Medicare's quiet 'sea change' on therapy for the elderly

Agency was not required to alert beneficiaries

Medicare has "quietly" expanded its coverage policy to pay for physical therapy, nursing care, and other services that aim to prevent the decline of patients with chronic conditions like multiple sclerosis, Parkinson's, or Alzheimer's disease—even if they show no signs of improvement.

In January, Medicare officials updated the agency's policy manual to remove any indication that improvement is necessary to receive payment for skilled care. "Coverage depends not on the beneficiary's restoration potential, but on whether skilled care is necessary," the policy states.

The revisions were part of a settlement to a class-action lawsuit filed in 2011 against HHS on behalf of four Medicare patients and five national advocacy groups, including the National Multiple Sclerosis Society, Parkinson's Action Network, and the Alzheimer's Association. The policy applies to treatment from skilled professionals for physical, occupation, or speech therapy and home health and nursing home care for traditional Medicare and private Medicare Advantage plans.

"It allows people to remain a little healthier for a longer time and stay a little bit more independent," says Margaret Murphy, associate director at the Center for Medicare Advocacy, which led the class-action suit. The move eases the burden on families who "are scrambling to take care of their loved ones," and allows patients who wish to avoid institutional care to remain in their homes longer, she added.

Though coverage cannot be denied for lack of improvement or stalled progression, it can still be denied or coverage can be limited for other reasons:

  • To qualify for nursing home coverage, a patient requires a physician's order prescribing skilled nursing home care (not custodial care) and the individual must have been admitted as a hospital inpatient for three consequence midnights (observation stays don't qualify). Limits on the length of Medicare nursing home coverage have not been changed.

  • Doctor-ordered physical, speech, or occupational therapy provided in a nursing home or outpatient facility by a skilled professional is subject to a $1,920 cap. Providers may receive an exemption for medically necessary care for costs up to $3,700 or more, depending on Medicare's review of the medical documentation.

  • To qualify for home health coverage, a doctor must have ordered intermittent care (every few days or weeks) given by a skilled professional for outpatient therapy, social work services, or a visiting nurse. The therapy caps do not apply to home health care as long as the patient is "homebound," meaning they require some form of assistance leaving the house.

80% of Medicare beneficiaries have a chronic condition

Additionally, the settlement establishes a "re-review" process for medical claims that were denied in the last three years solely because the patient wasn't improving or the care was intended to maintain their condition, the New York Times notes.

A quiet 'sea change'

The settlement comes as a relief to providers like Cindy Hasz, who owns a geriatric care management business and has struggled for years to get her clients Medicare coverage for physical therapy. Previously, "It has been standard operating procedure that patients will be discontinued from therapy services because they are not improving," she laments.

Still, Hasz voiced frustration that the changes in policy were not announced in the mail or even in a prominent notice online. According to the Times, Medicare officials were required to inform health care providers, bill processors, auditors, Medicare Advantage plans, the 800-MEDICARE information line and appeals judges, but not beneficiaries themselves. "This is a sea change," Hasz says (Jaffe, Times, 3/25). 

Prioritize chronic care resources across service lines

Although service lines have not traditionally prioritized treatment of chronic disease, much of the legwork for improving care for chronic conditions will fall to these organizational units. Effectively mobilizing service lines to care for patients with chronic conditions will require a deeper understanding of the reach of various conditions across individual service lines. Our Chronic Condition Inpatient Estimator can help you get started.


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