Less than a month before election day, the Democratic and Republican candidates for president are dueling over home-based care plans.

Vice President Kamala Harris announced on “The View” this week a proposal that would allow home care to be administered through traditional Medicare.

On the same day, former President Donald Trump and his campaign released a rebuttal, pointing toward home care-related policy implemented from 2017-2020, plus additional plans for a potential second term.

Harris’ proposal is a more lofty one. It would also – if implemented – create a massive tailwind for home care providers across the country. But, as LeadingAge President and CEO Katie Smith Sloan pointed out after the proposal, “we cannot overstate that without staff, there is no care.”

Trump, meanwhile, pointed to expanded supplemental benefits in Medicare Advantage (MA) as a way for seniors to access more home care-related services. His campaign team also focused on economic points that it believes will make aging in place easier for Americans under his leadership.

In this exclusive, members-only HHCN+ Update, I make the mistake of venturing into the presidential candidates’ plans for home-based care. Specifically, I examine how viable the plans are, and what they could mean for providers, if implemented.

Home-based care takes center stage

Home-based care providers were likely pulling their hair out over the predictable confusion that arose from Harris’ proposal Tuesday.

Home health care is already a robust benefit provided under the Medicare program, and generally includes services delivered to seniors after an acute health event.

Home care is not currently available under traditional Medicare, however, and generally includes non-medical services to help with activities of daily living.

The only place where home care is paid for under Medicare is through MA supplemental benefits, and MA pays for just a sliver of all home care provided currently.

So, yes, Harris’ proposal would be groundbreaking, if implemented. It would completely change the scope of the Medicare program.

As for the companies it would directly impact, pick a notable name in home care.

Currently, home care providers have a large addressable market: seniors with the ability to pay out of pocket for home care services; Medicaid beneficiaries in need of home- and community-based services (HCBS); veterans in need of home care, paid for through Veterans Affairs (VA); and a small portion of MA beneficiaries and long-term care insurance clients.

If home care were paid for by Medicare in the future, that would take the concept of “unlimited demand” to a new level. There are over 30,000 home care agencies in the country, almost all of which would have a new market opportunity if Medicare became another means to pay for home care.

The one potential downfall for providers would be former private-pay home care clients being able to use Medicare to pay for services. Private-pay home care doesn’t come without challenges, but it remains one of the most profitable forms of home-based care business.

Home health providers – which already provide care to Medicare beneficiaries, almost exclusively – would also see a business boon. Many of them already provide home care, and the ability to care for clients through one revenue source in both service lines would be massively beneficial.

After all, home-based care is responsible for one of the only successful Center for Medicare and Medicaid Innovation (CMMI) demonstrations of late. The Home Health Value-Based Purchasing (HHVBP) Model – now implemented nationwide – has already saved Medicare billions, and is likely to save many more billions moving forward.

“We think access to personal care services could at least double from six million customers today. By our estimate, the extra spending would expand the [total addressable market] by ~30% to $110 billion per year,” Macquarie Capital wrote in an analyst note this week. “Since Medicare covers home-based medical services, we expect a wider adoption of the integrated care model following added personal care services coverage. This could also expedite the transition to value-based care. Providers could benefit from aligned incentives, streamlined operations and cost synergies.”

Then comes the question of viability, however.

Harris is not the first person to propose such an idea. Home care stakeholders have suggested it for years, but so have other policymakers.

“When the Affordable Care Act was passed, a component similar to this was included and that ultimately was stripped out,” Tyler Giesting, a director of health care and life sciences at West Monroe, told me this week. “I think we’ve seen it fail in the past for reasons that come down to: can it be economically viable? The challenge would be getting something like this passed, in the way that it has been described so far.”

The Harris campaign has suggested that it would pay for the proposal, in part, by cutting Medicare payments for drugs. It estimated that the proposal would cost around $40 billion per year.

But other estimates suggest that it would cost closer to $400 billion.

Harris sees the proposal as a way to aid the “sandwich generation” – adults that have aging parents to take care of, as well as children. Those responsibilities make it tough to maintain employment.

For Harris, the key would be to convince the right stakeholders of the overall value of home care. It wouldn’t be enough to just prove that more Americans could continue contributing to the economy if they had additional help at home for their older relatives.

Harris’ team would need to instead pitch this as a long-term cost savings project. If more seniors had access to home care, less seniors would be driving up U.S. health care costs in hospitals, emergency rooms and more costly brick-and-mortar facilities.

That is already a battle home care providers face. They are regularly trying to convince payers that more home care equals less overall cost. But a concrete plan, and concrete evidence of those potential savings, would have to be laid out.

