In December, 2023, The Medicare Payment Advisory Committee (MedPAC) recommended a 22% payment reduction for hospice providers. This week, they’ve recommended additional cuts once again.
MedPAC has just released the March, 2024 Medicare Payment Policy Report, issued to Congress. The initial statement from MedPAC recognized the long-lasting impact of the COVID-19 pandemic on healthcare providers and the record inflation rates. The commission admits that the pandemic has caused burnout and personal risk to clinicians and other health care workers. The commission also admits that the effects of COVID-19, PHE-related policy changes, and emergency funding made it difficult to interpret the indicators of adequacy in Medicare’s payment rates.
The commission openly states that the fundamental problem with FFS Medicare payments is that providers are paid more when they deliver more services, whether or not those services provide value. The call for additional payment reforms to force providers to coordinate care over time and across care settings and to eliminate what may be necessary services that MedPAC doesn’t deem valuable.
Home Health Agencies
The commission reports the Medicare margins for HHAs at 22.2 percent in 2022. The commission calculates these margins excluding some fixed costs. The margins, according to the commission, indicate that FFS Medicare payments exceed the costs of care. This should incentivize HHAs to take on additional beneficiaries, as the margins are calculating using only costs that diminish by volume.
The commission notes a drop in HHA use in 2022 and lists possible causes including:
The number of FFS Medicare beneficiaries is lower due to the increased enrollment in Medicare Advantage
Lower use of inpatient hospital care among FFS beneficiaries
Hospitalized FFS beneficiaries were less likely to be discharged to home health care (no reason for this was given)
More FFA beneficiaries are using SNFs after hospitalization (no reason for this was given)
The staffing shortages reported by HHAs limit the volume of services they can provide
The commission implies that the staffing shortages are not a factor in the decline in HHA usage. The Department of Commerce’s employment data indicates staffing levels that are currently higher than pre-pandemic levels. Even though the data includes HHAs, hospice, private duty, pediatric agencies, and other home care providers, the commission still contends that Medicare HHAs comprise a significant enough share of this group to conclude there is no staffing shortage nationwide.
The commission also reports that the decrease in the number of HHAs nationwide is not a factor in the decline of HHA usage, because most beneficiaries still live in an area with at least on HHA. The commission recognizes that the number of employees and contract laborers is not used to calculate access to care, even though it is a factor. They also admit that an HHA does not need to serve an entire area to be counted as serving the area, and that the capacity to serve additional beneficiaries is not considered.
The report recognizes that preventable readmissions to hospitals is lower among for-profit and free-standing HHAs than for hospital-based care. However, the commission dismisses this data in favor of the all-cause measure of hospitalization, which is much higher for HHAs. This measure covers 60 days and includes all hospitalizations for any cause and includes community-admitted and home health admitted patients. Essentially, MedPAC is assigning a 14.2 percent hospitalization rate to all home health patients, regardless of the cause of hospitalization, whether or not it is deemed preventable, and whether or not it is in any way related to the initial 30-day-period of post acute care.
The average cost of a 30-day period increased by 4 percent in 2022, due to a higher cost per visit. The HHAs are combatting this by reducing the number of in-person visits per 30-day period. Since MedPAC did not track telehealth visits, there is no data on the overall cost per visit, regardless of whether it was in person or remote. HHAs are working within the PDGM model for reimbursement by lowering their overall costs per 30-day period through telehealth visits, remote patient monitoring, and other technologies implemented to increase efficiency in HHAs. MedPAC wants to penalize this by reducing payment rates. This will only serve to push HHAs to further decrease the number of visits, which will impact quality of care, satisfactions rates, and rehospitalization rates.
The commission concludes that because the payments exceed the costs, the benefits of home health care are devalued as a substitute for more costly care options. MedPAC argues that the overpayment since 2000 creates higher expenditures for beneficiaries, but fails to provide data to this effect.
As noted by NAHC, there are flaws in MedPACs calculations as well as in the foundation of their position:
Exclusions such as taxes, telehealth, and marketing in cost calculations incorrectly inflate the margins
MedPAC relies heavily on the CMS calculations for budget-neutrality, which NAHC has already refuted as incorrect, bordering illegal formulas
The data used in these calculations omitted all HHAs that are hospital-based.
NAHC, along with other agencies, will continue to advocate on behalf of HHAs, hospice providers, and other home-based care agencies in front of Congress to ensure these disastrous cuts will not become permanent inclusions in Medicare policy. We will continue to bring you updates as this issue continues to unfold.
