A conversation with Randy Forrest – March 2016
By: Chad Harrington http://www.relode.com/team
Randy Forrest of SMART Healthcare Resources trains and consults hundreds of home health agencies around the country every year regarding compliance, clinical documentation, financial and reimbursement practices. He’s the lead consultant for his company and he’s been in the industry now for 30 plus years.
Because he deals with home care agencies on a high level—and sees so many different ones from the inside every year—I asked him,
“What are the laws you find people are breaking that they don’t even know they’re breaking?”
My motive in asking this question was to give home care agencies an insight into some blind-spots they might have, which in the end will help them save resources. Of course, the first one has to do with hiring, which is our first concern at Relode http://www.relode.com/.
The Top Three Laws Home Health Agencies are Breaking Without Knowing It
1. Neglecting to Classify W-2 Employees Rightly
“Common mistakes that happen in the home care and hospice world is Medicare has a rule that requires at least one of your clinical disciplines to be W-2 employees. A number of companies have arrangements whereby they lease all employees through another company. It’s not appropriate to have a home care agency to have their RNs and or LVN’s as leased employees. They are not prevented from having contracted nurses, but their primary staff must be employed by the licensed home health entity.”
2. Not Paying LPNs (and CNAs) Overtime
“Another common thing that we’ve seen in home care is abuse of wage and hour laws, where they pay their licensed practical or vocational nurse on a per visit basis and fail to keep up with time to calculate overtime pay when appropriate. Those are non-exempt employees, and there’s been a number of legal settlements out there related to failure to abide by Wage and Hour Laws.
“Actually a big deal this year relates to home health aides / homemaker level employees. For many years home care entities had an exemption, where they did not have to pay overtime for those employees, but as of January 1st of 2015, there’s an executive order that says that that exemption is no longer in play. That has been fought in court, but most recently, the ruling came out—from the Supreme Court that found—that home care agencies would have to pay overtime for these employees.
“That’s very problematic in the home health world, because those folks are a lot of times providing services covered by State programs (for example, in Tennessee, TennCare program) where the reimbursements are very low resulting in low margins. Now that they will be required to pay overtime to these employees, we are concerned that that might lead to an access to care issue, because these companies can’t afford to provide services at a loss.
3. Holding Back Paychecks for Paperwork
“In the home care world a lot of the clinicians are paid on the ‘per visit basis,’ and many companies I’ve talked with make it a requirement for the clinicians to get paid that they have their paperwork turned in. In other words pay is held back for paperwork, though the employee worked those hours. That is a serious department of labor violation. If someone works an hour this week, you’ve got to pay them for that hour; you don’t have the right to hold back their paychecks.
“There are some interesting ways to work around that. For instance, a company could make it a policy to pay minimum wage for the work being done and pay the rest when the paper work is being done—with a carefully designed policy you can remain compliant with Wage and Hour Laws.”
Have people been fined for that kind of thing?
“Yes, home care agencies and hospice entities have been fined for both of those things. I had a client that prior to my engagement with them had made the decision they were going to pay their licensed practical nurses (non-exempt employees) on salary. The Department of Labor fined them $200K+ and the company ran up 3 times that amount in legal fees.”
Chad Harrington is the Content Director at Relode, the human-powered job posting http://www.relode.com/. He writes on all things hiring. Contact him through email mailto:firstname.lastname@example.org. Follow Relode on Twitter https://twitter.com/relodetools for all blog and company updates. For more articles from Chad Harrington on Home Health, see Relode’s home health and hiring series