Posts Tagged ‘home health agencies’

Home Health Agency Declares Bankruptcy, Blames Medicare


Home health care benefits available through the Medicare program have been curtailed in recent years. The effect of the government’s crackdown on home health care costs has been felt not only by patients, but also by health care providers themselves.

Take, for example, the case of Idaho’s Community Home Health agency (CHH). The company had been serving about 500 patients. Then Congress passed the Balanced Budget Act of 1997, directing Medicare to set limits on the costs which could be paid through for home care.

CHH, like other Medicare providers, had been paid a monthly amount based on an estimate of the number of patients it would see. These “periodic interim payments” would then be adjusted for the amount actually due the agency, with a smaller amount either paid or withheld from future payments once the bookkeeping was completed.

With the new law, however, CHH decided that it would not be able to serve the same number of patients. The agency dramatically cut its Medicare caseload in an attempt to anticipate the new government regulations. Its income would be slashed, but its costs would also be contained—or at least that was the theory.

Unfortunately, the agency continued to receive and cash checks based on its prior caseload. By the time CHH figured out it had a problem it had received overpayments of more than one million dollars. The agency told Medicare it needed to set up a plan to repay the money over time; Medicare first denied that there had been any overpayment, then threatened to withhold all payments until the account was corrected.

Although Medicare relented and offered a two-year repayment plan, CHH closed its doors and declared bankruptcy. Agency owners Gary and Verlene Kaiser, who had personally guaranteed CHH’s debts, also filed for bankruptcy. Meanwhile, Medicare investigators were allegedly telling other providers about the Kaisers and CHH, making it difficult for them to do any future business.

The Kaisers sued the government and Blue Cross of California, the “fiscal intermediary” which had handled CHH’s Medicare reimbursements. The Ninth Circuit Court of Appeals threw the lawsuit out, ruling that CHH and the Kaisers had to make their claims through Medicare’s administrative channels. The part of their claim alleging defamation and invasion of privacy was simply dismissed, since the government must give its consent to be sued. Kaiser v. Blue Cross, October 28, 2003.

CHH’s story provides a cautionary example to other providers. While government programs may provide a reliable cash flow, changes in the benefits can have a huge and unpredictable effect on the provider.

Estate Recovery

JUNE 13, 1994 VOLUME 1, NUMBER 29

A nursing home resident may qualify for and receive ALTCS benefits even though she owns a home and other exempt assets. Upon the death of the unmarried nursing home resident, however, the state may have a claim against the recipient’s estate for recovery of benefits paid during her life. When Congress made changes to the Medicaid program last fall, they included a provision that requires states to actively seek reimbursement from the estates of deceased recipients.

Congress specifically suggested that states might seek to recover from joint tenants and others who receive property by virtue of the death of recipients. Arizona has graciously declined to accept Congress’ suggestion.

According to new regulations just adopted in Arizona, the “estate recovery” program will pursue only those assets constituting the probate estate. This means that assets held in joint tenancy, or accounts naming a beneficiary, will not be subject to estate recovery. It also means that some planning options, such as sale of the elder’s residence to younger family members while retaining a life estate, will be even more attractive under the new rules.

The estate recovery program will most often be important with reference to the elder’s family home. Of course, transfer of a remainder interest (or transfer from the elder’s name into joint tenancy with children) will cause other problems. Either the transfer must be compensated at its fair market value (generating cash which will cause eligibility problems until it is spent) or it will result in a transfer penalty period. Still, planning options are increased, particularly for married applicants and for those who placed property in joint tenancy years ago.

Home Aide Shortage

Wall Street Journal, June 1, 1994

“Work-family juggling acts are being upset by a shortage of reliable home health aides.

Rising demand for aides to care for aged, disabled or ill people in their homes has made it the nation’s fastest-growing job, the Labor Department says. But poor pay and benefits and the hard tasks required are breeding shortages and turnover as high as 50% in some regions.

Just as child-care problems erode productivity, a tardy or absent home health aide can force those who oversee a family member’s care to miss work. ‘It’s a very serious issue for employed caregivers,’ says Barbara Lepis, director of the Partnership for Elder Care, a nonprofit consortium of 10 employers and the New York City Department for the Aging. Even if they get to work, family members may have to ‘spend all their time on the phone, patching together something for mom,’ she says.

When Elizabeth Kutza’s aged father moved in with her, she spent most of one summer at home because she couldn’t find a home health aide. The first person she hired quit after one day, and others were unable to lift her father or lacked transportation. She finally found someone to work part time. ‘I got almost nothing done. I was a nervous wreck by the end of the summer.’ says Dr. Kutza, director of Portland State University’s Institute on Aging. Qualified aides ‘are not easy to find and not easy to keep.’

Home care agencies, which have grown by nearly 50% in the past five years, can reduce turnover by screening and training aides, but many charge an hourly fee of several dollars that is added to the $4.25 to $8.50 an hour received by aides. Members of the National Association for Home Care, a Washington, D.C., industry group, are studying techniques to reduce turnover, among them improving benefits, including child-care aid.”

