Issue Brief | Medicare Home Health Coverage: Reality Conflicts with the Law

Medicare home health coverage can be an important resource for Medicare beneficiaries who need health care at home. When properly implemented, the Medicare home health benefit provides coverage for a constellation of skilled and nonskilled services, all of which add to the health, safety, and quality of life of beneficiaries and their families. Under the law, Medicare coverage is available for people with acute and/or chronic conditions, and for services to improve, or maintain, or slow decline of the individual’s condition. Further, coverage is available even if the services are expected to continue over a long period of time.^[1]

Unfortunately, however, people who legally qualify for Medicare coverage frequently have great difficulty obtaining and affording necessary home care. There are legal standards that define who can obtain coverage, and what services are available. However, the criteria are often narrowly construed and misrepresented by providers and policy-makers, resulting in inappropriate barriers to Medicare coverage for necessary care. This is increasingly true for home health aide services – the very kind of personal care services vulnerable people often need to remain safely at home.

A. The Law: What Home Care Is Covered Under the Medicare Act?^[2]

Home health access problems have ebbed and flowed over the years, depending on the reigning payment model, systemic pressures, and misinformation about Medicare home health coverage.  Regrettably, these problems are increasing and, if current and proposed policies and practices continue, they will only get worse. Accordingly, it is important to know what Medicare home health coverage should be under the law, especially for people with longer-term, chronic, and debilitating conditions.

1. Medicare Home Health Qualifying Criteria

Medicare covers home health services under both Parts A and B when the services are medically “reasonable and necessary,” and when:^[3]

• A physician or other authorized practitioner has established a plan of care for furnishing the services that is periodically reviewed as required;
• The individual is confined to home (commonly referred to as “homebound”). This criterion is generally met if non-medical absences from home are infrequent, and leaving home requires a considerable and taxing effort, which may be shown by the patient needing personal assistance or the help of an assistive device, such as a wheelchair or walker.. (Occasional “walks around the block” are allowable. Attendance at an adult day care center, religious services, or a special occasion is not a bar to meeting the homebound requirement.);
• The individual needs skilled nursing care on an intermittent basis, or physical therapy or speech-language pathology (or, in the case of an individual who has been furnished home health services based on such a need, but no longer requires skilled nursing care or physical or speech therapy, the individual continues to need occupational therapy); and
• Such services are furnished by, or under arrangement with, a Medicare-certified home health agency.^[4]

2. Medicare-Covered Home Health Services

If the qualifying conditions described above are satisfied, Medicare coverage is available for an array of home health services. Home health services that can be covered by Medicare include:^[5]

• Part-time or intermittent nursing care provided by or under the supervision of a registered professional nurse;
• Physical therapy, speech-language pathology, and occupational therapy;
• Part-time or intermittent services of a home health aide;
• Medical social services; and
• Medical supplies.

As described above, skilled nursing, physical therapy, and speech-language pathology services are defined as “qualifying skilled services” for the purpose of establishing eligibility for Medicare home health coverage.^[6] A patient must initially require and receive one of these skilled services in order to receive Medicare for other covered home health services.^[7] Home health aide, medical social worker, and occupational therapy services^[8] are defined as “dependent services,” (dependent upon a skilled service being in place) as are certain medical supplies.^[9] While occupational therapy is not considered a skilled service to begin Medicare home health coverage, if the individual was receiving skilled nursing, physical or speech therapy, but those services end, coverage can continue if occupational therapy continues.^[10]

The term “part-time or intermittent” means skilled nursing and home health aide services furnished any number of days per week as long as they are provided less than 8 combined hours each day and 28 or fewer hours each week (or, subject to review on a case-by-case basis as to the need for care, less than 8 hours each day and 35 or fewer hours per week).[11]

 M3. Medicare Home Health Coverage Can be Long Term

Importantly, and contrary to what is often stated, Medicare home health coverage is not just a short-term, acute care benefit.^[12]

B. The Reality: Access to Medicare Coverage and Home Care is Limited

The Center for Medicare Advocacy hears regularly from people who meet Medicare coverage criteria but are unable to access Medicare-covered home health care, or the appropriate amount of care.

