Will the new Medicare regulations affect your chronically ill patients?

Before you say no,’ read on — the rules have changed drastically

Who will take care of your chronically ill patients if changes in government regulations leave home health agencies and nursing homes no choice but to "just say no"?

If, as in the past, it still holds true that where Medicare goes other payers follow, case managers should be paying close attention to recent Medicare changes and the impact of those changes on the home health industry and other sectors of the health care delivery system. If you are a provider-based case manager, you probably already have felt the impact of reimbursement changes mandated by the Balanced Budget Act (BBA) of 1997. For those of you practicing outside the provider setting, a word of caution: Don’t be too smug. The impact of the BBA and the reimbursement system known as the prospective payment system (PPS) may yet trickle down to your patients.

Since the beginning of the year, more than 1,100 home care agencies, mostly proprietary for-profit providers, have either closed or withdrawn from the Medicare program. National home care trade associations, such as the National Association of Home Care (NAHC), blame the Health Care Financing Administration’s (HCFA, Baltimore) Interim Payment System (IPS), the precursor of the PPS. The IPS has wreaked financial havoc on the industry, NAHC says.

However, the home health industry has not taken this assault lying down. Home care agencies and associations nationwide have filed lawsuits against the U.S. Department of Health and Human Services, challenging the constitutionality and application of IPS. (For more on pending legal actions, see story, p. 184.)

In addition, home care associations recently stormed Capitol Hill demanding that Congress reconsider Medicare reimbursement changes. Gathering in Washington, DC, in September, the country’s leading home care groups joined forces in an effort to convince Congress to impose a moratorium on the Medicare home health IPS. The two-day rally was organized by NAHC (Washington, DC), the American Federation of Home Health Agencies (AFHHA, Silver Spring, MD), and the Home Care Association of America (HCAA, Washington, DC).

NAHC used the event to unroll a two-mile-long petition on the west lawn of the Capitol. The petition was signed by more than 10,000 home care providers, patients, state and national aging organizations, disability groups, churches, and state officials who support IPS reform.

"Without home health services," said NAHC president Val J. Halamandaris, "thousands of people will be forced to prematurely enter nursing homes at a higher cost to their families and state Medicaid programs."

Certain states have been particularly hard hit, argues NAHC. According to an ongoing survey of state home care associations that have been monitoring closures throughout the year, 64 home health agencies have closed in California, while 165 have closed in Louisiana, and 450 have closed in Texas.

Agencies proceed with caution

"Already home health agencies are much more cautious about which patients they will admit," says Sara Speights, director of government affairs for the Texas Association for Home Care in Austin. "You are still eligible for home care; the problem is Congress isn’t going to pay for it. The agency is left hanging out there. They won’t take patients who aren’t going to get well and independent in a reasonable time and stay under that cap congress has set," she explains. "Agencies are now in a position where it is all or nothing. They can’t legally abandon a patient. They can’t go in and give just some care. That means they won’t take that quadriplegic or brittle diabetic patient at all."

Case managers have a responsibility to understand the new eligibility requirements and be prudent about how they document the status of their patients, notes B.K. Kizziar, RNC, CCM, CLCP, case management consultant with Blue Cross/Blue Shield of Texas in Richardson.

"We also have to work with physicians to make sure they understand the criteria for home health. If we have a patient we know doesn’t meet criteria, it’s a disservice to the patient to move him from one home health agency to another looking for an agency creative enough to get Medicare reimbursement," Kizziar says.

But home care agencies aren’t the only ones who are becoming more selective about which patients they admit. "Sick and complex patients are finding fewer options. No one wants to take them," says Sandra L. Lowery, BSN, CRRN, CCM, president of Consultants in Case Manage ment Interventions in Franscestown, NH, and vice president of the Case Management Society of America in Little Rock, AR. "There are many issues. The first is that so many providers — from the home health agencies to the acute facilities to the skilled nursing homes — have staffed down. Many providers simply can’t supply the necessary staff to care for a C-3 quadriplegic or other complex patient."

A second issue is that providers are aware of the new PPS caps. The caps, which went into effect Oct. 1, represent a 15% reduction in home health payments as a result of freezing home health agency per-visit cost limits at 1993-94 levels.

"They know what their costs would be for a particular complex patient, and PPS won’t cover it. That means, the patient won’t be admitted," says Lowery, adding, "Even patients with commercial coverage aren’t covered for chronic care in most cases."

Jackie Soroko, RN, nurse case manager at Greenbriar Terrace Healthcare in Nashua, NH, agrees that the new Medicare rules are making life more difficult for the chronically ill. "We are very concerned about patient advocacy. But it’s certainly more difficult to provide care for any patient with chronic illness. PPS has moved facilities from a system that paid separately for ancillary services to one that pays a flat daily rate with no provision for outliers," she explains. "We’re negotiating with ambulance services and labs to get better rates. It’s what all facilities will have to do to manage the dollars Medicare now pays."

For some patients, there is no option but to shift costs to the states. "What you will see happening in the near future is a dramatic shift to the states," says Speights. "When these patients can’t or won’t be cared for with home health or nursing home placement, they will spend down all their money and become Medicaid eligible. What Congress and the tax payers have to understand is that just because you cut folks off, they don’t just go away. The whole health care system is like a big mobile. If you push this end, everything else shakes."