| DEPARTMENT OF HEALTH & HUMAN SERVICES | Health Care Financing Administration |
| Washington D.C. 20201 |
To All Home Health Agencies Serving Medicare:
The Balanced
Budget Act of 1997 enacted several Medicare payment reforms intended to ensure
that enrollees get the care they need and that Medicare is billed correctly. I
am alarmed by reports that some homebound Medicare enrollees are being
frightened by inaccurate information about changes in coverage, and that some
HHAs may be terminating care for Medicare enrollees and blaming the payment
reforms. This letter provides clarification of reforms in home health payment
to help you inform and care for Medicare enrollees appropriately.
The Secretary of Health and Human Services is required to establish an interim payment system while a prospective payment system is developed. This interim system establishes two types of payment caps: one is a revised routine cost cap per visit, and one is an aggregate cap based an either the average cost per beneficiary at each home health agency (HHA) and the region in which it is located or the median of aggregate limits applied to other HHAs. HHAs will be paid the lesser of 1) their actual costs, as before; 2) the per visit cap; or 3) the aggregate cap.
The new aggregate cap reflects the typical utilization of home health services for each HHA during the FY 1994 base period established by Congress. It allows HHAs to balance the cost of caring for any one patient against the cost of caring for all patients. We believe All Medicare enrollees can be safely and effectively cared for under this payment system by HHAs that deliver quality care efficiently.
The Balanced Budget Act also makes clear that the need for venipuncture alone does not qualify a homebound Medicare enrollee for other home health services. Beginning February 5, 1998, homebound patients who need blood drawn but who do not qualify for home health services will be entitled to venipuncture services provided by laboratory technicians under Medicare's laboratory benefit. Homebound Medicare enrollees who need blood drawn and who also qualify for other home health services can continue to have venipuncture services provided by home health agency staff under Medicare's home health benefit.
The Medicare Conditions of Participation require HHAs to provide accurate information to their patients about Medicare coverage and payment. Medicare enrollees must be informed about what services are and are not covered, and they have a right to participate in care planning. HHAs are not free to reduce the amount of care ordered for patients by physicians.
HHAs In Medicare are not allowed to discriminate against Medicare enrollees. If an HHA accepts non-Medicare enrollees at a given level of severity, it must also accept Medicare enrollees at similar levels of severity. HHAs that provide services to non-Medicare patients while refusing services to similarly situated Medicare patients risk having their provider agreements terminated and being barred from billing Medicare.
Any reports of HHAs misinforming beneficiaries or inappropriately terminating care for Medicare enrollees will be considered the basis for a complaint survey that could lead to termination of the HHA from Medicare.
I know you share our concerns on this issue, and I want to thank you for your continued efforts in trying to provide Medicare enrollees with the best care possible in the most efficient manner possible. I look forward to working with you on this and other important home health issues.
Sincerely,
Nancy-Ann Min DeParle
Administrator
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last revised March 8 2000