Fiscal Cliff Update for Home Care

Home care and hospice providers are keenly interested in the fiscal cliff update that occurred during the 11th hour on December 31, 2012. We broke it down specifically with home care in mind.

The Senate passed a bill to avoid the consequences of the impending “fiscal cliff” very early on New Year’s Day 2013 with a vote of 89-8 with 3 Senators not present for voting. The bill then went to the House where it passed 267-167.

Here is a quick breakdown of the implications to home care and hospice:

  • The bill extends tax rates for the vast majority of citizens along with a series of other tax-related extenders and unemployment benefits. It also includes a “doc fix” through 12/31/13.
  • There are no cuts to Medicare home health services or hospice care benefits, payments, or payment rates. No home health copays are in this bill.
  • The 2% Medicare sequestration will be delayed by 2 months, a small, but meaningful positive for home health and hospice.
  • Also, there are no Medicaid cuts affecting home care.
  • Protection against the Medicare outpatient therapy cap is continued through 12/31/13.
  • The “doc fix” is paid for primarily through cuts to hospitals with nearly $15 billion in a combination of coding adjustments and DSH payment reductions. ESRD payments are also affected by a reduction of $4.9 billion.
  • The CLASS program established to help finance long term care services through a voluntary insurance approach under the Affordable Care Act is repealed under the Senate bill. The repeal has no financial consequence as CMS earlier indicated that it would not implement the CLASS program due to its inability to assure financial viability.
  • A very important provision is the establishment of a Long Term Care Commission that will be charged with the responsibility of developing a plan for meeting the needs of the growing population of Americans needing care in the home and in other settings. The Commission will have 15 members appointed by the President and Congressional leaders with representation of consumers, older adults, family caregivers, and care providers.