Home Health Vendor Management Demands an Updated Approach

Recent staffing shortages and supply chain issues are driving home healthcare rates up significantly. These conditions require workers’ compensation claims teams to modify their approach, putting heavier emphasis on exploring cost comparisons and investing time in collaborative team evaluation of those costs. The current environment commands a new standard for how we manage catastrophic and long-term claims that include a home medical care component.

“This year has served up unique care demands that require special attention from all stakeholders managing a claim,” said Stacy Whalen, Senior Medical Manager at Safety National. “Acute awareness of vendor alternatives and willingness to perform extra due diligence before selecting providers has become essential to achieving the best possible outcome for the claim, and more importantly, the injured worker.”

This approach includes the following elements:

1. No More Relying on Auto-Pilot

Gone are the days where claims teams can exclusively depend on the same preferred vendors they have always hired to provide home health services and care. The old reliance on “click-and-send” referrals simply will not offer the leverage to mitigate the exposure. It is time to reevaluate everything, which includes exploring alternative vendors and getting several detailed price quotes. Try to get at least three quotes and compare them to find the best fit for the characteristics of the claim. In some cases, it may also make sense to approach your long-term vendors to see if they will be willing to re-negotiate agreements.

2. Collaborate with Your Claims Team Early and Often

This approach to vendor management can only succeed when the carrier, TPA and nurse case manager work together. It is impossible to do your best due diligence without the unique perspective that each party brings to the table. For instance, the field nurse can speak to the specific needs, sharing impactful details like if the injured worker lives in a challenging location that is hard to access. The TPA could then provide insight into various contract agreements they have with existing vendors that might be a great fit for the situation. The carrier might chime in with feedback on vendors they had a good experience with for specific injuries and care requirements. After vendor proposals are requested and received, active discussions that include each member of the team are essential.

3. Become a Smart and Savvy Quote Evaluator

Now that you received multiple quotes, it is time for the entire claims team to assess them. This is going to take several sets of eyes all combing through the details and making note of areas that need deeper investigation. Providers may explain that price increases are a result of staffing challenges, but do not take that at face value. There can be several undisclosed hidden fees. If you do not receive itemization of potential charges in the quote, ask for it. Vendor charges can include anything from the actual hourly rate, to transportation and mileage fees, to staffing differential charges for working nights and weekends. An itemization is the only way to uncover hidden fees that may be negotiable. Once you have your notes, go back and have that negotiation conversation to see what can be adjusted. Once care is established and in place, request an itemized statement from the vendor to ensure that the care being provided is based upon the negotiated rate.

This process may sound time consuming, but this exercise can be worth the extra time spent. Ultimately, these efforts can mean the difference between thousands in costs versus millions in costs for the life of the claim.