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Kristin Rowan has been working at Healthcare at Home: The Rowan Report since 2008. She has a master’s degree in business administration and marketing and runs Girard Marketing Group, a multi-faceted boutique marketing firm specializing in event planning, sales, and marketing strategy. She has recently taken on the role of Editor of The Rowan Report and will add her voice to current Home Care topics as well as marketing tips for home care agencies. Connect with Kristin directly kristin@girardmarketinggroup.com or www.girardmarketinggroup.com
On March 15th, the Centers for Medicare & Medicaid Services (CMS) issued a Center Informational Bulletin (CIB) that provides guidance and flexibilities to mitigate the impacts on providers resulting from the Change Healthcare Hack. In the guidance, CMS advises state Medicaid agencies that certain requirements will not be enforced, until June 30th, to enable ongoing funds to flow to providers and to prevent disruption of access to Medicaid services, prevent associated negative health outcomes, and avoid solvency issues for providers.
The most important component of the guidance is the ability for states to make interim payments to providers to avoid operational disruptions. Federal law and regulation does not allow for “advance payments” in Medicaid fee-for-service systems, despite their availability in Medicaid managed care environments; however, states can make interim payments to providers subject to reconciliation with actual services delivered.
CMS stresses that such interim payments are not advanced payments or prepayments prior to services furnished by providers, but rather are payments for services furnished that are subject to final reconciliation once the state has access to individual claims data currently inaccessible due to the cybersecurity incident.
The flexibilities CMS discusses in the guidance include:
Modifying required timelines for public notice, public process, and Tribal consultation and to obtain an earlier effective date for certain kinds of SPAs than would otherwise be possible;
Use interim payment methodologies to pay providers without current period claims data, as long they are determined via current approved payment rates, limiting the interim payments to the amount expected for each specific provider based on recent history, and reconciling the interim payments with final payments based on the actual services provided once they can be properly identified. These could be effective retroactively to the date when claims payment processing was disrupted due to the cybersecurity incident and could last until June 30, 2024;
Suspend beneficiary cost sharing requirements described in their state plans when necessary to avoid service disruptions for Medicaid beneficiaries for services affected by the hack;
CMS also includes language urging Medicaid managed care plans to make prospective payments to impacted providers and reiterating that plans do not need prior CMS authority to make prospective payments to providers. CMS also indicates that plans can:
Suspend or modify prior authorization requirements;
Allow early prescription refills and/or extend the length of prescription refills;
Extend existing prior authorizations;
Suspend out-of-network requirements; and
Modify or update cost-sharing requirements to be consistent with any changes that are made in the Medicaid state plan.
This week, we look at the state of the healthcare industry, vis a vis payers that do not pay.
While Home Health and Hospice leaders talk at every gathering about refusing to accept Medicare Advantage clients, some large Integrated Healthcare Systems are actually doing it. Other hospitals are responding to difficult payers by laying off staff, or even closing. The HHS Office of Inspector General repeatedly fines insurance companies for upcoding to gain inflated, unjustified monthly payments. Meanwhile, insurance companies report record profits, with their MA divisions leading the way. The fines go into the “cost of doing business” column.
March, 2024, Becker’s Hospital Review: Bristol (Conn.) Health will eliminate 60 positions, 21 of which are currently occupied and will result in layoffs at Bristol Hospital. The hospital’s CEO, Kurt Barwis, told a local newspaper a lack of reimbursement from insurers left the hospital without a choice but to cut staff.
October, 2023, NPR: Since 2010, 150 rural hospitals have closed. Under CMS’s “Critical Access” designation, Medicare pays extra to those hospitals to compensate for low patient volumes. MA plans do not. Instead, they offer negotiated rates that are lower than what traditional Medicare would pay.
December, 2023, Becker’s Financial Management: 13 additional hospital systems cut ties with Medicare Advantage plans since October.
What is going on?
The Medicare Payment Advisory Commission, MedPAC, believes it has learned the answer. In its March 15, 2024 report to Congress, the Commission called for a “major overhaul” of Medicare Advantage policies. It says it found that the program, designed to lower costs and extend the lifespan of the Medicare trust fund, does not save money but costs the fund more than if all beneficiaries were on traditional Medicare, $83 billion more in 2024.
Calling it, too politely, “coding intensity,” MedPAC concurs with the OIG that MA plans routinely exaggerate patient conditions. The report claims it will amount to MA clients appearing to need 20% more healthcare than fee-for-service beneficiaries, when they do not. Padded coding, MedPAC says, will increase Medicare premiums by $13 billion in 2024.
“A major overhaul of MA policies is urgently needed for several reasons,” the commission wrote in its report. MedPAC cited several problems that need to be addressed, including the disparity in costs between beneficiaries in fee-for-service Medicare and MA, a lack of information on the use and value of supplemental benefits, and challenges setting benchmark payment rates.
A proposal currently making its way through Congress would reduce supplemental payments to insurers, who threaten to raise premiums and cut benefits if their inflated benchmark payments are lowered.