“It’s one thing to have this idealistic proposal perspective, and it’s another to actually put it into action with a detailed plan,” Giesting said. “Then, there’s also getting it passed and put into law.”

A detailed plan is key. Even if we accept the idea that more access to home care could ease burden on Americans, while also keeping overall health care costs down, the implementation of the proposal through Medicare would need to be tirelessly thought out.

For instance, New York’s Consumer Directed Personal Assistance Program (CDPAP) – which allows family members to be paid to care for loved ones in need of home care – has been a fiscal disaster for the state.

Self-directed care has potential. It allows unpaid caregivers to be compensated, and for home care recipients to direct their own care. But it’s also hard to oversee.

For what it’s worth, if the proposal did move forward, I think the best way to go about it would be to prioritize care from existing, quality home care agencies. Agencies that train and vet their caregivers, ones that have been providing care professionally for a long time.

Trump proposals

The Trump campaign’s home care proposals are more understated. And, like Harris’ plans, more details would be needed to project true impact – for potential home care beneficiaries and providers.

“President Trump will prioritize home care benefits by shifting resources back to at-home senior care, overturning disincentives that lead to care worker shortages and supporting unpaid family caregivers through tax credits and reduced red tape,” the Trump campaign wrote in a release, in preparation for Harris’ announcement this week.

The campaign also evoked MA supplemental benefits. MA supplemental benefits – through the primarily health related pathway and the Special Supplemental Benefits for the Chronically Ill (SSBCI) pathway – were created during Trump’s presidential term.

The benefit that allows for home care services is dubbed In-Home Support Services (IHSS). MA plans have pulled back on offering IHSS in 2024, however.

“The Trump administration provided new Medicare Advantage supplemental benefits that included modifications to help keep seniors safe in their homes, respite care for caregivers, transportation coverage, additional in-home support services and assistance and non-opioid pain management alternatives,” the release continued.

The campaign also pointed out other indirect factors that have led to home care inaccessibility of late, such as inflation, which it believes it can continue to bring down.

Spotlight and policy

Home-based care being in the nationwide spotlight is a good thing for providers and older Americans.

But it’s also worth taking stock of where that spotlight has gotten us before. The Biden-Administration has been laser-focused on home care, but mostly HCBS through Medicaid.

Meanwhile, home health providers have been left behind. Advocates are in the throes of a three-year long fight against continued rate cuts from the Centers for Medicare & Medicaid Services (CMS), as other home-based care proposals are taking shape from both campaigns.

Home health providers are seeing their traditional Medicare payments cut, while also receiving payments from MA plans that often don’t cover the cost of care. All the while, MA penetration continues.

In April of 2023, I wrote about why federal support for home-based care is missing the mark.

While proposals from both campaigns this week contain some good elements, that fact remains true.

As home-based care takes center stage once again, Medicare-certified home health providers are forced to stand behind the curtains, at a time when their margins are evaporating.

“I would also want to remind the Biden, Harris administration that the existing Medicare home health program is under assault currently, and has been since 2020, with billions of dollars in cuts that have diminished access to care, so I think that investment and a stabilization of the existing Medicare home health benefit is something that is also needed,” Partnership for Quality Home Healthcare CEO Joanne Cunningham told HHCN this week. “With this news, I would just offer that recommendation and reminder.”

The post With The Election Nearing, Candidates Battle Over Home-Based Care appeared first on Home Health Care News.

Noli and Isabel Tcruz of Washington Township, Michigan, were sentenced on Sept. 4. Noli Tcruz received six years in prison, and his wife was given three years and two months.

The Tcruzes were convicted and sentenced for schemes related to their operation of several Macomb County home health care companies. These companies purported to provide legitimate medical care to Medicare beneficiaries but engaged in fraud.

“My office will diligently investigate and prosecute all types of fraud driven by greed,” U.S. Attorney Ison said in a statement. “Noli and Isabel Tcruz’s fraud harmed taxpayers and the government programs our tax dollars fund, including Medicare and COVID-19 programs. Health care professionals and providers have an opportunity and a duty to help people lawfully. Still, we will not hesitate to pursue individuals like these defendants who breach those duties to line their own pockets.”

The Tcruzes were involved in a roughly $5 million scheme to illegally offer kickbacks and bribes in exchange for referrals for home health care for Medicare beneficiaries. They also failed to pay their personal and business taxes.

After their last home health company closed in February 2020, Noli Tcruz began committing COVID-19 program fraud. He used a family member’s identity and company to deceive and defraud the Small Business Administration and Health and Human Services, obtaining over $250,000 in pandemic assistance funds.