In particular, people living with longer-term and debilitating conditions find themselves facing significant access problems. For example, patients have been told Medicare will only cover one to five hours per week of home health aide services, or for only one bath per week, or that they aren’t homebound (because they roam outside due to dementia), or that their condition must first decline before therapy can commence (or recommence). Consequently, these individuals and their families struggle with too little care, or no care at all.

As reported in Health Affairs in November 2019:^[13]

As reported in Health Affairs in November 2019:^[13]

The Center for Medicare Advocacy has been contacted by Medicare beneficiaries and their families from all over the country who are trying to obtain sufficient home health care to help improve or maintain their condition and remain safely at home. Here is one example that typifies what we hear:

• My dad is in the end stages of Parkinson’s disease and has qualified for home health aide care for 2 hours per week through Medicare.  He should have 24/7 care, however, the financial burden for paying for home health care is too much for us – and the average family. We were shocked to hear from home health agencies that Medicare only covers a few hours per week. We would like to see changes to allow more coverage for individuals living with a long term, progressive, terminal disease.

As geriatrician Dr. Laurie Archbald-Pannone states, “While family caregivers truly do selflessly give of themselves in the care of others, they need more than our recognition of their work. They need the Medicare system to provide appropriate resources for the care of their family members.”^[14] (Emphasis added.)

C. Access to Medicare-Covered Home Health Aides is Shrinking

Help with personal hands-on care is key to the well-being of patients, as well as their families and caregivers. Unfortunately, access to Medicare coverage for such care has declined. This is true even when individuals have an order and meet the law’s homebound and skilled care requirements – and thus qualify for coverage. Unfortunately, Medicare beneficiaries are often misinformed. They are told they can only get home health aides a few times a week, for a short time, and/or only for a bath. Sometimes they are told Medicare simply does not cover home health aides. The Center for Medicare Advocacy has even heard of an individual being told he could not receive home health aide coverage because he was “over income” – although Medicare has no income limit.

As noted above, under the law Medicare authorizes up to 28 to 35 hours a week of home health aide (personal hands-on care) and nursing services combined.^[15] While personal hands-on care does include bathing, it also includes dressing, grooming, feeding, toileting, and other key services to help an individual remain healthy and safe at home.^[16]  In the past, this level of home health aide coverage was actually available.  Indeed, the Center for Medicare Advocacy has helped many clients remain at home because these services were in place.

Currently, however, this level of coverage and care is almost never obtainable. Data demonstrate this dramatic change in coverage. In 2019 the Medicare Payment Advisory Commission (MedPAC) reported that home health aide visits per 60-day episode of home care declined by 88% from 1998 to 2017, from an average of 13.4 visits per episode to 1.6 visits.  As a percent of total visits from 1997 to 2017, home health aides declined from 48% of total services to 9%.^[17]

The real, personal impact of this reduced access to home health aides was highlighted in a 2019 Kaiser Health News article.^[18] The article includes stark findings about the unmet needs of vulnerable Americans struggling to live at home with little or no help. For example:

• “About 25 million Americans who are aging in place rely on help from other people and devices such as canes, raised toilets or shower seats to perform essential daily activities, according to a new study documenting how older adults adapt to their changing physical abilities.”
• “Nearly 60 percent of seniors with seriously compromised mobility reported staying inside their homes or apartments instead of getting out of the house. Twenty-five percent said they often remained in bed. Of older adults who had significant difficulty putting on a shirt or pulling on undergarments or pants, 20 percent went without getting dressed. Of those who required assistance with toileting issues, 27.9 percent had an accident or soiled themselves.”
• “60 percent of the seniors surveyed used at least one device, most commonly for bathing, toileting and moving around. (Twenty percent used two or more devices and 13 percent also received personal assistance.)” and
• Five percent had difficulty with daily tasks but didn’t have help and hadn’t made other adjustments yet.”

The Medicare home health benefit is misunderstood, inaccurately articulated, and narrowly implemented. Medicare-certified home health agencies have all but stopped providing necessary, legally-authorized home health aide services, even when patients are homebound and are receiving the requisite skilled nursing or therapy to trigger coverage. The Centers for Medicare & Medicaid Services (CMS) does not monitor or rebuke agencies for failure to provide this mandated and necessary care.

