Medicare Compliance & Reimbursement

Home care provisions in flux.

Congressional leaders are stepping up the intensity of Medicare legislation negotiations, and home health agencies may benefit from it.

The Medicare legislation negotiators aimed to reach an agreement by Oct. 29, said House Ways and Means Chair Bill Thomas (R-CA), who is also chairing the committee that is working out differences between the House and Senate versions of the Medicare and prescription drug benefit bills. However, at press time the conferees were still voting on elements of the package.

President Bush emphasized in several press conferences the importance of passing a Medicare drug bill this session. The home care-related Medicare changes are wrapped up in the same bill as the drug proposal.

Although observers warn that negotiations are fluid and provisions can quickly change, at press time legislators appeared to have agreed on following the Senate's lead, jettisoning any mention of home health copayments in the bill. If lawmakers backtrack on the agreement, they might go with other options floated in recent negotiations - imposing a copay only on episodes subsequent to the initial one, or charging a copay smaller than the approximately $50 per episode the House passed.

More good news for HHAs was an agreement to include a one-year, 5 percent add-on for rural HHAs. However, that addition is not as much as the 10 percent increase the Senate originally passed.

The price agencies will have to pay for the favorable copay and rural add-on decisions may be further reductions to inflation updates. A 0.4 percent reduction to the market basket index, which is used to update payment rates for inflation, originally was proposed. That figure may reach 0.9 percent in the new package, says the Visiting Nurse Associations of America.

Durable medical equipment suppliers may have a bigger price to pay. Lawmakers are considering a mixture of a freeze to inflation updates and implementation of competitive bidding. One popular combination is a one-year freeze to the consumer price index (CPI) update, followed by a gradual implementation of competitive bidding for DME, reports the American Association for Homecare.

Lawmakers are hoping for a full vote on an agreed-upon Medicare package by mid-November, although many observers expect a Thanksgiving deadline is more realistic. Obstacles to the package include controversial issues regarding the new drug benefit and the possibility of significantly exceeding the $400 billion limit set for the bill.

If legislators have to return to the bill to cut the projected cost estimate, home care may be a prime target, observers warn.

Even if the conferees can agree on a package, its passage is far from guaranteed. Senate Democrats may block the bill if it doesn't include key provisions, they said in a recent letter to Republican leaders. Observers give the forthcoming bill a 50-50 chance of passage, VNAA says.