Looking for land mines on the CORF battlefield
Looking for land mines on the CORF battlefield
Here are items to consider before joining the fray
Establishing a comprehensive outpatient rehabilitation facility (CORF) makes sense if your community has a significant Medicare population that seems to be being released from the hospital a little earlier and a little sicker, says Nancy Beckley, MS, MBA, president of the Bloomingdale Consulting Group in Valrico, FL. (To see what Medicare covers under CORFs, see box, p. 76.)
"Everybody, not just managed care, is forcing down the length of stay," she adds.
Here are some steps you should take if you are considering setting up a CORF:
• Conduct a feasibility study to determine the needs in your community.
Look at the number of Medicare patients in your community based on current Health Care Financing Administration (HCFA) data and the number you can expect to serve in the future based on HCFA projections.
Look at the types of patients being served from patient claims records.
Pinpoint the geographic location of existing facilities to Medicare patients.
Research physician referral sources to see if there is a need for your services through an informal survey.
"You have to have a patient base and strong support from referring physicians in order to succeed. If only 10% of your patients are Medicare patients, a CORF probably is not feasible financially," warns Mimi Stachowski, administrative director for ambulatory services at Bryn Mawr Rehabilitation in Malvern, PA, who implemented 13 CORFs in six states for her previous employer, Dallas-based Milestone Health Care, a contract management company.
• Insert the Medicare cost data from your outpatient records into a CORF cost report (available from HCFA) to see if you have the number and type of patients that would make a CORF beneficial for your facility, advises Lenore Hersh, director of planning and site development for Casa Colina Centers for Rehabilitation, with headquarters in Pomona, CA. Casa Colina previously operated CORFs successfully until payer changes necessitated their closure, notes Hersh.
• Be aware of all of Medicare’s regulations for CORFs, which might vary from state to state, depending on resources available. (For the regulations, see the story, p. 77.) Make sure it is to your advantage in terms of potential patients to comply with them, based on your patient population. The number of potential patients must outnumber other patients to make a CORF beneficial.
• Carry out a complete analysis of the advantages and disadvantages of being a certified CORF as opposed to simply revising your outpatient department.
Keep in mind that you will not be paid for social services, nursing, or counseling services for rehab patients unless you establish a CORF.
• Keep up with the changing nature of payers in your community through informal discussions with payers to determine future plans and coverage limitations. Determine where Medicare is going under managed care and capitation by studying what Medicare HMOs cover under their plans to make sure you won’t lose money on your charges.
• Know the cost of your services.
• Develop a good method of cost accounting. Medicare will pay for 80% of your costs, with patients picking up the remaining 20% through co-payments.
• Check with state regulators to see if you need to file for a certificate of need (CON) to open a CORF. Most states do not require a CON.
• Check with your state office for licensing and certifications to see if additional licensing requirements exist.
• Communicate with your Medicare intermediary to make sure your charges are reimbursed. Be aware that the reimbursement regulation for services of a CORF are open to interpretation by your state’s Medicare intermediary. Interpretations of what can be reimbursed often varies among intermediaries, Stachowski warns.
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