MedPAC Recommends Copays to Access Medicare Home Health: ‘A Discredited Idea,’ Says NAHC President

MedPAC Recommends Copays to Access Medicare Home Health: ‘A Discredited Idea,’ Says NAHC President

January 14, 2011 03:47 PM


For additional information:

Barbara D. Woolley
National Association for Home Care & Hospice
(202) 547-7424

WASHINGTON , D.C. (January 14, 2011) – The Medicare Payment Advisory Commission (MedPAC) voted yesterday to recommend that Congress impose a new copayment obligation on Medicare home health patients and that provider payment rates be cut in several ways starting in 2012 and thereafter. The National Association for Home Care & Hospice (NAHC) is coming out full force to explain why these are wrong-headed ideas that have not only been proven to have a number of detrimental effects on beneficiaries requiring services but to actually drive up health care costs.

The MedPAC copayment proposal would require seniors and disabled Medicare beneficiaries to pay a $150 copayment for each 60-day episode of home care where they do not go to a hospital or skilled nursing facility first. “Requiring the sickest of Americans to pay a fee to access home health care is an old and discredited idea,” said Val J. Halamandaris, president of NAHC. “I know this because as a young man, I helped Senator Frank E. Moss and Congressman Claude Pepper write the original Medicare home health benefit, which had copays in it. These fees were removed by Congress for several reasons; the first was that there was no evidence that they saved money. In fact, they cost the government more to collect than their imposition saved the Medicare program.”

“Second, copays had become nothing more than a ‘sick tax’ that fell heaviest upon the sickest, poorest, and most vulnerable members of society, impeding their ability to access home health services,” Halamandaris continued. “Third, copays for home health care resulted in hundreds of thousands of infirm seniors and disabled persons being relegated to institutions at many times the cost to the government.

“Fourth, Medicare copays resulted in the limitation of the rights of seniors and disabled persons to exercise the freedoms preserved for all Americans in the Constitution and Bill of Rights. Fifth, then as now, there was no evidence that copays were needed to control utilization. In fact, there was ample evidence that too few seniors who were eligible for care at home received such services. Despite the 10 percent increase in eligible Medicare beneficiaries since 1997, the home health program today serves fewer patients and costs the government billions less than it did 15 years ago.

“Sixth, the imposition of Medicare copays was resulting in cost-shifting to state Medicaid programs. Experience shows that if copays are instituted, the number of chronically ill and disabled persons who be forced to take the ‘pauper’s oath’ and apply for help from state Medicaid programs will again increase dramatically. The impact of such cost-shifting will precipitate a national crisis as states struggle to carry the weight of caring for the 78 million members of the Baby Boom generation who will require personal care assistance or help with the management of multiple chronic diseases.

“In the name of our mothers and fathers and grandparents, let’s learn from the past and not repeat the same mistakes. I call upon all Americans to join me in a crusade to protect our loved ones and their right to be live free and be cared for at home. Email your members of Congress: ‘Dump the sick tax!'” said Halamandaris, laying the groundwork for a major NAHC grassroots campaign over the coming months (click here to use the NAHC Legislative Action Network NOW to send this message to your legislators).

MedPAC also voted to recommend to Congress that home health payment rates be drastically cut beginning in 2012. Yet in the health care reform legislation last year, Congress already enacted a number of payment reforms in home health services that begin in 2011 and continue through 2017. Congress devised a carefully crafted schedule of reforms that balance the need for change with the goal of maintaining access to high quality care throughout the country.

“The MedPAC recommendations on payment rates would destroy the reform process that Congress mandated just last year,” said Halamandaris. “While Congress recognized that abrupt payment rate cuts severely heighten the risk that home care will be lost to many throughout the country, MedPAC’s desire for immediate and disasterous rate reductions ignores the reality that the majority of home health agencies today are barely paid the actual cost of the care they provide,” said Halamandaris.

He noted that even the data that MedPAC itself use show that fully 35 percent of home health agencies are now paid less than the cost of care and that scheduled cuts will bring that number to nearly 50 percent by 2012. “Congress sensibly chose to phase-in rate cuts gradually in order to give providers a chance to control their current costs and continue to exist to provide care. MedPAC instead chooses to push the entire home care provider community off a cliff,” Halamandaris contended.

NAHC believes that home care is not only the right way to save billions in Medicare expenditures, it is what the nation’s seniors need to meet their increasing and complicated health care requirements. Put simply, there is no greater value proposition in the health care system than home care, which helps save and extend lives as well as prevent and manage chronic disease while creating jobs and directly contributing to the long-term health of the economy.

In its annual March report, MedPAC will deliver its recommendations to Congress. Further analysis on the recommendations — and information on NAHC and the home care community’s response to them — will follow in future issues of NAHC Report.