Staffing, Compliance and Technology: What Legal Issues Providers Should Watch For In 2023

As home-based care becomes more popular and renowned among the larger health care system, agencies will need to put a greater emphasis on legal compliance.

Matt Wolfe, a health care attorney with the law firm Baker Donaldson, believes that value-based care, staffing struggles and the emergence of telehealth will all present even more struggles for providers in 2023.

But there are positive legal trends, too.

For the latest episode of Disrupt, HHCN sat down with Wolfe to chat about the negatives and positives, as well as recent developments in certificate-of-need (CON) court cases.

Highlights of the conversation are below, edited for length and clarity.

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HHCN: Matt, what’s your background in home health and home care, for our audience who might not be familiar with your work?

Wolfe: I am an attorney with the law firm Baker Donaldson and I represent health care providers across the continuum of care. That includes home health, home care and hospice providers.

What I do for them varies on the day and sometimes the hour, but my job is primarily to counsel them on regulatory and legal issues and to try to address compliance issues proactively and also represent them before various courts and administrative bodies.

Let’s talk about something we’ve discussed before, the case in Kentucky where two potential owners of a home health agency wanted to open up an agency specifically tailored to the Nepali-speaking people in the Louisville area. They were denied a certificate of need and eventually tried to take it to the Supreme Court, but the court is not going to hear the case. I want to get your thoughts on that.

It’s a case that is really a part of a broader movement by many anti-CON advocates to try to find a court that will determine that certificate-of-need law, which varies from state to state, is unconstitutional. Those advocates are trying to find it unconstitutional either under a state constitution like Kentucky, or under the federal Constitution.

Those cases take a variety of form and they’ve challenged a variety of different aspects of the certificate-of-need law. In this case, it was Kentucky’s requirement that prior to being able to operate a home health agency, the operator had to acquire a certificate of need. The courts, which has pretty much been the case across the board, determined that Kentucky’s certificate-of-need law was constitutional and therefore dismissed the plaintiffs’ claims.

What do you think is going to take place over the next 10 years here with these two combative sides on the CON debate? Obviously, you’ve said the courts have generally ruled on the side of CON being constitutional, but do you think there’s going to be any change with that?

I think you’re right that it’s a very hotly debated issue and it’s one that’s going to continue to be debated over the coming years.

Frankly, I think it’s a debate that’s better to be had in policy circles, with state legislatures and with state executive agencies and not really an appropriate conversation to be had — at least on a policy level — in our courts.

It’s hard to predict what’s going to happen because so much of this is going to depend on the particular state that we’re talking about. CON laws don’t exist in all states, and even in those states that do have CON laws, not all include home health. Not all include hospice, including hospice residential or inpatient, or even hospice at home.

Even in those states that do regulate hospice and home health through certificate of need law, their processes vary greatly. What they all have in common is that there’s some type of methodology or approach to determining whether there is a sufficient need in the communities they support.

For example, a new home health agency and the way in which that methodology is developed and applied varies greatly from state to state. It can also vary from year to year in those states. So what I encourage people to do that may have that sort of reactive aversion to CON laws is to actually better understand the process and determine how someone can participate in it.

In a state in which I work, there was a similar application the one described in the Kentucky litigation by a group of individuals who felt like another language minority was underserved. In that situation, the operator was actually able to obtain a certificate of need by going through the legislative process as opposed to going to a court and saying, ‘We don’t want to have to comply with these requirements.’

I think there are avenues for those who are on the outside looking in to be able to obtain CONs. Obviously in the markets in states that have CONs you can do so via acquisition, but there’s a whole host of options that are out there to be able to do so.

I personally think that certificate of need laws are helpful and important for ensuring that we have home health agencies that are of sufficient size and take care of a sufficient census of patients so that they can meet the rigorous Medicare conditions of participation and can provide quality care.

I think that’s really important for the industry as it matures, evolves, and frankly, as patients, payers, and other providers in the system continue to demand more and more from home health providers.

As we head into 2023, what are some of the biggest legal concerns for providers right now?

I think we’re really at a pivotal stage in the industry. We are slowly, and not so surely, emerging from the pandemic. Although we still are technically under the federal public health emergency, COVID exposed the significant need for home-based care and a significant challenge in the current environment for providing it.

Those concerns include the staffing crisis that providers continue to face. It includes some of the built-in payment challenges and the reliance, to a large extent, by home health agencies on Medicare fee for service. It also includes a growing adaptation of technology into home health, but there’s obviously still a lot more opportunity to do so.

As I look ahead to 2023 and think about the most pressing legal or regulatory concerns for home health providers, I would say staffing. Staffing retention, staffing engagement, the adoption of technology and the incorporation of that into operations.

Payer engagement. And that doesn’t just mean Medicare fee for service and Medicaid fee for service or Medicaid managed care, but also includes Medicare Advantage. Your publication has done a lot of great reporting recently on larger home health organizations that have been able to contract with large health plans, and I think that trend is going to continue.

Finally, and this may sound like a broken record, but compliance. The fact that home health agencies — along with lots of other health care providers — were lauded as heroes in the early days of the pandemic may give some the false comfort that there aren’t auditors, surveyors and investigators that are looking closely and scrutinizing the growing role of home health in our health care ecosystem.

I think providers that are looking to not just survive but to thrive in the post-COVID world are going to need to invest significantly in ensuring their compliance programs aren’t just updated but that they are fully implemented and that they become part of the fabric and culture of the organization.

In terms of compliance, the spotlight has really benefited home-based care providers, whether it’s personal care or home health, but at the same time — that means there might be more scrutiny than usual. I think that if there are organizations who see this opportunity to grow, that’s probably something that they may not consider as much as they should.

