Home health providers are grappling with a series of hurdles — inflation-induced financial challenges, labor shortages, pandemic pressures and more — that will only get worse if the proposed 2023 payment adjustments are finalized.
That’s the main finding of a recent study of labor costs by the Association for Quality Home Health Care (PQHH). The study was conducted by Dobson DaVanzo & Associates and examines changes in home health labor costs. The study is based on survey responses from six PQHH member organizations and interviews with five industry leaders.
“Healthcare workforce challenges are not leveling off, they are intensifying [in regards to] how organizations are experiencing recruitment and retention, salary pressures, benefit incentives and just trying to manage staffing in this environment right now,” Joanne Cunningham, executive director of PQHH, told Home Health Care News. .
Overall, staffing remains a major pain point for providers. On average, only 59% of home health agency positions were filled in the first quarter of 2022. Contributing factors included burnout, vaccination mandates, and COVID-19 risks .
Competition for available and qualified talent across health care sectors also continues to increase, at a time when home health care providers are struggling to keep up.
Additionally, hospital employee wages are increasing at a faster rate than the homecare workforce. This indicates that providers will need to increase clinical staff compensation to attract talent.
“There has always been competition between different sectors of health care, but that is also intensifying,” Cunningham said. “If you think about it, that means the health care workforce in general is getting tougher.”
In addition to raising salaries, home health providers want to be able to offer incentives such as signing bonuses, performance bonuses, tuition assistance and student loan payments.
Staff shortages, and a generally smaller talent pool, have had consequences for the home health business.
Specifically, providers were forced to decline referrals due to an inability to contract physicians. Some 71% of respondents said this affected the amount of care services their organization was able to provide.
“This is the thing about the dynamic of home health care providers turning down referrals, which not only affects them from a business standpoint, but affects the entire health care industry and the entire Medicare population. Cunningham said. “The demand for home care is increasing, that is a reality. If providers can’t, due to staffing and other financial pressures, take referrals, it means patients aren’t moving out of the hospital quickly and getting the services they need.”
In addition to the realities providers currently face, they are also hampered by payment rates proposed by the Centers for Medicare & Medicaid Services (CMS), as well as regulatory restrictions.
“These rates being proposed for next year have put considerable pressure on the industry,” Cunningham said. “At a time when there is so much demand and a clear preference for the ability to receive clinically advanced care at home, this is not the time to add the unnecessary pressure of massive cuts to the sector, especially as they face challenges with the workforce. . ”