Medicare Compliance & Reimbursement

President Bush has signed into law the largest Medicare overhaul in history - and it's time for skilled nursing facilities to prepare for the fallout. SNFs have won some tough battles: The Medicare Prescription Drug, Improvement and Modernization Act immediately renews a two-year moratorium on therapy caps and more than doubles the reimbursement rate for AIDS-related skilled care. But providers and their legal counsel still are wading through the hundreds of pages that spell out the Act's finer points. The consensus so far: Despite the magnitude of the historic legislation, it's not likely to rock nursing homes' world. "There's little else in the bill that directly benefits SNFs," summarizes Marie Infante, an attorney with Mintz, Levis, Cohn, Ferris, Glovsky & Popeo in Washington. But SNFs can't ignore the legislation altogether: "There are a few aspects of the legislation that affect nursing facilities in relatively minor ways," says Susan Kayser, an attorney with New York City's Duane Morris. The devil could be in the details, so providers should be diligent in sorting out the ways in which the Medicare Act could touch their businesses and affect their ability to provide care. Providers should pay close attention to the following provisions, experts agree: Therapy caps. This big win means beneficiaries can receive physical, occupational and speech therapy services provided under Medicare Part B beyond the two $1,590 caps in place since September 1. Though it stops short of slaying the caps altogether, the Act nixes the limits for two years. According to the Congressional Budget Office, the shift stands to bring about $700 million back to the industry. Reimbursement for AIDS-related care. This apparent victory - a 128-percent bump up in the AIDS-related RUG base rate - may in reality have little impact, suggests Christine Hurley, administrator of the not-for-profit Bailey-Boushay House in Seattle, which specializes in caring for individuals with AIDS. "A 128-percent increase doesn't make it," says Hurley. She notes the average daily drug costs for Bailey-Boushay residents average $400 to $600 alone. Still, the average provider may find some shelter in the increased rate, particularly in light of recent charges of discrimination against prospective HIV-positive residents. The new rate will be effective for services rendered on or after October 1, 2004, with the provision sunsetting when the RUG system is revamped to include such costs, explains Dawn Segler of the Tallahassee, FL, office of Moore Stephens Lovelace, an accounting and management firm. Physician fee schedule. In the current fiscal year, providers will see a 1.5 percent increase in physician fee schedules, which are used for establishing payment for Part B services. The increase is good news, particularly since providers expected a 4.5 percent cut. An additional rate increase of [...]