A recent Washington Post article concludes that many nursing homes have been “up-coding” billing for care of residents for years, meaning that some nursing homes sometimes bill a resident more than they should be billed by using a special billing category intended to be used only for the five percent of nursing home patients who need highly specialized care and rehabilition. 

The article quotes Marie-Therese Connolly, who headed the Justice Department’s Elder Justice and Nursing Home Initiative from 1999 to 2007, as stating that “[u]pcoding, billing for services not rendered, and billing for worthless services have been significant problems for years, costing taxpayers many millions, if not billions, of dollars.”

In the Washington area, two nursing homes owned by HCR ManorCare put their residents in the most expensive billing category at nearly five times the national average, according to the Washington Post analysis.  The ManorCare nursing home in Silver Spring, MD put 45 percent of its residents into that category, and the ManorCare facility in Wheaton, MD put 43 percent of its residents into that category.  According to the article, a spokesman for ManorCare denied any improper billing or upcoding, stating that residents are coded into billing categories based on their medical and rehabilitative needs.

According to the Post article, this billing program is specifically targeted in President Obama’s health-care legislation passed last week by Congress, changing two rules that experts said have been exploited by nursing homes to inflate bills.  For a review of how the new health-care legislation affects seniors, see my article Health Reform: Changes in Store for the Elderly. ]]> http://blog.virginiaelderlaw.com/2010/04/survey-shows-some-nursing-homes-may-bill-for-services-not-provided/feed/ 0 http://blog.virginiaelderlaw.com/2010/04/health-reform-changes-in-store-for-the-elderly/ http://blog.virginiaelderlaw.com/2010/04/health-reform-changes-in-store-for-the-elderly/#comments Thu, 08 Apr 2010 19:44:00 +0000 Evan Farr http://blog.virginiaelderlaw.com/?p=511 After a year of legislative wrangling and premature forecasts of death, historic legislation overhauling the nation’s health insurance system passed the Congress and has been signed into law by President Obama.  Among some of the highlights, this legislation contains:  

• The nation’s first publicly funded national long-term care insurance program, the Community Living Assistance Services and Supports (CLASS) Act;  
• A number of provisions aimed at ending Medicaid’s “institutional bias,” which forces elderly and disabled individuals in many states to move to nursing homes;
• Provisions that will help protect nursing home residents and other long-term care recipients from abuses, and give families of nursing home residents more information about the facilities their loved ones are living in or considering moving to. 

Community Living Assistance Services and Supports (CLASS) Act

The reasons for the CLASS Act, according to the U.S. Senate, are as follows:

• Long-term supports and services are not affordable or accessible for millions of Americans.
• An estimated 65 percent of those who are 65 today will spend some time at home in need of long-term care services, at an average cost of $18,000 per year.
• Five million people under age 65 living in the community have long-term care needs and over 70,000 workers with severe disabilities need daily assistance to maintain their jobs and their independence.
• One and a half million Americans are currently in nursing homes today. Roughly 9 million elderly Americans will need help with activities of daily living (ADLs) during the current year, and by 2030 that number will increase to 14 million.
• Many people who need long term services and supports rely on unpaid family and friends to provide that care, but ultimately are forced to impoverish themselves to qualify for Medicaid, which remains the primary payer for these services.

How the CLASS Act Works

• The CLASS Act will provide a lifetime cash benefit that offers people with disabilities some protection against the costs of paying for long term services and supports, and helps them remain in their homes and communities.
• CLASS is a voluntary, self-funded, insurance program with enrollment for people who are currently employed. Affordable premiums will be paid through payroll deductions if an individual’s employer decides to participate in the program. Participation by workers is entirely voluntary.
• Self-employed people or those whose employers do not offer the benefit will also be able to join the CLASS program through a government payment mechanism.
• Individuals qualify to receive benefits when they need help with certain activities of daily living, have paid premiums for five years, and have worked at least three of those five years.
• Once qualified, beneficiaries will receive a lifetime cash benefit based on the degree of impairment, which is expected to average roughly $75 per day.
• These benefits are intended to help maintain independence at home or in the community, and can be used to offset the costs of assistive living and nursing home care.

