Health Care Systems, Medicare & Medicaid

PTP 783 Module 3

History of US healthcare

1935: Congress began to look in to a national healthcare program

1949 (Truman) administration– Controversial, but later targeted to just

elderly

1965 House Ways & Means Committee brought forth 2 amendments to the SSA: Titles 18 Medicare & 19 Medicaid

Evolution of Geriatric Reimbursement:Medicare

Title 18 of Social Security Act 1965– Provide protection against cost of

hospital and related care aged >65 who are entitled to SS retirement benefits – Medicare A

– Permit >65 y.o. to purchase protection against the cost of physician services, one-half of the cost to be paid by the federal government – Medicare B

Evolution of Geriatric Reimbursement:Social Security

Title 19 of Social Security Act– Federal government matches cost of

medical assistance for medically indigent aged person for all needy persons for whom the state is receiving federal grants - Medicaid

Who Opposed the expansion of health care coverage?AMAAHAInsurance repsManagement special-interest

groupsThe political right

Sounds familiar?

Evolution of Geriatric Reimbursement

Balanced Budget Act 1997 – Effected PT Reimbursement in– SNF– Home Health– Hospitals– Outpatient– Medicare choice Plans– Inpt Rehab spared for about 3 years

The “Upside” to the Balanced Budget ActAnti Fraud Laws

– Billing for services not rendered

Anti Abuse Laws– Billing for services not considered

“reasonable and necessary”– Appropriate documentation is a must– Skilled service requirement

Medicare & Medicaid

CMS: Centers for Medicare and Medicaid Services

Purposes:– To establish policies on coverage,

eligibility, & reimbursement

– To establish standards for providers

– To provide program administration

– To monitor the performance of contractors and states

Medicare is made up of:

Part A services: hospital, in-pt

Part B services: out-patient services

Part C (Medicare Advantage plans) HMOs

Part D: Medications

Do you have to be over 65 to have Medicare?NOStipulations:

– Over 65 who is eligible for Social Security

– Railroad retirement benefits

or– Disability benefits for greater than 24

months– Chronic renal disease

Why is it important for physical therapists to be familiar with the rules defining skilled and nonskilled services for Medicare recipients?

Skilled Rehab Services covered by Medicare: o Evaluationo Reevaluationo Ther exo Manual therapy o Gait trainingo ROMo Ultrasound, E-stimo Diathermyo Paraffino Whirlpool

o Transfer trainingo Establishing a FMPo Restraint

evaluationo Orthotic trainingo W/c trainingo Pt & family trainingo Vasopneumatic

deviceso Infrared * (depends on

intermediary)

Medicare Part A coverage Hospital

– First 60 days pay all but $1184 (deductible)– 61-90 days pay all but $296/day– 91-150 days pay all but $592/day (lifetime reserve days)– >150 days Medicare pays nothing

SNF– Medicare pays first 20 days at 100%– then 80% from day 21-100 up to $148/day– after 100 days Part A services pays nothing

Home Health– Pays 100% medically necessary services, and 80% DME

• Must be home bound and under physician’s care Hospice

– Pays 100% except limited cost sharing for meds and respite care (5% discount off Medicare approved rate)

– Has to be a Medicare approved hospice inpt facility (not the pt’s home or a SNF that is not approved)

Blood– Pays for first 3 pints furnished by hospital or SNF during a

covered stay

Other issues with Medicare

Benefit period: begins on day 1 of hospital and ends after 60 days of wellness after d/c from hospital or SNF.

Medicare & SNFsFor Medicare coverage with PART A

services the pt must have A 3-day qualifying stay in the hospitalRequire skilled services (PT, OT, ST, nursing) If the pt is not directly admitted to a SNF after

d/c from the hospital then he/she has 30 days to be admitted to the SNF for Part A services to cover her stay.

Care at SNF must be for the same dx as what pt was hospitalized for

Prior to PPS (1997) SNFs were paid in 3 different categories

1. Routine costs: room, nursing services, medical supplies, psyc & social services, & use of facility equipment

2. Ancillary costs: therapy, meds, labs

3. Capital related costs: cost of land

*now it all bundled into one per diem rate

Medicare Assessments in SNFs

Medicare requires SNFs to do periodic assessments throughout a patient’s stay to determine level of payment.