Two physicians, Dr. Terry Baul and Dr. David Calderone, admitted to accepting kickbacks and bribes in exchange for referring Medicare beneficiaries to the Tcruzes. As part of their plea agreements, the two physicians were required to pay more than $3 million in restitution and forfeiture judgments. Additionally, they have been excluded from participating in Medicare and other federal health care programs.

“Paying kickbacks to induce referrals for medical services in federal health care programs is illegal and can lead to the delivery of unnecessary services, wasting valuable taxpayer funds,” Mario M. Pinto, Special Agent in Charge of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) said in a statement. “HHS-OIG will continue collaborating with our law enforcement partners to ensure that those who engage in unlawful kickback schemes in our federal health care programs are held accountable.”

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Home health agencies and other Medicare-reimbursed health care providers are just a couple weeks away from the return of sequestration.

For many agencies, the restart of the 2% cut will merely be a return to normal, pre-pandemic business. For others, however, it presents another cash-flow disruption that could, at worst, put some smaller operators out of business or, at the very least, add financial strain.

“The [2% cut] might not seem like a lot on the surface, but so much has changed since COVID,” Nick Seabrook, the managing principal at home health consulting firm SimiTree, told Home Health Care News. “The cost of care is definitely increasing, which makes any kind of cut to reimbursement hurt that much more.”

As mandated by the Budget Control Act, the U.S. Centers for Medicare & Medicaid Services (CMS) has been cutting Medicare reimbursements to home health agencies and other providers by 2% since 2014. Under law, payments that exceed Medicare’s cap must be returned to CMS.

Congress first suspended the 2% sequestration cuts as part of the Coronavirus Aid, Relief and Economic Security (CARES) Act in 2020. Along with COVID-19 grant money and regulatory flexibility, the sequestration relief has been a lifeline during the past two years, according to home health care leaders.

“At a time when staffing, recruitment and retention costs are increasing, it’s certainly not a welcome resumption of a cut,” Joanne Cunningham, executive director of the Partnership for Quality Home Healthcare (PQHH), told HHCN. “Especially, at a time when the provider community is struggling, still under the weight of a changed and more intense workforce environment.”

Under current policy, the 2% sequestration cut to the Medicare base payment rate is not being applied through the end of March.

If the “sequestration holiday” is not extended, from April to June, the sequester will be a 1% cut to the base pay rate. Starting in July, the full 2% cut will be back in effect.

That may not seem like a huge cut. But it could have a drastic effect on all providers, considering the current operational landscape, Seabrook explained.

“On the surface, agencies are now really struggling from when the workforce shortage and expenses are going up,” he said. “The cost to recruit, the cost to retain has gone up exponentially. We’re seeing signing bonuses going up, retention bonuses increasing.”

Impact to Medicare

National advocacy organizations such as PQHH and the National Association for Home Care & Hospice (NAHC) are waiting to see if Congress will consider yet another extension to the moratorium on Medicare sequestration.

Calvin McDaniel, director of governmental affairs for NAHC, described the pause as “incredibly beneficial.”

“Providers have been able to use the added flexibility to offset many COVID-related expenses, such as [personal protective equipment], added staffing, overtime and lost revenues,” McDaniel wrote in an email to HHCN.

Indeed, a continued pause on sequestration would help home health providers navigate rising labor and equipment costs, along with any future volume disruptions related to the COVID-19 pandemic. More generally, though, it would keep Medicare funding at a higher-than-normal level, which is important as more care shifts into the home.

“The pause has been extremely helpful and valuable for providers as they were trying to continue to provide care to patients,” Cunningham said.

The original purpose of the emergency sequestration pause was to enable home health providers to have the resources to provide care during the COVID-19 emergency while staying afloat financially.

Along with home health agencies, hospice operators, in particular, have benefited from the holiday. Edo Banach, president and CEO of the National Hospice & Palliative Care Organization (NHPCO), said the return could jeopardize end-of-life care in the U.S.

“Some providers have already reported having to turn away patients seeking hospice care, which means those patients are likely dying in hospitals, without hospice care, and with higher costs,” Banach told HHCN sister publication Hospice News. “Cuts to Medicare payments to hospice will make those problems worse — forcing more people to die in hospitals instead of at home, reducing access to care, and increasing costs.”

Broadly, Medicare spends about $18 billion per year on home health care. A full 2% cut with no relief in the second half of 2022 would mean there would be $180 million less in home health funding this year, with an estimated $360 million less each year after that, according to McDaniel.

