CMA ALERT, DECEMBER 12, 2010
The Centers for Medicare & Medicaid Services (CMS) issued new regulations on November 17th regarding coverage for home health services. The new regulations clarify Medicare coverage for home health services, including physical therapy, occupational therapy and speech-language pathology services. The regulations are effective January 1, 2011; however, since they clarify rather than change coverage rules, they are also applicable to services prior to that time.
Most importantly for people with long-term conditions, the new regulations "clarify" that skilled care does include services that are intended to maintain a person's condition and that no "rules of thumb" should be used to deny care – including rules that require restoration potential.  The regulations state:
"Rules of thumb" in the Medicare medical review process are prohibited. … Any "rules of thumb" that would declare a claim not covered solely on the basis of elements, such as lack of restoration potential, … or degree of stability, is [sic] unacceptable without individual review of all pertinent facts.
To determine whether a service is skilled, and therefore coverable, the new regulations direct decision-makers to review accepted standards of clinical practice and to consider whether a professional is needed for the service to be safe and effective for the particular beneficiary. These considerations, rather than the ability to improve, are the key factors to be considered in making coverage determinations. The rules state that they do not alter coverage, but rather provide additional detail for care planning, assessment, and reassessment. They should help advocates in their efforts to ensure that necessary services are covered, particularly for people with chronic conditions.
To successfully use the new rules to help obtain Medicare coverage, it will be important for advocates to forge alliances with their clients' care providers to make sure that care plans are comprehensive, well-documented, and reflect the specific needs and therapeutic goals of the individual. In this respect, the care plan can be an advocacy tool as well as a necessary treatment guide.
Improvement Not Required for Home Health Therapy
One of the most important aspects of the revised home health coverage regulations includes a more detailed explanation clarifying when Medicare covers establishment or performance of therapy in the context of a maintenance program. The regulation states:
The unique clinical condition of a patient may require the specialized skills of a qualified therapist to perform a safe and effective maintenance program required in connection with the patient's specific illness or injury. When the clinical condition of the patient is such that the complexity of the therapy services required to maintain function involve the use of complex and sophisticated therapy procedures…by the therapist… or the clinical condition of the patient is such that the complexity of the therapy services required to maintain function must be delivered by the therapist… to ensure the patient's safety and to provide an effective maintenance program, then those reasonable and necessary services shall be covered. (emphasis added)
In response to the many comments from advocacy organizations, CMS eliminated many references to the requirements of "improvement" or "progress" that were initially proposed in the therapy coverage regulations. CMS acknowledged that while progress might be an indication of effective therapy, it was not the sole evidence that therapy was necessary. Instead the coverage criteria needed to focus on the inherent complexity of the therapy services needed by the patient. As a result, several references in the text to improvement in function and progress were replaced in the final version with references to effectiveness of treatment. The regulations now clearly state that skilled, Medicare-coverable therapy does not require progress or improvement. In addition, in the places where the regulations retain the requirement that progress be made (for other forms of non-maintenance therapy), specific exceptions exist if the therapy meets the definition for maintenance.
Finally the regulations now specifically recognize that therapy for a maintenance program is reasonable and necessary and covered by Medicare. The preamble states:
Regarding the comment that the proposed regulation does not define "reasonable and necessary" in a way that clearly provides for coverage of maintenance therapy,…[i]n these revisions we describe that therapy can be considered reasonable and necessary when the criteria for maintenance therapy are met.
The final version of the regulations clearly acknowledges that a therapy maintenance program may be reasonable and necessary without regard to progress:
The amount, frequency, and duration of the services must be reasonable and necessary….
(B) …If progress cannot be measured, …therapy services cease to be covered except when…
[m]aintenance therapy is needed. (emphasis added)
The final version of 42 CFR §409.44(c) contains additional language indicating when Medicare will cover therapy for beneficiaries with chronic and long term conditions.
Care Plan Requirement
For therapy services to be covered, the patient's clinical record must contain a plan of care established by a qualified therapist, in conjunction with the physician, which describes a course of therapy treatment and goals that are consistent with the patient's functional evaluation. Documentation in the clinical record must describe the goals of the treatment plan, be measurable, and demonstrate that the method used to assess the patient's function, including activities of daily living (ADLs), is in accordance with acceptable practice standards.
