Home Health Leaders: Beneficiary Copays Wrong Approach to Medicare Physician Payment Reform

Washington, DC — The Partnership for Quality Home Healthcare today commended the House Ways and Means Committee for advancing efforts to reform payment policy for the nation’s Medicare physicians. However, the Partnership cautioned that re-imposing a Medicare home health copayment would impact vulnerable senior citizens and lead to increased taxpayer costs.

In a statement released Friday, the Ways and Means Committee invited stakeholders to comment on potential Medicare changes, including a copayment on Medicare home health beneficiaries. In its message, the Committee clarified that offsets such as a home health copayment “are not the position of the Ways and Means Committee.”

“We applaud the Committee for their efforts to improve Medicare payment policy for the physicians who serve Medicare beneficiaries. However, increasing the financial burden of home health beneficiaries – who are documented as being among the poorest, sickest and oldest in the Medicare program – is the wrong way to finance physician payments or reform Medicare,” said Chairman Billy Tauzin, senior counsel to the Partnership for Quality Home Healthcare. “Congress repealed the Medicare home health copay in 1972 because it doesn’t work, and Ways and Means is right not to make it a Committee position now. We commend lawmakers for instead focusing on pro-patient reform policies that preserve beneficiary access and deliver substantial savings via targeted integrity and efficiency reforms.”

Analyses by Avalere Health demonstrate that the home health patient population is typically poorer, sicker and older than the Medicare beneficiary population as a whole. Nearly 26 percent of home health beneficiaries are age 85 and older compared to 11.8 percent for all Medicare patients. Eighty-six percent of home health patients are living with three or more chronic conditions, while 69 percent of all Medicare beneficiaries is that sick. Last, fully 73 percent of Medicare home health beneficiaries have an annual income below 200 percent of the federal poverty level (FPL), compared to only 38 percent of all Medicare beneficiaries with the same income levels.

Due to these factors, increasing home health beneficiaries’ out-of-pocket costs has been projected to reduce seniors’ ability to access low-cost home healthcare and put them at risk of forgoing home-based care for higher-cost facility-based care. Indeed, analyses indicate a home health copayment could increase Medicare costs by $16.7 billion over ten years due to a shift to higher-cost post-acute care settings.

The Partnership notes that re-imposition of a home health copayment could undermine Congress’ important efforts to reform Medicare’s post-acute care delivery system. In response to a request from the House Ways and Means and Senate Finance Committees for ideas on improving the efficiency and effectiveness of post-acute care, the Partnership is preparing recommendations designed to enhance the delivery of quality patient care and generate significant savings.

“Positive solutions that protect vulnerable seniors while also delivering billions in taxpayer savings are within reach,” added Eric Berger, CEO of the Partnership. “We look forward to working with the Ways and Means Committee and other leaders in Congress to advance targeted reform policies that improve care for our nation’s seniors, strengthen Medicare program integrity, and improve the efficiency of this vital senior care program.”

For example, in lieu of a home health copayment, the Partnership is urging Congress to instead advance targeted policy reforms that combat the isolated instances of fraud and abuse. Home health community leaders have put forth the “Skilled Home Health and Integrity Program Savings” (SHHIPS) proposal, which offers targeted solutions that strengthen Medicare program integrity by preventing payment of aberrant claims before they occur, strengthening the claims review process, and improving conditions of participation standards.