* Medicaid’s fraud unit testified at the October Board of Medical Services meeting that the unit had sent 72 recovery letters for billing problems to home health agencies amounting to $1.5 million. Of that $1.5million, $1.3 million is sought from ONE agency. That means $200,000 is being recovered from 71 agencies for an average of $2,800 per agency. We have been told that many of the recovery letters are incorrect (such as letters to agencies where patient was never a patient! We’ve encouraged all agencies to appeal all questionable recoveries even though the dept. has told agencies they are required to have an attorney even for the $64 recoveries.

* State Auditor’s Medicaid Fraud and Abuse Program Performance Audit (July 1999) is bases its assumptions on national data which does not represent Colorado experience accurately.

2. Board of Medical Services and proposed rules
* The Board of Medical Services held three meetings and heard 15 hours of testimony about department’s proposed norms. The board sided with small business that these rules were an administrative nightmare for provider agencies and added additional unnecessary bureaucratic paperwork AND DID NOT SAVE SUFFICIENT AMOUNT OF MONEY (max of $1 million) to make the effort worthwhile. The norms also placed an additional burden on home health aides, the people who can cope least with paperwork. The board determined that the norms were not the answer to growth in home care.  (SEE NORMS)

* The Board of Medical Services also DID pass a rule in November which changes the way home health aides (CNAs) are reimbursed. This rule is expected to save $2.6 million. However, as of January 6, 2000, this rule has not been implemented.
 

* In addition, the Board of Medical Services passed rules earlier this year that will help reduce growth in the home care budget. Rules were passed by the Board of Medical Services which made it clear that agencies cannot “unbundle” home health aide and personal care provider visits. Before, this was unclear and agencies had received mixed messages from the department on whether they could do it or not in response to a terrible shortage of home health aides (CNAs). Another rule passed early in 1999 that allows Home Health Aide Visits without nurse intervention. In the past the nurse was required to provide teach and assess visits on each patient. We still have to do this periodically but cannot bill for the visit. (The home care industry thinks this actually opens up the benefit and will cost the state MORE not less money.)

3. Home care reimbursement rates & personnel shortages

* Home care rates are not yet at levels “targeted” by the dept. several years ago…

* Home care did not receive COL rate increases for many (8 to 10) years when the BOREN Amendment mandated automatic increases for nursing homes and hospitals. The Joint Budget Committee has recognized home care as a community provider these past several years. 

* NO COL increase has been recommended for home care in 2000-2001. 

* As is true for other providers, Medicaid reimburses far below Medicare rates for home care services. For example, depending on an agency’s cost, an agency in Denver could be paid $100.81 for a Medicare skilled nursing visit while being paid $69.32 by Medicaid for a similar visit. A home health aide visit could be reimbursed at $46.43 by Medicare but only $38.43 by Medicaid.

4. Personnel Shortages

* Home care competes with nursing homes and other facilities for the SAME entry level personnel (home health aides and personal care providers). It IS easier to work in one place or to leave health care and work at Dillards. If rates are raised for other health care sectors, it is IMPERATIVE that home care receives the same % of increase in order to compete in the tight employment market place.

* Home care is also experiencing a huge nursing shortage. Nurses are leaving home care, not just for more money, but because of the increasing paper work (OASIS).
(See article)

5.  Number of home health agencies compared to population

* Colorado has one Medicare certified agency for every 2,846 seniors over age of 65. Colorado has less agencies per capita than western states with similar populations: Kansas, Idaho, OK, and New Mexico. (We have more agencies per capita than larger states of NY and California)

* 60 home health agencies have closed due to financial reasons after BBA’97. 

6. Lack of data from department
 
 * We have been unable to get current information from department on 1998- 99 utilization patterns (visits per client). Looking at FY 1997-98, as reported  in December 1999, there  seems to be progress in the right direction (see  11/1/99 report on “Growth in Home  Health.” 
 
 * It is very difficult for our industry to identify solutions when we don’t know  the facts.
 
 * The Medicaid Rate Change History chart as presented by the dept. at their  12/21/99 hearing does not accurately reflect rate changes for home care.

7. Co-Pays 
 
 * As traditionally designed, co-pays actually discourage the use of home care  (the client says, “No thank you; don’t come in today.” The result is more  costly hospitalization and nursing home placement. This is why Medicare has  never implemented co-pay for home care.

 * A co-pay system implemented for the purpose of everyone paying even “a  little” for their care and appreciating it more must be carefully designed to  ensure that the client is the one contributing toward the cost of care, not  the home care agency. (up-front agreement to pay the bill made between  agency and client).
 

8. Solutions
 
 * The growth in home care is occurring in elderly and disabled  population.  This will continue as these populations continue to grow.

 * The growth is outcome of many public policy decisions in the past:
  - Spousal equity for HCBS clients (equal to nursing home equity)
  - Deinstitutionalization
  - Growth and promotion of alternative care facilities
  - DD clients in HCBS (lawsuit)
  - Increase in Model 200 slots
  - Fast track program at point of discharge from hospitals
  - Hospital DRG incentives
 
 * Cutting reimbursement rates is NOT the answer. This just penalizes  home  care providers.
 
 * We have proposed changes to SEPoint incentive system.
 
 * We have proposed intense case management for long term disabled  clients.
 
 * We have proposed moving hospital $ to PDN line item to save much $.
 
 * We have proposed a prospective payment system for home care  modeled after the new Medicare system which goes into effect October  2000.
 

Home Care Association of Colorado  7853 E. Arapahoe Ct., Suite 2100 Englewood, CO 80112-1361  Fax (303) 694-4869 - Phone (303) 694-4728  hcac@assnoffice.com