AIDS patients: opportunities and risks.

Though difficulties persist, this could be an important avenue of diversification

As AIDS becomes a recognized part of our health care landscape, we in the long-term health care industry increasingly find ourselves faced with issues surrounding admissions of and reimbursement for AIDS

Since AIDS is a disease impacting several different populations, the reimbursement issues vary greatly among patient groups. With cases as diverse as: a senior who contracts HIV from a blood transfusion, a professional who contracts HIV from unprotected intercourse, a drug user who contracts HIV from sharing needles, and a baby born with HIV passed on from his/her mother, HIV-positive consumers defy easy classification. Clearly, each of these case examples represents a different political, socioeconomic, and psycho-social base, though with potentially similar health care needs. With four primary payment sources: private pay, Medicare, Medicaid and private insurance-based managed care, AIDS patients represent a largely untapped market in the long-term heal care field.

As the cliche goes, AIDS does not discriminate. Increasingly the disease is affecting Americans across all strata. From the perspective of long-term care, it is important to recognize that the disease is mistakenly thought of as strictly a middle-age problem; it affects all age groups, even the elderly. According to just-released Centers for Disease Control (CDC) reports, over 11% of the HIV-positive population is age 55 and older. Additionally, it is estimated that between 10 and 25% of the nursing home population age 65 and older may be HIV-positive.

The CDC estimates that approximately 50-60,000 new cases of AIDS are reported nationally each year. AIDS is one of the leading causes of death in the 25-40 age group. This group represents a particular departure from conventional skilled nursing care for the geriatric, but other, less traditional populations are also emerging. Pediatric AIDS, for instance, has grown from an aberrant manifestation into a unique area of specialty within pediatric medicine. Because of increases in both the number of AIDS cases and in long-term survival rates, coming from a background of prior neglect due to ignorance and discrimination, each of these groups represents a growing market for providers of skilled nursing services.

A significant portion of the professional working population that has AIDS can pay privately or are well-insured. As a reflection of this, several for-profit health care facilities are exploring units dedicated to this population. Other facilities have been successful at integrating a private AIDS population into the traditional long-term care mix (although there are considerations with this that will be addressed later in this article.). Medicare funding is another avenue by which providers may find some new reimbursement opportunities in caring for AIDS patients. That is because persons diagnosed with HIV and AIDS fall under the Americans With Disabilities Act, thereby classifying AIDS as a disability. To qualify for the Medicare benefits, the AIDS patient must have been physician-certified as disabled for 24 months.

Until recently, this two-year qualifying period served to exclude most AIDS victims from Medicare benefits, since their survival rates tended to be less. With recent technological advancements, however, it is no longer uncommon for AIDS patients to remain viable, though frequently in need of health care, for extended periods. These recent developments present new-found opportunities for providers interested in treating this growing population.

Nevertheless, as with all Medicare coverage, the knowledge of applicable admitting diagnoses and related qualifying criteria cannot be stressed enough. HIV and AIDS-related diagnoses are identified with disease codes ranging from 42.1 to 44.9.

Most often, AIDS patients require heavier care than the typical geriatric patient population. "Heavier care" means more nursing time for patient monitoring, medication administration and increased psychological support and social service intervention. However, the amount of services each patient requires depends greatly on how advanced the disease process is and how it manifests in the particular patient. Some of the services AIDS patients may require include specialized intravenous therapy, rehabilitation, psychological support, nutrition management, behavior management, oncology support, pain management, hospice and advance directive counseling.

Our experience with hospitals and skilled nursing facilities with dedicated AIDS units reveals that persons with AIDS require more intensive medical care than most skilled nursing patients, because of these patients' multiple complex medical problems. The higher-acuity needs of this patient population will most likely result in higher staffing levels. Depending upon a facility's routine costs and their application, providers' Medicare reimbursement may warrant a routine cost limit exemption or exception request.

Operating a skilled nursing facility with an AIDS unit presents many potential opportunities - and obstacles, as well. At our facility, providing care to persons with AIDS enabled us to establish a reputation as a top-notch and well-respected provider of subacute services to a niche population with complex medical needs. This renown came at a price, however.