“NAHC is pushing for further suspension of sequestration,” he added. “It is a top legislative priority for 2022. NAHC has been in strong opposition to sequestration from its inception, as it has always served as a penalty paid by providers for nothing that they’ve done wrong.”

Additional consequences

Small providers with relatively tight financial margins could feel the greatest impact from a 2% cut coming back. But the larger companies would likewise lose out on millions of dollars in reimbursement.

Executives from Encompass Health Corporation (NYSE: EHC) detailed what kind of financial hurdles the company will face once sequestration returns during an investor conference on Wednesday.

“We estimate that for our consolidated business, that’s about a $50 million year-over-year headwind,” CFO Doug Coltharp said.

Those added headwinds could lessen industry M&A activity and have other unintended consequences.

Seabrook said he expects both small and large providers to be significantly affected by sequestration’s return. But again, the providers — mostly smaller ones — who are “skating by financially” might have a difficult time staying afloat.

“Agencies that are struggling right now are going to be impacted the most,” he said. “For the agencies who are hanging by the skin of their teeth and struggling to keep up with demand because of cost increases and staffing challenges, this is almost a death by a thousand paper cuts. This could be the paper cut that really puts them in jeopardy.”

Cunningham agreed, saying agencies with fewer resources will have a difficult time managing as usual with their cost and payment structures.

“[PQHH] members tend to be the national companies that have a multi-state presence in the home health sector, but in my years representing the home health community, I do understand the unique challenges that smaller providers have,” she said. “Any kind of negative impact to their payment structure really causes a lot of havoc, and it’s hard to manage.”

Seabrook, who was in Washington, D.C., last week, doesn’t feel optimistic about another delay.

“Everything I’ve heard is that the legislation would have had to be in place right now to put it back,” he said. “The message I’m hearing is to be planning on this 1%, 2% schedule remaining as is.”

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Speaking during an interview with CNBC while attending the World Economic Forum in Davos, Switzerland, Trump suggested that he would consider cuts to Medicare and other entitlement programs during his second term. That mindset is a stark shift from his 2016 presidential campaign platform, which promised to protect Medicare and Social Security.

“At the right time, we will take a look at that,” Trump told CNBC. “You know, that’s actually the easiest of all things, if you look.”

Trump did not elaborate on what parts of Medicare his administration would theoretically target for spending cuts.

After multiple newsrooms covered his comments, a White House spokesperson told The Washington Post in a statement that the president is not actively pursuing benefit cuts, but that the administration would continue to seek ways to curb fraud, waste and abuse throughout government programs.

“President Trump is keeping his commitment to the most vulnerable Americans especially those who depend on Medicare and Social Security,” the statement noted.

Medicare spending reached $750.2 billion in 2018, according to the Centers for Medicare & Medicaid Services (CMS) Office of the Actuary. The Congressional Budget Office (CBO) projects Medicare spending to hit $1.3 trillion in 2029, accounting for 18.3% of the entire federal budget.

The spending rate on home health services is projected to surpass all other care categories moving forward, partly due to Medicare-beneficiary preferences and partly due to a rise in complex, chronic conditions. U.S. expenditures on home health care are estimated at $108.8 billion for 2018 and projected to hit an estimated $186.8 billion by 2027.

The president said recent economic growth could make it easier to cut government spending on Medicare and other entitlements.

“Well, we’re going — we’re going to look,” Trump said. “We also have assets that we’ve never had. I mean, we’ve never had growth like this.”

At this point in time, just the specter of Medicare cuts is likely enough to encourage home health providers to write to their members of Congress, many of whom are actually strong advocates of home health care. Under the Patient-Driven Groupings Model (PDGM), providers already face a possible 4.36% assumption-based behavioral adjustment.

“What CMS is doing is making an assumption that is very unfair,” Sen. Susan Collins (R-Maine) previously told Home Health Care News. “It’s making an assumption that most home health care providers are being overpaid. I just don’t believe that is the case.”

Meanwhile, the Medicare Payment Advisory Commission (MedPAC) is urging Congress to reduce the calendar year 2020 Medicare base payment rate for home health agencies by a whopping 7%.

The average home health agency gets about 55% of its funding from Medicare, according to MedPAC.

CMS’s final home health payment rule for 2020 released in October increased Medicare payments by an estimated 1.3% — or about $250 million. The increase reflected a 1.5% update required by the Bipartisan Budget Act of 2018, in addition to a mandated 0.2% decrease to rural add-on payments.

The post Trump Hints at Possible Medicare Cuts appeared first on Home Health Care News.

