HOME HEALTH CARE: HCFA Finalizes Controversial Regulations

      Home health care providers will still have to post "surety bonds of $50,000 or 15% of their Medicare revenues, whichever is greater," and they will also have to make do under "an interim payment system that will keep Medicare payments at 1994 levels until October 1999." Home health care providers who were "counting on" changes in these Medicare rules "got a letdown Monday" when the Health Care Financing Administration published its final regulations, the Albuquerque Journal reports. The initial regulations, contained in last year's Balanced Budget Act and announced in January, brought widespread criticism from the home health care industry, which contended the regulations would put them out of business. HCFA said in March it would "amend" the regulations, but announced Monday that changes wouldn't be made until at least 2005. Explaining the decision, HCFA said in a release Monday that the surety bond rule would "help assure that fly-by-night providers are kept out" of the industry. But many in the home health care industry "say the surety bond requirement is a hardship, because they lack the buildings or vehicles that other kinds of businesses would use for collateral." Further, the reimbursement levels set under the interim rules are often less than the actual costs of taking care of a patient. The Journal reports that a "federal suit challenging the new rules is scheduled for a hearing Monday in Dallas." There are also bills pending in Congress that would change the rules. A bill in the Senate would place the surety bond requirement only on agencies less than a year old and other bills pending in both houses would change the reimbursement system.

No Home (Health) On The Range
      In New Mexico, the interim system will cost health agencies $30 million, the Journal reports. New Mexico Association for Home Health Care Executive Director Jole Glenn said that in some cases the federal reimbursements are $400 too low per patient. High Country Nursing Home President Frank Pollan said the $30 million estimate doesn't take into account that some agencies might have to close down. "It looks real bleak," he said, adding that because his agency can't produce a $50,000 surety bond it will be forced to close, thus leaving 50 patients without care. According to a show of hands at the state AHHC meeting last week, almost all of the approximately 125 agencies said they "might have to close because of the new rules." Even if changes are made in 2005, Gary Moffit, co-owner of Basin Home Health Care said, "It could still be the death knell for our industry. It's probably going to be changed, but it's going to be much too late for the majority of providers. A lot of Medicare recipients are going to be grievously harmed" (Sedrel, 6/1).