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Home Health Licensure

Initial Licensure

Many States require a budget and business plan as part of the application process. Walters Financial Services has a 100% acceptance rate on all budgets and business plans submitted for licensure. The company provides budgets for all types of providers.

How much money do I need to start a home health agency?

The answer of course depends on your staffing levels, the expected patient volume, patient mix, etc. Contact us for your specific financial requirements. In the meantime, the following guidelines are used for licensure:

Medicare Requirement

Effective January 1, 2011, and pursuant to 42 CFR 489.28(a) and 424.510 (d)(9), an HHA entering the Medicare program must have available sufficient funds, which many States term initial reserve operating funds, at (1) the time of application submission, and (2) all times during the enrollment process, to operate the HHA for the three month period after Medicare billing privileges are conveyed by the Medicare contractor (exclusive of actual or projected accounts receivable from Medicare. This means that the HHA must also have available sufficient initial reserve operating funds during the 3-month period following the conveyance of Medicare billing privileges.

Most States

Most States, except Florida, do not have a minimum funding requirement in addition to the Medicare requirement.

Florida/AHCA Requirement

The State of Florida funding requirement is explained via the AHCA Q&A document found on their website at the following link:

An excerpt from that document is copied here for your convenience:

3.1 How much funding should I have to start a home health agency?

There is no amount that every applicant could use as a starting point. Effective July 1, 2008 each home health agency applicant must prepare a business plan. Each agency’s plan for the services offered and the amount of staff to be hired is different. Once you complete your plan and retain a CPA to prepare your financial schedules you will be in a better position to determine how much funding you will need. Please note that the minimum amount of funding cannot be less than three (3) month’s average operating expenses.

Florida Minimum

The AHCA requires 3 months of operating reserves and if applying for Medicare, the federal requirement is similiar in that the Medicare contractor will look for a 3 month reserve. The AHCA has determined that the same funds cannot be used to satifsy both Federal and State requirements, so essentially, new providers looking for Medicare certification will need to set aside 6 months of operating expenses as a contingency.