Nonpartisan Report Underscores Need to Protect Financially Vulnerable Seniors

Washington, DC — Home health leaders today cited a newly released report by the Economic Policy Institute (EPI) as yet more evidence that a large portion of “˜economically vulnerable’ elderly Americans could be significantly impacted by possible entitlement changes resulting from budget negotiations in Washington. The EPI report underscores the need to protect elderly and vulnerable Americans from cost-sharing policies that could negatively impact seniors’ economic status and living standards.

The EPI report finds that nearly half of the U.S. elderly population – 19.9 million Americans – is “˜economically vulnerable’ with incomes lower than 200 percent the supplemental poverty threshold and the oldest Americans – aged 80 and older – are the most financially unstable. The report further indicates that increased out-of-pocket health costs on seniors would result in more American seniors living within the “˜economically vulnerable’ threshold.

The report states, “Even though nearly all of the elderly have health insurance through Medicare, many still spend a large share of their income on health expenses, including premiums and out-of-pocket medical costs”¦With out-of-pocket medical costs consuming such a large share of elderly incomes, every additional dollar in medical costs can cause significant financial strain.”

Underscoring this risk, analyses by Avalere Health illustrate that the Medicare home health population is poorer, older and sicker than the Medicare beneficiary population as a whole. Because the majority of home health patients are financially disadvantaged, the burden of increased-out-of-pocket costs would put significant financial strain on the Medicare home health population.

Whereas an estimated 38 percent of all Medicare beneficiaries have an annual income below the federal poverty level (FPL), which equals $22,340 per year for a household of one, Avalere finds that a full 73 percent of Medicare home health beneficiaries have this low-income status. The Avalere analysis also finds that nearly 40 percent of home health users who are not dually-eligible for Medicaid nor have other supplemental insurance would likely be responsible for the full out-of-pocket cost associated with a cost-sharing requirement.

“The EPI data underscores the home health community’s concern that re-imposing the repealed home health copayment or otherwise hiking out-of-pocket costs would put low-income beneficiaries at great financial risk,” said Eric Berger, CEO of the Partnership. “Such a change would cause taxpayer costs to rise, as poor seniors are forced to return to costly facilities for treatment. That is why we urge lawmakers to instead consider pro-patient solutions such as program integrity reforms that achieve significant savings while protecting America’s greatest generation.”

Report co-author and EPI economist Elise Gould stated, “After working hard their entire lives, millions of our elderly are struggling to pay for basic needs”¦As such, policy makers should consider the dire consequences proposals to restructure these programs would have on our parents and grandparents, shifting more costs unto them when many are barely making ends meet.”

The Partnership for Quality Home Healthcare was established in 2010 to assist government officials in ensuring access to skilled home healthcare services for seniors and disabled Americans. Representing nearly 2,000 community- and hospital-based home healthcare agencies across the United States, the Partnership is dedicated to developing innovative reforms to improve the quality, efficiency and integrity of home healthcare. To learn more, visit www.homehealth4america.org. To join the home healthcare policy conversation, connect with us on Facebook, Twitter and our blog.