Home health versus Home Care: What’s the Difference?

Today I am going to answer a question that was asked of me during a consult last week?  What is the difference between home health care and home care in rehab therapy? I am going to answer this question in layman’s terms because it can be very confusing!

Home health is a service provided in the home when the person is considered homebound or it is taxing for the person to get out of the home due to their disabilities. A company typically has to go through extensive paperwork to become a licensed home health agency. With home health, a physical therapist or a nurse has to open up the client. In other words, an occupational therapist or speech therapist cannot go in and work with a client unless one of the aforementioned providers is already providing services. However, an occupational therapist or speech therapist can provide the services alone if there is still a need after a physical therapist or nurse has discharged the person. So, they can close the client alone but cannot open the client up. In home health, the providers are typically paid per visit versus per hour. There are also multiple disciplines providing services more often in home health than in home care. With Medicare, home health is billed under Medicare part A.

Home care is a service that is provided in the home but the therapist or company is billing under outpatient services. They are billing the same codes that are billed if a person were to go into an outpatient clinic. With Medicare, home care is billed under Medicare part B. An occupational therapist, physical therapist or speech therapist can apply to be credentialed with insurances to provide outpatient services in the home. Any of these disciplines can provide services alone in the home under home care. The assessment is billed untimed for most insurances and the treatment is billed by the unit. The documentation for each insurance may be different as some require a doctor’s signature for the plan of care for example and others do not. Each insurance company has a manual that includes their documentation requirements and acceptable diagnoses (LCD codes-local coverage determination codes). There may also be a cap on the amount of dollars that can be billed annually under this service and again this amount varies by insurances. Group agencies can also be credentialed to provide outpatient services in the home. Typically a group will have independent therapists assign their benefits over to them so that the group can bill.

There are other differences between home health and home care services and I suggest studying the cms.gov website and your state DHHS website to become more familiar with these differences. As much as we have learned about the differences, we still find that a lot of people, including people who pick up the phone at some of the insurance agencies, have no idea that there is a difference which can result in payment denials. A person cannot get home health and home care at the same time under several insurances. It is important to have the rationale for the services in writing which comes from agency manuals–we have sent in excerpts from their manuals on more than one occasion to justify billing outpatient in the home.

If you decide to become a home health or home care provider know that although there may be some challenges, you are providing services in the most natural environment–the home!

Check out the must read-The E-Myth by Michael Gerber as well as the books about starting a home health agency below!