Upper Lower Upper Quartile Median Quartile Quartile Median Quartile Quartile Median Quartile Operating Dashboards (Continued) Medicare Episode Profitability Average payment per episode $ 2,328 $ 2,648 $ 3,148 $ 2,501 $ 2,708 $ 3,141 $ 2,285 $ 2,670 $ 3,115 Direct costs per episode Salaries ,003 Employee benefits Contract services Total labor 869 1,147 1, ,122 1, ,170 1,455 Transportation Other direct costs Nonroutine supplies Total direct care costs per episode 919 1,241 1,570 1,025 1,170 1, ,243 1,536 Direct profit (loss) per episode 1,141 1,365 1,707 1,228 1,507 1,742 1,056 1,409 1,770 Direct profit (loss) margin per episode 45.1% 55.1% 63.8% 48.0% 54.4% 61.8% 44.0% 54.1% 62.3% Indirect agency costs per episode , , ,066 1,601 Total agency cost per episode 1,806 2,062 2,435 1,812 2,051 2,396 1,894 2,336 2,914 Profit (loss) per episode based on total agency costs (22) Profit (loss) margin per episode based on total agency costs 16.1% 23.1% 30.6% 18.3% 25.7% 30.9% -0.9% 12.7% 25.0% Provider-based overhead costs per episode Total costs per episode 1,888 2,196 2,573 1,900 2,127 2,501 1,953 2,405 2,984 Overall profit (loss) per episode (111) Profit (loss) margin per episode 9.8% 19.7% 29.0% 16.1% 20.9% 28.3% -4.3% 10.5% 23.3% Health Care Group Questions? Contact M. Aaron Little at mlittle@bkd.com. 6 of 7

57 07/17/2013 Medicare Home Health Operations Detail Dashboard Report Peer Group Data 1 State Data 1 National Data 1 BKD Analysis of BKD Analysis of All United States OCS HomeCare Elite, SHP Benchmark Medicare Certified Measure Top 100 Leaders Agencies Lower Upper Lower Upper Lower Upper Quartile Median Quartile Quartile Median Quartile Quartile Median Quartile Operating Dashboards (Continued) Gross profit (loss) margin % 52.0% 60.8% 34.0% 46.5% 55.3% 39.0% 51.0% 61.0% Agency profit (loss) margin 4 1.8% 10.5% 19.2% 4.7% 7.5% 18.4% -3.2% 2.8% 10.8% Salaries as a % of total costs % 59.7% 67.6% 52.6% 58.8% 66.9% 47.5% 57.1% 65.0% Salaries as a % of total revenue % 50.8% 61.0% 47.7% 53.9% 61.1% 43.9% 54.4% 64.5% Employee benefits as a % of total salaries % 18.0% 22.3% 13.5% 18.3% 22.8% 11.0% 15.2% 20.1% Total salaries & employee benefits as a % of total costs % 70.1% 78.3% 62.6% 72.3% 79.1% 50.8% 65.0% 74.6% Total salaries & employee benefits as a % of total revenue % 60.7% 70.8% 55.0% 64.3% 73.9% 46.4% 61.3% 73.4% Purchased services as a % of total costs 4 2.7% 7.8% 14.9% 2.2% 5.2% 12.6% 3.2% 10.3% 21.3% Purchased services as a % of total revenue 4 3.3% 6.2% 13.0% 2.1% 4.9% 10.7% 3.1% 10.2% 21.0% Total labor as a % of total costs 73.5% 81.3% 86.5% 74.2% 80.5% 85.1% 72.3% 79.6% 85.3% Total labor as a % of total revenue % 68.1% 77.3% 63.9% 71.5% 80.8% 64.7% 74.8% 84.3% Direct labor as a % of total costs % 50.8% 60.8% 46.8% 53.1% 62.6% 36.9% 47.5% 58.0% Direct labor as a % of total revenue % 41.6% 56.4% 39.9% 47.9% 59.1% 34.6% 44.6% 55.3% Indirect labor as a % of total costs % 27.7% 35.7% 16.4% 24.4% 33.3% 19.3% 27.8% 38.7% Indirect labor as a % of total revenue % 25.9% 29.9% 14.6% 21.0% 29.8% 17.6% 26.8% 39.5% Transportation as a % of total costs 0.2% 2.3% 4.4% 1.8% 3.1% 4.1% 0.0% 1.9% 3.8% Transportation as a % of total revenue 4 0.1% 2.1% 3.8% 1.6% 2.9% 3.6% 0.0% 1.5% 3.4% Other costs as a % of total costs 10.4% 15.9% 25.0% 12.2% 15.2% 22.2% 12.2% 18.3% 26.0% Other costs as a % of total revenue % 17.2% 24.5% 10.4% 15.5% 20.7% 12.9% 18.9% 27.1% Administrative & general costs as a % of total cost 29.5% 39.0% 47.7% 29.1% 37.6% 44.5% 30.7% 39.8% 48.7% Administrative & general costs as a % of total revenue % 36.0% 42.0% 26.2% 34.7% 41.4% 29.5% 39.2% 48.9% Capital & plant costs as a % of total cost 4 2.0% 2.8% 4.2% 2.4% 2.9% 4.1% 2.4% 3.5% 5.1% Capital & plant costs as a % of total revenue 4 1.8% 2.8% 4.1% 2.1% 2.7% 3.8% 2.3% 3.4% 5.2% Days in accounts receivable Current ratio Quick ratio Return on equity 4 8.2% 28.8% 76.4% 3.6% 19.9% 45.9% -6.1% 13.9% 77.1% Return on assets 4 2.4% 28.6% 87.5% 6.4% 16.6% 50.5% -9.5% 8.7% 51.9% 1 Data compiled using all Medicare cost reports available from CMS with fiscal years ending in Estimated based on payment rates effective for the location of the agency rather than service area. 3 Dashboard indicator only applies to hospital-based agencies, and accounts for costs allocated to the agency from the provider. 4 Dashboard indicator only includes freestanding agencies as hospital-based agency data is not available from CMS data sets. 5 Estimated based on 230 work days per year. Health Care Group Questions? Contact M. Aaron Little at mlittle@bkd.com. 7 of 7

