Lawmakers Propose to Cap Medicare Home Health Episodes

Lawmakers aim to limit Medicare payments for home health agencies that have, on, average, a higher number of episodes of care, according to a recently proposed bill from the House Energy and Commerce Committee.

The bill, H.R. 3245, was introduced by Congressmen Brett Guthrie (R-KY) and Jim Matheson (D-UT), who both serve on the Committee, which also shares jurisdiction over Medicare Part B with the House Ways and Means Committee.

Advocacy groups, such as the National Association for Home Care & Hospice (NAHC), believe that the proposed bill intends to be a program integrity measure designed to control fraud, waste and abuse, however, do not see the legislation as a fitting solution.

“An episode cap runs a risk of imposing a barrier to care for chronically ill Medicare beneficiaries who are entitled to unlimited episodes of covered care,” said a recent NAHC Report.

Home health agencies that end up having an imbalance of such patients risk hitting the cap, as their episode average rises to accommodate care for these individuals.

The cap may even trigger a complete change in the Medicare benefit, NAHC adds, as “safe” patients are limited to those who need only short term care.

“An episode cap would push the benefit to short term care without actually revising the benefit itself,” said NAHC. “No business can provide care without reimbursement.”

The national home care advocacy group also likened the proposal’s attempts to quell Medicare fraud and abuse in the home health industry to a “nuclear option” that should be used as a last measure.

“An episode cap is a ‘nuclear option’ at best, to be considered only after all other oversight and enforcement measures have failed,” said NAHC. “At this point there is no proof that anything is wrong let alone that targeted corrective measures have failed.”

In 2010, NAHC advocated for a 10% cap on outlier revenues in the Medicare home health benefit. As a result, evidence showed that 60% of outlier claims came from one metropolitan area, suggesting that some areas may require greater scrutiny than others when it comes to fraudulent practices.

“The [home health agencies] that would be affected by an episode of cap are all over the country, albeit in some areas more concentrated than others,” said NAHC. “This concentration warrants a review, not the premature use of the nuclear option.”

Written by Jason Oliva

Jason Oliva