Home Health & Hospice Week

You could find out too late the prescription drug benefit is hitting you in the wallet.

Home health agencies that thought they were an arm's length away from the new Part D prescription drug benefit under Medicare had better think again.

Just because agencies don't furnish the drugs doesn't mean they aren't affected by the changes surrounding the new benefit, experts warn. The more beneficiaries an HHA serves who are dually eligible for Medicare and Medicaid, the more likely the HHA could see a big financial impact in the beginning of 2006.

That's because nearly six million dual eligibles nationwide have been transferred from Medicaid plans that formerly paid for their drugs to new Special Needs Plans (SNPs) under Medicare that are administered by managed care organizations, the Government Accountability Office notes in a recent report.

In some states, when the beneficiaries were passively enrolled without their consent into the SNPs, they were also switched over from regular fee-for-service Medicare into a full Medicare Advantage plan.

In other states, beneficiaries weren't automatically enrolled in full MA plans, but were convinced by MA marketers to elect such plans along with their drug benefit. Beneficiaries often don't understand that the switch will affect their home health or other Medicare-covered services in any way, advocates charge.

Medicare managed care has been on the rise in recent months anyway, thanks to more generous reimbursement, notes consultant Alison Cherney with Brentwood, TN-based Cherney & Associates. That means agencies should expect to see more patients in general, not just dual eligibles, signing onto MA plans.

HHAs can expect to see more states hop on the passive enrollment bandwagon as the savings from switching benes from Medicaid to Medicare becomes clear, predicts consultant Steve Braff with The Braff Group in Palm Springs, CA. "States strapped for cash will support this covert shift from Medicaid to Medicare Advantage. Last I checked that was about all of them," Braff quips.

Beneficiary representatives are suing in one state that allowed the passive enrollment into full MA plans. The Pennsylvania Health Law Project has filed a class action lawsuit on behalf of beneficiaries against the Centers for Medicare & Medicaid Services to stop the passive enrollment.

CMS didn't have the legal authority to allow passive enrollment and didn't notify beneficiaries properly of the change, the suit charges. "Passive enrollment will cause poor Medicare beneficiaries in Pennsylvania to lose the freedom of choice of health care providers which is guaranteed by the Medicare statute," PHLP says in a release. Benes will be limited to network providers and subject to utilization controls under the plans that they didn't choose.

Opt Out Not Always A Viable Option

Even though they were sent notices about the change, many dually eligible home health patients will have no idea of what's going on, experts expect. That means a number of HHAs are likely to serve patients as usual in January, then find out later that the patient was under an MA plan.

In that case, the agency's traditional Medicare claims for that patient will be denied, notes the Council of State Home Care & Hospice Associations. Then the HHA will have to seek reimbursement from the patient's MA plan. The plan will either deny the claim outright or pay the agency on its owncertainly less lucrative--terms, notes managed care expert Martin Hadelman with Advisors for Health Care in Roswell, GA.

Passively enrolled beneficiaries "are at serious risk of losing access to their current caregivers," warns the National Association for Home Care & Hospice. "Likewise, unknowing home health agencies are at risk of continuing to serve these patients only to be refused reimbursement afterward," NAHC stresses in a message to members.

Agencies that know whether their patients have been enrolled in MA plans aren't off the hook either. They will have to either lose the patients or secure a contract with the managed care organization, Braff notes.

Entering into a managed care contract is likely to mean lower reimbursement and more paperwork. Braff expects HHAs and beneficiaries in urban areas to be most affected. States like Florida with high dual eligible populations are also being hit hard, notes Gene Tischer with the trade group Associated Home Health Industries of Florida.

Escape hatch: Beneficiaries who have been enrolled in MA plans but want to go back to regular FFS Medicare can opt out at any time, CMS notes. But many patients don't even understand how to opt out, PHLP cautions. And some benes have reported trouble getting off MA plans' rolls when trying to opt out, the Law Project says.

Outcomes May Suffer

Payment problems aren't the only difficulties agencies are encountering with the drug plan switch-over, Tischer points out. Patient health status and outcomes may also end up being a problem if benes can't secure their needed medications under their new plans.

One AHHIF member reported 55 patients calling the HHA after Jan. 1 to complain that they couldn't get their meds, Tischer tells Eli. The agency tried to step in and work out the problems with CMS and got only five of those cases cleared up for patients. "There is no way to help these people out," Tischer laments. "It's a mess."

Nationwide there were numerous reports of beneficiaries being unable to secure their prescription medications for a variety of administrative reasons, ranging from lack of coverage proof to tied up phone lines at insurers, according to press reports.

Four states and some cities have stepped in and promised to pay for dual eligibles' prescriptions until CMS and its SNP plans work out the kinks. In the meantime, CMS is pointing the finger at insurers to step up and has called for patience during the transition.