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How to Get More Referrals and Increase Market Share: Arrangements with Ambulatory Surgical Centers

By Elizabeth Hogue

Outpatient surgeries, including joint replacements, have outstripped inpatient surgeries over the last 10 years. Specifically, from 1990 to 2014 outpatient surgery rates have grown 15.4%, which has resulted in a drastic reduction in total inpatient surgeries. According to the American Hospital Association’s Annual Survey data, there were 9.015 million inpatient surgeries and 17.386 million outpatient surgeries for 2014.


This means that Medicare certified home health agencies and private duty agencies must now look to ambulatory surgery centers (ASCs) as a major source of referrals of patients. Since an increasing number of joint replacement surgeries are being performed in ASCs, it is increasingly important for Medicare certified home health agencies to focus on ASCs as sources of referrals. Likewise, private duty agencies should look for referrals of patients who are not able to return home without assistance following outpatient surgery, but who do not meet the eligibility requirements of the Medicare home health benefit.


Enter a Preferred Provider Agreement.
 Both home health agencies and private duty agencies may, for example, wish to enter into Preferred Provider Agreements with ASCs. These Agreements could be exclusive. They could also provide that, in the absence of a choice by patients, patients will be referred to preferred providers. A key area of concern about Preferred Provider Agreements is how to help ensure that patients’ right to freedom of choice is honored.


New Rules for Discharge Planning
Some ASCs are owned by hospitals, which raises the question of whether ASCs owned by hospitals are required to comply with Conditions of Participation (CoPs) for discharge planning for hospitals of the Medicare Program. Current CoPs for discharge planning require hospitals to present lists of Medicare certified home health agencies, but not private duty agencies, to patients from which they may choose providers. Current CoPs for discharge planning, however, do not require hospitals to present lists of Medicare certified home health agencies from which patients may choose at outpatient surgical sites, including ASCs.


 It is important to note, however that the Centers for Medicare & Medicaid Services (CMS) published proposed regulations governing discharge planning by hospitals in the Federal Register on November 3, 2015. If these proposed regulations are finalized as drafted, hospitals will be required to comply with CoPs for discharge planning, including the presentation of lists to patients, at all outpatient surgical sites, including ASCs.


 Currently, however, both ASCs owned by hospitals and so-called freestanding ASCs are not required to present lists of home health and private duty agencies to patients or to offer choice to patients so that they can choose providers. Consequently, unless patients voluntarily express a choice of home health and/or private duty agencies, ASCs may refer patients to their preferred providers consistent with Preferred Provider Agreements.


Consequently, there is an opportunity for Medicare certified home health agencies and private duty agencies to garner referrals from ASCs through the use of Preferred Provider Agreements without violating patients’ right to freedom of choice. Like so many things in healthcare these days, now is the time!


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©2017 Elizabeth E. Hogue, Esq.  All rights reserved.
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