How Much Do Home Health Agencies Make Per Patient

A home health agency is an important service provider that provides home-based treatment and care to the elderly and sick. These services are usually funded through various public and private insurances, private payments, or Medicare and Medicaid. However, a home health agency’s revenue per patient depends on the type of service, the patient’s condition, and the local market. Here is a stet-by-step analysis of home health agency revenue per patient and various factors involved.

Patient Status and Service Delivery

A home health agency’s income per patient largely depends on the patient’s physical condition. If the patient has a long-term or chronic illness, such as diabetes or heart disease, the demand and concentration of services may be higher. Agencies can earn more for long-term care. On the other hand, in case of short term service the income is relatively less.

Type of Service

A significant portion of home health agency income depends on the type of service provided. Non-medical services such as personal care, housework, and social assistance have lower returns, whereas medical services have relatively higher returns. For example, agencies can earn more in the areas of injections, physiotherapy or special care, as these services require high-quality skills and equipment.

Payment Source

How a home health agency receives money from patients is a major factor in revenue. Generally, income comes from three sources:

Medicare: Many home health agencies in the United States receive funding form the government health insurance program for the elderly and low-income individuals. Medicare pays a fixed fee per patient, which is determined by the type and duration of services.

Private Insurance: Private insurance companies charge different rates for patient care, which is a major part of the agency’s revenue.

Out-of-pocket Payment: Some patient seek home health services at their own expense, where the agency receives revenue directly from the patient.

Local Market Influence

Home health agency revenue depends on the local market. Larger cities or higher income areas tend to have higher incomes due to higher demands for services. On the other hand, incomes may be lower in rural or low-income areas, because the prices and demand for services are lower.

Operating Expenses

Operating expenses are important to consider when determining the gross revenue per patient of a home health agency. This includes staff salaries, service equipment, travel expenses and administrative expenses. Net income is determined after these expenses, which gives a true picture of income per patient.

Average Revenue Per Patient

A home health agency in the United States can earn an average of $100 to $400 per patient, depending on the patient’s condition, type of service, and local market. If medical services are provided, the income is generally higher, but in case of non-medical services, the income is comparatively lower.

Conclusion

Revenue per patient for home health agencies is a complex process, depending on patient status, type of service, payment source, and local market. With proper planning and management skills an agency can maximize its revenue and at the same time ensure the best service to the patients.

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