The state’s home health care agencies suffering the unintended consequences of Medicare reforms in last year’s Balanced Budget Act are getting closer to receiving modest financial relief.
A bill that cleared the U.S. House of Representatives Oct. 9 would bring $2 million to Rhode Island home health care agencies that say they’ve lost between $18 million to $20 million in Medicare reimbursements. The organizations point a collective finger at the new law saying it penalized the most frugal among them. The new bill, entitled The Medicare Home Health Care Interim Payment System Retirement Act of 1998, passed during a mark up of this year’s budget resolution, doesn’t do as much as U.S. Representatives Bob Weygand, D-RI, and Jim McGovern, D-Mass., had hoped for last winter when they introduced it. And its outcome was still uncertain at presstime since it still had not been fused with a corresponding measure in the Senate before it could be sent to President Clinton for his signature. Nor does it bear the names of Weygand and McGovern. (The sponsors, Reps. Bill Thomas of California and Bill Archer of Texas, run the committees that produced the bill.) Still Weygand was pleased by what he did accomplish.
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“With the way this week has been, this gives a little bit of satisfaction,” Weygand said on the phone from Washington, D.C. where he cast his vote for a Republican-led inquiry into the possible impeachment of President Clinton the day before. “It’s been a long haul. Jim and I have been working very hard on this for the past 18 months.”
Organizations like the VNS of Pawtucket, Central Falls, Lincoln and Cumberland, which closed last May, “won’t reopen, as its clients have been absorbed by other agencies,” he said. “But it’s raised the threshold for the ones who were getting reimbursed the least.”
The changes in Medicare reimbursement rates were part of the Balanced Budget Act of 1997. That bill cut $115 billion from the federal insurance program for the elderly over five years, including $16.2 billion in home-care payments. The new reimbursement system is based on 1993-1994 levels, less 2 percent, regardless of whether a home-health agency’s budget was low or inflated that year.
The so-called Interim Payment System, or IPS, was intended to last through next October. After that, Congress wants the Health Care Financing Administration, which oversees Medicare, to switch to a “prospective payment system” that would pay a flat rate by diagnosis — much like the one it uses to pay hospitals. The change didn’t happen immediately because HCFA said it needed time to develop a payment formula.
On Weygand’s wish list for the 106th Congress are the elimination of an extra 15-percent cut to home health care funds if the new payment system isn’t implemented by October 1999, retroactive reimbursements for agencies that have suffered under the current cuts and what he called an “outlyer policy” for the sickest of Medicare recipients.
Paula Parker, executive director of the Rhode Island Partnership for Home Care, said she is hoping the final version will do more to “level the playing field.”
For low-cost agencies, the House bill “may mean only an increase of a couple of hundred” (dollars) per patient,” she said. “And that isn’t going to make much of a difference in terms of their fate.”
Parker said she’s also worried that new agencies will be discouraged from opening and that the additional 15-percent cut in funding will happen since HCFA “has already indicated it won’t meet its deadline for a new prospective payment system.”
Any further reduction “would be another catastrophic event for home health providers,” she said.
