NAHC Submits Additional Comments to House Ways & Means Committee on Post-Acute Care Draft Legislation
September 4, 2013 10:11 AM
The National Association for Home Care & Hospice (NAHC) submitted additional comments to the House Ways & Means Committee regarding draft legislation to modify post-acute care payments within Medicare. The House Ways & Means Committee’s draft legislation on Medicare post-acute care includes a 1.1 percentage point cut in inflation updates and bundling of post acute payments, and NAHC’s comments come in response to the Committee’s request for public feedback on such proposals. The House Ways and Means Committee has jurisdiction over the Medicare program.
NAHC submitted its original comments on August 15, and submitted supplemental comments based on both new data showing the negative consequences the current draft legislation would have on the home health community as well as additional information from post-acute care bundling programs.
For more information on the previous comments submitted by NAHC, please see NAHC Report from August 20, 2013.
In its revised comments, NAHC reiterates its opposition to proposals for additional cuts to home health stating that home health providers:
“Cannot sustain more payment rate cuts if we want to continue innovating and investing in technology to improve the delivery of care. Already in the pipeline are significant payment rate cuts for Medicare home health services. Medicare has proposed to rebase payment rates to levels 14 points lower than current rates beginning in 2014 through a four-year phase-in of 3.5% annual reductions. In addition, the ACA mandates application of a “productivity adjustment” starting in CY 2015. That adjustment is expected to reduce payment rates by 0.5 to 1% annually thereafter while the adjustment has nothing to do with changes in home health productivity. Finally, home health agencies are already experiencing a payment reduction of 2% through sequestration.
To withstand just the currently scheduled rate cuts, Medicare home health agencies would need significantly higher margins than exist today. MedPAC estimates 2013 Medicare margins at 11.8%. In reality, the margins are much lower when all home health agencies are considered in the analysis. The margins are still even lower when all service costs are included as MedPAC excludes hospital-based HHAs from its analysis along with such costs as telehealth, respiratory therapy, nutritionist support, taxes, and other normal business costs. However, even with the inaccurate MedPAC margin of 11.8%, the currently scheduled cuts (estimated at 17.5% by 2017) bring HHAs to well below zero in margins triggering an access to care crisis. There is no way that HHAs can withstand any further rate cut as the Committee is considering.”
With respect to the bundling proposal, NAHC has taken the position that home health agencies should play the central role in managing any bundled post acute care payments.
To read NAHC’s full supplemental comments, please click here.