A Major Change to Therapy/Rehabilitation Coverage for Medicare Patients

Q. At age 62, my father, Paul, was diagnosed with ALS (amyotrophic lateral sclerosis). He can’t walk, get out of bed, or breathe on his own (he’s on a ventilator). He can’t use the toilet, bathe, or dress himself, either. After a recent hospitalization and short-term stay in a nursing home for rehab, in-home therapists had been helping him maintain his strength, to the extent possible, for the past two weeks.

My parents recently got disturbing news. Medicare told my mother that dad is not getting any better, so they will no longer pay for his physical and occupational therapy. The therapist handed her a notice that the agency she worked for was terminating care within 48 hours, and that mom was taught and knows how to perform exercises for dad herself. This came as a real shock to my parents and it seems inhumane to me. Is this typical or is this something new? Do my parents have any recourse? Thanks for your help!

A. I am sorry to hear about your difficult situation. Unfortunately, what you have described is very difficult, and there are also changes to Medicare that took effect at the beginning of this year that could have an even more negative affect on many people who are receiving therapy in the home after post-hospital nursing home rehabilitation stay or after a hospitalization for those who go directly to home for rehab/therapy.

Home health agencies that offer therapy/rehab services such as physical therapy, occupational therapy, and speech therapy are grappling with significant changes in how Medicare pays for services. Patient-Driven Groupings Model (PDGM), which was implemented last month, is the most significant change to Medicare’s payment methodology for in-home therapy/rehab services in the last 20 years and it’s affecting many providers and patients, similar to your father.

Two years ago, about 12,000 home care agencies that offer limited therapy/rehab services (most of them for-profit) provided care to 3.4 million Medicare beneficiaries. With Medicare’s new PDGM, that number will be significantly lower this year and in years to come.

How PDGM Changes Things

In the past, Medicare’s in-home therapy/rehab rates reflected the amount of therapy delivered. In other words, more visits meant higher payments. Here’s how PDGM has changed things:

• What payments are based on has changed: Payments are now based on a patient’s underlying diagnosis, the presence of other complicating medical conditions, the extent to which the patient is impaired, whether he or she is referred for services after a hospitalization or a stay in a rehabilitation center and the timing of services (payments are higher for the first 30 days after discharge from a nursing home or a hospital);

• There are fewer incentives to serve patients who need extensive physical, occupational and speech therapy;

• Patients who need assistance for complex conditions, such as post-surgical wounds, are attractive to agencies;

• Occupational therapists and assistants are being laid off, asked to decrease the number of visits to clients and directed to provide services for less than 30 days;

• Agencies are responding by cutting physical, occupational, and speech therapy for patients. They are firing therapists. And they are suggesting that Medicare no longer covers certain services and terminating services altogether for some longtime, severely ill patients.

Patients on Observation Status Should Especially Take Heed

Hospitals often do not admit some patients, but rather place them on observation status to determine whether they should be admitted. These patients, if not admitted to the hospital for at least three nights, are not covered and will likely get a hefty bill in the mail for their care. Nor are they eligible for Medicare reimbursement of a limited amount of skilled nursing care following their hospital stay.

An agency that provides limited in-home therapy/rehab for a patient who was in the hospital under observation will be reimbursed as if the patient had been an outpatient. This lower reimbursement rate means that such agencies may be reluctant to provide care for patients who were under observation status or who haven’t been in a hospital at all.

As I have explained in previous articles on the subject, it is important to learn whether you are admitted or under observation. Hospitals are required to provide notice to patients if they are under observation for more than 24 hours. For more details on observation status, please read my blog articles here.

Advocates and the Centers for Medicare & Medicaid Services (CMS) Speak Up on Changes

According to William Dombi, president of the National Association for Home Care and Hospice, believes that “(t)hese cuts may not be a good move medically. Patients might deteriorate without therapy and end up in the emergency room or the hospital.”

A spokesman for CMS said the federal agency is monitoring the implementation of the PDGM, including therapy service provision, at the national, regional, state, and agency level. He said, “(w)e do not expect home health agencies to under-supply care or services; reduce the number of visits in response to payment; or inappropriately discharge a patient receiving Medicare home health services as these would be violations of [Medicare] conditions of participation.” Yet that seems to be what is happening already.

For more information about the new rule, click here.

Appealing Medicare’s Decision

If you are in the Original Medicare Plan, you can file an appeal if you think Medicare should have paid for, or did not pay enough for, an item or service you received. If you file an appeal, ask your doctor or provider for any information related to the bill that might help your case. Your appeal rights are on the back of the Medicare Summary Notice that is mailed to you. The notice will also tell you why your bill wasn’t paid and what appeal steps you can take.

You also have the right to a fast appeal if you think your Medicare-covered services are ending too soon. This includes services you get from a hospital, skilled nursing facility, home health agency, or outpatient rehabilitation facility.

Your provider will give you a written notice before your services end that tells you how to ask for a fast appeal. If you’re not given this notice, ask for it.

For more details on how to file an appeal, please click here.

Plan Now for Long-Term Care

Please note that Medicare has never covered personal care aides that assist people in their homes with Activities of Daily Living (ADLs), such as toileting, bathing, dressing etc., so the changes described are just about in-home therapy/rehab services.

If you have a loved one who needs more help than can be provided in the home, such as assistance with ADLs, it may be time to consider long-term care options. Planning in advance is especially important, since long-term care costs $12,000 – $14,000 a month in the Metro DC area.

To protect your family’s assets from these high costs, the best time to create your own long-term care strategy is now. Generally, the earlier someone plans for long-term care needs, the better. But it is never too late to begin the process of Long-term Care Planning, also called Lifecare Planning and Medicaid Asset Protection Planning.

If you have a family member nearing the need for long-term care or already getting long-term care or if you have not done Long-Term Care Planning, please call us as soon as possible to make an appointment for an initial consultation:

Elder Law Fairfax: 703-691-1888
Elder Law Fredericksburg: 540-479-1435
Elder Law Rockville: 301-519-8041
Elder Law DC: 202-587-2797