As Dr. Archbald-Pannone notes,

“As a geriatrician, every week I see patients who are fortunate enough to have family who are able to provide medical care and support. However, I also see more patients who do not have family available to provide full care, are in desperate need of more home care support, but cannot afford the price tag … Without in-home care, we’re leaving our family members alone and at risk. … We may not be available to stay home with them, but Medicare should support trained care aides who can be.” [19]

When Medicare doesn’t cover in-home care, patients and families often must go without. Those who can afford to, pay out-of-pocket, from savings, or with credit cards. Others, who are, or become, poor (often due to health care costs) look to their state’s low-income Medicaid program for help. Thus, costs are regularly shifted to people in need and, for those who are dually eligible for Medicaid as well as Medicare, to state Medicaid programs.  The needs and costs of caring for people who are dually eligible are substantial:

In 2018, there were 12.2 million individuals simultaneously enrolled in Medicare and Medicaid. These dually eligible individuals experience high rates of chronic illness, with many having long-term care needs and social risk factors. Forty-one percent of dually eligible individuals have at least one mental health diagnosis, 49 percent receive long-term care services and supports (LTSS), and 60 percent have multiple chronic conditions. Eighteen percent of dually eligible individuals report that they have “poor” health status, compared to six percent of other Medicare beneficiaries.^[20]

 In summary, as the authors in the November 2019 Health Affairs article concluded: ^[21]

The harm to Medicare beneficiaries and their families would be  greatly reduced if home health aide coverage was provided as intended by law.  As it is, access to help with personal care and activities of daily living is minimal. ^[22]

D. Impact of Caregivers on Access to Medicare Home Health Coverage

Medicare does not cover or help to pay for family caregivers, but the fact that caregivers are – or are not – available, willing, or able to serve as caregivers frequently interferes with a beneficiary’s ability to obtain Medicare-covered in-home care.  On the one hand, beneficiaries and their families may be told that a home health agency will not provide care because it is not safe for the individual to remain at home without a caregiver available. On the other hand, when a family caregiver is available, patients may be told that, as a result, Medicare will not cover in-home care since that caregiver should provide the care.

In fact, neither of these is true. Medicare coverage is not dependent on whether there is or is not a family caregiver – or other caregiver – available. Medicare beneficiaries are eligible for Medicare-covered home care regardless of whether they do or do not have family or other caregivers in place.

As federal regulations state, among other requirements, services must “[b]e of a type that there is no able or willing caregiver to provide, or, if there is a potential caregiver, the beneficiary is unwilling to use the services of that individual.”^[23] Indeed, CMS’s own Medicare Policy Manual confirms that beneficiaries are entitled to have the costs of reasonable and necessary services reimbursed by Medicare without regard to whether there is someone available to furnish the services. The CMS Policy Manual states, “ordinarily it can be presumed that there is no able and willing person at home to provide services rendered by the home health aide or other home health personnel.” (Emphasis added.)^[24] 

E. Medicare’s Home Health Payment System Influences Access to Care

On January 1, 2020, CMS implemented a new Medicare payment system for home health services called the “Patient Driven Groupings Model” (PDGM). PDGM changed home health agencies’ financial incentives and disincentives to admit or continue care for Medicare beneficiaries.^[25] Unfortunately, the financial motivations are often harmful to vulnerable beneficiaries, particularly those with chronic conditions and longer-term health care needs. Although CMS has stated that “PGDM relies more heavily on clinical characteristics,”[26] such as functional levels and co-morbidities, the most significant components of PDGM consider admission source and timing, not patient needs.

PDGM’s financial incentives include higher rates for the first 30 days of home care. Payments are also higher for beneficiaries who are admitted after an inpatient institutional stay (hospitals and skilled nursing facilities), and lower for those admitted from the community. (The “community” category includes hospital outpatients, including hospitalized patients in “Observation Status,” as well as patients who start care from home, without a prior hospital or SNF stay.) The new payment model also reduced the billing period from 60 days to 30 days, encouraging shorter periods of care. Additionally, PDGM lowered the financial incentive to provide physical, occupational or speech language pathology therapy by removing therapy service utilization payment thresholds.