“If payments to MA plans were lowered, plans might reduce the supplemental benefits they offer,” MedPAC wrote in its report. “However, because plans use these benefits to attract enrollees, they might respond instead by modifying other aspects of their bids.” The barrage of TV ads, featuring aging celebrities, have been found to be deceptive and too often backed by shady front companies representing brokers, not insurance companies. The brokerage company behind the Joe Namath ads, for example, has reorganized and changed its name three times.
Pushback from AHIP, the insurance industry lobbying organization, has been as expected. “MedPAC’s estimates are based on ‘speculative assumptions’ and ‘overlook basic facts about who Medicare Advantage serves and the value the program provides.'”
MedPAC asserts that its estimates are based on history, not speculation.
Healthcare Providers Beg to Differ
A lack of payments from Medicare Advantage plans is one reason the Connecticut hospital is laying off staff, the Hartford Courant reported March 14. CEO Kurt Barwis told the newspaper Medicare Advantage plans have been denying claims more frequently while delaying payments for the claims they do approve. “Our primary care is to take care of patients, their single focus is shareholder value and profits,” Mr. Barwis told the Courant. “The Medicare Advantage abuse is outrageous.”
The strategy insurance companies deploy to avoid providing care, Barwis continued, is excessive prior authorizations, coupled with delayed payments. This obstacle to care is directly in opposition to CMS policy. MA divisions of large insurers respond that they are private insurance and allowed to impose their own treatment approval policies. MedPAC says this claim is incorrect.
Richard Kronick, a former federal health policy researcher and a professor at the University of California-San Diego, said his analysis of newly released Medicare Advantage billing data estimates that Medicare overpaid the private health plans by more than $106 billion from 2010 through 2019 because of the way the private plans charge for sicker patients. Kronick added that there is “little evidence” that MA enrollees are sicker than the average senior, though risk scores in 2019 were 19 percent higher in MA plans than in original Medicare. That gap continues to widen.
Where does this excess taxpayer money go?
2023 Medicare Advantage business division profits and 2022 CEO compensation reported by publicly traded companies:
UnitedHealth Group: $22.4 B (Andrew Witty $20,865,106)
Aetna (CVS): $8.3 B (Karen Lynch $21,317,055)
Elevance Health (Anthem): $6 B (Gail Boudreaux $20,931,081)
Cigna: $5.1 B (David Cordani $20,965,504)
Centene: $2.7 B (Sarah London $13,246,447)
Humana: $2.5 B (Bruce Broussard $17,198,844)
We found one curious outlier. Molina Health, with annual revenue 10 percent of UnitedHealth Group’s income and 2.16 percent of the market, paid its CEO $22,131,256 in 2022.
Download the entire MedPAC 2024 report here. Chapter 7 is the Home Health section. A summary of MedPACs recommendations begins the chapter thus, “For calendar year 2025, the Congress should reduce the 2024 Medicare base payment rates for home health agencies by 7 percent.”
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Tim Rowan is a 30-year home care technology consultant who co-founded and served as Editor and principal writer of this publication for 25 years. He continues to occasionally contribute news and analysis articles under The Rowan Report’s new ownership. He also continues to work part-time as a Home Care recruiting and retention consultant. More information: RowanResources.com Tim@RowanResources.com
March 12, 2024, the National Association for Home Care and Hospice (NAHC), Leading Age, the National Hospice and Palliative Care Organization (NHPCO), and the National Partnership for Healthcare and Hospice Innovation (NPHI), published their findings from a 2023 survey on regulation. These findings were presented to Congress and CMS earlier this year. The organizations surveyed 133 respondents, who noted regulatory issues as the top concern for providers. Of particular concern was the audits that have been increasing steadily for years.
More than half of respondents said they have undergone simultaneous audits, usually the TPE and SMRC audits. 52.9% of respondents said they had multiple audits within six months of each other, conducted by different contractors, and more than half of those said they had to submit the same charts for each audit.
Hospice Auditor Issues
The findings indicate some issues with the training, knowledge, and integrity of auditors. Many respondents indicated having received denials of physician visits, documented separately from face-to-face visits, simply because they occurred on the same day. Some reported denials due to the absence of an IDG meeting even when no IDG meeting was required. Multiple respondents said the denial reasoning was copied and pasted from past denials and/or that the auditor did not seem to have read the documentation that was sent.
Auditing Inconsistencies
The report findings indicate that there are often delays in receiving audit results, sometimes up to 18 months. Some RAC audits had listed available dates for findings, but the findings were not actually available for several months after the listed date. Respondents also indicated that instructions from the auditors were presented using terminology that was not consistent with standard operating procedures in a hospice environment (read: auditors are using hospital lingo and expecting hospices to understand it).
