Home Health & Hospice Week

GAO report leaves out other negatives of MA plans' home care policies, industry says.

Common knowledge about Medicare Advan-tage in the home care industry is now getting attention from the general public for the first time, and home health agencies hope the information will change managed care practices for the better.

Nearly 20 percent of beneficiaries enrolled in Medicare Advantage plans have higher cost-sharing for home care services under MA plans than they would in regular fee for service Medicare, says a new report from the Government Accountability Office. And 21 percent of beneficiaries have a plan that excludes home care costs from its out-of-pocket maximum cap, the report adds.

MA plans advertise benefits that beneficiaries can understand, like cheaper emergency room cost-sharing or lower prescription drug costs, notes Karen Hinkle with the Kentucky Home Health Association. "Initially they could get these added benefits at a lower cost than their Part B traditional coverage and that has been appealing," Hinkle tells Eli. But later they find out they have to pay more for services like home care.

"It has not been in the interest of [the Centers for Medicare & Medicaid Services] to make these is-sues clear to beneficiaries ... as CMS aggressively promoted MA plan enrollment," notes Bob Wardwell with the Visiting Nurse Associations of America. CMS says such information is already available to beneficiaries or is too burdensome for MA plans to publicize, says Wardwell, a former top CMS official.

"Of course the information ... is not available or is tucked away somewhere on the plan's Web site," Wardwell notes. That's "a favorite place for 85-year-olds to do research," he jokes.

For instance, many plans charge benes a copayment for home health visits while FFS does not, notes Joanne Cunningham with the Home Care Association of New York State. That information isn't always clear when selecting a plan.

Choosing an MA plan without adequate information "has become a guessing game for beneficiaries," Wardwell criticizes. "Those who guess poorly pay the price for whatever may be gained by others."

How it works: Most MA plans receive incentive payments on top of regular Medicare rates, notes Neil Johnson with the Minnesota HomeCare Association. Those "rebates" help put MA spending at 12 percent above regular FFS spending, the GAO report notes.

MA plans use a portion of their rebates to pay for general and administrative expenses and to boost their own profits, the GAO says.

Robbing Peter: "It's truly amazing to me that the increased cost of MA plans is being passed on as increased Part B premiums to those in traditional Medicare without any public reaction," Wardwell says. "Those extra dollars subsidize profits for the plans and extra benefits and reduced cost sharing for some benefits for MA enrollees."

Powerful Ways and Means Health Subcommittee Chair Pete Stark (D-CA) seems to agree. "I believe people should have the choice to join a private plan," Stark said in a Feb. 28 subcommittee hearing on the report. "But, the rest of us should not be subsidizing that choice."

Even the GAO has its doubts about the current payment structure. If the policy objective of the rebate payments "is to subsidize health care costs of low-income Medicare beneficiaries, it may be more efficient to directly target subsidies to a defined low-income population than to subsidize premiums and cost sharing for all MA beneficiaries, including those who are well off," the report concludes.

But CMS insists that the GAO doesn't fairly look at the overall benefits of the plans, according to its comments on the report.

What About Benefit Restrictions?

The GAO report focuses only on the cost-sharing aspect of MA plans, not accessibility to the benefit. One of the major drawbacks of MA plans for home care is their restriction of home care services.

"Medicare Advantage plans are providing a different level of home health care compared to traditional Medicare to beneficiaries," protests Vicki Hoak with the Pennsylvania Homecare Association. "Our agencies report that they average about six nursing visits and very seldom get approval for home health aide services," Hoak tells Eli.

"The number of authorized home health care visits is far fewer under managed care," Cunningham agrees. "Managed care has a history of underpaying for vital services, setting notoriously low rates for home health care, failing to inform ... providers about beneficiaries' change of enrollment to managed care plans and aggressive consumer marketing tactics."

The bottom line: "The general public does not understand that they may have to pay more for home health services if they have Medicare Advantage--and get less service," Hinkle says. "And of course providers get paid less."

Even once beneficiaries do understand that home care carries a cost increase, they still choose plans that have cheaper things like prescription drugs, notes Chicago-based regulatory consultant Rebecca Friedman Zuber.

It's frustrating for agencies to fill out OASIS assessments on patients, then have the MA plan ignore them when setting utilization limits, Hoak says.

Home care providers need to bend their legislative representative's ear about this issue, Hoak urges.

"These issues must be addressed in order to create a more patient-friendly managed care environment," Cunningham adds.

And at least some lawmakers seem to be listening. "I see no reason why managed care plans should be grossly overpaid and under-regulated," Stark said in a statement for the hearing.

Don't expect too much to happen before the Bush Administration draws to a close, advises consultant Tom Boyd with Rohnert Park, CA-based Boyd & Nicholas. "The administration ... will not do anything given their agenda and vested interest in MA," Boyd believes.

Medicare legislation shaping up for this summer may include MA cuts, however. But that same legislation is also looking likely to take a bite out of HHA payment rates from Medicare too (see Eli's HCW, Vol. XVII, No. 8).

Do this: In the meantime, you can get out and speak to senior and baby boomer groups about how to choose an MA plan that's right for them or their loved ones, Hinkle suggests. "I try to give them a balanced view and criteria to consider when making these decisions."

Note: The GAO report is at www.gao.gov/new.items/d08359.pdf.