Home Health & Hospice Week

When your LUPA percentage is higher than usual, it's time to play Sherlock Holmes to get to the root of the potential problem.

Low utilization payment adjustments (LUPAs) under the home health prospective payment system can be extremely financially punishing to home health agencies. That's because when a patient's episode drops under five visits, home health agencies are paid a low per-visit rate instead of the entire episode amount.

Dollars and cents: For example, the base epi-sode amount for fiscal year 2006 is $2,264.28 while the per-visit rate for skilled nursing is a mere $98.85 (see Eli's HCW, Vol. XV, No. 7). If you furnish an episode with four skilled nursing visits, you'll receive almost $1,870 less than for a five-visit episode.

All HHAs will have some unavoidable LUPAs, experts note. The key is making sure you head off quality and financial problems at your agency by being on guard against unnecessary LUPAs. Ask Yourself This Question When agencies find their LUPA percentage is higher than average, it's time to ask some piercing questions about care delivery, urges consultant Karen Vance with BKD in Springfield, MO. "Are patients getting what they need from your agency?" Vance asks.

Consider these six steps when examining your LUPA level: 1. Compare yourself to your peers. For example, all Missouri Medicare agencies had a median LUPA rate of 12.85 percent in 2003, according to a report compiled by BKD from cost report data for that year. Freestanding agencies in that state saw a median LUPA rate of 11.08 percent.

Where to find it: HHAs can obtain benchmarking reports from a variety of companies (including a report offered by Eli Research and BKD).

If your LUPA numbers are average, you may not need to investigate further, Vance offers. But if they are high or low, looking into the matter may head off or correct major problems. 2. Examine the acute care hospitalization rate. A high percentage of LUPAs may indicate that your patients aren't receiving the care they need to stay out of the hospital, Vance warns. If you find a high LUPA rate, your next step should be to go to Medicare's Home Health Compare Web site and see where your hospitalization rate falls.

If your acute care hospitalization rate is high too, that's a red flag that you should examine your care delivery methods to ensure patients are getting the right services--and enough of them--to keep them out of the hospital. 3. Check out PEPs. Another danger sign is when your partial episode payment (PEP) adjustment rate is high, Vance cautions. A high LUPA rate and PEP rate combined could mean your patients aren't receiving enough care, so they come back to your agency within the 60-day episode or go [...]