Technical billing issues, when payments are denied not due ineligibility, but because of missing or incorrect information, can be corrected and then processed and paid. However, several respondents indicated that different MACs give different information on how process corrections for election statements and election addendums.
Gross Miscalculations
This was reported in the survey only once, but, as with any survey, extrapolating the data to the whole population, one must assume it has happened more than once: A hospice provider had a claim denied while under a CERT audit. The denial was due to the auditor decided that the patient was not terminally ill, even though the patient expired during the audit.
Recommendations for CMS
The organizations have some recommendations for changes:
CMS should re-focus its audit contractors on patterns and practices characteristic of providers that aim to minimize or avoid therapeutic care and supportive services that are required under the hospice benefit and fully reimbursed through the per diem payment.
CMS should require substantive education and training for all auditors that is consistent with the education given to providers to minimize inconsistencies.
CMS should increase transparency of audit contractor activity, including the number and types of audits being conducted, audit recovery amounts, results of audits by specific audit contractors, including reversal rates, top denial reasons and compliance with required timeframes for notification and review.
CMS should implement an informal mechanism to enable MACs and hospice providers to resolve technical claims denials prior to engaging in the formal appeal process.
CMS should require audit contractor medical reviewers to have an equivalent level of expertise and training in hospice care as the hospice medical director who certified a patient’s terminal illness.
According to a statement from NAHC, in 2023, the organizations have submitted 34 recommendations to CMS. To date, half of them have been implemented. They will continue to work with CMS toward enhanced transparency, equitable auditing, and targeting genuine fraud, waste, and abuse.
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Kristin Rowan has been working at Healthcare at Home: The Rowan Report since 2008. She has a master’s degree in business administration and marketing and runs Girard Marketing Group, a multi-faceted boutique marketing firm specializing in event planning, sales, and marketing strategy. She has recently taken on the role of Editor of The Rowan Report and will add her voice to current Home Care topics as well as marketing tips for home care agencies. Connect with Kristin directly kristin@girardmarketinggroup.com or www.girardmarketinggroup.com
Late on Monday, March 4, the Center for Medicare and Medicaid Innovation (CMMI) announced it plans to formally end the Value-Based Insurance Design (VBID) Medicare Advantage hospice “carve-in” demonstration on December 31, 2024, and that it will not accept applications to the previously released CY 2025 Request for Applications (RFA) for the hospice component of the Model. In its announcement, CMMI stated that it made the decision to terminate the demo “after carefully considering recent feedback about the increasing operational challenges of the Hospice Benefit Component and limited and decreasing participation among MAOs that may impact a thorough evaluation”. CMMI recently solicited input on the carve-in via a public request for information (RFI).
NAHC was pleased to be able to provide detailed comments to the RFI highlighting our members’ ongoing concerns and frustrations with the demonstration and registering our deep skepticism that the model was necessary or appropriate for hospice patients and families. We are pleased to see CMMI has decided to end this particular demo, and we look forward to continuing to work with them to advance innovation in care delivery and payment models for people with serious illness.
Since the carve-in was first announced, NAHC has maintained our strong opposition to the premise that incorporating hospice into the Medicare Advantage was necessary or would lead to positive outcomes. In 2019, NAHC emphasized our “unqualified opposition” to the program when it was first unveiled, and after more details were released in the model’s first request for applications (RFA); We have continued to stress our concerns since model implementation began, working with our hospice members to solicit feedback and translate those experiences into direct advocacy with CMS, CMMI, and members of Congress. As early evaluation data and inputs highlight, the model has been extremely burdensome for both hospices and participating plans, and has had no measurable positive impact on beneficiary or family outcomes, care experiences, or Medicare spending.
In the announcement about the model’s termination at the end of 2024, CMMI stated that the decision is not a result of the demo “not meeting its goals”, and that the agency will continue its evaluations of the hospice component to assess its overall impact. Over the course of the three years of the model, it was clear to NAHC that the demo was not meeting CMMI’s stated goals to drive greater care continuity and higher quality hospice care for beneficiaries and families. We also questioned the premise that a carve-in would save the Medicare program money in the long run. Contrary to what the VBID evaluators found, the seminal 2023 NORC research demonstrated that hospice utilization in the traditional Medicare program saves billions of dollars a year while delivering high-quality care.
CMS also indicated in their notification that later this year, they will issue additional guidance to ensure that “all obligations of any impacted organization may be met in a timely and reasonable manner so that hospice beneficiaries in the Hospice Benefit Component maintain a coordinated, seamless care experience.” NAHC will be following up directly with CMMI to better understand what may be included in this guidance and when it may be released.