58 Reporting Medicare Organizational Changes NAHC Financial Management Conference & Exposition 855A Requirements & Revalidation Presented by: Thomas E. Boyd, Principal Boyd & Nicholas, Inc. Requirements for Filing New Location New Business Name/add LLC or Inc. Change in ownership Acquisition/merger or stock transfer Additional Branch office 1

59 Reporting Medicare Organizational Changes Individual Updates/Changes If they have a 5 percent or greater direct or indirect ownership interest in the provider If (and only if) the provider is a corporation (whether for-profit or non-profit), all officers and directors of the provider Individual Updates/Changes All managing employees of the provider All individuals with a partnership interest in the provider, regardless of the percentage of ownership the partner has Authorized and delegated officials 2

60 Reporting Medicare Organizational Changes Timeline for Submission Change of ownership Acquisition/Merger Asset Sale Stock Transfer Timeline for Submission Updates to the provider ie: change of information 3

61 Reporting Medicare Organizational Changes Revalidation Project If you enrolled in the Medicare Program before March 25, 2011 you will get a letter by March of Revalidation Project DO NOT respond until you get your letter. You have 60 days from the date of your letter (not two months) to submit your 855A revalidation. 4

62 Reporting Medicare Organizational Changes Revalidation Project Be watching for your letter. Many are not addressed to a specific person. Revalidation Project 5

63 Reporting Medicare Organizational Changes Revalidation Project You must submit a paid receipt with your revalidation letter and 855A Revalidation Project MACs are requesting your NPI assigning your NPI most went out in If you don t have a copy of the Contact NPPES customer service at OR if you remember your user ID and password go to website and login, check that info is current and proceed to end and submit. You will get a new in hours. 6

64 Reporting Medicare Organizational Changes Revalidation Project We recommend at this time NOT to submit your 855As or Revalidation 855As in PECOS. There are many bugs in the PECOS system causing hardship to providers and delaying the submission. Instead complete the CMS downloaded pdf form: This form was updated in July Make sure you are using the correct form as above. Who Has Questions??? 7

