Maximizing Home Health Services: The Strategic Integration of Part B At-Home Outpatient Therapy

By Matt Cadile
Maximizing Home Health Services: The Strategic Integration of Part B At-Home Outpatient Therapy

In the rapidly evolving landscape of healthcare, home health providers are facing increasing challenges impacting their ability to deliver comprehensive care while remaining financially viable. The emergence of innovative services, including outpatient physical therapy delivered at home under Medicare Part B, presents an opportunity for home health providers to address these challenges and revitalize their service offerings. Let’s explore the changing market dynamics affecting home health businesses and discuss the benefits of strategically incorporating Part B at-home outpatient therapy.

Changing Home Health Market Dynamics

The home health industry has experienced significant shifts in recent years, driven by changes in reimbursement policies, shifting patient demographics, higher patient acuity, and an increased focus on value care models. These dynamics have introduced new complexities for home health providers, including:

  • Medicare Part A Restrictions: Traditional home health services, billed under Medicare Part A, are limited to patients who are immobilized and homebound. This restriction hinders the ability to provide certain therapies, leading to missed opportunities for comprehensive care.
  • Financial Strain: Operating under the constraints of Part A billing, home health providers often face financial strain due to limited reimbursement rates and costly administrative burdens.
  • Competitive Landscape: With outpatient physical therapy clinics billing under Medicare Part B flourishing, home health providers face increasing competition for patients in need of specialized therapies.

Soaring Referral Rejection Rates

Home health agencies are currently confronting an unprecedented rise in referral rejection rates. This surge is attributed to a combination of escalating patient demand, a lack of qualified nursing staff, and stringent eligibility criteria. The situation is posing a significant challenge for the health care system, as it is inhibiting patients' access to vital home-based care services.

At-home outpatient physical therapy providers can play a critical role in reducing referral rejection rates. By offering direct-to-consumer services, they can accept patients who may not meet the strict eligibility requirements of traditional home health agencies, such as needing skilled nursing care or being homebound. This offers an alternative referral pathway for patients who still require therapy but do not qualify for or have been rejected by other home health services. In addition, Luna's capacity to provide specialized physical therapy at home allows traditional home health providers to focus their resources on patients requiring more comprehensive care, thereby optimizing resource allocation and minimizing referral rejections.

Strategic Integration of Part B At-Home Outpatient Therapy

Luna Physical Therapy offers a groundbreaking approach to home health services by combining the advantages of both Part A and Part B while billing under the more cost-effective Part B. Instead of viewing outpatient physical therapy providers as competitors, innovative home health providers are beginning to incorporate Luna's Part B model into their service offering, creating an extended continuum of care for their patients and clinical partners. 

Why are innovative home health providers incorporating Part B outpatient physical therapy services?

  • Expanded Services: Part B at-home outpatient therapy allows providers to extend their services beyond the immobilized and homebound patient population, enabling them to treat a broader range of conditions and patients.
  • Enhanced Patient Outcomes: Access to outpatient physical therapy can lead to better patient outcomes and improved quality of life, as it enables a more comprehensive treatment approach tailored to individual needs.
  • Extended Influence of Post-Discharge Home Health Patients: Create clinical protocols and clinical escalations that help to manage care post-discharge for 30-60-90 days. 
  • Extended Visibility of Post-Discharge Home Health Patients: Today, discharged home health patients in need of outpatient physical therapy are left to their own devices to seek PT from a disconnected third party physical therapy provider. No visibility or data is available to the home health agency to monitor progress and more importantly, ensure the patient is not readmitting to the hospital or ER. 
  • Reduce Hospital Readmissions and ER Visit Post-Home Health Discharge: Continuing patient rehabilitation under Part B reduces chances of  patients seeking hospital services
  • Maximize Clinical Staff: Home health providers are facing significant nursing shortages due to rising demand, complex patient needs, and high staff attrition. This shortage hampers care quality and restricts service expansion. Leveraging an outsourced Part B at-home provider allows for the re-allocation of skilled nurses to attend to patients with higher acuity care. 
  • Reduce Referral Rejection Rates: Free up existing resources to focus on home health services that have higher margins for home health agencies.
  • Competitive Edge: Integrating Part B at-home outpatient therapy into their service offering can set home health providers apart from traditional competitors and outpatient clinics, positioning them as leaders in innovative care delivery.
  • Patient Convenience: Delivering therapy at the patient's home reduces logistical challenges and improves patient compliance, fostering a more patient-centric approach to care.
  • Collaborative Care: By collaborating with Luna Physical Therapy, home health providers can establish a network of specialists, fostering a multidisciplinary approach to care that benefits both providers and patients.


As the home health industry navigates through the rapidly evolving healthcare landscape, leading home health providers are adapting and embracing innovative solutions to remain competitive and sustainable. The incorporation of Part B at-home outpatient therapy, exemplified by Luna Physical Therapy's model, offers a strategic advantage for home health providers seeking to expand their services, enhance patient outcomes, and thrive in changing market dynamics.

By strategically integrating Part B services, home health providers are positioning themselves as pioneers in delivering comprehensive, patient-centric care while optimizing their financial performance. Embracing this new paradigm will not only benefit providers but, most importantly, improve the lives of the patients they serve.