- Medicare Coverage of Home Health Care Has Not Changed Under the New Payment System (PDGM)
- Massachusetts Task Force Calls for Closure of Low-Performing, Low Occupancy Nursing Facilities
- Register Now – Upcoming CMA Events
Background. On January 1, 2020, the Centers for Medicare & Medicaid Services (CMS) began implementing a new Medicare payment system—“Patient Driven Groupings Model” (PDGM)—for home health services. Under PDGM, home health agencies have a new set of financial incentives to consider when admitting and continuing care for Medicare beneficiaries. Unfortunately, those financial incentives are harmful to beneficiaries, particularly those with chronic conditions and longer-term health care needs.
PDGM’s financial incentives include higher rates for beneficiaries who are admitted after an inpatient institutional stay (hospitals and skilled nursing facilities) and lower rates for those admitted from the community. (The “community” category includes hospital outpatients and hospital patients in Observation Status, as well as those who start care from their home, without a prior hospital or SNF stay.) The new payment model, among other changes, also lowers the financial incentive to provide therapy by removing the therapy service utilization payment thresholds. Sadly, the new Medicare payment system and shift in financial incentives have already started harming beneficiaries. For instance, Home Health Care News indicates that there are “[s]tories of widespread layoffs of PTs, OTs and SLPs persist — and now new reports of agencies incorrectly telling their patients that Medicare no longer covers therapy under the home health benefit . . .”
Official Response. On February 10, 2020, CMS released a special edition Medicare Learning Network (MLN) Matters article to address continued care and therapy under PDGM. The MLN article makes clear that, while the reimbursement system has changed, “eligibility criteria and coverage for Medicare home health services remain unchanged.” CMS adds that, “as long as the individual meets the criteria for home health services as described in the regulations at 42 CFR 409.42, the individual can receive Medicare home health services, including therapy services.” In light of the Jimmo v. Sebelius Settlement Agreement, the MLN article also states “there is no improvement standard under the Medicare home health benefit and therapy services can be provided for restorative or maintenance purposes.”
Thus, according to CMS, the following remain true under PDGM:
- Medicare eligibility and coverage rules have not changed;
- Home health services can continue as long as individuals meet the Medicare coverage criteria; and
- Beneficiaries can receive home health services to improve their condition, to maintain their current condition, or to slow or prevent further decline.
Contact Us. For assistance obtaining or maintaining, Medicare-covered home health services, please contact the Center for Medicare Advocacy at HomeHealth@MedicareAdvocacy.org.
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The nursing home industry instinctively responds to the closures of nursing facilities by claiming that Medicaid rates are too low and must be increased. A legislatively-mandated Massachusetts task force on nursing facilities has a different response. Describing declining occupancy in nursing facilities, multiple facilities having both chronically low quality and low occupancy, and the dramatic shift of Medicaid dollars from institutional care to home and community-based alternatives, among other factors, the Nursing Facility Task Force identifies policy options under four broad categories:
- “[R]ight-sizing” the nursing home industry by closing or repurposing poor quality, low occupancy facilities;
- Establishing a Medicaid payment system that incentivizes higher occupancy and quality;
- Strengthening and streamlining “suitability review standards” that determine who can operate nursing facilities; and
- Strengthening the workforce by, for example, “requiring that a certain percentage of facility expenditures are directed towards staff wages and other direct care costs.”
While it is yet to be seen if and how these policy goals will be implemented, the Task Force is certainly correct that it is not sustainable or appropriate to prop up chronically low quality facilities with low occupancy rates. As the Task Force notes, these facilities “cannot independently generate sufficient income to offset fixed and variable costs” and “Rates and market forces are not enough to preserve quality nursing facilities and reduce low-quality beds.” A more robust and aggressive policy is needed.
 The Center for Medicare Advocacy has argued that closures have multiple causes. See “What’s Causing Nursing Home Closures?” (CMA Alert, Apr. 4, 2019), https://www.medicareadvocacy.org/whats-causing-nursing-home-closures/.
 Nursing Facility Task Force (Jan. 30, 2020), https://www.mass.gov/doc/nursing-facility-task-force-final-report/download.
 Id. 10.
 Id. 21.
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Whither Medicare – From Promise to Privatization
April 30, 2020, 8:30 AM – 3:30 PM
Kaiser Family Foundation,
1330 G St NW, Washington, DC 20005
Early-Bird Single Seat: $225 (Prior to 2/29/2020. $250 thereafter)
Against the increasing privatization of Medicare, voter focus on health care, and the ongoing talk about a Medicare for All, the 2020 Summit will focus on the promise, challenges to, and future of Medicare.
- What was the original vision and promise of Medicare?
- Is Medicare as a social insurance program a thing of the past?
- Will Medicare be allowed to “wither on the vine,” as Newt Gingrich suggested?
- Should Medicare be the model for universal coverage?
- How can Medicare be improved for all people who qualify now, and may qualify in the future?
The Center for Medicare Advocacy is honored to welcome Wendell Potter as this year’s Sen. Jay Rockefeller Lecturer.
Other confirmed speakers include: former Sen. Jay Rockefeller; former Sen. Chris Dodd; Ted Kennedy, Jr., Chair of the American Association of People with Disabilities; Tricia Neuman, Kaiser Family Foundation Senior Vice President; Clare Durrett, Associate Executive Director of Team Gleason; Judith Feder, Georgetown University professor of public policy and former dean of what is now Georgetown’s McCourt School of Public Policy; and health care journalists Susan Jaffe, Trudy Lieberman, and Mark Miller.
Register Today at: https://www.medicareadvocacy.org/summit/
Wednesday, February 26, 2020 3:00 PM – 4:00 PM EST
Presented by Center for Medicare Advocacy Executive Director, Attorney Judith Stein, and Associate Director, Attorney Kathy Holt, this webinar will further discuss the Medicare home health benefit, including a more detailed look at issues with coverage and access.
Thursday, March 26, 2020 1:00 PM – 2:00 PM EST
Presented in collaboration with California Health Advocates Senior Medicare Patrol by Center for Medicare Advocacy Associate Director, attorney Kathleen Holt and Center Senior Policy Attorney Toby S. Edelman, this webinar will:
- Provide a brief overview of Medicare SNF and HHA Medicare coverage.
- Examine new Medicare payment systems for SNF (Patient Driven Payment Model or PDPM) and for HHA (Patient Driven Groupings Model or PDGM).
- Discuss the impact of PDPM and PDGM on access to Medicare covered services since implementation.
- Review practice tips and tools to access Medicare covered services.
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