INTRODUCTION

Medicare's recently adopted Home Health Advance Beneficiary Notices (HHABNs) have come under fire from Home Health Agencies (HHAs). The notice requirement, contained in a Health Care Financing Administration (HCFA) Program Memorandum, effective March 1, 2001, embodies important beneficiary protections and should be retained. 

BACKGROUND AND HISTORY

HHABNs make the text of the notice mandatory. They create no new rights.

Beneficiary notices are not new to the Medicare home health system. Since 1975, federal regulations have required Medicare providers to issue written notices to beneficiaries when they believe Medicare coverage for services they are providing or will provide will not be available. The only change as of March 1, 2001 is to mandate the precise language of the HHABNs.

Since September 1999, HCFA has worked with home health agencies to develop mandated HHABN language and format. It has issued and withdrawn proposed notices several times, always soliciting public comment and Office of Management and Budget (OMB) approval through the Paperwork Reduction Act (PRA) process. OMB approved the notices on December 1, 2000.

HHABNs help beneficiaries.

In order to get the health care they need, beneficiaries must have accurate, informative and understandable notices from providers when Medicare services are denied, reduced or terminated. HHABNs establish a uniform standard for beneficiary notices. In the past, home health beneficiaries have not always been provided the notices to which they are entitled. When provided, many notices have not contained accurate information, either about the basis for the denial, reduction or termination of services or about appeal rights.

THE HHABN NOTICE REQUIREMENT

Each HHA must provide Medicare home health beneficiaries with an HHABN when it advises a beneficiary that it:

• Will not accept the beneficiary as a Medicare patient because Medicare will not pay for the services;

• Proposes to reduce a beneficiary's home health services because it expects that Medicare will not pay for the current level of or frequency of care; or

• Proposes to stop furnishing all home health services to a beneficiary because it expects that Medicare will not continue to pay for the services.
  

HHABNS AND THE PROSPECTIVE PAYMENT SYSTEM (PPS)

PPS does not change the home health notice requirement.

PPS does not change a beneficiary's right, if the beneficiary disagrees with the HHA's opinion, to have an official Medicare determination of his or her right to Medicare covered home health services. If a beneficiary desires to continue services after receipt of an HHABN and is willing to pay for those services, the beneficiary is entitled to have the HHA submit a demand bill to the Medicare program for consideration of coverage and payment. Under PPS, the demand bill (and any supporting documentation) is submitted to Medicare by the HHA at the end of the 60-day period defining an episode of care as provided under PPS.

HHABNS AND PERSONS DUALLY ELIGIBLE FOR MEDICARE AND MEDICAID

Like all other Medicare beneficiaries, persons eligible for both Medicare and Medicaid are entitled to notice that comports with constitutional due process when services are denied, reduced, or terminated. The right to notice is not altered by the Medicare HHABN, PPS, or the person's dual eligibility status.

While Medicaid payment for home health services for persons dually eligible for Medicare and Medicaid is generally predicated on a showing that payment is not available under Medicare, individual states approach the triggering of Medicaid payment differently. The HHABN notice process does not change state Medicaid law, policy, or regulation with respect to access to Medicaid payment. The HHABN notice process is a creature of the Medicare program. It does not regulate Medicaid policy. Every Medicare beneficiary, regardless of entitlement to Medicaid, is entitled to an HHABN in the appropriate circumstances.

HCFA (CMS) DEVELOPS NEW MEDICARE NOTICE FOR HOME HEALTH BENEFICIARIES

 On August 5, 1999, Secretary Shalala issued a new Program Memorandum for all Regional Home Health Intermediaries (RHHIs) throughout the country. The Program Memorandum includes a set of new model notices which home health agencies must provide to certain Medicare beneficiaries. The Program Memorandum and Notices were included in the Secretary's Memorandum in Opposition to Plaintiffs' Motion for Summary Judgment in Healey v. Shalala, Civil No. 3:98CV00418(DJS), (D. Conn., filed March 4, 1998). (In Healey, plaintiffs are suing for declaratory and injunctive relief, alleging that the Secretary does not provide Medicare home health beneficiaries with timely and appropriate notices when home health services are denied, reduced, or terminated by home health agencies (HHAs). Plaintiff's also request review before services are reduced or terminated. Plaintiffs are represented by the Center for Medicare Advocacy, the National Senior Citizens Law Center, and other Medicare beneficiary attorneys.)

