'Goal No. 1 is to get CMS to step back, exercise their authority, and say we don't have to institute these cuts now,' says the president of the NAHC.
At this week’s U.S. Senate subcommittee hearing on the importance of home health, William A. Dombi, president of the National Association for Home Care and Hospice, and Carrie Edwards, RN, BSN, MHA, LSSGB, director of home care services for Mary Lanning Healthcare, were two of the five witnesses who testified in front of the subcommittee.
At issue was the Centers for Medicare & Medicaid’s proposed significant rate cut of 5.653% for 2024—a $870 million cut out of a $16 billion benefit.
HealthLeaders spoke with Dombi and Edwards ahead of the hearing about how home health and home care continue to struggle to provide the care their clients and patients need and how the rate cut would future exacerbate these struggles.
This transcript has been edited for brevity and clarity.
HealthLeaders: What are the main concerns the home health and home care sector are currently seeing?
William A. Dombi: The word that I'm hearing the most is survival. The providers of care are looking for ways to survive these challenges today. The issues are the workforce crisis and the aspect of payment rates.
We are also struggling with the continued growth in Medicare Advantage, which in most instances pays less than the cost of care.
The Centers for Medicare & Medicaid Services have enough leverage and power to be able to do that, and otherwise what they're trying to do is take advantage of the opportunities for innovative services, whether it be hospital-at-home care or use of technologies to supplement the in-person services.
You've got a tug of war between forward-looking opportunities and backward-looking regulatory actions on payment rates and in the middle of that is, where do you find the staff? It's a combination of are there people to do it and do you have the financial capabilities to get this perspective candidate to say yes, or for current workers to stay onboard.
HL: Carrie, do you think Medicaid will eventually extend its coverage to home care services? If so, how would this remedy some issues in that setting?
Carrie Edwards: In some states the Medicaid program does pay for caregiving and in others it doesn't. My agency provides home health services, covered by Medicare, and then we also do home and community-based care through Medicaid.
People want to stay at home while they're aging and the home health Medicare benefit allows our agency to provide skilled nursing care to keep them at home, and we teach the patients and families to care for themselves at home. Then, if they did need ongoing care after the Medicare benefit ended for that patient with goals met, they could transition to that other side if they had Medicaid services.
There have been efforts over the years to have Medicare take on long-term care but it's failed time and time again because of the cost.
I think the states would love to see Medicare take over the realm of long-term care from Medicaid for a couple of reasons. One is that the states are paying a good portion of the cost of Medicaid, but the other is that people qualify for Medicaid only after they've been hospitalized.
People who are destitute or near destitute from absorbing healthcare costs, it just seems an unfair thing to do, particularly in the last decade of people's lives. But the politics and the financing of it have been tried and so far, have not made it across the finish line to get Medicare to pay for that kind of service.
By 2030, I'm hoping there's enough home health and home care agencies still around. If there's continued Medicare cuts or decreases to Medicaid funding, there's going to be more closures.
HL: If there aren't enough healthcare workers to accommodate the growing demand for these services, how are patients expected to get the care they need?
Dombi: The demand is there for the service among the public, and clinicians see the value of healthcare services at home, and it saves spending, but the buyer, Medicare and/or Medicaid at times, and others either don't have the financing to do it, or don't want to acquire the financing to cover those kinds of costs.
It is a challenge that this country is facing with Medicare and Medicaid. It's a challenge countries all across the globe are facing, too, as we see Europe, Japan, and China aging as well. As someone who is aging himself, I'm concerned personally about where things will be by 2030. Medicare is at risk of bankruptcy even before 2030.
HL: What is it that CMS is hoping to accomplish with the cuts, despite struggles providers are facing because of them?
Dombi: In this case, the cuts are not coming because Congress is saying cut. Congress said a transition from one payment model to another must be budget neutral.
Home health providers and home care agencies agree, we just don't believe CMS has implemented them in a budget-neutral fashion, meaning the amount of money spent today is less than the amount of money spent on care under the old payment model. That does not comply with the laws of Congress.
That's why this hearing is being held, to figure out a way to deliver what they think is necessary care, but to do so has been complicated by CMS' actions. Congress can't simply say, “Well, let's just stop the cuts,” because the Congressional Budget Office will look at that and say, ”How are you going to pay for that?”
What we really need is for Congress to tell CMS to do its job correctly. We're hoping for that kind of action out of Congress and there is legislation pending that would stop the cuts, too.
HL: How informed do you think legislators are about the issues home health and home care are facing?
Dombi: I'll offer this respectfully to Congress: their hands are in too many different subject areas for them to have the depth of knowledge that Carrie has or that I might have. We can't expect them to. At the same time, they're quick learners.
It's clear that home health is not just less costly than a day's stay in an alternative care setting, but studies for several years now have shown that it saves money by preventing people's condition from getting worse and being hospitalized at a huge cost.
In fact, Medicare's invested in a program called home health value-based purchasing, but I would imagine if you were to ask members of this committee who will be holding the hearing, “What does HHVBP stand for?” you would be hard pressed to find someone who knows. So, we're going to tell them about it.
HL: Carrie, how do you plan to use your perspective and knowledge from being in the field to paint a picture for the committee?
Edwards: By sharing my personal experience with my home health and home care agency that was at risk of foreclosure earlier this year. We've been working hard and have made significant changes to stay open at this point. That's why I hope they don't have further cuts, because I know we will probably close if they do go through.
We used to serve 13 counties in our part of rural Nebraska, which was about 42,000 Medicare beneficiaries. Now we serve one county and about 7,000 Medicare beneficiaries. A lot of those previous 13 counties don't have other any other options for care.
Staff have left because they were fearful of the agency closing. We're not replacing those positions, so with less staff we're trying to take care of the clients and patients we can.
We've had to turn down referrals, some of which we previously serviced, but live in those outlying counties that we no longer serve. This year to date we've turned away 55 referrals.
HL: What outcomes are you hoping will come from your testimony?
Dombi: Goal No. 1 is to get CMS to step back, exercise their authority, and say we don't have to institute these cuts now to give us some breathing room to find more long-term solutions.
There are issues out there and what Carrie told you can be extrapolated nationwide. The data shows that over the last five to six years, half a million fewer Medicare beneficiaries are accessing home health services.
There's a Medicare-eligible population that wants home health services and we have gone from 3.5 million Medicare beneficiaries using home health in a year, to 3 million beneficiaries now. Half a million people are either in higher cost settings or they're trying to deal with their healthcare needs without support.
Edwards: We just want to be able to take care of the patients in their home, the ones that need it.
Dombi: The truth is that we've been through this before in the late 1990s.
The payment model was changed, and they instituted something called the interim payment system. Fewer Medicaid beneficiaries received services, 40% of home health agencies closed, and spending on the Medicare skilled nursing facility benefit went up from $11 billion a year to $24 billion a year. Right now, it's at $27 billion.
We're spending nearly twice as much on skilled nursing facilities for less than half of the population of people receiving care.
Some people need a skilled nursing facility, and they can't be safely cared for at home, but to see this happen before and on the verge of it happening again, sometimes it takes the sky falling and crashing on the ground before Congress acts.
We're hoping to prevent that from happening this time around.
Editor's note: This story was updated at 5pm on September 21, 2023.
Jasmyne Ray is the contributing editor for revenue cycle at HealthLeaders.
The Centers for Medicare & Medicaid have proposed a rate cut of 5.653%, taking a $870 million cut out of $16 million.
The proposed cut would further exacerbate the struggles home health providers and home care agencies are currently dealing with.