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Home Health & Hospice Week

Budget:

SENATORS CONSIDER HOME CARE CUTS

Published on Wed Apr 22, 2009

HHAs, suppliers squarely on the budget chopping block.

Home care providers are targets for Medicare cuts this year, but at least now they're not alone.

The Senate Finance Committee has issued more ideas for how to fund comprehensive health care reform, and home health agencies and durable medical equipment suppliers top the list of ideas. But hospitals, physicians, Part D drugs, and more providers are also on the lawmakers' list of options for cutting health care costs.

"Home health is still on the target list," acknowledges William Dombi of the National Association for Home Care & Hospice. But "at least now it has company."

Under President Obama's budget plan, HHAs were the only providers singled out for Medicare cuts. The Senate Finance Committee is considering a much wider range of reductions for providers. That diminishes the likelihood that the entire Medicare provider savings sought will come from HHAs, Dombi hopes.

Still, the senators' ideas for cost-cutting won't be popular with agencies. In the latest brainstorming document meant to spur discussion, the committee suggests following the Medicare Payment Advisory Commission's recommendations for reduced inflation updates for HHAs and other sectors. It also suggests "contemplating further adjustments given the current levels of payments in the program."

Or Congress could require the Centers for Medicare & Medicaid Services to "'re-base' home health payments to better reflect the current number and mix of HH services and their level of intensity and to take into account the relative margins related to specific conditions and service areas," the Senate Finance paper suggests.

This could be a good sign, NAHC says. "It is encouraging that the committee is giving consideration to some options that would reform the home health payment system as an alternative to an across the board cut," the trade group tells its members. "This would indicate that there is increasing recognition of the wide disparity of home health profit margins."

Lawmakers might also consider instituting a cap on outlier payments for HHAs, the committee suggests.

HHAs could also fall under the more general suggestions the paper makes for ensuring appropriate payments, capturing productivity gains, and modifying beneficiary contributions. The latter could lead to home health copayment that the industry has been fighting for years, NAHC cautions.

DME Back On The Radar

While the committee mentions no specific cuts for DME items, it does float the basic idea of reducing Medicare payments to suppliers. "The committee will explore options to improve payment accuracy for DME items and services," it says.

The HHS Office of Inspector General has identified overpaid DME items, the paper adds. And Senate Finance Chair Max Baucus (D-Mont.) and Ranking Member Charles Grassley (R-Iowa) made a specific reference to ensuring appropriate payments for "oxygen and power wheelchairs" in a release about the options document, notes the

American Association for Homecare.

This is in contrast to President Obama's budget, which didn't mention DME cuts specifically.

"Further reductions to home medical equipment reimbursement will tear the already fragile safety net provided by home care," says AAHomecare's Tyler Wilson in a release. "Home medical equipment and care helps reduce the length of expensive hospital and institutional care, allowing people to remain in the comfort of their own homes."

Bright side: The vague mention of DME adjustments is encouraging, believes the National Association of Independent Medical Equipment Suppliers. "The fact that it is not leading the way in Senate Finance's efforts to pay for reform gives the industry a chance to fight for change that will be positive," NAIMES says.

Battle commences: Both HHAs and suppliers are already fighting hard against possible Medicare cuts this session. The pressure is on because Congress is working on a more accelerated timetable than usual for Medicare legislation.

House leaders have pledged to introduce a health care reform bill by late July. That's a few months earlier than the usual end-of-the session legislation that includes Medicare changes.

In the Help Us Choose Home campaign orchestrated by NAHC, home care nurses from all 50 states this month visited their representatives on Capitol Hill to urge them to block cuts to home care.

Suppliers are drumming up congressional support for the Home Oxygen Patient Protection (HOPP) Act of 2009 (H.R. 2373), reintroduced earlier this month by Reps. Tom Price (R-Ga.) and Heath Shuler (D-N.C.). HOPP would repeal the oxygen cap.

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