65 Reporting Medicare Organizational Changes Contact Information Tom Boyd, MBA, CFE Principal Boyd & Nicholas, Inc

66 Compliance in Organizational Change 2013 Financial Management Conference Home Health Summer Camp 2013 William J. Simione, III Principal Simione Healthcare Consultants, LLC Value Driven Health Care Environment What do we know & what do we need to know 1. Do we truly understand our costs & how they relate to patient care? 2 1

67 Compliance in Organizational Change Value Driven Health Care Environment A. Do we truly understand our cost and how they relate to patient care? 1 2 What do I need to get myself ready? Do I have the data? Do I understand the data? Do I know how to react to the data? Understanding the Gross Margin Direct Salaries & Benefits Contracted Services Transportation Medical Supplies Other Direct Care Costs 3 Value Driven Health Care Environment B. Do we truly understand our cost and how they relate to patient care? 3 4 Payer Analysis GM Profitability Net Margin Profitability Can we measure the true value of our services? Difficult many times to truly qualify the value of Home Health Need to demonstrate that we are operating efficiently Need to have the seat at the table to educate all parties All indicators need to be positive Know the Pain Points of our referral sources Home Care is not an adjunct service, but a key component in the health care continuum 4 2

68 Compliance in Organizational Change INTEGRATING CLINICAL & FINANCIAL MANAGEMENT Integrating Clinical & Financial Management The need for both clinical and financial information is becoming more important to home care agencies. Recognize key clinical and financial indicators that can be used daily, weekly, etc. Analyze trends by comparing to previously run data. Use data to integrate and educate your clinical and financial teams; and Report to senior managers and Board of Directors 6 3

69 Compliance in Organizational Change Key Financial Indicators Gross Margin Net Margin Payer Mix Liquidity Ratios Cost Per Visit Days Sales Outstanding Case Weight Mix Episode Distribution Reimbursement per Episode Cost Per Episode Indirect Cost as a Percentage of Revenue 7 Integrating Clinical & Financial Management How does this relate back to Clinical? How do I share this data? Where do I begin? 8 4

70 Compliance in Organizational Change STEP #1 Dive Into The Data Maximize your EMR system? Do we truly understand all of the reports? What reports are the Clinical Director/Supervisors currently using? Are they meeting their needs? What information could they use? Can we do a data Dump? Is this the only way? 10 5

71 Compliance in Organizational Change Dive Into The Data Understand your business What makes up your revenue? How are we providing services? Does the data tell/confirm the story? Do we truly understand what is happening? 11 Dive Into The Data - Episodic Payers Can we determine the following? # of Episodes per admission Can we determine outliers? Try and understand the reasons # of visits per Episode by type of Episode How/Does this change for subsequent episodes? How/Does this change by diagnosis? Duals vs. Regular admissions 12 6

72 Compliance in Organizational Change Life Of An Admission Column Labels Count of SOC/Re-Cert Row Labels January February March April May June July August September October November December January February March April-13 7 Grand Total Life of an Admission - Visits Per Episode Carrier Medicare/OH Active/D/C D/C 5/1/2013 (All) Average of Tot Visits Column Label Row Labels Grand Total January February March April May June July August September October November December Grand Total

73 Compliance in Organizational Change Life of an Admission - Therapy Visits Carrier Medicare/OH Active/D/C D/C 5/1/2013 (All) Average of Tot Ther Column Label Row Labels Grand Total January February March April May June July August September October November December Grand Total Life of an Admission (cont d) Carrier Medicare/OH Active/D/C D/C 5/1/2013 (All) Column Label Average of RAP_HHRG$ Row Labels January-12 $ 2, $ 2, $ 2, $ 1, February-12 $ 2, $ 2, $ 1, $ 2, March-12 $ 2, $ 2, $ 2, $ 2, $ 2, $ 2, $ 1, April-12 $ 2, $ 2, $ 1, $ 1, May-12 $ 2, $ 2, $ 2, $ 2, June-12 $ 2, $ 2, $ 2, $ 1, July-12 $ 2, $ 2, $ 1, August-12 $ 2, $ 2, $ 1, $ 5, September-12 $ 2, $ 2, $ 1, $ 1, October-12 $ 2, $ 2, $ 2, November-12 $ 2, $ 2, $ 1, December-12 $ 2, $ 2, Grand Total $ 2, $ 2, $ 2, $ 2, $ 2, $ 2, $ 1,