Increasing access to hospice care remains NAHC’s primary policy goal. We are committed to working to improve more timely connection to hospice, reducing the percentage of very short stays that make it difficult to benefit fully from the hospice model, and ensuring every provider is capable of delivering high-quality, person-and-family-centered services. We appreciate our engagement with CMMI on the carve-in over the years, and we welcome the opportunity to collaborate with them on new ways to support seriously and terminally-ill people and their families.
CMS recently issued guidance about how to build and maintain worker registries, i.e., management platforms, that make qualified health workers easy to find so that more individuals who receive Medicaid-covered home and community-based services (HCBS) can receive care in settings of their choice. Worker registries are designed to answer these questions: Who is qualified to provide HCBS in each state and how can Medicaid recipients find them?
On February 27, 2024, CMS announced several new initiatives and Resources from the Administration for Community Living’s (ACL) Direct Care Workforce (DCW) Strategies Center to address the shortage of workers who provide direct care to elderly and disabled clients. New initiatives include several types of assistance that are intended to help states strengthen their systems for recruiting, retaining, and developing direct care workers; and a national hub to connect states, stakeholders, and communities to best practices and other resources related to the direct care workforce.
Specifically, DCW Intensive Technical Assistance will facilitate collaboration among state agencies and with stakeholders to improve recruitment, retention, training, and professional development of direct care workers. The DCW Strategies Center will provide up to two hundred fifty hours of individualized technical assistance on a variety of issues for up to six teams involving multi-agency state teams.
A coach will be assigned to each team and have access to subject matter experts to support them in addressing states’ unique needs. Support provided through this initiative will be coordinated by a consortium led by ADvancing States in partnership with the National Association of State Directors of Developmental Disability Services and the National Association of State Medicaid Directors.
The DCW Peer-Learning Collaborative will bring representatives of four to six states into working groups focused on a particular topic. The DCW Strategies Center will host monthly virtual meetings focused on group learning to facilitate information sharing on best practices, innovative strategies, and demonstrated models for growing the direct care workforce. In addition, each participating state will receive up to seventy hours of individual technical assistance on a topic or issue important to each state. Each participating state is expected to accomplish at least one policy or program-related milestone as a result of participation in this initiative.
CMS also announced the official launch of the DCW Strategies Center website at https://acl.gov/dcwcenter. This website is intended to serve as the national hub for resources about best practices, promising strategies, upcoming events, webinars, and technical assistance opportunities to strengthen and expand local direct care workforces.
CMS acknowledges in the announcement that low wages, lack of benefits, limited opportunities for career growth, and other factors have resulted in a continuing shortage of critical workers. The shortage reached crisis levels, says CMS, during the COVID-19 pandemic and currently continues, with more than three-fourths of service providers that decline new clients and more than half of providers cutting services.
According to CMS, the problem described above must be addressed in order to help ensure that people who need assistance have options other than moving to a nursing home or other institutional setting.
Now is the time for providers of private duty or home care services and the associations that represent them to work intensively with state programs, especially Medicaid Programs, to maximize available assistance as described above.
In 2020, CMS launched a hospital care at home program to help increase patient capacity during the height of the Covid-19 pandemic. The study included 300 hospitals and thousands of patients receiving care in their home using a hospital at home waiver. Outcomes of the study showed that patients had greater ability to stand up and move around at home than would have had in a hospital and that in-home caregivers were better able to educate patients on home to care for themselves once they were able to see the social determinants of care in the home. CMS also reports only 7.2% of patients were required to be transferred to a hospital.
Hospital Study
Mass General Brigham conducted its own study alongside CMS and analyzing outcomes of diverse patients, including socially vulnerable and medically complex patients. The findings of their national analysis showed that within 30 days of discharge, 2.6% of patients used a SNF, 3.2% died, and 15.6% were readmitted. Findings were consistent among all groups, including those who generally have worse outcomes: patients of Black and Latine race and ethnicity, dual-eligible patients, and patients with disabilities.
Health System Study
In April of 2020, Kaiser Permanente conducted an 18-month study on the scalability of “Advanced Care at Home” (ACAH). The patients all required hospital-level care and were first admitted to the program through the emergency department. Some were admitted to the hospital, and some were instead admitted to the Kaiser ACAH program, where a team of nurses, physicians, nurse practitioners, and a pharmacist developed a care plan.
This study increased its daily census from 7.2 per day to 12.7 per day at the end of study. The average episode of care decreased from 7.43 days to 5.46 days and readmission rates dropped from 11.52 percent to 9.24 percent. These patients were less likely to experience delirium than patients admitted to traditional hospital settings. The researchers noted the limitation of the study as being too small to develop precise comparisons.
Limitations of Acute Hospital Care at Home
Currently, the only patients eligible for AHCaH are those who have been evaluated in a hospital or emergency department. Kaiser has extended this to patients seen in their own urgent care offices in areas where they don’t own a hospital. Kaiser has served a few thousand patients through this program, but they estimate there are more than 1.1 million eligible patients. Rural patients who don’t live near a hospital or emergency department have the same trouble accessing AHCaH that they do accessing hospital and physician care now.