The recent sentencings bring April’s home health-related fraud cases to at least five overall, a total that broadly reflects the increased scrutiny and oversight the industry currently faces.

On April 22, the U.S. Department of Justice (DOJ) announced that the owner of a West Bloomfield, Michigan-based home health agency was sentenced to 84 months in prison for his role in an $8.3 million scheme to defraud Medicare. In addition to his prison sentence, Zahir Shah was also ordered to pay more than $ 8.3 million in restitution.

Shah was found guilty of one count of conspiracy to commit health care fraud and wire fraud, and one count of conspiracy to pay and receive health care kickbacks.

According to evidence presented at his trial, from 2007 to 2017, Shah submitted false certifications to enroll and stay enrolled as a Medicare provider. Additionally, Shah allegedly paid illegal kickbacks to recruiters in exchange for Medicare beneficiary referrals and billed Medicare for claims from these referrals.

Meanwhile, on April 18, DOJ announced that a former medical doctor and his business partner were sentenced to 33 months in prison for their roles in a $7.1 million Medicare fraud scheme that took place in three Las Vegas hospice and home health care agencies. On top of their prison time, Camilo Q. Primero and Aurora S. Beltran were each sentenced to three years of supervised release and ordered to pay restitution of more than $2.4 million.

Primero — a former doctor and owner of Las Vegas-based Angel Eye Hospice, Vision Home Health Care and Advent Hospice — and his business partner, Beltran, were determined to have received $7.1 million from Medicare by filing false enrollment documents.

The false documents, according to DOJ, allowed Primero to operate hospice and home care agencies even though he had been previously excluded from all federal health care programs.

Additionally, Primero and Beltran allegedly submitted false hospice care claims for people who didn’t require care. The two have prior convictions in California state court for defrauding the state’s insurance system.

Since its formation in March 2007, the Medicare Fraud Strike Force, which maintains 14 strike forces operating in 23 districts, has charged nearly 4,000 defendants who have collectively billed the Medicare program for more than $14 billion.

Last month, the Office of Inspector General (OIG) in its fiscal year 2020 budget asked for an extra $10 million in funding to specifically combat fraud, waste and abuse by home- and community-based service providers.

The post Former Home Health Agency Owners Sentenced to Prison, Ordered to Pay Over $10.7M appeared first on Home Health Care News.

Sens. Susan Collins (R-Maine), Bill Nelson (D-Fla.) and Debbie Stabenow (D-Mich.) introduced the Home Health Payment Innovation Act — S. 3545 — on Wednesday. If passed, the bill would amend the Social Security Act and loosen a homebound requirement for Medicare beneficiaries in Medicare Advantage plans.

This bill — along with others introduced over the last month, including H.R. 6932 and S. 3458 — is another effort on Capital Hill to reshape proposed home health payment reform from the Centers for Medicare & Medicaid Services (CMS).

CMS released details of PDGM in July. In its initial announcement, CMS highlighted how PDGM is meant to better align reimbursement with patient needs and set a Jan. 1, 2020 implementation date.

Many home health leaders have been pointing to issues within the rule, including the behavioral adjustments, along with changes to the Low Utilization Payment Adjustment (LUPA) and how case mix weight is determined.

“S. 3545, S. 3458, and H.R. 6932 share identical language surrounding payment protections — by requiring any behavioral-based payment changes to be grounded in evidence — and observed data,” Keith Myers, CEO of LHC Group (Nasdaq: LHCG) and chairman of The Partnership for Quality Home Healthcare, told Home Health Care News via email. “S. 3545 also includes a provision that would permit the waiving of the homebound regulatory requirement … This flexibility is needed and necessary as home health is an important part of keeping patients out of higher levels of care and institutional settings.”

The Partnership has come out in support of the Home Health Payment Innovation Act. The D.C.-based Partnership is an organization that works with government officials to ensure access to home health care services for all Americans.

“S. 3545 would help to ensure greater stability in the new home health payment model … This is a data driven approach, consistent to what CMS is doing with the skilled nursing facility new payment system — and is a more responsible, evidence-based way to transition to a new payment model,” Myers said.

Certifying that a patient is eligible for the Medicare home health benefit requires that a patient be homebound, confined to the home, or their periods outside of the home are infrequent and short in duration.

“Loosening the homebound requirement would enable greater flexibility for the patients we care for, which would improve the quality of care and enhance home health’s ability to participate in new models of care, and Medicare managed care,” Myers said. “It would also allow home health providers to reach those in need of skilled home [health care] services who are currently restricted from receiving home health services because of a strict regulation that limits the capacity of home health to be part of the care of needy Medicare patients.”

