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Written by: Mediware on Tuesday, November 6, 2012 Posted in: Outpatient Rehab

As with most, I have followed the standard that a patient must demonstrate functional improvement to be eligible for Medicare payment in post-acute rehabilitation settings.  Last month, the Centers for Medicare & Medicaid Service (CMS) agreed to changing this standard by recognizing that “maintaining” vs. “improving” a patient’s functional status is equally valid to justify eligibility for rehabilitation services.  This is a landmark decision, changing Medicare history and reversing one barrier to care for people who need it most.

With current focus upon reducing hospital readmissions, CMS is forced to reconsider the cost/benefit of providing rehabilitation services as a way to reduce the costs associated with readmissions.  The history of waiting for a patient’s condition and functional status to deteriorate to such a level as requiring hospitalization to become eligible for restorative services now presents an unsustainable argument unsupportable with the associated economics. The proposed settlement will reverse this irrational and unfair approach to medical services.

Attorneys from the Center for Medicare Advocacy, Vermont Legal Aid and CMS have agreed to settle the “Improvement Standard” case (Jimmo, et al vs. Sebelius).  The proposed settlement agreement was filed in federal District Court on Oct. 16, 2012.  When approved, CMS will revise the Medicare Benefit Policy Manual and other Medicare manuals to correct all language suggesting that Medicare coverage is dependent on a beneficiary “improving.” New policy provisions will state that skilled nursing and therapy services necessary to maintain a person’s condition can be covered by Medicare.

On Oct. 24, 2012 the New York Times published an editorial  “A Humane Medicare Rule Change,” noting the CMS reversal of  “irrational and unfair approach to medical services” that developed “over decades because of Medicare’s fragmented and loosely administered process for handling beneficiary claims.” The Times editorial applauded the settlement as “clearly the humane thing to do for desperately sick people with little hope of recovery.”

CMS will have its work cut out when launching the campaign to inform healthcare providers, Medicare contractors and Medicare adjudicators. They should not limit Medicare coverage to beneficiaries who have the potential for improvement.  Rather, providers, contractors and adjudicators must recognize “maintenance” coverage and a beneficiary’s need for skilled care that is performed or supervised by professional nurses and therapists. We must also assume CMS will issue guidance for determining what constitutes maintenance eligibility and how effective therapy will be if restricted by existing therapy cap limitations. Perhaps this windfall of rehabilitation access will be applied exclusively to patients with the most severe of chronic conditions such as Alzheimer’s disease, multiple sclerosis, Parkinson’s disease, stroke, spinal cord injuries and traumatic brain injury, and be applied only to ambulatory rehabilitation providers; IRFs and rehabilitation units of acute hospitals will not receive benefit of this new interpretation. All of a sudden, healthcare transformation begins to affect the rehabilitation sector in a meaningful way.

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