The CMS waiver for AHCaH has been extended through December 2024. Beyond that, it is unclear how hospital care at home will be reimbursed. Some providers have offered hospital care at home to risk-based patients in a VBC model. Not all eligible patients will qualify for the waiver or VBC reimbursement. Without specific provisions from CMS to reimburse hospital care at home for all Medicare and Medicaid patients and coverage from private insurance, the hospital at home program will remain limited.
The current model for AHCaH includes technology support for the patient using a tablet, smartphone, or other device. This requires that the patient have a broadband internet connection in the home, which eliminates eligibility for rural patients who are already underserved.
Final Thoughts
There is a lot of support for Hospital Care at Home among providers, health systems, and consumer insurance companies. Support for home health, hospice, palliative care, and supportive home care has not been as strong. As these larger players start to see the cost and outcome benefits of care in the home, a few things may happen.
First, hospitals, payers, and physician groups may start to recognize the value of care at home and be more open to creating referral partnerships with care at home agencies. Home care is a small percentage of total care reimbursed by Medicare and Medicaid and we could see that increase.
Conversely, these providers may realize that care at home is lucrative and will extend their own AHCaH models to include post-acute and hospice care, cutting out home care agencies altogether. Care teams are constructed around a Hospital Care at Home patient. Including a post-acute nurse who is familiar with the patient history would provide additional continuity of care.
Either way, I see the support for the Hospital Care at Home program as beneficial to home health. Branches of health care that were previously averse to extending patient care into the home are now supporting it. Increased adoption of telehealth and other technology platforms increase the possibilities for integrating with home health and hospice providers. Interoperability between Hospital Care at Home and Post-Acute Care at Home may finally become a reality.
We will continue to report on the AHCaH waiver as the deadline to renew comes closer.
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Kristin Rowan has been working at Healthcare at Home: The Rowan Report since 2008. She has a master’s degree in business administration and marketing and runs Girard Marketing Group, a multi-faceted boutique marketing firm specializing in event planning, sales, and marketing strategy. She has recently taken on the role of Editor of The Rowan Report and will add her voice to current Home Care topics as well as marketing tips for home care agencies. Connect with Kristin directly kristin@girardmarketinggroup.com or www.girardmarketinggroup.com
The National Association for Home Care and Hospice joined other advocacy groups this month on Capitol Hill to fight against the looming pay cuts from CMS. Some members of Congress joined the fight for “common sense policies” to expand access to care in the home for Americans.
Rep. Adrian Smith (R-NE-3), who spoke at the event, decried moves against home health, saying “there are cuts looming that are not based on reality” and “we want to make sure reimbursement policies are reflective of the actual realities.” Smith is also the representative who introduce the “Homecare for Seniors Act,” H.R. 1795, which would allow the use of Health Savings Accounts (HSAs) to be used for home care.
Rep. Terri Sewell (D-AL-7) has a personal connection to home care and spoke about how her mother cared for her father through a series of strokes he suffered. She expressed strong opinions about payment reductions that could see home health lose as much as $20 billion dollars over the next ten years. Sewell called the idea “frightening” and said, “I am a big fan of making sure that my constituents have access to quality, affordable health care.”
The Medicare program has admitted that home health is not just a bringing of great care and not just a more cost effective way to provide care, but is a service that provides dynamic value. Care in the home has decreased overall costs by $3.2 billion dollars just in the small segment of value-based payment model test cases. Patients who receive care in the home are re-admitted to the hospital 37% less frequently than those who do not and are 43% less likely to die than patients who do not receive care at home. Still, CMS is looking at additional pay cuts which bring the total payment reduction down 13.72% since 2019. The costs of everything else have increased in that time. According to the U.S. Bureau of Labor and Statistics, the average cost of living has increased 22% since 2019. NAHC President Bill Dombi said, “Where we’re headed in 2024 is that half of all home health agencies will be operating in the red with the cuts facing them in the Medicare program. It’s not a recipe for continued access to care.”
Dombi, along with many others, is predicting that 50 percent of agencies will be operating in the red after the next round of payment reductions and that without a reversal of these pay cuts we could see the end of care at home altogether with a collapse of the home health payment system.
The advocacy event on Capitol Hill helped raise awareness of the plight of care at home among some policymakers, but more help and advocacy is needed. Please, take a few minutes to click the link below and tell your members of Congress to support the Preserving Access to Home Health Act of 2023.
