June 11, pm Eastern; 1pm Central; 12 noon Mountain; 11am Pacific Making Cents of Your Direct Costs Barbara Rosenblum, CEO Pat Laff, Managing Principal, Laff Associates Tom Boyd, Principal, Boyd & Nicholas

Welcome Quick basics Handouts How pose questions Q&A During the session, type your questions in the upper-right hand corner as they come to mind. Please include your name and location. We will compile a blinded list of questions and answers and provide to you via . Zeb Clayton, Director Customer Support at SHP GoToMeeting™ Technical Tips

Welcome Barbara Rosenblum, CEO Strategic Healthcare Programs, LLC Pat Laff, Managing Principal Laff Associates Tom Boyd, Principal Boyd & Nicholas

How We’ll Spend the Next 60 Minutes - Talking Points The Industry’s Dirty Little Secret Nuances of Direct Cost Data The Value of Having Current Cost Data The Rules of Engagement Standardized Definitions & Accounting Rules Completing Your Cost Template Questions & Answers

Introduction to the SHP Direct Cost Calculator™ The template self-calculates all totals and unit costs and determines the agency’s Direct Costs per Visit and provides a benchmark derived from all participants in the SHP Direct Cost Calculator program. Providers wishing to participate must attend one of the quarterly workshops prior to entering data. All expenses are to be recorded using accrual accounting in accordance with the principles of the American Institute of CPA’s and Medicare regulations.

Instructions for the Workshop 1.Make sure you have your financial data “homework” in front of you 2.We’ll start with a review of all 11 of the required fields in the Direct Cost Calculator 3.At the end of the review, you’ll be prompted to log on to your SHP account navigate to the Cost Template 4.You will be guided on how to fill in each of the fields 5.Reminder: Each monthly you will need to update your Direct Cost Calculator with updated year- to-date costs

Cost Calculator Fields & Definitions 1. SHP Client Provider No: This number will be assigned to each provider by SHP. 2. From and To: Enter the first day of the month that begins the year-to-date fiscal period included in the analysis, preferably six months, but not less than 6 months; Enter the last date of the fiscal period to-date, i.e. preferably Dec. 31, 2007 for a complete year or March 31, 2008 for a shorter period. 3. Billable Visits: Enter the number of skilled intermittent billable visits for each discipline for all payers.

Cost Calculator Fields & Definitions 4. Salaries – Supervisors: Enter the total salary expense, including paid time off (PTO), of only those supervisors whose sole responsibility is the daily direct supervision of clinical field staff for each of the disciplines specified on the template. (Paid time off includes vacation, holidays and sick days.) For those supervisors whose responsibility includes more than one, but not all, disciplines (RN & HHA, and PT, ST & OT), allocate their salaries to each discipline in proportion to the field staff visits provided. 5. Salaries Staff Enter the total salary expense, including PTO, overtime, etc., for each of the disciplines specified on the template, of only those field staff whose sole responsibility is to provide the daily hands on patient care.

Cost Calculator Fields & Definitions 6. Payroll Taxes Enter the combined federal (and any state) payroll taxes – FICA and Medicare tax for both the supervisors and staff for each of the disciplines.

Cost Calculator Fields & Definitions 7. Fringe Benefits – Premium Based Enter the total net cost to the provider (does not include employee contribution) for each discipline for employee health, dental, vision, life, AD&D, etc for each of the disciplines. For those providers that are self insured, determine the percentage of the employee contribution to the total premium to calculate the provider’s expense. (You should be able to get that information from the Human Resources department). 8. Fringe Benefits – Retirement/Profit Sharing Enter the total net cost to the provider (does not include employee contribution) for each of the disciplines specified on the template for employee for 401-k, 403-b, or any other IRS approved Profit Sharing plan. For those providers that are part of a hospital or health system, you should be able to get the information related to the percentage of eligible salaries and contribution rates from the Human Resources department.

Cost Calculator Fields & Definitions 9. Workers’ Compensation Insurance Enter the total cost based upon the specified percentages of salaries (different rates for field staff and office-based personnel, i.e. supervisors) for each of the disciplines. The rate for caregivers is higher than the rate for administrative personnel. The current rates can be obtained from your latest Workers Compensation Insurance invoice and applied (as a percentage) to your caregiver salary cost for each discipline. For example if SN rate is given as $8.80 per hundred and your SN salaries are $50,000 then 8.8% of $50,000 or $4,400 is your SN Workers Compensation Insurance costs for SN.

Cost Calculator Fields & Definitions 10. Auto Reimbursement (Allowance) Enter the total of the expenses incurred for staff visits and supervisory travel for each of the disciplines. This should include any flat amounts, mileage and/or per visit payments. 11. Contract Personnel Enter the total cost incurred by the provider for services provided by both individuals and those under contract (no taxes withheld and forwarded to the U.S. Treasury) and contract organizations, specific for each of the disciplines.

We’re About to Instruct You to Login REMINDER… Type in any questions or suggestions that you have. Pat Laff and Tom Boyd have graciously agreed to make themselves available for questions after the seminar. Their contact information is located on the contact slide of this presentation.

Contact Information Barbara Rosenblum, CEO (805) Pat Laff, Managing Principal Laff Associates (843) Tom Boyd, Principal Boyd & Nicholas (707)

It’s Show Time! 1. Please login to your SHP account 2. Navigate to the Account Management page 3. We’ll give you a few minutes before proceeding