Sequestration: What Does it Mean for my Hospice?

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Sequestration is a government mechanism, put into effect as part of the Budget Control Act of 2011, involving a series of spending cuts aimed at reducing the nation’s deficit. The cuts would be required of most core government functions. Beginning March 1, 2013, sequestration is expected to continue through 2021 unless congressional action is taken.

These reductions included a 2% decrease in Medicare reimbursement. Simply put, for each $100 a hospice would bill for services, $98 will be received. According to the National Hospice and Palliative Care Organization’s Facts & Figures released in November of 2012, 84% of patients served across the country were enrolled in the Medicare Hospice Benefit. It is also important to note that the sequestration reduction is in addition to the funding cuts already in place from the Affordable Care Act and other recent Medicare cutbacks.

These budgetary restraints come at a time when the industry as a whole is faced with greater scrutiny through increased audits and medical record review as well as the introduction of mandatory quality reporting in the areas of pain alleviation and symptom management. While these trends are designed to assure patients and families of the highest quality of care, the burden is on agencies to provide more complex care to patients both medically and administratively. Some agencies have already made reductions in their workforce or been forced to close in-patient units.

The unintended results of these actions include caring for patients in a smaller service area and under-utilization of hospice services by outlier communities. Hospice care is the personification of hope and the people working in this field will face the current challenges with creative ideas to solve problems while always focusing on changes that will provide long-term benefits to the industry. Dying in the home of your choice on your own terms is an important ideal and one well worth fighting for.

By Diane Baldi, RN

The Implications of Sequestration in Marketing, Sales and Admissions
The implication is simple; hospice providers must increase the earlier referral and admission of appropriate terminally ill patients and their families which means increased focus and teamwork.

The senior management, clinical and sales teams must work together to identify opportunities for the hospice to differentiate itself in the service area. Liaisons needs to have the right sales materials to emphasize these differentiating services.

Intake must have a sense of urgency in setting appointments and must be able to effectively handle objections so the patient and family will agree to meet face-to-face with the hospice. The admissions team must be skilled at presenting hospice services so patients and families see the benefits to them in receiving care. The team must also be comfortable with handling objections. Intake and admissions should be included in the identification of opportunities and customers for the liaisons to include in their sales calls.

Sales liaisons must evaluate their referral sources and focus primarily on customers who currently refer (the 80/20 rule), as well as identify new opportunities and customers. Pre-call planning, 10-12 quality calls/day, sales call cycles based on A, B, and C accounts and written sales plans will contribute to growth and alleviate some of the pain of budget cuts.

In summary, assess, focus, plan and follow-up for all.

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