Managing a home health or hospice agency can feel like balancing on a tightrope. Except the tightrope is on fire, and you’re balancing Medicare CoPs on your head.
Between providing exceptional patient care, managing staff, and navigating industry regulations, it’s easy for compliance to get pushed aside. But neglecting compliance can lead to severe consequences. These can include failed audits to patient safety issues and even provider terminations.
At The Home Health Consultant, we've worked with hundreds of agencies. In doing so, we've found that neglecting compliance is often the root cause of:
-survey failures
-unexpected regulatory visits
-declining referral sources
-patient safety incidents
-legal challenges
-provider terminations
Agencies that prioritize compliance face fewer operational issues. They also tend to achieve greater stability, longevity, and financial success.
In this article, we’ll explain what compliance is and why it’s essential for success in the home health and hospice industry.
What Does Compliance Look Like in Home Health and Hospice?
Compliance, at its core, means adhering to legal and regulatory requirements. It sounds straightforward, but in practice, it’s far from simple.
Compliance encompasses all aspects of running your agency, including managing patient care, meeting staffing requirements, and submitting accurate billing. Almost every essential task your agency must handle is likely connected to compliance.
During the initial Medicare certification process, maintaining compliance is relatively easy. This is due to the limited patient census and shorter timelines before the first survey. As agencies grow, so do their complexities.
Managing a larger census doesn’t just mean more money in your pocket. It also means:
-juggling new staff
-an increase in referral sources
-budget constraints
-vendor reliability issues
-urgent care needs
For example, finding a nurse to visit a remote patient on short notice. Or the biller you hired did not keep up with this year’s changes, leading to claim denials. In the midst of all these pressures, it can be tempting to cut corners. But these shortcuts can quickly lead to significant problems.
Why Is a Compliance Program Crucial for Agencies?
Failing to meet compliance standards creates a dangerous situation for agencies. Even a minor oversight, like inadequate disaster planning or patient education, can escalate into serious consequences. What you may have thought was a small issue can lead to legal liabilities, conditional survey findings, or provider termination.
Home health and hospice agencies are heavily regulated for good reason. The main goal of these regulations is to ensure that care doesn’t harm patients, caregivers, or staff. Secondary goals focus on:
- improving patient outcomes
- preventing fraud
- fostering quality improvement through data-driven practices
What Do Compliance Lapses Actually Cost Your Agency?
Neglecting compliance in home health and hospice care isn’t just about regulatory risks—it can quickly become a financial disaster. Lapses in compliance lead to significant, and often unanticipated, expenses that strain agency resources. Here's how costs can escalate:
- Resurvey Fees: If an accreditor requires a follow-up survey to address compliance issues, the costs can exceed $5,000 per instance.
- Payment Reductions: Noncompliance penalties can result in Medicare payment reductions of 6% or more, translating to tens to hundreds of thousands of dollars annually for a typical agency.
- Application Errors: Submitting incorrect Medicare or health department applications wastes valuable time and can cost thousands in operational resources.
These costs don’t just impact your bottom line—they disrupt operations, increase stress, and hinder your ability to provide quality care. Proactively investing in compliance can prevent these financial pitfalls, ensuring your agency remains stable and profitable in a highly regulated industry.
Why Home-Based Care Poses Unique Safety, Supervision, and Resource Limitations
Unlike hospitals or skilled nursing facilities, HH and HSP services operate in patients' homes. With less structure and fewer daily interactions between staff and clinicians, agencies face unique challenges:
- Uncontrolled Environments: Unlike hospitals, where patient safety measures can be enforced, in-home care relies on patients and caregivers to implement safety guidelines.
- Limited Supervision: Clinicians work independently in the field, making it harder to ensure consistent adherence to protocols.
- Delayed Problem Detection: Agencies depend on self-reporting by patients and caregivers. This can delay the identification of issues.
- Resource Constraints: Clinicians in home settings often lack immediate access to supervisors, equipment, or emergency resources.
These challenges do not make maintaining compliance impossible. But it’s important to be aware of them as your agency grows so you can adjust your processes accordingly.
How Regulations Enhance Health and Safety
The regulatory framework for home health and hospice agencies has evolved over decades. CMS isn’t just adding rules to give you a headache. All federal and state regulations were created to respond to recurring problems.
For example, the introduction of mandatory Emergency Preparedness standards in 2018 was a direct response to dangerous situations created after Hurricane Katrina in 2005. These regulations aim to minimize risks and improve outcomes in complicated care environments.
How Does Compliance Drive Agency Success?
After reading the above, you should have a clear understanding of why compliance is crucial and how harmful it can be to underestimate its importance. Now let’s dive into the exciting part.
Prioritizing compliance doesn’t just mean avoiding disaster scenarios. There are major benefits that can transform an agency by:
- Promoting healthier, safer patient outcomes.
- Equipping staff with better education and resources.
- Reducing operational chaos and minimizing staff turnover.
- Protecting the agency from costly surveys, audits, or legal actions.
- Ensuring business stability through successful inspections and audits.
- Enhancing profitability by avoiding inefficiencies and errors.
Why Do Agencies Overlook Compliance?
Despite its importance, many agencies brush off compliance until a survey. Pressing daily tasks like staffing, payroll, or patient care often take precedence, leaving compliance efforts to the last minute. It can, and does, happen. But this reactive approach can lead to rushed, expensive fixes and significant operational disruptions.
How Can Agencies Begin Their Compliance Journey?
Understanding the value of compliance is the first step toward reducing stress, improving patient outcomes, and ensuring long-term success. Agencies ready to embrace a compliance program should start by exploring different structures and strategies to find the best fit for their operations.
By making compliance a cornerstone of daily operations, home health and hospice agencies can navigate regulatory challenges with confidence, setting the stage for sustainable growth and profitability. To read more about how to maintain compliance, check out our article 'What is QAPI & Why It Matters for Home Health & Hospice Agencies.'
*This article was written in consultation with Mariam Treystman.
Topics:
