By Beth Carpenter
President
Beth Carpenter and Associates
In our previous article, we explored the important decisions one needs to make when entering the home health and hospice marketplace, whether to start-up a new agency or purchase one already in business. Perhaps, after looking at the home health or hospice agencies available in your community, you have decided to start your agency from scratch. Today, I explore the anatomy of an agency start-up, and the key steps involved in the start-up process. Finally, I offer tips you can use to ensure success in your new business venture.
Step 1: Designate a Project Leader
The first step is to determine who will serve as the Project Leader and drive the project forward. It is very important to put a project leader and a clear plan of action in place when starting any agency from scratch. The Project Leader will take responsibility for all aspects of the start-up timeline. This person should have start-up experience with positive outcomes and may become the agency’s Administrator. If you do not have anyone who possesses the necessary qualities and experience, look for someone who is detail oriented, sales oriented, flexible and known for consistently meeting deadlines. Your Project Leader must know and be able to interpret as well as implement State and Federal Guidelines in order to have a successful operation as quickly as possible. You also need to determine how much support you are able to extend to the Project Leader (if you, in fact, do not hold this position) as the level of autonomy may vary based on the support you are able to provide and the background and prior experience of the individual. If you plan on the Project Leader also becoming the agency’s Administrator, you must verify that s/he meets the State and Federal standards for the position.
Step 2: Acquire “Deemed Status” and State Recognition
Agencies are encouraged to use the services of a Medicare “deeming authority” such as Accreditation Commission for Health Care (ACHC), Community Health Accreditation Program (CHAP) and The Joint Commission (TJC) to meet the requirements for a home health or hospice agency to participate and receive payment from the Medicare or Medicaid programs. These “deeming authority” organizations can be used to provide a "deemed" accreditation survey instead of a state survey and meet all of the Medicare certification requirements.
The process of certifying a new agency contains dozens of time consuming, albeit logical steps. Although some steps are interchangeable, most are not. Your Project Leader must be able to discern the difference and be flexible while maintaining focus on the goal of Medicare certification. You need to have a reasonable budget to fund the steps necessary for successful completion of the “deemed status” accreditation survey, which is the path I recommend.
All clinical and operational policies and procedures must be in place prior to the survey. The policies and procedures must meet the State and Federal Guidelines plus the deeming authority's standards. Agency policies and procedures standards are also surveyable. Consequently, it is recommended that the policies and procedures meet, but do not exceed, the State and Federal Guidelines.
Step 3: Complete Applications for Governing Bodies
You must fill out multiple applications during the start-up process for Federal and, potentially, State governing bodies. Make sure to fill out these applications accurately and completely – any blanks or information that is questionable on the forms will slow down the process. (While I list this as Step 3, this is something that you will need to complete throughout the entire start-up process.)
Step 4: Hire Staff
The Administrator must hire all office staff and field staff, processing their employment according to the agency policies and State/Federal requirements. All caregivers must be completely oriented to all regulations and policies prior to the survey by the deeming authority. Good knowledge of State and Federal requirements, excellent recruitment techniques, efficient hiring practices, competitive compensation and established disciplinary guidelines are important. Agencies must be prepared to show proof of all the hiring steps taken to ensure compliance to all State and Federal requirements in this area.
Step 5: Establish Relationships with Referral Sources
Building relationships with potential referral sources in your geographic service area is always a good idea; however, prior to the deemed status survey you must establish relationships with referral sources that are willing to refer patients to an agency that has not passed its certification survey. This sounds simple to do; however, in a competitive atmosphere it can be very difficult as well as labor intensive to establish a new referral relationship.
• All agencies are required to begin providing services to patients prior to completing the certification process and are not able to bill for these services.
• The sales effort is even more demanding when doing a hospice start-up as all facilities’ contracts and vendor contracts must be in place prior to the initial survey as well as having patients on service.
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