Home Health & Hospice Week

Fair Labor Standards Act exemption invalid, court rules.

If you don't want to pay unnecessary overtime, stay on top of developments in this legal case.

A regulation applying the "companionship services" overtime exemption under the federal Fair Labor Standards Act to agency-employed home care aides is invalid, a U.S. court of appeals said last week.

The exemption has been used by home care agencies to provide regular hourly wages, rather than overtime compensation, to aides who work more than 40 hours in a week. The court, the U.S. Court of Appeals for the Second Circuit, reheard the case after the U.S. Supreme Court earlier this year reversed the Second Circuit's previous similar ruling and remanded the matter back to the appellate court for further consideration.

If the Second Circuit's decision ultimately stands, HHAs within the court's jurisdiction--New York, Connecticut, and Vermont--will be required to pay home care aides and personal care workers overtime compensation.

The decision would also apply to any party that employs aides, except those that employ the aide directly for their own services, says the National Association for Home Care & Hospice.

The next stop for the case is likely once again the U.S. Supreme Court, says NAHC.

• Sept. 1 marked the mandatory effective date for Medicare's new home health advance beneficiary notice (HHABN).

Download the forms in English or Spanish at www.cms.hhs.gov/BNI/. To access forms and directions, click on the dedicated link on the top left-hand margin: FFS HHABN.

Questions? CMS is directing home health agencies with questions to contact their regional home health intermediary.

Update: CMS officials speaking at the Aug. 15 Home Health, Hospice & DME Open Door Forum indicated that they would update HHABN instructions to include the Spanish language phrases for use with Option Box 1.

• Dr. Mark McClellan announced his resignation as CMS administrator on Sept. 5, saying he will likely step down by early October.

McClellan, a physician and an economist, was sworn in as CMS administrator in March 2004. He supervises Medicare, Medicaid and the Children's Health Insurance Program, which together provide care to more than 90 million Americans, at a federal cost of more than $550 billion a year.

McClellan has been a proponent of pay-for-performance programs within Medicare and he has overseen the implementation of Medicare's new Part D prescription drug benefit.

A replacement for McClellan has not been named, but potential nominees include CMS Deputy Administrator Leslie Norwalk and Herb Kuhn, director of CMS' Center for Medicare Management.

• The Deficit Reduction Act and its new capped rental provisions for durable medical equipment, prosthetics, orthotics and supplies (DMEPOS) don't apply to enteral and parenteral nutrition pumps, said Joel Kaiser of CMS, speaking at the Home Health, Hospice & DME Open Door Forum on Aug. 15.

The nutrition pumps are covered under Medicare Part B and are therefore exempt from the provisions, he explains.

A "very old manual section" has been confusing some suppliers and home health agencies, he noted.

• Modern Healthcare magazine has listed home health's Val Halamandaris as one of the most powerful men and women in healthcare. Halamandaris serves as president of the National Association for Home Care & Hospice.

Bill Gates, chairman of Microsoft Corp. and mega-philanthropist as co-chairman of the Bill and Melinda Gates Foundation, topped the list this year, followed by President Bush.

• Arcadia Resources will acquire Lovell Medical Supply, a respiratory and durable medical equipment (DME) company with locations in Mount Airy, Elkin, North Wilkesboro and Statesville, North Carolina. Arcadia announced the acquisition Sept. 5.

Lovell Medical Supply currently generates approximately $3 million in annualized revenues.

• Maine is ahead of the curve when it comes to promoting home health services as an alternative to more costly nursing home care. That is the focus of a Sept. 4 article in the Portland Press Herald.

Reducing the funds and the number of customers flowing into long-term care institutions has caused several nursing homes throughout Maine to close their doors, the article reports. At the same time, the state has increased spending on long-term home health care.

The number of home health aide jobs in the state has increased from 12,872 in 1996 to 17,670, according to Lisa Pohlmann, associate director for the Maine Center for Economic Policy.

• A Huntington Beach, CA, man has been sentenced to 10 years in prison and ordered to pay more than $6 million in restitution for a Medicare billing scam.

In the scam, unneeded motorized wheelchairs and other items were prescribed for patients and Medicare was billed.

Prosecutors said that Phu Luong, 51, used the money he netted from the scheme to buy a boat, expensive cars, a waterfront home and to pay off Las Vegas gambling debts.

Luong, who owned United Medical Supply in Huntington Beach, was convicted in April of 35 counts of health care fraud and five counts of money laundering.

The federal court in Santa Ana sentenced him late in August. Luong was among 10 people indicted in 2005 for allegedly overbilling Medicare $24 million.