Choosing a Caregiver

MAY 30, 1994 VOLUME 1, NUMBER 27

By Joan Ardern, Community Liaison, Care Coordinators, Inc.

(Second of three parts)

There are advantages to hiring a home health agency rather than hiring someone privately. Agencies are on-call twenty-four hours a day. A progressive agency will have updated training programs for their caregivers. Another advantage of an agency is that it has the ability to provide a substitute in case of an emergency. The agency also assumes responsibility for payroll, worker’s compensation insurance, and related paperwork.

A major pitfall with either hiring privately or through an agency is the potential for a well-intentioned caregiver to assume more responsibility than intended. Clients may find themselves by-passed on major decisions concerning their care. A good agency will monitor the care being provided and ensure that the caregiver adheres strictly to the assigned responsibilities.

Another way to find a caregiver is to use a new type of service that emerged in the late 1980s–the private case management company. The case management company can provide an assessment and evaluation of client needs, financial management, hiring and monitoring of caregivers, and (in some cases) protective services such as guardianship and conservatorship. The case management company can be an effective choice for the family who does not want to deal directly with the process of hiring the caregiver. A private case manager will first assess the needs of the client and then coordinate appropriate services from professionals for the individual’s care. Essentially, you will be paying the case manager to conduct the research to find the proper caregiver and to monitor the caregiver. The cost of the caregiver should remain the same whether provided through a home health agency or a case management company.

About this Series

Joan Ardern, Community Liaison for Care Coordinators, Inc. has written this three-part series on “Choosing a Caregiver.” The first installment appeared in last week’s Elder Law Issues, and the final segment will be printed next week.

Lawyer Sentenced

Phoenix lawyer David Mason was sentenced to seven years in prison last week on fraud and theft charges. Mason was also ordered to pay almost $400,000 in restitution to several clients and estates he had administered.

Mason plead guilty to the charges last month. He admitted using his Sun City law office to gain control of clients’ estates and then misappropriate funds.

Mason has been suspended by the State Bar of Arizona since 1992. His conviction and sentence will result in automatic disbarment. Mason had previously served as a circuit judge in Aledo, Illinois, before moving to Sun City.

A Jolly Good Fellow

Elder Law Issues’ Editor, Publisher and Author Robert B. Fleming has been named as a Fellow of the National Academy of Elder Law Attorneys. The Academy, at its annual Symposium in Seattle last week, named Fleming and five other elder law attorneys as Fellows in recognition of their contributions to their respective communities and the practice of elder law generally. The other new Fellows hail from Florida, California, Ohio and Georgia. They join the fifteen national elder law leaders already selected for Fellowship in previous years.

Choosing a Caregiver

MAY 23, 1994 VOLUME 1, NUMBER 26

By Joan Ardern, Community Liaison, Care Coordinators, Inc.

(First of three parts)

As the American population ages the need for more caregivers becomes magnified. Today, many families are living in the so-called “sandwich generation,” where the day to day stress of caring for an elderly or disabled loved one can create family chaos. Health care changes and complicated insurance forms can add to the burden, not to mention the added responsibility of finding a reliable caregiver.

From observing case managers at Care Coordinators, Inc., I know that hiring a caregiver is a matter not to be taken lightly.

Home Health Agencies

One of the easiest ways to hire a caregiver is through a home health agency. You can find these agencies in the telephone book. Here are some questions to be asked in a phone interview:

  • Is the agency licensed by the state of Arizona?
  • Is the agency bonded? (Most agencies are)
  • Is the agency Medicare certified?
  • What is the hourly cost for a caregiver? A Registered Nurse?
  • Is there a minimum charge per visit? (Some agencies have a two or three hour minimum)
  • Can the agency provide emergency substitution if, for example, the caregiver is unable to work?

Will the agency perform an assessment of the patient to determine the required level of care and identify medical issues? Is there a charge for this assessment?

Private Caregivers

The problems become more difficult when hiring a caregiver privately. Often the family member is facing a crisis, needing a caregiver immediately, and may be tempted to hire someone in haste. This brings up a key point. Despite the urgency, don’t rush the process to find the right caregiver. Request that applicants provide a resume along with copies of the following documents:

  • Proof of citizenship
  • Proof of social security
  • Proof of auto insurance and driver’s license
  • List of references

It may also be a good idea to conduct a background check if you are hiring someone privately. There are reliable firms that, at reasonable costs, will perform background investigations for you. There are a couple of advantages to a security check. First of all, you will eliminate the unreliable individuals and, second, the background check will verify the good choices.
About Joan Ardern

Joan Ardern, the guest contributor responsible for this three-part series on “Choosing a Caregiver,” is Community Liaison for Care Coordinators, Inc. Joan is also current President of Arizona Continuity of Care, and Co-chair of the Academy for Health Services Marketing, Tucson Chapter. Joan is also active with the Tucson YWCA Board of Directors and serves as co-facilitator for an Alzheimer’s support group.

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