Home Health Articles and Information

How to Avoid the Financial Blow of 2021

Dec 21, 2020 8:30:00 AM / by Michael McGowan, CEO, OperaCare LLC.

How to avoid the financial blow of 2021

I read an interesting article this week about how funds from the CARES act and Payroll Protection Programs may have softened or in some instances negated the financial blow predicted by CMS’s implementation of PDGM.

If the blow was indeed softened what should we be thinking about and expecting in 2021?

Take Top Down Control of your business:

You cannot optimize your revenue or control your operational costs when you have twenty to thirty clinicians in the field independently running your operations. Standardization or centralized control of revenue development, care planning, and clinical service utilization DURING THE OASIS VISIT while the nurse is in the home, is the only way to achieve the control over operational costs and patient outcomes your agency needs to survive.


Start running your agency from the top down by requiring your field staff to interact with your QA staff during the OASIS assessment visit.

Standardized Service Delivery:

Savvy hospital systems standardized their care delivery during CMS’s implementation of the Diagnosis Related Groupings (DRG’s) as a survival technique. Unfortunately, more than 25 % of their peers went bankrupt and were absorbed by other companies because they did not.

Hospitals learned very quickly that a DRG reimbursement of $3,000.00 could not support labor and materials expenditures of $3,739.00. While this is simple math to the hospital administrator, home health providers continue to resist this reality.

Here is the home health version of the above: Three Nurses see the same CHF patient. Each nurse assesses the patient in the nurses preferred manner. Some walking, some talking, and some simply basing it upon their impression or opinion about the patient.

Using a fully loaded visit cost of $150.00, let’s look at this...


Reimbursement $1,800.00 for 30 days.


  •  Nurse #1 needs fourteen visits, labor cost = $2,100.00 – Potential loss $-300.00
  •  Nurse #2 needs ten visits, labor Cost = $1,500.00 – Potential Profit $300.00
  •  Nurse #3 stabilized the patient and taught them self-management of their disease process in eight visits labor cost $1200.00 - Potential Profit $600.00

For the majority of home health agencies, this discrepancy of care management is happening every hour of the day. If your agency does not take steps to begin controlling costs, care utilization, and patient outcomes you might find yourself in the same situation that approximately 25% of acute care hospitals did.


The home health agency that makes the hard and maybe unpopular choice to change operations—giving control to management and quality assurance team will continue to provide great patient care in this new PDGM era.

Does this seem impossible? It’s not! OperaCare’s data driven quality assurance system gives your agency everything you need including guidance with any operational changes to take charge of your agency, improve margins and patient outcomes – thriving in value-based patient care or PDGM.


Schedule a 10 min Call to Learn More


Tags: PDGM, Co-morbidity, Home Health, Quality assurance, 5-Day RAP Penalty

Michael McGowan, CEO, OperaCare LLC.

Written by Michael McGowan, CEO, OperaCare LLC.

Michael McGowan is a former State/CMS Region IX OASIS coordinator and president of OPERACARE. Based in Socorro NM. The company utilizes proactive OASIS analytics to exploit the entirety of PPS system, establish financial predictability, minimize ADR’s & Audit risks, and monitor OASIS outcomes. The company’s remote monitoring services mimic Intermediaries and audit contractor’s activities to quantify your risks and validate the care you deliver.