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Home Health & Hospice Week

Industry Notes:

Do You Know The DOL's New 'FairPay' Rules For Overtime?

Published on Thu May 27, 2004

Hourly versus salary is key.

Under the new FairPay rules, workers earning less than $23,660 per year -- or $455 per week -- are guaranteed overtime protection.

The Department of Labor outlines the basics of its new overtime regulations, which will take effect Aug. 23, on its Web site at www.dol.gov/esa/regs/compliance/whd/fairpay/main.htm.

"Registered nurses who are paid on an hourly basis should receive overtime pay," the DOL says in a new fact sheet on nurses' wages. But if RNs receive a salary, make at least $455 per week and meet the qualifications for the learned professional exemption, they are exempt from the overtime rules.

"Licensed practical nurses and other similar health care employees, however, generally do not qualify as exempt learned professionals ... and are entitled to overtime pay," the DOL explains.

  • Just like home health agencies, skilled nursing facilities don't have to pay for items bundled into the SNF prospective payment system rate unless they have a valid arrangement with an outside supplier, the Centers for Medicare & Medicaid Services notes in a new transmittal. And that means durable medical equipment suppliers should secure a written agreement to steer clear of bundling errors.

    "Whenever a supplier furnishes services that are subject to consolidated billing in the absence of a written agreement with the SNF, the supplier risks not being paid for the services," CMS warns in May 21 Transmittal No. 183.

    CMS puts pressure on the SNF to secure written agreements with outside suppliers to avoid bundling confusion. Many inappropriate claims for DME can be avoided if the SNF gives the supplier accurate and correct information on the resident's bundling status, the memo stresses.

    "Medicare does not prescribe the actual terms of the SNF's written agreement with its supplier (such as the specific amount or timing of the supplier's payment by the SNF)," CMS points out. The SNF and supplier should arrive at specifics "through direct negotiation between the parties." The contract should include dispute resolution procedures, though, the memo says.

  • Nursing homes may be the biggest hurdle in the path to expanded home care benefits. A nursing home trade association wrote a letter to the editor of the Pittsburgh Business Times, protesting a story that had praised home care as a cost-saving long-term care setting.

    "Moving an individual out of a facility-based setting like a nursing home to a home setting may indeed save costs -- but only in the short term, when less care is required," wrote Alan Rosenbloom, president and CEO of the Pennsylvania Health Care Association. "However, longer-term costs are likely to be higher for home care."

    Rosenbloom urged lawmakers to recognize that under the "'woodwork effect' ... higher demand for in-home services is resulting in progressively higher government health care costs."

  • Another hospital-affiliated home health agency is closing its doors. Marion, IN-based 1st Call Home Health and Hospice will shut down June 30, the Marion Chronicle-Tribune reports.

    The HHA and hospice, a joint venture between Marion General Hospital, Cardinal Health System and St. Joseph Hospital and Health System in Kokomo, will lay off 22 workers and discontinue services to 73 patients. Its closure will leave Grant County without a hospice program, the paper says.

    But not for long. Marion-based New Hope Hospice, run by long-term care company TLC Management, will fill the gap by expanding its services to Grant County patients immediately, according to the Chronicle-Tribune.

    Meanwhile, Chicago-based Help At Home is planning to open a home care program in the area, the paper says.

  • Pediatric Services of America Inc. expects to see a return of a half million dollars, thanks to a favorable decision on a Medicare audit appeal. The Norcross, GA-based company's carrier originally wanted $1.7 million after an audit, but then recouped $800,000 after agreeing some of the records had sufficient medical documentation for services.

    Now an administrative law judge ruled in further favor of PSAI. But the Medicare Appeals Council has 60 days to review the ALJ decision, the company warned.

  • Another hospice company has its sights set on a national presence. Connecticut-based Voyager HospiceCare Inc. and Fort Worth, TX-based American Hospice Inc. plan to complete a merger in the third quarter of this year, according to a release.

    The combined companies aim to "acquire and start new agencies throughout Texas and neighboring states with the goal of expanding nationally," the release notes. American Hospice will retain its corporate identity.

    Private equity firm Saunders Karp & Megrue  will extend financing to the company. SKM invests "in a small number of well-managed companies which can achieve superior rates of return over a five to seven year period," SKM says on its Web site.

  • Gentiva Health Services Inc. has inked a deal with TriWest Healthcare Alliance to coordinate and deliver home care services to 2.1 million members in 21 states.

    Under the contract effective June 1, Gentiva's CareCentrix managed care division will furnish or arrange for a third-party provider to furnish home nursing, home infusion, durable medical equipment and respiratory therapies to the eligible military personnel and their families in TriWest's region, Melville, NY-based Gentiva says. TriWest is a TRICARE contractor.

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