The new Medicare payment system and shift in financial incentives have reduced access to necessary care.[27] Home Health Care News reports that “[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…” ^[28] Reductions in skilled therapy do not only harm the individual who needs that care; they can also end access to home health aides, because aide coverage is dependent on the individual also receiving skilled therapy or nursing.

In response to misinformation and service changes in light of PDGM, CMS released a special edition Medicare Learning Network (MLN) Matters article on February 10, 2020.^[29] The MLN made clear that, while the reimbursement system had changed, Medicare coverage law and rules had not:

• Home health services can continue as long as individuals meet the Medicare coverage criteria; and Medicare home health coverage and service rules have not changed;
• Beneficiaries can receive home health services to improve their condition, and to maintain their current condition, or to slow or prevent further decline.²⁹

Conclusion

All too often, older adults and people with disabilities are unfairly denied access to necessary, Medicare-covered home health care. As a result, they and their families suffer. The Center for Medicare Advocacy urges CMS and its contractors to ensure that Medicare beneficiaries obtain the Medicare home health coverage and necessary services they qualify for under the law.

[1] 42 C.F.R §408.48(a)-(b); MBP Manual, Ch. 7, §§401.1 and 70.1. See, Jimmo v. Sebelius, No. 11-cv-17 (D.Vt.), filed January 18, 2011; Settlement 2013; Corrective Action Plan 2017. See, https://medicareadvocacy.org/medicare-info/improvement-standard/. See, https://www.cms.gov/Center/Special-Topic/Jimmo-Center.
[2] For a fuller discussion of Medicare home health coverage, see, Chiplin Jr., Alfred,  Stein, Judith, Medicare Handbook, Chapter 4, Home Health Coverage, (Wolters Kluwer, 2020; updated annually).
[3] 42 U.S.C. §1395f(a)(2)(C); 42 C.F.R. §§409.42 et seq.
[4] 42 U.S.C. §1395x(m).
[5] 42 U.S.C. §1395x(m)(1)–(4).
[6] 42 C.F.R. §409.42.
[7] 42 C.F.R. §409.44.
[8] Occupational therapy services can be either a qualifying service or a dependent service. Occupational therapy services that are not qualifying services under 42 C.F.R. §409.44(c) can be covered as dependent services if the requirements of reasonableness and necessity are met. 42 C.F.R. §409.45.
[9] 42 C.F.R. §409.45.
[10] 42 C.F.R. §409.42(c)(4); Medicare Beneficiary Policy Manual, Ch. 7, §30.4.
[11] 42 U.S.C. § 1361(m).
[12] 42 C.F.R §§409.48(a)-(b); Medicare Beneficiary Policy Manual, Ch. 7, §§40,1.1 and 70.1.
[13] Health Affairs, “Financial Hardships of Medicare Beneficiaries With Serious Illness” by Kyle, Blendon, et al, Vol. 38, No. 11, pp. 1801-1806 (November 2019). Note: The authors define “serious illness” as individuals “reported having a serious illness or condition that, over the past three years, had required two or more hospital stays and visits to three or more physicians.” p. 1802.
[14] The Hill, “Family Caregivers Need Support, Medicare Should Cover In-Home Aides” by Laurie Archbald-Pannone, MD (November 15, 2019), available at: https://thehill.com/opinion/healthcare/470677-family-caregivers-need-support-medicare-should-cover-in-home-care-aides.
[15] 42 U.S.C. §1395x(m)(1)-(4). Note, receipt of skilled therapy can also trigger coverage for home health aides.
[16] 42 CFR §409.45(b)(1)(i)-(v). See also, Medicare Benefits Policy Manual, Chapter 7, §§50.1 and 50.2.
[17] Medicare Payment Advisory Commission (MedPAC), “Report to Congress: Medicare Payment Policy” (March 2019), Ch. 9, pp. 234-235, available at: http://www.medpac.gov/docs/default-source/reports/mar19_medpac_ch9_sec_rev.pdf?sfvrsn=0.