74 Compliance in Organizational Change Life of an Admission (cont d) Carrier Medicare/OH Active/D/C D/C 5/1/2013 (All) Average of Final$ Column Label Row Labels Grand Total January-12 $ 3, $ 2, $ 1, $ 2, $ 3, February-12 $ 3, $ 2, $ 1, $ 1, $ 2, March-12 $ 3, $ 3, $ 2, $ 2, $ 2, $ 2, $ 2, $ 3, April-12 $ 3, $ 2, $ 1, $ 1, $ 2, May-12 $ 2, $ 2, $ 2, $ $ 2, June-12 $ 3, $ 2, $ 2, $ 1, $ 2, July-12 $ 2, $ 2, $ 1, $ 2, August-12 $ 2, $ 2, $ 3, $ 2, September-12 $ 2, $ 2, $ 2, $ $ 2, October-12 $ 3, $ 2, $ $ 2, November-12 $ 2, $ 2, $ 1, $ 2, December-12 $ 2, $ 1, $ 2, Grand Total $ 3, $ 2, $ 1, $ 1, $ 2, $ 2, $ 2, $ 2, Dive into the Data - Other Payers Look at the visit volume Do we know visits per admission Does this differ by Payer Can we drill down to the diagnosis? What is the trend? Medicaid volume Duals Traditional Move to Managed What does this mean? 18 9

75 Compliance in Organizational Change Dive into the Data - Other Payers What is our census Need to know by payer Do we have patients with no visits within the last 30 days? Are we tracking admission by payer, by month, by referral source? Grow Market Share through strategic alliances Is there a trend? How should we react? 19 Dive into the Data - Episodic Payers Meet with staff to understand what is happening What is the story Is it helpful Why is this important to understand the data Financial Clinical 20 10

76 Compliance in Organizational Change STEP #2 Staffing Understand how admissions and Episodes equate to staffing Direct Indirect Develop Productivity expectations throughout the organization Productivity should be consistent and measurable 22 11

77 Compliance in Organizational Change Methodology Options - Weighted Calculation Weight types of visits based on length of visits and documentation time SOC Resumptions Recertifications Discharge High mileage High tech/high skill Weighted visits not consistent in the industry - difficult to compare 23 Methodology Options - Direct Calculation # visits in a given time # FTE s x # Days # Visits/Day 24 12

78 Compliance in Organizational Change Methodology Options - Direct Calculation # of visits # FTE s x # Days # Visits/Day Number of visits In a given time (week, month) By individual By discipline (RN include LPN, PT include PTA) By team Number of FTE s Sum of full time equivalents NOT employees Number of days available to work After benefit and meeting time 25 Number of Days Available to Work - Example Example Hours Days % Payroll Time Paid Time Off 2, % 11.5% Time Available to work 1, % Mandatory In-Service/Education Required Staff Meetings % 3.5% Total Time Available to Visit 1, % In order to meet national productivity benchmarks, staff must have at least 80-85% of their time available to visit

79 Compliance in Organizational Change Productivity Forces Motivation Economic Career development Management practices Impact of culture, conflicts and trust Efficiency Effective tools Skills development Education and training Utility Measure of satisfaction or impact the work 27 Factors Impacting Productivity Average miles per visit Time available to visit Agency Patient-Related Characteristics Casper Report Prior conditions Hospitalization risks Needs help with ADL s/iadl s but none is available Stage IV pressure ulcers Significant differences in Acute Conditions Chronic Conditions Home Care Diagnosis 28 14

80 Compliance in Organizational Change Staff Collaboration Setting expectations Historical performance Performance reports and feedback Team productivity Team building activities Trust and collaboration Success of the unit vs. success of the individual 29 BALANCING ACT Optimal Outcomes Patient Expectations Productivity Expectations Patient Needs 30 15