The new Program Memorandum and the accompanying Home Health Agency Beneficiary Notices (HHABNs) include detailed instructions to the Regional Home Health Intermediaries (RHHIs) that must be followed by home health agencies when they wish to deny, reduce, or terminate Medicare covered home health care services. The development of these new notice requirements, and of the HHABNs, are an outgrowth of Healey settlement negotiations that were terminated before completion. While this is an important step forward in providing proper notice to Medicare home health beneficiaries, many issues still need to be resolved.

The new notice requirements and HHABNs were sent to RHHIs on August 2, 1999. Program Memorandum, Transmittal Number A-99-37 (August 1999). The model notices and the instructions on their use become effective on September 30, 1999. The model notice instructions replace the current notice instructions found in '3730.2, of the Medicare Intermediary Manual, (MIM)(Pub.13) and in '270 of the Home Health Agency Manual, (HHAM)(Pub. 11). The Secretary states that the new notices are to be used by providers ... "as required by MIM, Part 3, '3440, Establishing When Beneficiary Is On Notice Of Non-coverage."

Highlights of the Program Memorandum include:

• If an HHA expects that Medicare will deny payment, the beneficiary must be advised of this before services are initiated or continued;

• HHABNs must be provided when the HHA expects Medicare to deny care on the basis that it is "not medically necessary and reasonable," custodial, or that the beneficiary is not homebound, or does not require part-time or intermittent services;

• HHAs can not accept a beneficiary as a private pay patient without first providing an HHABN and the necessary follow-up;

• HHABNs must identify the specific home health services that are being denied, reduced, or terminated;

• HHABNs are to be hand-delivered where possible, and if not possible the notice being sent by mail to the beneficiary or person acting on his or her behalf;

• Telephone notice is permissible, but will not constitute evidence of proper notice for purposes of the HHA's waiver of liability protections;

• HHAs must provide beneficiaries with assistance in understanding HHABNs and in completing the HHABN process;

• HHAs must timely effectuate the beneficiary's choice with respect to the option of terminating services, or paying for the continuation of services and having a demand bill submitted to Medicare for initial determination;

• With respect to demand bills, Regional Home Health Intermediaries (RHHIs) must not assume that the services that are at issue are to be denied Medicare coverage solely on the basis of the HHAs decision, but rather must provide a genuine initial determination decision.

The HHABNs must be provided by HHAs in any case where a reduction or termination of services is to occur, or where services are to be denied before being initiated, except "in any case in which a physician concurs in the reduction, termination, or denial of services." This is a worrisome exception.

Currently, HHAs often fail to notify physicians before making the initial decision to deny, reduce, or terminate services. Further, physicians are often not fully aware of their role and authority in the process of obtaining home health services, and many are afraid of being accused of fraud. They tend to go along with the HHA's decision without question. Moreover, it is important that the beneficiary receive notice in any event so that she can assert a right to a review of the the physician=s alleged concurrence. As written, the HHAs' assertion that the physician concurs with the reduction or termination of services would negate the beneficiary's entitlement to notice about appeal rights.

A number of enforcement issues are also raised by the new notice rules. The Program Memorandum states that failure to provide HHABNs could affect a HHA's limitation on liability status (see Medicare Intermediary Manual, (MIM) '3446). It also states that the failure to provide HHABNs is a violation of the HHA Conditions of Participation (COP), (42 CFR 480.10) and can lead to sanctions, including contract termination. The reality is that enforcement of these provisions has been minimal at best. Moreover, the Secretary's capacity to provide appropriate monitoring of compliance with the COP is not established.

There are three different model HHABNs. HHABN-1 is to be used when all services are to be terminated. HHABN-2 is to be used when the HHA believes Medicare will not pay, even before services are started. HHABN-3 is to be used where on-going home health services are to be reduced. Each HHABN has a "return page@ on which the beneficiary is to check one of two boxes, AA@ or AB,@ indicating either that they agree to the termination, reduction, or denial of care, or that they wish to pay for the services at issue and have the HHA submit a demand bill to the RHHI for an initial Medicare decision. (It would be useful to have a third option allowing the beneficiary to state that he or she would like the services continued, but can not afford to pay for the services pending an initial Medicare decision.)

As to the form and layout of the HHABNs, they are "busy" and contain a lot of text and options that may be difficult to read and comprehend. In addition, the Secretary uses a range of clip art (pointing hands, telephone symbols, boxes, etc), the result of "focus testing," in an effort to draw attention to certain information and options. Advocates will want to evaluate how well this promotes beneficiary understanding and use of notice options.

Advocates should monitor the unfolding of these important notice issues.