[18] Kaiser Health News, “Seniors Aging In Place Turn To Devices And Helpers, But Unmet Needs Are Common” by Judith Graham (February 14, 2019), available at: https://khn.org/news/seniors-aging-in-place-turn-to-devices-and-helpers-but-unmet-needs-are-common/. See also, Kaiser Health News, “Home Care Agencies Often Wrongly Deny Medicare to Chronically Ill,” Susan Jaffe (1/18/2018), https://khn.org/news/home-care-agencies-often-wrongly-deny-medicare-help-to-the-chronically-ill/.
[19] The Hill, “Family Caregivers Need Support, Medicare Should Cover In-Home Aides” by Laurie Archbald-Pannone, MD (November 15, 2019), available at: https://thehill.com/opinion/healthcare/470677-family-caregivers-need-support-medicare-should-cover-in-home-care-aides.
[20] Centers for Medicare & Medicaid Services (CMS), Medicare-Medicaid Coordination Office, Fact Sheet: “People Dually Eligible for Medicare and Medicaid” (March 2020), available at: https://www.cms.gov/Medicare-Medicaid-Coordination/Medicare-and-Medicaid-Coordination/Medicare-Medicaid-Coordination-Office/Downloads/MMCO_Factsheet.pdf.
[21] Health Affairs, “Financial Hardships of Medicare Beneficiaries With Serious Illness” by Kyle, Blendon, et al, Vol. 38, No. 11, pp. 1801-1806 (November 2019).
[22] See also, Johns Hopkins University Bloomberg School of Public Health study that also finds people with limitations in activities of daily living (ADLs) experience significant harm when they cannot access adequate help with ADLs at home. “Medicare Spending and the Adequacy of Support with Daily Activities in Community-Living Older Adults with Disability” by Jennifer L. Wolff, Lauren H. Nicholas, Amber Willink, John Mulcahy, Karen Davis and Judith D. Kasper, Commonwealth Fund and National Institutes on Aging (May 2019), as reported by American Association for the Advancement of Science (AAAS) EurekAlert website at: https://www.eurekalert.org/pub_releases/2019-05/jhub-msh_1052819.php.
[23] 42 C.F.R. §409.45(b)(2)(iii).
[24] CMS, Medicare Benefit Policy Manual, Ch. 7, Sec. 20.2, “Impact of Other Available Caregivers and Other Available Coverage on Medicare Coverage of Home Health Services”(updated April 22, 2015).
[25] See, Center for Medicare Advocacy “Home Health Practice Guide: Medicare Home Health Coverage and Care Is Jeopardized By the New Payment Model – The Center for Medicare Advocacy May Be Able to Help” (Jan. 7, 2020) available at:  https://medicareadvocacy.org/home-health-practice-guide/; also see, e.g., Center for Medicare Advocacy Weekly Alert  “Medicare Coverage of Home Health Care Has Not Changed Under the New Payment System (PDGM)” (Feb. 20, 2020), available at: https://medicareadvocacy.org/medicare-coverage-of-home-health-care-has-not-changed-under-the-new-payment-system-pdgm/.
[26] https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HomeHealthPPS/HH-PDGM.
[27]  https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/HomeHealthQualityInits; https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Value-Based-Programs/Other-VBPs/HHVBP.
The Medicare payment structure creates incentives for home health agencies to provide care for beneficiaries with shorter-term, post-acute care conditions. Further, CMS policies and practices create barriers to Medicare-covered home care for people with longer-term and chronic conditions.
These barriers and incentives include:
* Inaccurate and/or incomplete training for entities that make Medicare coverage determinations;
* Home Health Quality Reporting Program (HHQRP);
* Home Health Value Based Purchasing (HHVBP) Models;
* Office of Inspector General, Medicare Contractor, and other audits of Home Health Agencies pointing to so-called “overutilization”.
[28] Home Health Care News, “CMS Watching Home Health Providers Closely Amid Shifting Therapy Strategies” by Robert Holly, (Feb. 12, 2020), available at: https://homehealthcarenews.com/2020/02/cms-watching-home-health-providers-closely-amid-shifting-therapy-strategies/.
[29] CMS, MLN Matters article “The Role of Therapy under the Home Health Patient-Driven Groupings Model (PDGM)”, Number: SE20005 (Feb. 10, 2020), available at: https://www.cms.gov/files/document/se20005.pdf.

March 24, 2021 – J. Stein