Is it even possible anymore to start a home nursing business?

renerian, BSN, RN · Jun 29, 2005

I agree that you need a ton of money to float the business while waiting for your certification numbers etc and it is not a fast process.

renerian

Roland · Jun 30, 2005

So do the seven (or nine I can't remember which number she said) patients have to be Medicaid/Medicare and not private pay? If they were private pay at least in theory (as if it were actually possible for a startup company to find seven private pay clients) you could start the business without floating huge sums of money. On the other hand if they had to be Medicaid/Medicare clients then it really would involve floating many tens of thousands of dollars (in addition I would argue that it might raise ethical questions since you would be taking on clients with no guarantee that you would ultimately even be approved PPS, and might have to "dump" them if not successful in gaining Medicaid/Medicare approval).

How long have the requirements been in place? It almost sounds like the current regulations create a "de facto" monopoly of existing agencies in the home health care field. Was this something that was "pushed" by major corps. in the field to reduce future competition? What's the argument for not allowing nurses (after going through an approval process) to bill directly for their services cutting out or at least reducing the "middle man".

NancyNursz71 · Jul 5, 2005

There is always the option of independent providers; call your state contact to see if it is an option for you. From what I can see, the regs are in place to stop all the "fly by night" companies from taking a profit and running. There are many costs you don't consider at first; the paperwork, charts, storage, supplies, printer ink ...The $250,000 is a low estimate-- when you get your 7-9 patients, you then apply for a surveyor to come out & this can take a few weeks. Then when you pass survey, you wait for your Medicare number. Once you have that, you apply for the Medicaid number and wait some more. You are expected to track complaints, employee requirements (CEUs, TB, CPR, skills checks, sup visits), incidents, and complete OBQI/QM programs. Don't forget billing and the programs that don't communicate with each other. With Medicare, you bank on so many dollars in payment but then you get reductions for hospitalizations, pay for DMEs, and the ever constant denials for coding issues or errors in OASIS. Here in my location, it seemed like hospitals kept the higher revenue patients for their own agencies and referred out the daily/ BID wounds or high-risk patients. Then consider the benefits offered around you by other companies: mileage (esp. with the cost of gasoline), cell phones, computerized documentation, insurance-- how will you attract and keep quality employees? Are you going to offer therapy? If not, you cannot accept patients with service needs you don't offer. Do you know coding? Errors in coding are a nightmare. Billing is a fright. Then you need to consider if you want a life outside the business. How will you take a vacation? Who will run the company, take the 24/7 calls, resolve staffing issues, and cover visits when someone quits or calls in ill? I won't ever try to build from the ground up again!

sgent · Jul 5, 2005

I also don't know your state, but many issue CON's for nursing homes. I would definately call your Board of Health (or whomever regulates nrusing homes) to get a better grasp of the facts.

Roland · Jul 5, 2005

It has been my experience that the stated objective of deterring "fly by night companies" is often used as a cover for the true intent of "limiting competition so that major players do not have to compete with potentially lower cost, smaller providers." I have seen this same argument "we have to stop the fly by night companies" used in various and diverse industries ranging from mortgages and appraisal to hair dressing and taxi cab industries. In this case I suspect that the "major players" especially those home health care companies associated with hospitals have lobbied for years so that the current regulatory burden to start a home health care agency all but elminates everyone but millionaires. It's a pattern that tends to repeat with varying degrees in almost every American industry. I truly believe that we will one day live in a world where to even open a hot dog stand or janitorial service will be cost prohibitive for all but the large established organizations. One might term this as the "Wall Marting of America" except that this is the regulatory rather than competitive side of this trend (that is to say that its not enough that huge companies like Wall Mart are able to operate on insanely small margins which make smaller competition difficult. Many larger companies seek regulatory "shelter" which discourages or eliminates smaller, potentially leaner competition).

Here's my question. How did the people I referenced above manage to open a home health care agency which is now one of the biggest in Indianapolis on a single RN salary (she actually said that she spend about 10K). Have regulations really changed that much in the last 20 years?

