October 2, 2015

Congress raises red flag on proposed home health cuts

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The Hill Congress Blog

As millions of skilled caregivers across the country work diligently to keep our nation’s homebound seniors healthy and aging safely and comfortably in their homes, some policymakers in D.C. are simultaneously making policy decisions that seriously undermine their progress.

Some might call it “death by a thousand cuts.” I consider it a terminal illness that is draining the life and vitality from a remarkable program aimed at serving vulnerable seniors when they need it most.

Home healthcare, which includes nursing care, physical therapy, occupational therapy and speech therapy, allows approximately 3.5 million homebound American seniors to receive clinically necessary care at home. Not surprisingly, more than nine out of every 10 seniors prefer to age at home rather than a nursing home or other care facility, according to data from the senior polling resource Bring the Vote Home. It’s also remarkably cost effective and good for Medicare.

Even so, home health continues to weather a seemingly endless barrage of cuts that are making it exceedingly difficult for home healthcare providers to succeed. In June, the Centers for Medicare and Medicaid Services (CMS) proposed within its 2016 Home Health Prospective Payment System (HHPPS) rule to cut an additional $350 million from the Medicare program’s home healthcare benefit. This is in addition to four-year, 14 percent rebasing cuts imposed on the home health benefit in January 2014.

CMS itself projected that “approximately 40 percent” of all home health agencies would be operating at a loss by the end of 2017 as a result of cuts in 2014. And yet, two years later, the hits keep coming. New estimates from Avalere Health suggest the collective impact of implemented and newly proposed home health cuts will leave a whopping 48 percent of America’s home health agencies (HHAs) facing bankruptcy, thereby leaving small, independent and rural providers at greatest risk.

And in areas where HHAs are forced to close as a result of cuts, patients may be forced to seek care in more expensive institutional settings or, far worse, avoid treatment all together. The impacts will not be isolated: according to an analysis by Avalere Health, more than 631,000 Medicare beneficiaries in nearly 2,000 rural counties relied on home healthcare services in 2013.

Also included in CMS’ proposed regulation is a Home Health Value Based Purchasing program (HHVBP) that appears to be a huge departure from VBP initiatives passed by Congress for hospitals and skilled nursing facilities. While hospital and SNF VBP programs cap total annual penalties at 2 percent, penalties in the proposed home health variant would start at 5 percent and rise to 8 percent.

As it currently stands, the HHVBP would impact nine states as early as January 1. The unfortunate end result being that seniors living in Arizona, Florida, Iowa, Maryland, Massachusetts, Nebraska, North Carolina, Tennessee and Washington could see another, very real threat to the home health delivery system on which they depend.

With the health of millions of seniors hanging in the balance, an increasing number of lawmakers have taken note. Not only are many of them concerned with the impact these policies will have on their constituents, they are concerned with how CMS formulated the cuts, which appear to be based on outdated data that does not reflect today’s costs of delivering skilled home healthcare services.

In a joint letter to CMS, 133 bipartisan members of Congress have asked the Medicare agency to reconsider their proposed cuts and questioned the agency’s methodology which, according to the letter, “appears to be based on a 2000-2010 case mix weight change analysis rather than changes in the condition of beneficiaries during the 2012 to 2014 period that Medicare proposes to address.”

These bipartisan lawmakers should be commended for raising a red flag on these policies that stand to further weaken the nation’s home health delivery system. Now more than ever, as our Baby Boomers need the care and support they’ve earned over the years, our policymakers should strengthen and support Medicare’s home health benefit. It’s time that they make wise decisions that enhance its health, not undermine it.

Tauzin served in the House from 1980 to 2005. He was president and CEO of PhRMA from 2005 to 2010. He is currently senior counsel to the Partnership for Quality Home Healthcare.

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