Medicare Ruling alters “Improvement Standard” for Home Health

On October 16, 2012, The Center for Medicare and Medicaid services (CMS), in conjunction with the Center for Medicare Advocacy and Vermont Legal Aid, announced a settlement in Federal District Court regarding the use of an “improvement standard” as a qualification for skilled Home Health services. The settlement was in response to a lawsuit filed in January 2011 against Health and Human Services (HHS), targeting the use of such an improvement standard to deny coverage to chronic Medicare beneficiaries that may not demonstrate progress during care episodes. Historically, CMS contractors tasked with approving payments to Providers, whether Skilled Nursing Facility (SNF) or Home Health based, have relied on the erroneously applied, informal Medicare policy that requires improvement, or progress, to receive payment coverage. As a result, chronic patients who exhibited little if any progress, or actually demonstrated regression during episodes due to the expected decline associated with their diagnosis or condition, were often denied coverage due to the fact that they were “not likely to improve”.

The use of an “improvement standard” to qualify Medicare services actually describes a traditional CMS interpretation of the Medicare Act, which requires that payment coverage be made for care “reasonable and necessary for the diagnosis or treatment of an illness or injury, or to improve the functioning of a malformed body member.” Though progress is not explicitly required by the Medicare Act verbiage, CMS Fiscal Intermediaries often denied coverage to beneficiaries based on the rationale that they were “stable” or only required “maintenance services”. As a result, the working standard for Medicare coverage became a level of “improvement”, where lack of progress became grounds for claim denial despite any legal or regulatory requirement of improvement for qualification.

The settlement announced in October prohibits Medicare contractors from denying coverage based on patient improvement. When the terms of the agreement are finalized, Medicare will revise all policies to affirm that coverage is not related to a beneficiary’s improvement. This will certainly alter the current working reality regarding how coverage is continued for those types of chronic clients who fail to demonstrate progress from the related clinical programming. The settlement and any changes expected as a result, focuses on chronic patient populations, with conditions such as MS, Parkinson’s and dementia. The issue of how to define and deliver maintenance care, particularly the relevant rehab services often indicated in these cases, is the question at hand.

As CMS revises policies to address the settlement, they will address the concept of “maintenance” coverage for Home Health Providers and clinicians. This process of care expansion must address specifics of this type of programming for clear and concise guidelines, and there will undoubtedly be many factors in exactly how this coverage is determined. First and foremost will be the G-code utilization that CMS introduced in the 2011 PPS Final Rule; three additional G-codes were added to establish delivery of therapy maintenance programs by “qualified” therapists. They addressed Physical and Occupational Therapy, as well as Speech Pathology, and specifically required the use of the G-codes with the following terminology:
“Services performed by a qualified _____________________________ to establish or deliver a ____________________________ maintenance program.” Insert the following combination to complete the regulatory statement above – (Physical Therapist/physical therapy)(Occupational Therapist/occupational therapy)(Speech-language Pathologist/speech language pathology). This denotes the Medicare policy to deliver “maintenance-type” services for clients with chronic conditions who need regular adjustments, or modifications, to their home program, which in the case of therapy, usually references the Home Exercise Program. Maintenance services have been covered since that time in the situation where the condition of the patient, or the nature of the program, were at a level of complexity that it would be considered unsafe to turn the management of the care over to a non-therapist.

So it is interesting to note that Medicare had previously acknowledged the need for some level of maintenance intervention regarding therapy-care delivery for chronic conditions; the author believes that this is where CMS will begin when expanding coverage from the recent settlement. The issue will likely be approached from the angle that continued services for maintenance reasons can effectively slow the decline of the chronically-challenged patient, regardless of specific diagnosis. Many physicians and health advocacy groups support this policy change as a means of maintaining independent function for the chronic patient, directly affecting quality of life issues. The American Physical Therapy Association issued a statement on the settlement; “We strongly believe that allowing Medicare beneficiaries to receive physical therapy in skilled nursing facilities and home and community based settings will result in significant cost savings in the long term, as well as help bolster the triple aim of health care reform to improve care for individuals, improve health for populations and lower spending growth”.

The relevant questions are exactly what types of services will be covered and how will they be managed under the new policy. It is expected that skilled therapy services will be approved to maintain a patients’ condition or slow deterioration. The question at hand is exactly what will constitute skilled therapy services, i.e. Range of Motion employed to reduce contractures is often considered an un-skilled service modality, and this definition may not change under the recent settlement. In fact, the use of the G-code referenced above may allow for the therapist to have regular and significant input into the maintenance program without redefining the concept of skilled therapy services. It is important to note that the spirit of the settlement mirrors the preventive wellness approach of the Accountable Care Organization (ACO) model, identifying ways to reduce healthcare costs in an innovative manner.

So expect a strict definition of exactly what is included under the heading of maintenance to follow, and this author doesn’t expect a wholesale expansion of the therapy utilization currently covered under the PPS model. Plans to eliminate visit-based therapy payments, as well as patient co-payment recommendations, if or when enacted, will certainly affect many of these types of programs. Stay tuned over the next 6 months; Medicare is expected to clarify exactly how this new “maintenance” therapy program will be delivered, and all agencies will be affected.

Arnie Cisneros, P.T., President of Home Health Strategic Management, is the most progressive speaker in homecare today. He provides coaching and consulting services to providers on a national basis (see regarding S.U.R.C.H. and other clinical management protocols for quality outcomes.

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