In addition, the question remains is it possible to start such an agency without "carrying" those seven clients. In other words could you "recruit" seven to ten home health patients who were either private pay or had insurance and then apply to Medicare/Medicaid or do the patients have to be Medicare/Medicaid before you can even apply (in which case you would be carrying them until approved). Again, I am not asking "is it easy to start a home health care business" rather my question involves the possibility for a person of average means to do so.

My goal is to provide an agency setting wherenurses receive the vast majority of the hourly reinbursement with the agency keeping only enough to cover the costs of doing business. In addition, I would seek to offer nurses the option of either having benefits or a higher hourly salary (there are those who would rather earn $40.00 without benefits than $35/hr with such benefits). I would even consider setting such an agency up as a non profit entity . I believe that such a scenario would further empower nurses making home health nursing relatively more attractive to nurses (since average hourly rates would increase from say the mid 20's to high 30's). In turn this would attract more nurses to home health care. Ultimately, this would put additonal pressure on hospitals (who would lose even more nurses to home health care) to pay their staff nurses more, and to provide better working conditions.

I see this as but one element in an all out crusade to increase the pay and working conditions of nurses in the United States and world at large.

There is always the option of independent providers; call your state contact to see if it is an option for you. From what I can see, the regs are in place to stop all the "fly by night" companies from taking a profit and running. There are many costs you don't consider at first; the paperwork, charts, storage, supplies, printer ink ...The $250,000 is a low estimate-- when you get your 7-9 patients, you then apply for a surveyor to come out & this can take a few weeks. Then when you pass survey, you wait for your Medicare number. Once you have that, you apply for the Medicaid number and wait some more. You are expected to track complaints, employee requirements (CEUs, TB, CPR, skills checks, sup visits), incidents, and complete OBQI/QM programs. Don't forget billing and the programs that don't communicate with each other. With Medicare, you bank on so many dollars in payment but then you get reductions for hospitalizations, pay for DMEs, and the ever constant denials for coding issues or errors in OASIS. Here in my location, it seemed like hospitals kept the higher revenue patients for their own agencies and referred out the daily/ BID wounds or high-risk patients. Then consider the benefits offered around you by other companies: mileage (esp. with the cost of gasoline), cell phones, computerized documentation, insurance-- how will you attract and keep quality employees? Are you going to offer therapy? If not, you cannot accept patients with service needs you don't offer. Do you know coding? Errors in coding are a nightmare. Billing is a fright. Then you need to consider if you want a life outside the business. How will you take a vacation? Who will run the company, take the 24/7 calls, resolve staffing issues, and cover visits when someone quits or calls in ill? I won't ever try to build from the ground up again!

KCIN · Jul 5, 2005

they are tightening the loopholes because of the ramnpant medicare fraud that the fbi is investigating

Roland · Jul 6, 2005

they are tightening the loopholes because of the ramnpant medicare fraud that the fbi is investigating

That's fine so long as "the rules" don't estasblish a system that preclude anyone, but millionaires from starting a business. Of course we all know from experiences like Enron, and WorldCom that it is often the biggest players that commit the most egregious acts of fraud and misconduct. Put bad people in jail who commit fraud and throw away the key, but don't punish the honest entrepeuneur. Small business creates the vast majority of new jobs in our economy and is one of the reasons that our per capita GNP, and unemployment is significantly superior to most European nations where the hurdles to small business are much larger by comparison.

I submit that major interests often use every opportunity to lobby both state and federal legislators (as well as administrative authorities) to progressively raise the bar required for entry into various industries. Everyone wants a monopoly its human nature. The problem is that major players (read hospitals, HMO's, and major corps) often have the financial clout to lobby over a long enough period of time to create situations that essentially legal monopolies.

caroladybelle, BSN, RN · Jul 6, 2005

You can argue the unfairness as much as you want...it does not change the facts regarding the situation and merely taxes your time and patience.

Just like the thin and the attractive will always have an advantage in the job market, all things being considered. Fair, NO ...but reality is harsh.

