With government cuts (or default) looming, everyone is talking about cuts. The battle is really over how much cutting will be done, and who will bleed most. The two federal programs that are most often discussed as targets for cutting are Social Security and Medicare. And every political stripe agrees that as the growing number of Boomer retirees move into these programs, stresses will be felt throughout the federal budget.
In this environment, The Centers for Medicare and Medicaid Services (CMS) has proposed changes that include a %3.35 cut in payments to the nation’s home health agencies (HHA) to begin next year. What might these cuts mean to the delivery of medicare services?
The Centers’ report proposes a savings of $640 million for 2012, mostly in realigning accounts for pre-emptive payments for non-medical related services. Indeed, the report claims that the savings comes mostly from adjusting billing predictions, not from a reduction in care:
A proposed rule was displayed at the Federal Register today proposing a 3.35 percent decrease in Medicare payments to home health agencies (HHAs) for calendar year (CY) 2012. This would be an estimated net decrease of $640 million compared to HHA payments in CY 2011. It would include the combined effects of market basket and wage index updates (a $310 million increase) and reductions to the home health prospective payment system (HH PPS) rates to account for increases in aggregate case-mix that are largely related to billing practices and not related to changes in the health status of patients (a $950 million decrease).
Another focus of the CMS’s budget trimming is to ensure routine communications between home-health providers and the certifying physicians who registered people in the program. The effort here is to encourage better record-keeping throughout the system to help avoid either doubling up on treatment unnecessarily, or paying for treatments not carried out.
People of most political stripes would surely welcome such adjustments, though $640 million when some are trying to cut $4 trillion can suddenly seem like chump-change. Medicare is likely to get further, and larger, cuts as ‘negotiations’ continue over the budget and the debt ceiling. (For a Tea Party view of why the cuts to Medicare only scratch the surface, see Judson Phillip’s op-ed in Thursday’s Washington Post p.A-19).
But one question almost no one is asking about reducing the federal budget is, “Why not cut back on our three ongoing wars rather than on those seeking medical care in their later years?”
