Home Health Leaders Express Disappointment in MedPAC’s Comments to CMS Regarding Home Health Prospective Payment Rule for 2015

The Partnership for Quality Home Healthcare expressed disappointment in the Medicare Payment Advisory Commission’s (MedPAC) letter to the Centers for Medicare and Medicaid Services (CMS) which called for further funding cuts to Medicare’s home healthcare benefit as well as the retention of the operationally burdensome face-to-face narrative requirement which CMS proposes to eliminate.

The home health community has already absorbed an unprecedented 14 percent cut starting in 2014 and any additional funding cuts stand to jeopardize vulnerable seniors, women and jobs. On January 1, CMS began implementing an annual cut of 3.5 percent for 2014-2017 – the maximum allowable under the Affordable Care Act (ACA). The cut is so large that CMS itself has conceded it will leave “approximately 40 percent” of home health providers operating at a net loss by 2017, putting at risk 1.3 million seniors and upwards of 465,000 home healthcare jobs, according to Avalere Health estimates. Home health agencies already operate on razor-thin all-payer operating margins and simply cannot absorb additional cuts.

The seniors directly impacted by these cuts are among the most vulnerable in the Medicare program. Recent analyses by Avalere Health show that Medicare home health beneficiaries are older, poorer, sicker and more likely to be disabled and of an ethnic or racial minority than the general Medicare population as a whole. For example, beneficiaries receiving home healthcare are 50 percent more likely than all other Medicare recipients to have four or more chronic conditions.

Furthermore, the current funding cuts disproportionately affect women, as the majority of home health beneficiaries as well as their skilled caregivers are women. Specifically, more than 60 percent of Medicare home health beneficiaries are female and women account for 90 percent of the nearly 465,000 jobs that are in jeopardy of being lost.

“Home health patients are already at risk of losing access to critical home health services due to the cuts imposed in 2014,” stated Eric Berger, CEO of the Partnership for Quality Home Healthcare. “MedPAC’s suggestion to further reduce payments beyond CMS’ current proposal would create real vulnerabilities for homebound seniors, healthcare professionals, small businesses, and the Medicare program as a whole.”

As Congress and the Administration work to improve the Medicare program, home healthcare offers important opportunities for achieving sustainable savings and improved care coordination. For example, post-acute care bundling and the establishment of value based purchasing programs can achieve significant pro-patient, pro-taxpayer benefits – and both depend on a stable and sustainable health care delivery system which would be undermined by further cuts. The Partnership is a strong supporter of legislation that would achieve these outcomes, including H.R. 4673, The Bundling and Coordinating Post Acute Care (BACPAC) Act of 2014 and H.R. 5110, The Securing Access Via Excellence (SAVE) Medicare Home Health Act of 2014.

The Bundling and Coordinating Post Acute Care Act (BACPAC) would establish bundled payments for post-acute care services and utilize post-acute care coordinators and their networks of post-acute care providers to manage patient care utilizing a 90-day, site-neutral bundled payment initiated on the day of patient discharge from the hospital. Importantly, the BACPAC model would reward participants when the total cost of care is lower than the bundled amount, thereby encouraging coordinated care in the most clinically and cost-effective manner possible.

Further, the Securing Access Via Excellence (SAVE) Medicare Home Health Act would establish a value based purchasing program that would reduce hospital readmissions via incentives that reward positive outcomes. The bill would enable millions of seniors to remain where they most want to be – in their homes, rather than in costly institutional settings – while preserving their access to skilled home healthcare services via relief from current law cuts.

Instead of imposing additional cuts or retaining the burdensome face-to-face narrative requirement, as MedPAC calls for, the Partnership also advocates for program integrity measures that target the isolated occurrences of fraud and abuse with strong reforms that would protect patients and achieve savings without recourse to indiscriminate across-the-board cuts.

Fraud and abuse is the work of a few bad actors in small pockets of the country. Out of the nation’s 3,143 counties, MedPAC itself has identified just 25 counties in a total of five states where the majority of abuse impacting the home health benefit is occurring.

Furthermore, the face-to-face narrative requirement is not a requirement of the ACA and has been in effect since 2012, creating delivery system and beneficiary service disruptions. Keeping it in place for an additional year is not advantageous to Medicare or seniors.

To aid in advancing program integrity reform, the Partnership has put forth the Skilled Home Health Integrity and Program Savings (SHHIPS) proposal, which would prevent payment of aberrant claims, strengthen the claims review processes, improve participation standards and establish temporary entry limitations to prevent excess growth.

“The skilled home healthcare community supports reform that achieves savings through targeted program integrity and value-improvement reforms – not further indiscriminate across-the-board cuts,” added Berger. “Home healthcare plays a vital role in the delivery of post-acute care for our nation’s seniors and additional funding cuts to an already strained program would do little but threaten care for millions of vulnerable seniors.”