Many states have Certificates of Need. To obtain a CON, you have to "prove" that your health care service is needed and that you can provide the service. In some states (Georgia for one), new CONs are very difficult to obtain. To limit medicare/medicaid outlays by the state...they limit CON availability. The state has X number of nursing home beds (not all of these are in popular areas and not all are in good facilities). The state can legally say that they have adequate beds even though many of these beds are far from family and friends and may be in very undesirable places. It thus discourages many people from moving into the state that will perhaps place an "undue burden" on it.

Thus there is a financial incentative to limit CONs. Companies have to jump through multiple hoops (requiring a lot of cash and political wrangling) to get CONs.

Is it right????? Well, as it affects the state monetary outlays, it is their right. Is it fair to the independent entrepeneur....most definitely not.

I would say 250,000 is a very very low estimate of what the startup costs would be. If you look at the legal issues, the paperwork issues, the staffing issues, it probably would cost more. Then again, it depends on the state and their own issues. Florida would probably be much easier. But then, everything is medicare/medicaid and frequently results in losing money.

Also, as previously mentioned, MDs and hospitals tend to "cherry pick" patients. They keep the patients with the best insurance plans/reimbursement and turn the ones with the poor reimbursement plans over to outside agency. As an Onco nurse, if the patient has good insurance, the MD office does their meds/chemo if at all possible. The uninsured or underinsured get chemo at the not for profit facility.

Roland · Jul 7, 2005

So do the seven plus patient clients that you need to apply for Medicare PPS approval need to be Medicare/Medicaid patients? Again, if they can be private pay (either their own funds or private health insurance) then it is at least feasible to start a small private pay only operation and then transition to Medicare/Medicaid and the cost would not be theoretically prohibitive since the private pay could help pay the bills of starting.

You can argue the unfairness as much as you want...it does not change the facts regarding the situation and merely taxes your time and patience.
Just like the thin and the attractive will always have an advantage in the job market, all things being considered. Fair, NO ...but reality is harsh.
Many states have Certificates of Need. To obtain a CON, you have to "prove" that your health care service is needed and that you can provide the service. In some states (Georgia for one), new CONs are very difficult to obtain. To limit medicare/medicaid outlays by the state...they limit CON availability. The state has X number of nursing home beds (not all of these are in popular areas and not all are in good facilities). The state can legally say that they have adequate beds even though many of these beds are far from family and friends and may be in very undesirable places. It thus discourages many people from moving into the state that will perhaps place an "undue burden" on it.
Thus there is a financial incentative to limit CONs. Companies have to jump through multiple hoops (requiring a lot of cash and political wrangling) to get CONs.
Is it right????? Well, as it affects the state monetary outlays, it is their right. Is it fair to the independent entrepeneur....most definitely not.
I would say 250,000 is a very very low estimate of what the startup costs would be. If you look at the legal issues, the paperwork issues, the staffing issues, it probably would cost more. Then again, it depends on the state and their own issues. Florida would probably be much easier. But then, everything is medicare/medicaid and frequently results in losing money.
Also, as previously mentioned, MDs and hospitals tend to "cherry pick" patients. They keep the patients with the best insurance plans/reimbursement and turn the ones with the poor reimbursement plans over to outside agency. As an Onco nurse, if the patient has good insurance, the MD office does their meds/chemo if at all possible. The uninsured or underinsured get chemo at the not for profit facility.

Traveler · Jul 7, 2005

My branch hh agency office is in a very rural isolated part of the county surrounded by National Forest and mountains. Several other agencies come "up on the mountain" to see patients but the majority of patients in this area are seen by us because the folks here like locals to provide their care and know that the office is close by. We recently applied for a CON for hospice which would have been a great service to be able to provide. Currently two other agencies provide hospice care but they are a minimum of an hour away- a bad thing for hospice. We were denied and the only thing that we could figure is that the company I work for also owns some nursing homes- perhaps they thought it would be a monopoly. In any event, it is very political.

classicaldreams · Jul 7, 2005

. . . .I believe that such a scenario would further empower nurses making home health nursing relatively more attractive to nurses (since average hourly rates would increase from say the mid 20's to high 30's). In turn this would attract more nurses to home health care. . . .

Having owned a business in the past, I would not leave a hospital job or hh agency job just to make another $15.00/hr. Overhead, including ss tax, would certainly gooble that up quickly.

Classicaldreams