The bills have received support from Amedisys (Nasdaq: AMED), the National Association for Home Care & Hospice (NAHC) and others across the industry.

“Americans have listed health care as the most important problem facing our country should come as no surprise,” Sen. Collins, said during a hearing on reducing cost and enhancing delivery of health care. “Health care is a deeply personal, complex issue that affects each and every one of us and comprises one-sixth of the American economy. If we want to improve the affordability and accessibility of health care, as well as the sustainability of our entitlement programs, we simply must get a handle on cost.”

Written by Kaitlyn Mattson

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Not only will home care providers likely not see significant changes to MA plans in 2019, but the next few years could be a slow burn, according to Anne Tumlinson,  founder of Anne Tumlinson Innovations, a health care consulting company. Tumlinson previously led Medicaid oversight at the Office of Budget and Management, and founded the post-acute and long-term care consulting practice at Avalere Health.

For home care companies, proving the value—and financial savings—of their services will be critical. Thinking like a payer, rather than a provider, will also likely help home care players make inroads in MA in the years ahead.

Enrollment needs

One of the biggest motivations for MA plans to add supplemental benefits is enrollment, Tumlinson told Home Health Care News.

As MA plans look to attract enrollees, balancing supplemental benefits and costs will be a very thoughtful process. MA insurers have to submit their health plan bids to the government to take part in the program, and they must meet certain requirements and limits of coverage in addition to pricing their services. A costly home care benefit could make it difficult to make the math work on those bids, as it would mean that beneficiary premiums would be higher.

“The No. 1 thing to health plans is attracting enrollees, more than saving money,” Tumlinson  told Home Health Care News. “But in order to attract enrollees, [they] have to have a low bid. If [plans] shove a bunch of supplemental benefits that are new and untested that actuaries don’t know how to price, that’s going to pop up your bid.”

To get non-skilled home care more squarely situated as a MA supplemental benefits, the cost savings have to be there.

This approach also means providers are responsible for proving the value of home care. In other words, they need to make their case in a language that health plans will understand—with data.

“If you have evidence—believable and credible evidence—that your intervention is in fact reducing hospitalizations and is a net savings, then health plans definitely want to know about that,” Tumlinson said. “The best thing this industry could do right now is commission massive studies on savings [that show] how using home care, meals, transportation, technology—all the things we know contribute to potentially improving health outcomes—actually reduce the use of the emergency room and inpatient hospitalizations. That’s it. That’s the magic.”

If providers don’t have the data to prove their value, they could still potentially get into contracts with MA plans by taking on risk, according to Tumlinson. Actuaries, which score MA plan bids and costs, can analyze costs to the health plan by adjusting the risk that a home care provider or other partner will take on.

“That’s a strategy [home care] could use tomorrow,” Tumlinson said of approaching providers with the option of taking on risk for adding in-home care services benefits.

2020 vision

Home care providers should also be aware there is a bit of a waiting period ahead before non-skilled supports are truly a benefit in MA plans. While the supplemental benefits are expanded for 2019, plans are more likely to adopt them for 2020 and later.

“We have some time because there is no way any health plan is going to submit a new benefit package for the 2019 enrollment year, which starts this fall,” Tumlinson  said. “None of [the plans] will have this supplemental benefits palace in place—it’s too late.”

For the first few years, managed care organizations are also likely to start slowly adding in home care benefits in small pilots, according to Tumlinson.

Some organizations that have already blurred the line between provider and payer, such as Humana (NYSE: HUM), are adding more MA benefits that directly address social determinants of health and needs in the home. However, Humana may be the exception, as most health plans aren’t taking on the same mentality with the same vigor.

“I think the health plans are going to start experimenting with [more supplemental benefits], but they’re not [yet], with the exception of Humana,” Tumlinson said.

Still, for many MA plans and managed care organizations, the addition of home care as a benefit will likely not happen all at once in 2019, or even in 2020, though there may be some opportunity as organizations come to understand the value-add of home care.

“This is just the beginning of a very slow burn to shift the Medicare program, and if we think there is some incredible strategic opportunity, that is unlikely,” Tumlinson said.”It’s going to be a process of education and a process of convincing actuaries. There are huge operational challenges. … This is a small opportunity. It’s good news, but it’s a small opportunity, not a big opportunity.”

Written by Amy Baxter

The post Why Medicare Advantage May Be a Small Opportunity for Home Care appeared first on Home Health Care News.

