Home health industry members urged Congress on Monday to abandon a proposal to make Medicare patients cover part of their home health service costs and instead target fraudulent billing among a few outlaw agencies.
Requiring Medicare recipients to pay $300 per episode of care, or around $18 per home visit, would reduce the use of home health services and Medicare spending by $40 billion over 10 years, according to the Congressional Budget Office.
“Sixty percent of those are people living in poverty, below poverty. It means that most of those folks won’t have the benefit of home health. They’ll end up in hospitals. They’ll die a lot sooner and families will have to be without the ones they love a lot sooner,” said Billy Tauzin, a former Louisiana Congressman and now senior adviser to the home health industry.
Tauzin and U.S. Rep. Bill Cassidy, R-Baton Rouge, were among the speakers at an home health- and hospice-care industry event.
Tauzin said a better solution would be to pass legislation that cleans up the fraud being committed by a few members of the home health industry.
An industry-commissioned study found that a handful of states account for 97 percent of the fraudulent activity and abuse of Medicare, Tauzin said. Two counties, Miami-Dade in Florida and Hidalgo in Texas, account for half.
The abuses involve abnormally high numbers of high-cost patients, who typically make up a small percentage of those treated, he said. Rooting out those agencies would save the same amount of money as the $150 co-pay the Medicare Payment Advisory Commission supports, without penalizing poor seniors, he said.
The commission has recommended a $150 co-pay per episode of care. An episode of care involves around 17 home visits at $9 per visit. The co-pay would cut Medicare spending by around $20 billion over 10 years.
Bill Borne, chief executive officer of Baton Rouge-based Amedisys, one of the country’s largest home health companies, said these patients, known as “outliers,” make up 4.5 percent of home health patients industry-wide.
At Amedisys, outliers are around 1.5 percent of the company’s daily patient census,
Borne said. But in Miami-Dade, 55 percent to 60 percent of those receiving home health services are considered high-cost patients.
Borne said although a co-pay of $150 or $300 doesn’t sound like much, it works out to 5 percent to 12 percent of the income for elderly people living at or below poverty level.
And those are the patients whose access to care should not be limited, Borne said.
“That same patient will show up in the emergency room and be hospitalized for three or four days, and ultimately cost the system more money,” Borne said.
Cassidy said he learned the value of the home health industry, and about the patients who use the service, during 20 years of practice at Earl K. Long Medical Center.
Home health will play an important role in reducing the cost of Medicare, which could be bankrupt in 13 to 14 years, he said. Every 13 seconds another person qualifies for Medicare, and the weight of that rapidly aging population is putting enormous pressure on the program.
Having those patients treated at home, where the cost per day is about 40 percent of the cost for a nursing home and less than a tenth of a hospital is a much more cost-effective solution, Cassidy said.
The Medicare Payment Advisory Commission found that changes are needed in the home health payment system.
The lack of cost-sharing in Medicare is unusual because most of the program’s benefits require patients to cover part of the cost, according to the commission. Making patients share the costs of home health visits would make patients more likely to consider whether services are necessary.
The commission also found that the home health industry rapidly adapts to whatever changes Medicare makes in its payment system. When Medicare added incentives for additional visits, the number of visits increased dramatically.
Amedisys and Lafayette-based LHC Group Inc. are among the publicly traded home health firms under investigation by federal agencies for Medicare billing practices. A Wall Street Journal analysis raised questions about whether home health companies boosted patient visits unnecessarily in order to trigger thousands in bonus payments from Medicare.
Amedisys and LHC officials have said they expect to be cleared.
Borne said Monday the bottom line is that abuse is an industry issue, not an Amedisys issue.
The study found “small pockets of extraordinary abuse,” Borne said. A surgical approach to remove that abuse through legislation would prevent others from being harmed.