While helpful for some seniors, this benefit is fairly minimal for those of us living in the Northern Virgina area, as $75 per day won’t go very far.  In the Northern Virgina area, the average cost for home health ranges from around $18 – $22 per hour; for Assisted Living facilities from around $3,500 per month to $7,000 per month; and for Nursing Homes from around $6,000 per month to $10,000 per month.

Help for Medicare Recipients and Early Retirees

Of great interest to many seniors, the new health care law will eventually close the Medicare Part D coverage gap known as the “doughnut hole.” As most seniors know, the Medicare Part D prescription drug program covers medications up to $2,830 a year (in 2010), and then stops until the beneficiary’s out-of-pocket spending reaches $4,550 in the year, when coverage begins again. Many seniors fall into this “doughnut hole” around Labor Day, at which point they have to pay for the medications out of pocket through the end of the year.

The new law starts the process of closing the gap by providing a $250 rebate to Medicare beneficiaries who fall into the doughnut hole in 2010. Then, beginning in 2011 there will be a 50 percent discount on prescription drugs in the gap, and the gap will be closed completely by 2020, with beneficiaries covering only 25 percent of the cost of drugs up until they have spend so much on prescriptions that Medicare’s catastrophic coverage kicks in, at which point copayments drop to 5 percent.

Starting January 1, 2011, Medicare will provide free preventive care: no co-payments and no deductibles for preventive services such as glaucoma screening and diabetes self-management. Also, the legislation increases reimbursements to doctors who provide primary care, increasing access to these services for people with Medicare.

The law provides help for early retirees by creating a temporary re-insurance program that will help offset the costs of expensive health claims for employers that provide health benefits for retirees age 55-64. Scheduled to run from June 21, 2010 through January 1, 2014, the reinsurance program will pay 80 percent of eligible claim expenses incurred between $15,000 and $90,000.

The law calls for an increased Medicare premium for those individuals earning more than $200,000 a year and married couples whose income exceeds $250,000. The law also applies the Medicare payroll tax to net investment income for couples earning more than $250,000 a year or individuals earning more than $200,000 a year.

Most of the cost savings in the law are in the Medicare program, which has made many seniors fearful that their benefits will be cut. The cost-saving measures do not affect the basic Medicare benefits to which all enrollees are entitled, but they may affect those enrolled in private Medicare Advantage plans. Medicare has been paying insurers who offer these plans more than it spends on average for Medicare beneficiaries. The original idea of Medicare Advantage was to save money by paying them less, the idea being that private insurers could be more efficient than the federal government. The opposite turned out to be the case.

Health care reform will pay the private insurers less, meaning that some will choose not to continue their plans and others will curtail extra benefits they offer enrollees, such as reimbursement for gym membership or free eyeglasses. But the cuts will be gradual, with the largest not beginning until 2015. The law also offers bonuses to efficiently run Advantage plans.

Another provision in the law will cut Medicare payment to nursing homes by about $15 billion over the next decade. Although Medicare does not pay for long-term care in nursing homes, Medicare does, in certain limited situations, pay for short-term rehabilitation in nursing homes, and Medicare’s payment to nursing homes for such short-term rehabilitation has been significantly higher what Medicaid pays to nursing homes.

Beware of Scammers

The new law has also created opportunities for scam artists, some of whom are peddling bogus policies through 1-800 numbers and by going door to door, claiming there’s a limited open-enrollment period to buy health insurance, warns secretary of Health and Human Services Kathleen Sebelius. For more on the fraud alert, click here.  

For the full text of the Reconciliation Act of 2010, click here. 