I think that’s absolutely right and that’s something I see. Frankly, it’s common, not just amongst home health providers, but across really any type of health care provider where a provider experiences significant growth through operating in the right way: investing in their workers and developing their knowledge and expertise.

Oftentimes, the compliance programs, the staffing and other resources needed to support them, do not keep pace. Making sure that as an organization grows, you’re also making sure that the compliance program grows with it.

That requires conducting a review of its effectiveness, looking at what additional resources are needed and what new risks providers face in our evolving regulatory environment.

What about some legal hot waters providers may get into when it comes to staffing?

We could take an entire podcast on that question alone.

To hit a few highlights: you have Wage and Hour Act concerns, you have issues with ensuring that you’re paying for travel time, mileage reimbursement and obviously making sure that you have an environment that is diverse and inclusive and non-discriminatory.

I think as providers continue to struggle with hiring and retaining sufficient staff, to be able to actually take all the referrals that they have, investing in what it takes in order to retain staff is going to be increasingly important.

Obviously there’s not a one-size-fits-all solution to doing that. That requires investments in what I like to think of as sort of career paths and career trajectories for individuals who are involved in home-based care.

Ultimately, I don’t know that you’re ever going to be able to provide a sufficient hourly wage for direct care workers in order to keep up with restaurants and large technology companies that are coming in and offering really, really high wages.

What I think that health care providers can do is say, ‘This is not just a way to make ends meet for the next few months. This is really a way to have a career in health care, it’s a great entry point for a career in health care that can be sustainable and meaningful.’

Some of these companies obviously need more staff than they’re able to hire at times. Sometimes they’re using part-time workers or workers from staffing agencies when people are out sick like what happened in early January during the Omicron surge. Does that also come with legal risks, when you obviously have non-full-time workers working for you more often than usual?

Sure. I think every organization and every employer has to consider not just dedicated staff, but what the right mix ratio is of part time versus full time, directly employed versus employees hired through their staffing agencies.

I’m not in the business of telling providers how to run their companies, but I do think when you’re relying primarily on — or even exclusively — upon staffing agencies, you lose the ability to control or influence the quality of care.

You lose the ability to control health outcomes, which are going to be so critical for providers as they move along the value-based continuum, as they diversify their pay and they meet some of the new value-based purchasing obligations under the home health final rule.

What’s the case with technology in terms of legality and making sure that your agency runs smoothly? What are some things to consider there?c

I think there’s a lot of promise, obviously, in technology and in being able to better serve the patient and provide additional data that providers can rely upon in order to be able to shape and refine the plan of care.

There’s also an incredible amount of data that can be used to help evolve how we pay for and how we provide care moving forward. I think home-based care providers are uniquely positioned to be able to tap into that data just simply because of their proximity and access to patients in their daily affairs.

We also have to realize that data is highly sensitive information and that home health or home-based care providers need to be very careful on how that data is transmitted from patient — through their providers — through vendors.

I think providers need to be very careful and thoughtful about contracts, making sure vendors are helping to ensure better care to patients and that they’re providing more value, to pay ORs and to help the provider to grow.

I think that’s where the uncertainty is. There was such an explosion, seemingly overnight, of so-called ‘telehealth,’ that most people don’t want to go back to the way things were pre-March 2020.

People now appreciate being able to see a doctor from the comfort of their own home and, in some cases, to be able to consult with or be examined by providers. I think that’s going to continue to grow. I think home-based care providers can play an important connecting role in that. Technology can also provide additional information for providers that, frankly, may still have concerns about the utilization of telehealth and the idea of losing that connectivity to a patient that may no longer be in their exam.

Good data, sophisticated data, is what drives all of those value-based arrangements. If you don’t feel confident about your data and you don’t feel confident about the ability to harvest additional data, it’s going to be very difficult to be able to play in that value-based space.

If there are two things that you believe providers should be most focused on heading into 2023, what would you say those two are?

I think we’re going to continue to see, with all of the uncertainty, consolidation in the industry. I think that if you’re a small to medium sized provider, the temptation may be to find some dance partner to be able to grow,

I think there are also opportunities to grow organically and to grow across lines of service. We talked before about the number of providers that are in all of the different auspices: home health, hospice, home-based care. I think there are continued opportunities to grow organically.

Then there are also opportunities to be able to develop niches amongst certain specialized populations and to go deep into communities as opposed to just going big.

I do think that the regulatory scrutiny and the regulatory uncertainty that we’re going to see, even though we now have a finalized home health rule, is something to keep an eye on. There’s still a lot of uncertainty about how the behavioral adjustment is going to play out long term, whether Congress intervenes, whether litigation becomes necessary and then what CMS does in the final rule for 2024.

Providers that want to be able to succeed are going to continue to need to look at ways to not just do what they did before, but to be able to position themselves to be able to thrive in this ever-changing environment. If I had to whittle it down to two things that providers should focus on, I would go back to what I said before: staffing and compliance.

What about some positive outlooks that providers can look forward to in 2023?

I think there are a lot of positive things to reflect on. Lawyers get a reputation, and probably deservedly so, for being somewhat negative or pessimistic. But I think there are a lot of exciting things that have happened.

I think that there has been a growing recognition and embrace of the importance of home-based care as part of the continuum of health care. Home-based care providers need to take advantage of this window to assert their roles in the health care space. They need to do that with payers, policymakers and other providers.

The other positive development is the growing role of technology and home-based care. I’m hopeful that there will be sufficient revenue for home-based care providers to receive so that they can continue to make the necessary investments in technology to better serve patients.

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