How Do I Conduct a Time Study to Determine Level of Care Expenses for my Hospice?

How can time studies help my hospice cost report?

According to the hospice cost report regulations for form 1984-14, all direct care hospice expenses must be divided by level of care (LOC).  As an example, RN salaries need to be reported separately for Continuous Home Care (CHC), Routine Home Care (RHC), Inpatient Respite Care (IRC) and General Inpatient Care (GIC) patients.

Since most facilities do not maintain separate accounts in their chart of accounts for each level of care (e.g., RN CHC Salaries, RN RHC Salaries, RN IRC Salaries, and RN GIC Salaries), and many do not completely track care hours by level of care, several methods of determining how to correctly break out the expenses have been suggested.

One method would be to conduct time studies.  The time studies should be conducted over two separate two-week periods in different quarters of the year, preferably at different times of the month.  For example, one may choose to conduct one time study from January 14 – January 27 and another from October 1 – October 14.

During the time study period, each employee would be required to track his or her hours by LOC each day.  At the end, the facility will be able to total the hours spent on care for each LOC.  Add the totals for each LOC for every expense category from the two time studies together.  Divide that amount by the total hours each category of employee worked during the time study periods to get the percentage allocation.

An example would be a facility which, during the two time study periods, all salaried RNs together worked a total of 1,000 hours.  Of those 1,000 hours, 230 of them were spent on CHC, 420 on RHC, 190 on IRC, and 160 on GIC.  All RN salaries for the year would be allocated 23% CHC, 42% RHC, 19% IRC, and 16% GIC.

Disclaimer:  This blog does not contain legal advice. What it does contain are our best
explanations, advice, and suggestions to help hospices and hospice cost report preparers to understand the new cost report form (1984-14) and offer suggestions for its preparation. Progressive Provider Services assumes no legal responsibility for the content of this blog, nor for cost reports prepared based on the content herein.











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