More links:

Health Reform Implementation Timeline

Health Insurance Reform: A Guide for Seniors

Consumers Guide to Health Reform

Democratic Policy Committee Summary & Analysis of the two enactments

The Patient Protection and Affordable Care Act, Section by Section Analysis

Summary of The Health Care and Education Reconciliation Act

When a person with disabilities submits an application for benefits, the SSA normally passes the application through a rigorous five-step process to ensure that the applicant truly needs assistance. The SSA first checks to see if the applicant is working, and then assesses whether the applicant is suffering from a “severe” medical condition. In the third step of the process, the SSA compares the beneficiary’s condition to a list of impairments that normally qualify a person for benefits without further assessment. When a person’s condition matches a condition on the list of impairments, the SSA presumes that the applicant has a disability and typically awards benefits without proceeding through the final two steps.

Unfortunately, most applicants typically have to wait for a long time before arriving at this third step in the evaluation process. Compassionate Allowances speed this process up by defining certain specific conditions that “obviously meet disability standards.” Prior to this month, the SSA included 50 medical conditions on the list of conditions that qualified for a Compassionate Allowance.  As of March 1, 2010, the SSA has now added an additional 38 conditions to the Compassionate Allowances list, greatly expanding the number of people who are eligible for the Compassionate Allowances program.

Although most of the conditions on the revised list are rare, of tremendous importance for the aging population is the fact that the SSA has now included Early-Onset Alzheimer’s Disease, Mixed Dementia, and Primary Progressive Aphasia among the new fast-track conditions, meaning that people who are diagnosed with any of these conditions can now receive disability benefits very quickly. In addition to a monthly disability payment, qualification for SSDI also allows earlier entry to Medicare health insurance benefits for those under age 65.  And for those under age 65 whose conditions are so severe that they must be placed in a nursing home, a disability determination from SSA also speeds up the Medicaid application process.

Please follow the links below to learn more about the Compassionate Allowance program:

Initial List of Compassionate Allowance Conditions

38 New Compassionate Allowance Conditions

Additional information about how compassionate allowances are processed

Statements from Family Members and Individuals with Early-Onset Alzheimer’s Disease

I’m not at all a political pundit, and I have not read the entire Bill, but
I have seen and heard what appears to be a great deal of misinformation out there in the popular press. Here’s a slightly left-of-center article explaining the current status of the Bill and summarizing and rebutting some of the seemingly more outrageous claims that are out there:

MAKING LAW REALLY IS LIKE MAKING SAUSAGE!

Lots of clients have also been asking me whether Obama’s health care reform plan will affect Medicaid. Medicaid is the federal program that pays for approximately 70% of people residing in nursing homes.
It is my understanding that the current Bill does not change the Medicaid long-term care program at all. Long-term care is essentially “custodial care” — it does not fall under the umbrella of health care or under Obama’s new health care reform.

So for now, Medicaid is alive and well. If you have a family member who is in a nursing home or who you think might need to enter a nursing home in the near future, please contact us, as there are dozens of Medicaid Asset Protection strategies that we can use to help clients protect assets and get better long-term care in the process.

A copayment is the portion of a medical provider’s bill that the patient is responsible for. Under the new law, Medicare recipients will eventually pay the same 20 percent copayment for outpatient mental health services that they now pay for other types of medical care. This represents a significant reduction from the 50 percent copayment that patients currently pay for mental health care. The law gradually implements the changes, with the copay dropping to 45 percent in 2011, 40 percent in 2012, 35 percent in 2013 and finally to 20 percent in 2014.

The new law also increases access to certain drugs commonly prescribed for patients with mental illnesses. Specifically, Medicare must begin to offer full coverage for prescriptions of benzodiazepines and barbiturates by 2013. Low-income patients also gain better access to certain kinds of antipsychotic and antidepressant drugs that they may not be able to afford under current pricing plans.

When someone is dying but there really is no hope for recovery, the family often calls 911 and starts a process which can result in great stress and great emotional discomfort. The loved one who is dying ends up in a hospital or nursing home in a strange environment, frightened and confused and tied to tubes and monitoring devices. This is not the ideal way in which to spend one’s last hours on earth.