A 30-bed AIDS unit had been opened in our 87-bed skilled nursing facility. While the unit did average a population of 24, patient census fluctuations, coupled with the disproportionate economic influence that the unit had on our overall financial picture, was vexing. Since the unit represented over a third of the facility's beds, the ability of the facility to achieve economies of scale and to control staffing expenses presented a formidable challenge. Further, AIDS medications are extremely expensive, and many managed care organizations want all-inclusive per diem rates. We learned that it is important to negotiate either a daily cap amount for medications or to have the medications as exclusions. Also, since this population reflects such varying insurance policies and payer sources, the provider has to closely monitor the various patient benefits.

We also experienced problems gaining commitment from physicians and other health care providers whose outside interests were potentially in competition with the unit - for example, there were Stark 2 self-referral concerns.

The resulting pitfalls we encountered involved attempts to achieve economies of scale, physician buy-in, appropriately negotiated managed care contracts reflecting the special care needs of the AIDS patient population (especially medication reimbursement), and accounting for the co-payments, deductibles and caring for patients on Medi-Cal. Ultimately, the facility was forced to downsize the AIDS unit.

Most skilled nursing providers recognize the reimbursement dangers inherent in admissions of Medi-Cal/Medicaid AIDS patients. This population could potentially fill a facility's beds with residents who would never represent more than the current (in California) $70-$95 rates. Such rates can threaten a facility's viability as patients' acuity, and the related costs of care, increase. Several state governments, including California's, are looking at ways of making reimbursement for higher acuity patients more equitable (i.e. transitional care rates, sub-acute rates, etc.), and some states do have special rates for AIDS patients or acuity-based rates. Until these new levels and rates are implemented more generally, however, facilities must remain especially careful about admitting patients who will require resources beyond the facilities' means.

Managed care is coming to long-term care, though, and with the resulting challenges of maintaining census, the managed care population may turn out to be facilities' best option, and affiliations with referral sources will be helpful. The numerous restrictions intrinsic in many capitation and per diem plans require, however, that providers be careful when it comes to such placements. Also, unlike the Medicare population, commercial managed care insurance programs carry additional risks. Benefit periods, deductibles and co-insurance amounts can vary from policy to policy within the same insurance company. In short, while the population of AIDS patients is growing, the financial waters of reimbursement for their care remain largely uncharted.

A whole other set of challenges faces would-be providers of health care for AIDS patients - those previously-mentioned obstacles. While many nursing home residents may in fact be HIV-positive, the staff's learning of such populations could worry or even scare off valuable employees. Fear and ignorance continue to foster a culture of scorn toward this population of patients. Providers must commit resources to educating their employees concerning the true extent of the threats posed by caring for AIDS patients. Caring for patients with many other infectious diseases can be just as dangerous to caregivers, if not more so, and providers must stress the importance and efficacy of universal precautions (which should be in place anyway). Also, administrators and department heads must remind their staffs that this population is entitled to the same quality care as the rest of our residents.

Providers must also continually educate their resident and family populations on these issues. Considerable AIDS-phobia still exists in our society, and the aging and dying are no exception. When family members ask if their loved ones will have a roommate who has AIDS, facility staff must stand united in responding that they will not discriminate against any population that they are duly licensed to serve. As one nursing home administrator observed, "These days it is quite possible that the resident had an HIV-positive roommate in the acute care setting." The fact is, with current confidentiality laws, any of us can be face-to-face with someone who has AIDS at any time.

There are difficulties indeed. Whether we see the opportunities inherent in the situation is up to each of us in skilled nursing facility management. One way or another, more and more Medicare-certified and subacute skilled nursing beds will be filled with disabled AIDS patients. Do we know how to take business advantage of this?

David Cohan, M.H.A., M.B.A., N.H.A., is Senior Healthcare Consultant, Kellogg & Andelson Accountancy Corporation (818) 971-5100, and Michael Torgan, M.B.A., N.H.A., is Regional Director of Marketing/Managed Care, Country Villa Health Services (310) 574-3733, both in Los Angeles, CA.