Assessment and Reassessment
The regulations require more frequent assessments and reassessments of therapy treatment plans. An initial functional assessment must be made by a qualified therapist (instead of an assistant), and periodically reassessed at least every 30 days. If more than one therapy discipline is involved, a qualified therapist from each discipline must provide separate assessments and (reassessments on a 30 day basis). Additional assessments by a qualified therapist are required if therapy visits are expected to be extended to 13 or 19 visits. Subsequent therapy visits will not be covered until the qualified therapist has completed the reassessment and objective measurement of the effectiveness of the therapy as it relates to the therapy goals.
The new home health clarifying regulations are much better than initially proposed. The final regulations should be helpful to advocates in their efforts to ensure that necessary Medicare-covered home health services are initiated and continued. The Center for Medicare Advocacy and other beneficiary advocates and organizations were very involved in efforts to obtain these clarifications. We are grateful to CMS for the important edits that were made to the final regulations.
For further discussion, please contact executive director Judith Stein (jstein @ medicareadvocacy.org) or associate director Margaret Murphy (mmurphy @ medicareadvocacy.org) in the Center for Medicare Advocacy's Connecticut office at (860) 456-7790.
75 Fed. Reg. 70461 (Nov. 17, 2010), amending 42 C.F. R. §409.44(c), effective January 1, 2011
 42 CFR §409.44(c)(2)(iii)(C); 75 FR 70395 (Nov. 17, 2010)
 75 CFR 70395 (Nov. 17, 2010)
 75 Fed. Reg. 70394
 75 Fed. Reg. 70393
 75 Fed. Reg. 70394
 75 Fed. Reg. 70395
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With the passage by both Houses of Congress of the Medicare and Medicaid Extenders Act of 2010, HR 4994, a number of provisions set to expire at the end of 2010 will continue through the end of 2011.
1. Medicare Physician Payments
The Act's extension of current Medicare payment rates to physicians through 2011 received the most attention in the media. Without the extension, physicians would have experienced a 25% reduction in their payments on January 1, 2011. The scheduled reduction in physician payment rates is based on a formula, the sustainable growth rate or SGR, that was enacted as part of the Balanced Budget Act of 1997. Congress has enacted delays to its implementation since 2003.
2. Other provisions that were extended through 2011 in the Extenders Act
The Qualified Individual (QI) program, which pays the Part B premium for individuals with incomes between 120% and 135% of the federal poverty level. If QI had not been extended, individuals who lost their QI benefits would have had to pay the standard Part B premium of $115.40 starting in January.
The Medicare Therapy Cap Exception Process, which allows beneficiaries and providers to seek coverage for medically necessary outpatient therapy services provided by non-hospital providers once the annual payment level is reached.
Transitional Medical Assistance (TMA), which enables low-income families who become employed to maintain their Medicaid during the transition process.
3. Clarifications to Provisions Enacted as Part of the Affordable Care Act (ACA)
Clarifying that revisions to the prospective payment system for skilled nursing facilities, which were published in the Federal Register on August 11, 2010 (74 Fed. Reg. 40288) and are known as RUGs-IV, are fully implemented, effective October 1, 2010. The ACA had delayed implementation of RUGs-IV from October 1, 2010 to October 1, 2011, except for changes to concurrent therapy and the look-back period. See our Alert, "Health Reform: The Nursing Home Provisions," https://www.medicareadvocacy.org/InfoByTopic/Reform/10_06.17.SNFProvisions.htm.
Clarifying that the effective date of the provision concerning a 12-month Part B special enrollment period (SEP) for disabled Medicare beneficiaries who are also eligible for TRICARE is March 23, 2010, the date of enactment of the ACA.
The Extenders Act was sent to President Obama for his signature on December 10, 2010. The President is expected to sign the Act.
 Balanced Budget Act of 1997 (BBA), Pub. L. 105-33 (Aug. 5, 1997), amending 42 U.S.C. § 1395w-4(f).
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"Choosers" are those beneficiaries who are eligible for the Part D low-income subsidy (LIS) and are in drug plans that they chose for themselves rather than a benchmark plan assigned by CMS. The CMS letter, titled "Corrected Information About Your Medicare Drug Plan Costs", which comes on tan paper, was mailed between 12/15/10 and 12/17/10 to approximately 246,000 beneficiaries nationwide. This notice corrects errors that were discovered in the initial notice some choosers received last month. You can view the corrected letter at: www.medicareadvocacy.org\InfoByTopic\PartDandPrescDrugs\10_12.16.ChoosersCorrection_2010.pdf
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REMINDER: Your clients can spend the Holidays with their families at home. See our Alert, "You Can Leave the Nursing Home!"
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