Obama’s 2014 Budget May Spell Changes for Home Health Providers

The home health care industry could experience some changes in 2014 such as Medicare copayments for new beneficiaries or increased fraud prevention measures for agencies receiving federal reimbursements.

Some aspects of President Obama’s 2013 budget pertaining to home health care will likely remain for next year’s budget, expected to be released on April 10, according to the Medicare Newsgroup.

If the White House’s 2014 budget is similar to the previous year’s budget, its Medicare-related measures will stay focused on containing costs and reducing fraud and waste, says the article.

The president’s fiscal 2013 budget included measures that would introduce copayments for new Medicare beneficiaries receiving home health care starting in 2017. Implementing copayments would have pros and cons, according to supporters and detractors of the concept.

The budget cited research indicating that beneficiaries with Medigap plans providing first dollar or near-first dollar coverage “have less incentive to consider the costs of health care services, thus raising Medicare costs and Part B premiums for all beneficiaries.”

While requiring Medicare beneficiaries to pay part of the costs of their home healthcare could alleviate program costs, it could also end up costing Medicare more in the long run, according to an analysis by the Partnership for Quality Home Healthcare with Avalere Health.

In many cases, it’s cheaper for beneficiaries to receive at-home care as opposed to getting skilled nursing or rehabilitation care in an institutional setting, the analysis pointed out. If they were to instead seek institutionalized care because a Medicare copayment made home health care unaffordable on top of existing housing and basic living expenses, Medicare would end up paying for much of that care in a much more expensive setting.

“A co-payment could lead some low-income beneficiaries to forego needed home health services and end up in an institutional setting as a result, where the cost to Medicare and taxpayers would be higher,” the Partnership for Quality Home Healthcare said of the December 2012 analysis.

Another budgetary measure expected to carry over from fiscal year 2013 to 2014 is the President’s call for Medicaid to be a “last resort payer.”

Medicaid  may continue efforts to reduce fraudulent reimbursement claims, says the Medicare Newsgroup, by rescreening 1.5 million home health agencies, medical equipment suppliers, doctors, hospitals and other providers for potential fraud.

Ed. note: A previous version of this article indicated that Medicaid may rescreen 1.5 million home health agencies, rather than 1.5 million various health care providers, including home health agencies.

Written by Alyssa Gerace

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