Home Health & Hospice Week

Freeze unwarranted, industry argues.

Home health agencies might want to get used to the leaner budgets they're currently on under the 2006 rate freeze.

As expected, the Medicare Payment Advisory Commission has recommended another HHA rate freeze in 2007, according to its March 1 report to Congress. The influential advisory body gives a number of justifications for the freeze, including a projected HHA Medicare profit margin of 14.7 percent in 2006.

The number of agencies and home health users has increased in recent years, MedPAC notes in the report. "Considering current margins, increased spending and volume, stable access and quality, and good access to capital, these providers can accommodate next year's cost increases without an increase in base payments," MedPAC says about post-acute providers in a press release.

A rate freeze would come on top of negative inflation updates for HHAs in each of the last five years, the American Association for Homecare notes in a release. "The freeze is unwarranted, unjust and unsound," AAH's Sue Mairena says.

"If Congress approves MedPAC's recommendation, we will call on them to explain to millions of home care patients why Congress has cut this important benefit four years in a row," Carolyn Markey, CEO of the Visiting Nurse Associations of America, says in a release.

• Professional Home Care Inc.'s victory on physical therapy salary costs has been short-lived. As expected, the Health and Human Services Administrator has reversed a Provider Reimbursement Review Board decision that sided with the Oklahoma-based HHA on PT salary limits (see Eli's HCW, Vol. XV). Professional is "seriously considering an appeal" in federal court, reports the HHA's attorney, John Jan-sak with Harriman & Jansak in Towson, MD.

About $75,000 is at stake in the PT salary portion of the case, Jansak confirms to Eli. Professional has about a month to decide whether to appeal.

Agencies have routinely won federal district and appeals court cases on this topic, but HHS continues to reverse PRRB decisions on the PT salary guideline issue. That forces HHAs to resort to a federal court appeal to secure their reimbursement.

• Providers may soon find out whether the Deficit Reduction Act is enforceable. Mobile, AL elder law attorney Jim Zeigler filed the first lawsuit disputing the DRA Feb. 13. "My legal point is that the House passed one version, the Senate passed another version and the president signed the Senate version. That violates the Constitution," Zeigler says in a release.

A typo put the rental period for items in the existing home medical equipment capped category at 36 months instead of the 13 months agreed to by the House and Senate. No date for a hearing has been set for Zeigler's lawsuit.

• The National Quality Forum will soon be voting on a new set of voluntary "preferred practices" for hospices. The hospice quality measures wouldn't become consensus standards like those that CMS was required to adopt for Home Health Compare last fall, notes NQF spokesperson Phil Dunn.

NQF solicited comments on 36 proposed hospice standards ranging from responding to patients 24 hours a day, seven days a week to providing education and support to caregivers to staff credentialing.

NQF staff is revising the standards based on comments received; then NQF members will vote on the standards starting March 7. NQF Board members will consider approved measures for adoption in April.

More information, including the 36 proposed standards, is at www.qualityforum.org/docs/palliative_care/WebPHFrameworkConsensus01-11-06.pdf.

• If skilled nursing visits for a wound care patient are ordered repeatedly, expect to encounter scrutiny. "A finite and predictable period of time for daily visits for wound care (or any skilled service) must be documented from the start of care," regional home health intermediary Associated Hospice Service says in its January Frequently Asked Questions for home health. "That estimate should be revised downward as the episode of care goes on in order to comply with the intermittency rule," AHS says on its Web site.

"A plan with the order 'Sn visits for 21 days' repeatedly will be looked at closely," AHS warns.

• Weaker-than-expected earnings for the latest quarter combined with the resignation of a top exec sent Amedisys Inc. stock plunging about 25 percent Feb. 23. Unexpected costs from earlier Housecall and Spectracare acquisitions and the residual impact of Hurricanes Katrina and Rita affected earnings, CEO Bill Borne says in a release. But Wall Street analysts worry that more financial skeletons may be in the Baton Rouge, LA-based chain's closet, considering the resignation of Chief Financial Officer Greg Browne.

Amedisys reported net income of $7.3 million on revenues of $118.9 million for the quarter ended Dec. 31, 2005, compared to a $6.1 million profit on $64.4 million in revenues for the same period in 2004.

• Option Care Inc. saw increased earnings for the quarter ended Dec. 31, 2005. The Buffalo Grove, IL-based infusion and specialty pharmacy chain reported net income of $6.7 million on revenues of $144 million for the quarter, compared to a $5.3 million profit on $113 million in revenues for the same quarter in 2004.

Home infusion and specialty pharmacy services increased 37 percent and 18 percent, respectively, compared to the prior-year period, Option Care says.

• Medicare's switch to the HIGLAS accounting system has cut spending by $9 million so far, CMS touts in a release. HIGLAS delays HHA Request for Anticipated Payment (RAP) reimbursement by one day and reduces the amount used to calculate interest on overdue claims (see Eli's HCW, Vol. XIV, No. 20). Palmetto GBA is the only RHHI that has adopted HIGLAS thus far.