Tilong was indicted on charges of conspiracy to commit health care fraud, health care fraud, conspiracy to pay kickbacks, payment of kickbacks and conspiracy to commit money laundering in November 2015. Tilong, along with his wife Marie Neba, fraudulently billed Medicare millions for home health care services that were either medically unnecessary or were not provided, investigators allege.

Tilong was sentenced to 80 years in prison in December 2017 for his role in the $13 million fraud scheme and for filing false tax returns. He was scheduled to be sentenced in October 2017, but failed to appear; his 80-year sentence was given in absentia.

Marie Neba was sentenced to 75 years in prison for her role in August 2017. Investigators believe Tilong fled the Untied States and is residing in Cameroon.

Tilong and Neba operated Fiango Home Health Care, Inc., a home health agency based in Houston, Texas. From February 2006 to June 2015, Fiango was paid more than $13 million in fraudulent Medicare reimbursements, according to the OIG.

Tilong paid illegal kickbacks to patient recruiters for referring Medicare beneficiaries to the agency for purported home health services, evidence in trial showed. Tilong also paid illegal kickbacks to Medicare beneficiaries and falsified medical records to bill Medicare for home health services that were not medically necessary or never provided. He attempted to destroy evidence, blackmail a witness and suborn perjury from witnesses, OIG noted.

In November 2016, he pleaded guilty to one count of conspiracy to commit health care fraud, three counts of health care fraud, one count of conspiracy to pay and receive health care kickbacks, three counts of payment and receipt of health care kickbacks, and one count of conspiracy to launder monetary instruments. In June 2017, Tilong also pleaded guilty to filing false tax returns related to Fiango.

OIG’s most wanted health care fugitives includes more than 170 individuals on charges related to health care fraud and abuse.

Written by Amy Baxter

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Hospice admissions grew 4.6% from the third quarter of 2016 to the third quarter of 2017, rising to 313,500, according to the report, which is based on 100% of the most recent Medicare Part A and B claims data. Excel Health offers on-demand, cloud-based data solutions and has robust medical databases.

Over the same year-to-year time period, hospice utilization grew, with 48.8% in the third quarter of 2017 being the highest utilization to date, and 1.7 percentage points greater than in the third quarter of 2016. Utilization is measured as the number of decedents that had hospice care over the number of total decedents.

Hospice admissions grew year over year in all states except five—Maine, North Carolina, New Jersey, New York and Iowa. Wyoming experienced the highest admissions growth, rising 19.2% year over year.

Nearly all states also had higher utilization rates, with only two states—North Carolina and Arkansas—seeing a slight drop in utilization year over year.

Home health care admissions grew 0.7% in the second quarter of 2017 from the same three months in 2016, reversing a negative trend seen over the previous few quarters. Fourteen states saw a decline in admissions year over year. Wyoming had the highest growth in admissions—13.2% year over year.

Utilization remained near its constant rate, around 1.6% for all Medicare beneficiaries in the second quarter 2017, according to the report. All states saw higher utilization of home health care services, with both Massachusetts and Mississippi growing 2.4% year over year.

As more baby boomers age into Medicare eligibility, the proportionate demand for home health care has dropped, as the average age of Medicare beneficiaries declines. Demand will likely rise again as a proportion of the Medicare population as baby boomers age.

The growth of home health care and hospice services is not totally surprising, as 10,000 baby boomers turn 65 every day.

From the third quarter of 2016 to the same period in 2017, the total number of Medicare beneficiaries rose 2.3%, from 56.1 million to 57.5 million, according to the report. And the growth of beneficiaries also means spending will rise. By 2027, the rate of Medicare spending as a percentage of total federal spending is expected to rise to 17.5%.

Written by Amy Baxter

The post Home Health and Hospice Admissions, Utilization Trending Up appeared first on Home Health Care News.

House and Senate lawmakers voted in favor of the Tax Cuts and Jobs Act—a piece of legislation that updates the nations tax code after three decades and adds nearly $1.5 trillion to the national deficit.

The final stretch of the bill’s passage was not all smooth sailing.

The House passed the bill mid-Tuesday, sending it to the Senate. But in a turn of events later in the day, Senate Democrats ruled that three provisions in the bill violated Senate budget rules, according to an Associated Press report. The Senate passed the bill early Wednesday morning, however, and sent it back to the House, which passed the measure again in a 224-201 vote. No Democrats in either chamber voted for the bill, The Hill reported.

The bill is now headed to President Donald Trump’s desk to be signed into law; however, various news outlet report that he will not sign the bill until a later date.

