Health coverage changes in the Affordable Care Act (ACA) have a big impact on senior care employers. Providers are faced with choices, costs, and risks that need to be understood today in order to ensure compliance.

 

While confusion and uncertainty do exist, it is imperative for employers to take steps today to understand what lies ahead.

 

Health care reform is exacerbated by today’s realities in senior care that are already making it difficult to consistently provide high-quality care at lower costs. Reimbursement cuts that could reach $65 billion, workforce shortages, and an aging population are skewing the curves of supply and demand.

Adding to these complexities is an additional 32 million Americans who will enter health care by 2019 as more people become insured under ACA guidelines, according to data from the Henry J. Kaiser Family Foundation. In addition, 2014 will be a monumental year for the new law as changes and guidelines escalate. But, 2013 is the year to explore options, formulate a strategy, and embark on the path to compliance, all while focusing on high-quality care and lower costs.

 

What’s more, look-back guidelines make 2013 a critical year for workforce calculations, making it even more important to get a plan in place today.

 

One of the most critical areas for providers to examine is their workforce. Labor represents their top expense, and it is also a key indicator of the quality care and services provided to patients and residents.

 

Examining labor management strategies is a top priority. Understanding and managing part-time and full-time employee status is foundational to determining the impact of the ACA to each and every provider (see graphic, page 40).

 

Controlling labor costs is also key, as 40 percent of health care service employers expect costs to increase due to ACA requirements starting next year, according to Mercer in “Health Care Reform After the Decision, 2012.”

Under the ACA, employers with 50 or more full-time employees must provide qualified health coverage to those full-time workers or face a penalty. A full-time employee is considered someone who works a minimum of 30 hours per week or 130 hours per month (see graphic, above) on average.

 

Sounds simple enough, right?

 

Now, consider the complexities in truly determining and planning for which employees are part-time and which are full-time. While it may seem manageable on paper, it is difficult to execute on a day-to-day and shift-by-shift basis.

 

Employee absences, last-minute call-offs, and staffing shortages, for example, are common issues that senior care providers deal with each and every day.

 

Filling shifts is often accomplished by scrambling to find replacements, resulting in overtime hours or additional PRN (as needed) hours. These issues now become more complex, as a part-time employee works over 30 hours, for example, just by picking up an extra shift here and there.

 

In addition, employees often rack up additional minutes by simply clocking in early and clocking out late. These incremental minutes and hours add up significantly over the course of a week, month, and year. This, too, could easily become the tipping point for part-timers crossing over to full-time status.

 

While a one-time overage will not cause a part-timer to enter full-time status, it is critical for providers to outline their plans for managing their part-time/full-time mix in order to avoid unplanned penalties.

Providers must consider the following workforce practices in light of impending ACA deadlines and requirements as part of the action plan to be compliant while maintaining quality care, operating efficiently, and managing costs.

Many providers deal with two to three employee call-offs each day, leaving gaps in the schedule and risking quality care and services due to potential understaffing. That’s why most providers fill open shifts as fast as possible, with the first person who agrees.

 

With the ACA part-time/full-time rule, the risks have increased with each and every open shift.

 

Providers should put a plan in place for dealing with call-offs and unplanned open shifts. First, schedulers or managers should determine whether or not the shift needs to be filled, based on their hours per patient day targets or staffing level requirements.

 

When shifts do need to be filled, identifying criteria for selecting a “best fit” replacement is important.

 

For example, schedulers or managers filling the shift should understand how many hours potential, qualified replacements have worked to date and how many are scheduled.

 

Managers must ask, what will be the impact of picking up this extra shift? Will it cause a part-time replacement to enter full-time status? Will overtime be incurred? What is the impact with regard to union requirements?

 

With the new ACA requirements, evaluating part-time/full-time hours needs to be added to the list of criteria in determining best-fit candidates when filling an open shift.

Early clock-ins and late clock-outs can add up, just minutes at a time, to significant overages. While there are plenty of times it may be necessary for a certified nurse assistant to stay late to help with a needy resident, there are also plenty of times when clocking out late can be avoided.

 

While many providers have established a threshold for employee punch overages—commonly seven minutes—it is not enough. Providers should make sure that schedulers or managers are comparing employee punch data with schedules, and identifying variances, on a daily basis.

 

With additional reporting, it is possible to project overages in advance, providing enough time to adjust schedules to avoid the unplanned extra hours.

 

This not only controls costs, it also helps maintain the proper mix of part-time/full-time employees the provider has established.

 

Providers need to equip schedulers with the proper tools and information for creating and updating schedules.

They need to be aware of the organization’s goals and objectives in managing employee hours, not only for common things like overtime and hours per patient day requirements, but now for the full-time threshold.

 

Schedulers need to check daily and weekly hour totals for employees and avoid building extra time into

schedules. Short-staffing situations may make this difficult, but it is important to take the time to evaluate each potential overage ahead of time, so it can be avoided.

Balancing staff with resident census and acuity needs—each and every shift—goes a long way toward ensuring proper staffing.

 

What’s more, it provides opportunities throughout the course of the day to determine where staff members are needed and where they are not.

 

Equipped with information on upcoming admissions or move-ins, for example, schedulers can plan for bringing in extra staff ahead of time. Additionally, if census decreases, they have the opportunity to eliminate extra shifts to stay aligned with labor budget goals, while ensuring proper care.

 

Schedulers should have employee-hours information, both incurred and planned, at their fingertips when deciding whose schedules to adjust.

 

This ongoing focus on proper staffing, aligned with census and service needs or acuity, not only ensures quality care and services but also helps in the quest to manage part-time and full-time employee hours.

 

In addition, providers who right-size their staff day in and day out find greater adherence to labor budgets and save money in doing so, while remaining properly staffed to provide quality care.

Prioritizing staffing and labor management is a critical step in preparing for health coverage changes in the ACA. Start by optimizing scheduling and labor management practices for visibility into and control over employee hours to maintain part-time/full-time goals.

 

And, consider how automating core processes can accelerate efforts in achieving objectives. These practices, along with efforts to control overtime and minimize turnover, can make significant strides in reducing costs in an already cash-strapped environment.