Home Health & Hospice Week

If you contract with Medicare managed care organizations, brace yourself for a whole new level of paperwork, thanks to changes to the patient appeals process.

And all Medicare home care providers should heed the new procedures as a harbinger of appeals changes to come in the regular Medicare fee-for-service world.

Starting in January 2004, the Centers for Medicare & Medicaid Services will require two-step notices of termination of services for Medicare+Choice patients receiving care from home health agencies, nursing homes or certified outpatient rehab facilities, CMS outlines in an April 4 Federal Register notice. Home health agencies will be responsible for generating and delivering at least the first notice.

"MCO appeal rights ... should be on the home care radar screen," urges William Dombi, vice president for law with the National Association for Home Care & Hospice's Center for Health Care Law. CMS' proposed appeals regulations "implicate the HHAs directly and indirectly," Dombi says.

Every time an M+C organization decides to discontinue home care services to an enrollee, the HHA must issue a "generic" notice to that patient, according to the final reg with comment. CMS will craft the generic notice template, which will inform enrollees of their appeal rights, and obtain Office of Management and Budget approval for the form.

HHAs must insert the patient's name and the date the services will terminate onto the form, then deliver the form to the patient as late as the next-to-last visit or at least two days before the termination of services is scheduled. Agencies must have patients sign and date the notice to acknowledge they have received and comprehended it.

That's where agencies' responsibilities end under the reg. But that responsibility will be burdensome enough, predicts attorney Jeffrey Schneider with Hogan & Hartson in New York. HHAs often won't know by the next-to-last visit whether the M+CO will terminate the patient's services, Schneider tells Eli. That means when the decision does come down, agencies will have to make an extra visit solely to deliver the first, generic notice. That translates to extra costs and overhead.

"It will be a particular challenge for agencies to deliver notices promptly," especially compared to nursing homes and CORFs, predicts Bob Wardwell with the Visiting Nurse Associations of America. CMS appears to assume that HHAs furnish patient visits at regular intervals, when time between visits actually can vary drastically, notes Wardwell, a former CMS official.

With no knowledge of service termination ahead of time, "the home health nurse will have to jump in the car, drive out and deliver the bad news," when the M+CO makes the call on discontinuing services, Wardwell laments.

"It's not just going down the hall," as it will be for institutional providers, Schneider points out.

After the HHA has furnished the initial, generic form, M+CO enrollees will have a choice. They can accept the termination or they can go through an expedited appeals process that will furnish an appeals determination before coverage ends, CMS says in the reg.

If they want to appeal, enrollees can start the process rolling by calling a toll free number furnished in the first, generic notice by noon of the first day after they received the form. The M+CO then is responsible for furnishing a second, more detailed notice to the patient by the end of the business day on which it was notified of the appeal.

The detailed notice must contain a specific and detailed explanation of why services are no longer reasonable and necessary or no longer covered; a description of any Medicare coverage rule, instruction or policy (including citations) supporting the decision; any M+CO policy, contract provision or rationale used to make the decision; and facts involved in the decision.

The M+CO is responsible for the second, detailed notice, CMS makes clear in the reg. But CMS also says M+COs are free to delegate the responsibility of the decision-making, the notice generation, and the notice delivery to the providers it's contracting with - namely, home care providers.

It will be up to M+COs and providers to work out whose responsibility the notices are, since the regs allow health plans to pass the buck, notes attorney Robin Fisk in Plymouth, NH. That will be "a contractual point of negotiation," says Fisk, who works frequently with M+COs.

Providers that agree to take on the responsibility of creating and/or delivering the second, more detailed notices should ask for compensation for those extra duties, Fisk recommends. If, and how much, they can get will depend on their bargaining power with the M+CO.

Even if home care providers take on those extra responsibilities, it is still M+COs who are ultimately responsible for the notices under the reg, notes Mohit Ghose, spokesperson for the American Association of Health Plans, which represents managed care organizations. If providers don't get the notices out on time, M+COs are forced to cover the care until the notice is delivered, Fisk notes.

HHAs won't be liable for that care, unless the M+CO talks them into including a contractual provision that would make them liable if they failed to provide the notice. "I don't see why agencies would accept that, unless they have no leverage" with the M+CO, Fisk says.

If home care providers do decide to take on the notices, they should make sure they're covering their costs on them. The duties will require an extra, last-minute visit to the patient's home to deliver the second notice. And in crafting the notices, the agency must be very familiar with the M+COs coverage policies and guidelines, notes Burtonsville, MD-based attorney Elizabeth Hogue.

That may be one reason M+COs will be reluctant to delegate generation of the notices to providers, Fisk forecasts. They'll want to cite their own policies, "chapter and verse," in the form, she says.

And providers actually may have a conflict of interest in creating the notices, Wardwell points out. If HHAs want the patients to receive more care - and to get paid for delivering that care - they could make the explanation in the notice look weak, so that the patient wins the appeal. M+COs likely will want to put their own spin on justification in the notice and provide the strongest argument they can to support their decision to terminate services, he contends.

CMS published a proposed regulation on M+CO appeal rights last year and this regulation is final, but the agency still is taking comments on it due to the significant changes from the proposal (see story in article "managed care"). CMS will take comments on the reg until June 3.

CMS plans to publish the template for the first-step, generic notice and the second-step, more detailed notice in June or early July, an agency official said in the May 7 Open Door Forum for home health. CMS will take comments on those forms before finalizing them.

After taking comments on the final reg and forms into consideration, CMS will issue instructions on implementing the new appeals process before its deadline of next January, the CMS official said in the forum.

The new appeals procedures have been a long time coming. CMS constructed the appeals procedures as part of a settlement in a class action lawsuit filed against it in 1993, Grijalva v. Shalala. Many of the appeals procedures protested in the suit have long been changed, but CMS and the plaintiffs came to a settlement in 2000. As part of the settlement, CMS must implement these fast-track appeals for M+CO enrollees.

"It's important for Medicare beneficiaries to be able to obtain a fast, independent review when they disagree with their health plan's decision that services should end," CMS Administrator Tom Scully said upon publishing the final reg in April. "It should be easy, and fast, for beneficiaries to appeal decisions about their health care, whether they are enrolled in Medicare+Choice or traditional Medicare."

CMS hinted throughout the managed care appeals reg that it has the same sort of plans for regular Medicare fee-for-service appeals some day, observes Wardwell.