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Kristin Rowan has been working at Healthcare at Home: The Rowan Report since 2008. She has a master’s degree in business administration and marketing and runs Girard Marketing Group, a multi-faceted boutique marketing firm specializing in event planning, sales, and marketing strategy. She has recently taken on the role of Editor of The Rowan Report and will add her voice to current Home Care topics as well as marketing tips for home care agencies. Connect with Kristin directly kristin@girardmarketinggroup.com or www.girardmarketinggroup.com
The National Association for Home Care and Hospice joined other advocacy groups this month on Capitol Hill to fight against the looming pay cuts from CMS. Some members of Congress joined the fight for “common sense policies” to expand access to care in the home for Americans.
Rep. Adrian Smith (R-NE-3), who spoke at the event, decried moves against home health, saying “there are cuts looming that are not based on reality” and “we want to make sure reimbursement policies are reflective of the actual realities.” Smith is also the representative who introduce the “Homecare for Seniors Act,” H.R. 1795, which would allow the use of Health Savings Accounts (HSAs) to be used for home care.
Rep. Terri Sewell (D-AL-7) has a personal connection to home care and spoke about how her mother cared for her father through a series of strokes he suffered. She expressed strong opinions about payment reductions that could see home health lose as much as $20 billion dollars over the next ten years. Sewell called the idea “frightening” and said, “I am a big fan of making sure that my constituents have access to quality, affordable health care.”
The Medicare program has admitted that home health is not just a bringing of great care and not just a more cost effective way to provide care, but is a service that provides dynamic value. Care in the home has decreased overall costs by $3.2 billion dollars just in the small segment of value-based payment model test cases. Patients who receive care in the home are re-admitted to the hospital 37% less frequently than those who do not and are 43% less likely to die than patients who do not receive care at home. Still, CMS is looking at additional pay cuts which bring the total payment reduction down 13.72% since 2019. The costs of everything else have increased in that time. According to the U.S. Bureau of Labor and Statistics, the average cost of living has increased 22% since 2019. NAHC President Bill Dombi said, “Where we’re headed in 2024 is that half of all home health agencies will be operating in the red with the cuts facing them in the Medicare program. It’s not a recipe for continued access to care.”
Dombi, along with many others, is predicting that 50 percent of agencies will be operating in the red after the next round of payment reductions and that without a reversal of these pay cuts we could see the end of care at home altogether with a collapse of the home health payment system.
The advocacy event on Capitol Hill helped raise awareness of the plight of care at home among some policymakers, but more help and advocacy is needed. Please, take a few minutes to click the link below and tell your members of Congress to support the Preserving Access to Home Health Act of 2023.
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Kristin Rowan has been working at Healthcare at Home: The Rowan Report since 2008. She has a master’s degree in business administration and marketing and runs Girard Marketing Group, a multi-faceted boutique marketing firm specializing in event planning, sales, and marketing strategy. She has recently taken on the role of Editor of The Rowan Report and will add her voice to current Home Care topics as well as marketing tips for home care agencies. Connect with Kristin directly kristin@girardmarketinggroup.com or www.girardmarketinggroup.com
he battle for stable Home Health reimbursement rates continues full speed ahead on Capitol Hill, but the advocacy organizations engaged on the front lines of that battle are losing ground. The Partnership for Quality Home Healthcare and the National Association for Home Care and Hospice have deployed weapons from educating Congressional staffers to suing CMS. Those traditional methods appear to be insufficient, as the specter of draconian rate cuts casts a larger and larger shadow.
Missing from the conflict is the only effective weapon, flooding lawmakers with messages from their constituents.
According to Joanne Cunningham, CEO of the Partnership, the time is now to bring that weapon to the front. She told over 600 attendees at this week’s Home Care 100 event in Scottsdale that she and Bill Dombi have done everything they can up to now, adding that the only way to stop $3.5 to $5 billion in Medicare cuts is for every person of voting age whose livelihood depends on Home Health care to call or write their House Member and Senators.
STEP ONE: A "Must-Pass" Bill
“Preserving Access to Home Health Act of 2023,” is a pair of bi-partisan bills introduced into the House and Senate in the summer of 2023. (S.2137/H.R. 5159) They would prevent CMS from making new cuts to the PDGM payment system, both now and in the future, by blocking annual “recalculations” that traditionally use flawed formulae.
The bills would require MedPAC to perform more comprehensive calculations before it makes recommendations to Congress. Currently, the Commission only considers revenue and profit margins from traditional Medicare. They determine that Home Health margins are too high without looking at the small-to-negative margins providers accrue from Medicare Advantage, Medicaid, the VA, and private insurance. Medicare profit margins make it possible for HHAs to care for patients with stingier payers. Reducing those margins too far, which MedPAC recommends every year, would remove access to care for millions of beneficiaries.
