Legislation:
BUDGET AX FALLS ON HHAS' NECKS
Published on Tue Nov 22, 2005
Congress approves 2006 rate freeze, but glimmer of hope remains.
The week before Christmas turned into a wild budget ride ending in a crash for home health agencies.
HHAs' worst fears were realized when the House of Representatives on Dec. 19 approved a budget reconciliation compromise package that included a Medicare HHA rate freeze for 2006. The freeze would wipe out a 2.8 increase announced in November (see Eli's HCW, Vol. XIV, No. 40).
The House passed the freeze provision even though neither the House nor Senate's budget bills included it, and even though influential lawmakers had signed onto letters protesting the possible measure in days leading up to the vote.
As originally proposed by the Senate Finance Committee, the House also included in the approved package a one-year reinstatement of the 5 percent rural add-on for 2006.
What's more, the bill included a provision requiring agencies to report as-yet-unspecified quality data in 2007 or face a 2 percent reduction to the market basket index inflation update in that year. The legislation called on the Medicare Payment Advisory Commission to compile a report about home health pay for performance by June 2007 as well.
All eyes turned to the Senate, with hope that either the home care freeze would be thrown out or the bill wouldn't secure passage. But with Vice President Dick Cheney casting the deciding vote, the Senate package passed on a 51-50 margin on Dec. 21. A few changes were included, but none of them related to the home care provisions.
Medicare winners in the budget were physicians, who saw their scheduled 4.4 percent cut eliminated, and managed care and pharmaceutical companies, who succeeded in getting onerous provisions cut from the final version of the compromise.
"The effort to defeat the bill was clearly an uphill battle from the beginning," notes the Visiting Nurse Associations of America in a message to members. "The timing of MedPAC's announcement of average 16 percent Medicare home health [profit] margins during the conference negotiations certainly was a setback" (see Eli's HCW, Vol. XIV, No. 44).
DME Provisions Included Too Congress' final budget package also addres-sed durable medical equipment.
Provisions in the legislation called for elimination of the DME rental option after 13 months and elimination of the capped rental option for oxygen after 36 months.
The capped rental provisions shift a great deal of the cost burden to Medicare beneficiaries, protested the American Association for Homecare. But the 36-month oxygen limitation was an improvement over the original measure, which would have ended rental payments after 18 months, notes the Associated Press.
Not Quite A Done Deal Because there were a few changes when the Senate approved the package, the legislation now has to go back to the House for approval again. And [...]