In an official statement following the passage of the bill, Trump called the legislation a “big, beautiful tax cut for Christmas,” and an “extraordinary victory” for American families, workers and businesses.

Further, the tax reform will bring at least $4 trillion back to the U.S. economy, Trump said at bill passage event in Washington Wednesday afternoon.

House Speaker Paul Ryan explained that Americans can expect to see the result of the tax reform in their paychecks as soon as February 2018, while Vice President Mike Pence called the legislation a “middle-class miracle.”

Lower tax rates

Perhaps the most notable provision within the bill is the new lower corporate income tax rate, which will be set permanently from 35% to 21% starting in 2018.

In its review of the bill, Washington, D.C.-based The Tax Foundation—a non-profit, independent tax policy analyst firm—projected that the bill would reduce marginal tax rates on labor and investment. In broad strokes, this translates into an overall increase in both wages and jobs, the organization explained.

“The larger economy would translate into 1.5% higher wages and result in an additional 339,000 full-time equivalent jobs,” according to the foundation’s analysis.

For the health care services sector, this benefit could result in an overall increase in a business’ value, as reducing the corporate tax rate would drive an approximate 23% increase in earnings per share, according to a published note on the bill by financial services giant JPMorgan.

In terms of its impact on home health, Chicago-based financial firm UBS expects the industry to emerge as a winner from this new lower corporate tax rate.

The reduced corporate tax rate could be a “windfall” for such organizations, leading to an increase in cashflow, which they could use to reinvest in themselves or used for acquisitions, according to Frank Morgan, managing director of health care services equity research at Nashville, Tennessee-based RBC Capital Markets.

And because publicly traded home health companies generally have low financial leverage—or the amount of debt that they have—they stand to get the maximum benefit of a reduction in the corporate tax rate, Morgan explained to Home Health Care News.

“The tax rate going down, that’s good for everybody—but there is an offset: a cap on the deductibility of interest expense,” Morgan said. “If you have high levels of debt or high levels of leverage, you may be capped out on how much of your interest expense you can deduct from your pre-tax income. So, [for companies that have] higher leverage, they would not see as much of a positive impact as companies that have low leverage.”

An enormous burden

While the tax reform bill can be considered a “Christmas present” for some middle-income citizens as well as businesses, those benefiting from Medicare and Medicaid might consider the bill a lump of coal, as it puts such programs at risk.

The AARP projects that the tax overhaul would lead to automatic spending cuts to key programs mandated by the 2010 “pay-as-you-go” law, including $25 billion to Medicare in 2018.

The cuts are the biggest concern for the industry at large, according to Darby Anderson, executive vice president and chief development officer at Frisco, Texas-based Addus HomeCare, Inc. (Nasdaq: ADUS), and vice chairman at the Partnership for Medicaid Home-Based Care (PMHC).

“The concern is how or where any budget cuts would be implemented, should the tax cuts not drive equivalent economic growth to fully offset the cost,” Anderson said.

Katie Smith Sloan, CEO of LeadingAge, a non-profit organization that represents the aging services industry, called the tax legislation “ill-conceived,” in a statement following its passage.

“LeadingAge is concerned about the impact it will have on the federal budget and the availability of resources for Medicaid, Medicare, senior housing and other public programs serving older adults,” Sloan said.

However, Sloan was relieved that Congress preserved the medical expense deduction and tax-exempt private activity bonds in the final language of the legislation—items she said are “crucial” to non-profit providers who care for older adults.

Overall, the possibility of cuts to Medicare and Medicaid should put the industry on alert, Morgan explained.

“That is absolutely something we need to watch because when this tax rate drops and the tax revenues go down, then it’s going to add an enormous burden to the deficit in the near term,” he said. “So, absolutely, it’s something that we’ll watch very closely.”

Discussion on the matter will play out over the course of 2018, and quite possibly into 2019, Morgan predicted.

But policymakers have already taken measures to curb the possibility, with Sen. Susan Collins (R-ME) fighting to ensure no such cuts to Medicare would be triggered by the tax bill.

Bill Dombi, president of the National Association for Home Care & Hospice (NAHC), hopes Congress honors her efforts.

“As it is currently structured, the tax bill can trigger huge Medicare cuts for all providers unless Congress waives the so-called ‘pay-go’ rules when the deficit is increased,” Dombi told HHCN. “Both Speaker Paul Ryan and Majority Leader Mitch McConnell has said that the waiver will happen, but that will take place outside this bill.”

Written by Carlo Calma

The post [Updated] The Trickle-Down Effect of Tax Reform on Home Health appeared first on Home Health Care News.