Home healthcare today exemplifies leadership gone awry, and there is plenty of blame to go around. Individual agencies, trade groups and even HCFA have all helped create a major mess.
A quick overview. So what happened? In the early to mid-1990s, home health, the fastest-growing segment of healthcare, was wracked with fraud and abuse charges. This triggered Congress to clamp down on HCFA to "do something." So HCFA embarked on a surveillance program called Operation Restore Trust, which fairly-and unfairly-began to close agencies.
Meanwhile, HCFA was spending millions of taxpayer dollars to develop a mandatory data set called the Outcome and Assessment Information Set. The original purpose of OASIS was to determine the quality of home health agencies and require outcomes-based quality improvement at agencies through HCFA's surveillance of OASIS data.
In 1997, Congress passed the interim payment system to hold rising home-care expenses at bay. This closed even more home health agencies because the payment rates were retrospective and did not cover expenses already incurred.
Consequently, during the past two years home healthcare has felt unfairly targeted and penalized by interim-payment system reductions in reimbursement. Furthermore, implementing the OASIS data set added another potentially unreimbursed expense.
A blind eye. During more than 20 years in home care, I've worked as a public health nurse, in accreditation, as chief executive officer at the Visiting Nurse Association of Hudson Valley, in Mount Kisco, N.Y., and as a private entrepreneur. I love providing home care, but I think it's time to stick my neck out: The home-care industry saw its troubles coming but closed its eyes.
The industry became greedy. Associations were happy because as the industry grew, so did membership. Agencies were happy because business was very, very good. Although few agencies committed any outright fraud, most over-serviced patients at some point.
That's what the payment system encouraged, and that's the game Medicare set up. The rules were to document how sick patients were and use the home-care benefit to the maximum because the service window for certain illnesses was virtually unlimited, especially right after patients came home from the hospital.
More money out. HCFA is paying millions more to develop a prospective payment system in home care to further control expenses. It accelerated mandatory use of OASIS this winter to get the data it needs to figure out how to "fairly" pay agencies for services under the PPS. OASIS data collection for 9,000-plus Medicare-certified agencies was mandated in January 1999.
This wreaked havoc in the industry-even though the industry had been told for two years that it would happen. Trade associations tried political maneuvering to stop it. In the meantime, vendors spent millions of dollars to prepare software programs for data collection and transmission, just so their customers could meet the new federal mandate. Home health agencies spent millions to train staff and implement and/or purchase new systems to record the data.
After nearly every state survey agency had spent even more money to complete preparations and begin transmitting data from their own to federal databases, HCFA decided in April to delay the process indefinitely. It had been "nailed" because it failed to adequately protect patient confidentiality.
Trade groups claimed victory. Vendors fumed because of the tremendous expense without the offsetting revenues. Home-care agencies became confused about what, if anything, they were now supposed to do.
Rethinking the setup. After all my years in home care, the last 10 of them devoted primarily to outcomes measurement, I am concluding that home healthcare should not continue to be a Medicare benefit separate from inpatient services.
Congress discussed the idea of "bundling" services in 1997. Understandably, the home-care industry had a fit and argued that bundling would not adequately provide for patients' care at home. "That's not fair! We'll go broke! What about the patients?"
What about the patients? Perhaps if the acute-care benefit included home care, patients would receive better care. Of course there's always the risk that patients' home-care needs would be lost in an institutional system that didn't take the time to understand home health's benefits. But with time, those benefits could be realized. Perhaps the entire healthcare system would save money because the proper payment incentives would be in place.
Hospital control also would provide an incentive to discharge patients only when appropriate, because the cost of re-hospitalization would haunt a facility that didn't discharge properly the first time. Perhaps if hospitals were operating under a DRG expenditure cap that included home care, the battle to understand patient needs better would be won. It would be won out of the pure economics of the situation-choosing the most cost-efficient source of care, which has proved to work well in U.S. healthcare.
One thing is certain: There can be no more status quo. If home health wants to stay "in the game" as a separate industry, it must find the courage to lead itself and make needed changes. That will include accountability for the value of its services, with or without OASIS. If it can't do that, someone else will be happy to.
Alexis Wilson is an assistant professor at the University of Washington, School of Nursing, Tacoma, and the founder of Outcome Concept Systems, a home health benchmarking and software company based in Seattle.