AKA: PPS (Prospective Payment System)

Assessment Name End Date Days Covered # of Days Authorized for Payment

5-Day Assessment 1 to 5 1 to 14 14

14- Day Assessment 11 to 14 15 to 30 16

30- Day Assessment 21 to 29 31 to 60 30

60-Day Assessment 50 to 59 61 to 90 30

90-Day Assessment 80 to 89 91 to 100 10

Medicare RUG levelsDuring those assessment periods

the patient must fit into a RUG level (Resource Utilization Group)

Category Minutes Disciplines & days (within a 7 day period)

Ultra High 720At least 2 disciplines, one is at least 5x/wk (other at least 3x/wk)

Very High 500 At least 1 discipline for at least 5 days

High 325 At least 1 discipline for at least 5 days

Medium 150At least 5 days of any combination of the three disciplines

Low 45

At least 3 days of any discipline combination and 2 or more nursing rehabilitation services for at least 15 minutes

Medicare Part BDeductible: $147/yrMedical Expenses

– PT Services– 80% of hospital based services– All other PT clinics subject to therapy cap $1900

Clinical Laboratory Services• Pays 100%

Home Health– 100%, DME is 80%

OP Hospital Treatment– 80%

Blood: 3 pints ‘free’, afterwards covered at 80%

Reimbursement for PT services:

Outpatient – Medicare Part B$1900 cap for non-hospital PT

(2013)– On January 1, 2013, Congress passed

the American Taxpayer Relief Act of 2012 which extended the Medicare therapy cap exceptions process until December 31, 2013

Part B Premium

Part B services may be used when

There has been a decline in functional level due to disease, injury, or condition May or may not have been hospitalized Not covered currently by Part A services Decline can be due to:

Pain with decreased functional level, exacerbation of chronic condition with functional decline, exhaustion of Part A services, but still requires further PT services.

Medicare payment for home health services

PPS: predesignated payment that varies with health condition & care needs

Agencies provided payment for each 60-day episode of care.

Can have more than one 60 day periodAdjustments are made for significant

changes in condition or pts with fewer visits

OASIS if under Part A benefits

Quality Measures in Home HealthImprovements in mobility:

– Walking or moving around, transfers in/out of bed, less pain while moving around

ADLs– Bladder control, bathing, correct use of meds,

dyspnea levels

Long-term outcomesPatient medical emergencies

– Hospital admissions, urgent medical care

Managed Care by Medicare

Also called Medicare Advantage Plans

MCOs control access to health care services and create an system that works on efficiency of payment

As with most MCOs bureaucracy results in lapse of time from referral to treatment which impacts outcomes and complicates continuity of care.

HMO pros/cons

Pros:– Minimal paperwork– Additional services provided at little to no cost

(hearing aids, eyeglasses, dental care)

Cons: – Gatekeeper: limits PT treatments– Specifies which providers can be used– Income received by HMO is on a prepaid basis:

so increased incentive to minimize costs.

PT Practice Concerns Regarding Medicare

Need to be “enrolled”Obtain a provider numberNeed to accept fee scheduleNo waiving copaysPatient may have coordination of

benefits with MC primary, other provider secondary

In order for Medicare to pay physical therapy services must be:ReasonableNecessarySkilledAppropriate frequency & durationExpectation that the condition will

improvePhysician must sign the

certification every 90 days

MedicaidDiffers state by stateLow income (at or below 133% of national

poverty level)May have to ‘spend down’ to be eligibleSpousal Impoverishment Plan: spouse can

retain a relatively generous amount of income and assets

Funded by both federal and state levelsDoes not pay for MOW, unless pt has a waiverIn some states: PT is an ‘optional’ benefit for

Medicaid recipients

Medigap insurance policies

Created to gap the payment necessary when part A or B services are not covered.

Usually covers the 20% copayment that A or B does not cover

ExpensiveQuestionable future due to high costsMedicare only pays 80% of allowable

charges, so many providers charge more than this: leads to need for Medigap or other coverage

Veterans Benefits

Veterans Administration (VA) provides a program that covers health care for war veterans through over 153 VA hospitals, 773 outpatient centers and 100 VA nursing homes & contracts with community facilities.

May be able to get specific servicesAt times wait can be long and

distance traveled is great.

Other Long Term Care Policies in creation

35 states are creating their own policies

Hawaii: Family Hope program: program to finance long term care.

Medicare Fraud & Abuse

Fraud occurs when someone intentionally falsifies information or deceives the Medicare Program.

Abuse occurs when doctors or suppliers do not follow good medical practices that can result in unnecessary costs to Medicare

Medicare and the Future

Pay for Performance- PQRI– Will soon be paid for performance of patients. G-

codes.

Accountable Care Organizations– Where department get paid for services

Medical Homes– Cluster of all health care professional that give care

to a patient. You can treat in multiple settings.

Annual Wellness Visit– One time a year can see physician for wellness check

– BP, Medication, Cognitive loss, functional levels, *need fall risk*

‘Incident to’ rules: physician referral hand pick patients, not apply to therapy cap.

Resources

http://www.cms.gov/Web page for Centers for Medicare

and Medicaid Services (CMS)www.ssa.gov/OP_Home/ssact/title

18/1800.htm– Medicare Act

APTA Government Affairs