Attending to a dying loved one in the peace and quiet of the home with caring children and grandchildren surrounding the bed can be a meaningful and spiritual experience for all involved. Hospice can allow this to happen. Memories of a loved one passing in peace can provide great comfort for family members in years to come.

When there is no longer hope for prolonging life, especially when this decision is made months in advance, hospice is a better alternative to other medical intervention.

Hospice is a form of medically supportive care for patients who are terminally ill. It allows for compassion and dignity in the process of dying. A commonly used definition for terminally ill patients is, “patients who have a progressive, incurable illness that will end in death despite good treatment, and who are sick enough that you would not be surprised if they died within six months.”

Hospice care is a valuable service and is generally underused except for terminal cancer patients.  Hospice involves a team approach using the following providers:

-Family caregivers;
-The patient’ s personal physician;
-Hospice physician (or medical director);
-Nurses;
-Home health aides;
-Social workers;
-Clergy or other counselors;
-Trained volunteers; and
-Speech, physical, and occupational therapists, if needed.

The purpose of hospice is the following:

-Managing the patient’s pain and symptoms;
-Assisting the patient and the patient’s family with the emotional, psychosocial, and spiritual aspects of dying;
-Providing needed comfort and palliative medications, medical supplies, and equipment;
-Coaching the family on how to care for the patient;
-Delivering special services such as speech and physical therapy when needed;
-Making short-term inpatient care available when pain or symptoms become too difficult to manage at home, or the caregiver needs respite time; and
-Providing bereavement care and counseling to surviving family and friends.

A person can receive hospice from Medicare if he or she is:

-eligible for Medicare Part A (Hospital Insurance), and
-the doctor and the hospice medical director certify that the person is terminally ill and probably has less than six months to live, and
-the person or a family member signs a statement choosing hospice care instead of routine Medicare covered benefits for the terminal illness, and
-care is received from a Medicare-approved hospice program.

A person may continue to receive regular Medicare benefits from his or her customary doctors for conditions not related to the hospice condition.  

Most families wait too long to have their doctor prescribe hospice from Medicare. Many doctors and families don’t consider this care alternative for Alzheimer’s, degenerative old age, or other debilitating illnesses where a person is going downhill quickly, but they should. If you or a loved one is suffering from such an illness, please discuss the possibility of hospice care with your physician. You can also contact directly one of our area’s local hospice providers, such as Capital Hospice (www.capitalhospice.org ) or Odyssey Health Care (www.odsyhealth.com ).

Over 300 private insurance companies provide Advantage plans funded by Medicare but designed and administered by private companies. They look less like traditional Medicare coverage and more like modern group insurance. Most of these plans also incorporate the new Medicare prescription drug plan into the coverage.

The question for seniors is which plans are better — traditional Medicare or Medicare Advantage? And should a senior on traditional Medicare sign up for a new Advantage plan under open enrollment or go back to traditional Medicare?

Medicare Part A was modeled after traditional hospital insurance plans available in the 1960s. A defined amount of hospital care was provided upfront after an affordable deductible. Any additional care would have to be paid for by the patient. Such plans are easy to design and costs are easy to control since Medicare has a predetermined benefit it will pay. Any costs beyond the predetermined amount are covered by the insured.

One disadvantage to this old design is that increasing hospital medical costs since 1965 have resulted in a dilemma for the insureds. Because of incredibly high room rates, any costs borne by the insured beyond the initial covered hospital stay could be so expensive as to destroy financially the unlucky patient requiring more care. As a result, modern hospital plans, including the new Medicare advantage plans, are designed around catastrophic coverage where the insured covers some of the cost upfront but is spared from financial disaster. Catastrophic insurance will pick up 100% of the cost after a certain out-of-pocket limit is reached. Unfortunately, the Medicare hospital coverage has stayed the same and has not evolved into a modern catastrophic plan.