STEP TWO: Educating Congress
Ms. Cunningham emphasized that elected officials, as well as bureaucrats who write the regulations to implement the “will of Congress,” have yet to understand the impact in-home care has on overall healthcare spending and access to care. “We have to get bureaucrats to look at our data,” she said. “We know we save the trust fund more than we take from it, and we know that we are turning patients away because we cannot pay enough to attract clinicians in sufficient numbers. We have to educate them all.” She offered a few concrete suggestions.
What Works Best
Data, data, data. The most effective policy argument starts with independent analysis from outside the industry.
Tell stories. Elected officials and their staffers respond to real-life experiences of people within their districts and states. A group from Inhabit Health, for example, sat Congressional staffers down and told them about individual patients who had been kept out of hospitals and EDs, about great care they had received. They added summaries of their typical patients as well.
Listen. Staffers will challenge your assertions and ask hard questions. They will help you identify your ‘Achilles Heels.’ See this as helpful preparation for meeting the Member or Senator.
See them at home. Cunningham underscored the importance of making appointments and meeting with House members and Senators away from DC, for two reasons.
“A lot of people approach a Member on the way out of a church they both attend. What they don’t realize is that they are one of ten who will do the same thing between the church door and his car, from ten different industries. You just become ‘part of the clutter’ and are quickly forgotten.”
Back home advocacy is the most important thing you can do; it is even better than going to DC. Their main interest is re-election and they respond to messages from constituents. The purpose of advocacy is to cut through the noise. At home, you can say, “Hey, I know you; you’re my neighbor; listen to me!”
Repetition is key. When you write a letter, it goes on a list. Staffers count up how many constituents have written about each issue. The best strategy is to make them feel pressure from back home. Marshall all the political pressure you can, but fill it with data.
Case in Point
Ms. Cunningham told about leading a group of Home Health providers from Oregon to meet with Senator Ron Wyden in his home office. To make their case for Home Health reimbursement support, they showed him their books, which proved that MedPAC is wrong about Home Health profit margins. They changed his mind. She said that meeting was so powerful and successful, it has become a model for working with other states.
STEP THREE: Expose Medicare Advantage
The Partnership’s goal is to ensure alignment of the MA home health benefit with traditional Medicare – as all Medicare beneficiaries are all entitled to the same home health benefit, regardless of the payor.
“MedPAC met during the first week of January to discuss Medicare Advantage. The meeting, which included a focus on the methodology of payments, was contentious at times.” Cunningham said. “In its January 12 report to Congress, The Medicare Advantage Program: Status Report, MedPAC forecast that CMS will overpay MA plans as much as $88 billion in 2024, based on prior year behavior.”
Higher coding organizations have a competitive advantage because they receive larger payments for enrolling the same beneficiaries as other organizations, and they can offer more extra benefits and attract new enrollees simply because of their coding efforts
Andrew Johnson, PhD
Principal Policy Analyst,MedPAC
MA’s focus on extras such as Silver Sneakers, vision care, and basic dental care, along with low or zero premiums added to the Medicare Part B premium that all beneficiaries pay, are what MA plans emphasize in their annual barrage of TV commercials. Never mentioned on TV or in direct mail brochures are two practices that impact many times more dollars than gym memberships and low premiums. The undeserved $88 billion mentioned in the MedPAC report comes from exaggerating initial assessments of plan enrollees. Payments from Medicare to a plan hinge on patient acuity. When improperly padded, acuity robs the trust fund and pads insurance company profits.
The second downplayed practice is on the care side of the equation. The largest MA plans have often been found to deny procedures that traditional Medicare standards would have covered. When they do pay for care, especially Home Healthcare, they pay rates below traditional Medicare rates, often lower than provider costs. Cunningham concluded her comments with a description of the Partnership’s efforts to bring pressure from MedPAC and the HHS OIG to force MA plans to comply with regulatory requirements. “We are all of one mind regarding MA. I think we are going to see practices change.”
About PQHH
The Partnership for Quality Home Healthcare was established in 2010 to work in partnership with government officials to ensure access to quality home healthcare services for all Americans. Representing community- and hospital-based home healthcare agencies nationwide, the Partnership is dedicated to developing innovative reforms to improve the program integrity, quality, and efficiency of home healthcare for our nation’s seniors. pqhh.org
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Tim Rowan is a 30-year home care technology consultant who co-founded and served as Editor and principal writer of this publication for 25 years. He continues to occasionally contribute news and analysis articles under The Rowan Report’s new ownership. He also continues to work part-time as a Home Care recruiting and retention consultant. More information: RowanResources.com Tim@RowanResources.com
Tim Rowan is a 30-year home care technology consultant who co-founded and served as Editor and principal writer of this publication for 25 years. He continues to occasionally contribute news and analysis articles under The Rowan Report’s new ownership. He also continues to work part-time as a Home Care recruiting and retention consultant. More information: 