In order to cover this gap in coverage as well as other out-of-pocket costs in traditional Medicare, private insurance companies in the 1970s began offering Medicare supplement or Medigap insurance policies. For an additional out-of-pocket cost, most or all gaps in traditional Medicare could be covered. But this supplemental coverage is expensive, costing anywhere from $100 a month to $250 a month in premiums depending on whether some gaps are covered or Medicare health-care is provided at 100% with no additional out-of-pocket costs.

Congress’ intent in introducing new Advantage plans was to modernize Medicare coverage and make it look like existing catastrophic plans but at the same time provide lower out-of-pocket cost for traditional Medicare beneficiaries who are buying Medicare supplement policies. The Advantage plan, for a lower premium or perhaps no premium at all, would replace the more expensive combination of traditional Medicare and supplement plans.

There are three issues to consider when deciding whether to switch plans from traditional to Advantage or vice versa.

The first is the issue of premium costs. Initial premiums for Advantage plans are considerably less costly for seniors than buying a Medicare supplement with traditional Medicare. However, the trade-off is that the insured must pay more out-of-pocket upfront for services than with traditional Medicare and the supplement. This may be an acceptable trade-off for many seniors, but what if Advantage insurance carriers cannot make the premium costs work? In other words what if the advantage company has to raise premiums year-over-year to avoid losing money?

This is essentially what happened to Medicare+ plans that were designed on the same concept 10 years ago. Over the years, HMOs that provided Medicare+ did not find it cost effective. Many of them simply opted out of providing the plans and their clients had to go back to traditional Medicare. Congress has subsidized the new plans by giving them about $100 billion to get started. What happens when the subsidies are gone?  The new plans will also allow companies to increase premiums. But what if those premiums get so expensive that seniors find it more cost effective to go back to original Medicare? We don’t know the answer yet because these plans are still too new.

The second issue has to do with how well claims are paid by advantage companies. The company decides which claims it pays, not Medicare. Again, we don’t yet have enough experience to know whether private insurance companies are paying claims adequately or creating a hassle for their insured clients. There is some evidence that nursing home coverage and home health-care coverage under the new plans is being severely restricted or even denied over the same coverage that would be provided under traditional Medicare. Overall, it’s too early to tell about the claims issue.

The third issue has to do with the trade-off in costs. As a general rule of thumb, seniors who buy the advantage plans and who are relatively healthy will save a great deal of money over the years. They probably won’t have a lot of out-of-pocket costs for hospital stays and outpatient coverage.

Seniors who are not healthy are probably better off under traditional Medicare with the supplement insurance plan. This is because they are paying the costs of 100% coverage spread out, at a fixed cost, on a monthly basis through supplement premiums. This is contrasted with $1,500 to $3,000 one-time, out-of-pocket costs per year for receiving services through an Advantage plan. Some seniors just don’t have very large sums of money in their savings and prepaying care through monthly premiums for Medicare supplement is sort of like buying expensive health services on an installment plan.

Only time will tell whether Congress’ experiment with advantage plans is better than traditional Medicare or not.

If your Medicare Part B coverage begins on or after January 1, 2005, Medicare will cover a one-time “Welcome to Medicare” preventive physical exam within the first six months that you have Part B. Additionally, those at risk for abdominal aortic aneurysms may be referred for a one-time ultrasound at their initial exam.

Medicare covers one test every five years to check your cholesterol and other blood fat levels. 

Medicare covers breast cancer screening (mammograms) once a year for women over age 40; cervical and vaginal cancer screening (pap test and pelvic exam) once every two years for all women; colon cancer screening (colorectal) every year to every four years, depending on the test; and prostate cancer screening (PSA) every year for men.

Medicare covers flu, pneumococcal, and Hepatitis B immunizations.

For women, Medicare covers bone mass measurements to check if you are at risk for fracture due to osteoporosis. The test is covered once every 24 months.