Lawsuits soothe sting of federal regulations
By Elizabeth Hogue, JD
Health Care Attorney
Elizabeth Hogue Chartered
Burtonsville, MD
Not all is painful with the Interim Payment System, even though home care providers seem to be suffering from severe heartburn lately. But it's not terminal - yet. Lawsuits against the federal government are proliferating, and if just one of them wins, home care might get a collective dose of Maalox.
Court cases are being directed at the Health Care Financing Administration (HCFA), Donna Shalala, Secretary of the U.S. Department of Health and Human Services (HHS), and the fiscal intermediaries.
Home care patients in Connecticut have filed a class action suit against Donna Shalala in Ruth Healey et al v. Donna Shalala in the U.S. District Court for the District of Connecticut, Civil Action no. 398CV00418, March 4, 1998. The purpose of the suit is to seek meaningful notice and appeal rights on behalf of Medicare beneficiaries when their home health benefits are reduced or terminated.
A class action lawsuit filed in Dallas by the Texas Association for Home Care (TAHC) and Rockwall Home Health of Rockwall, TX, seeks an injunction to prevent HHS from implementing the IPS' retroactive payment limits, which are lower than current payments. Plaintiffs claim the limits do not cover the cost of caring for Medicare home health beneficiaries, particularly those with intense or multiple care needs.
Action aimed at Donna ShalalaAccording to TAHC, Medicare home health agencies have never been allowed to make a profit and still cannot. They are reimbursed only their cost for providing care up to certain limits. In Texas, the average annual home health patient cost in 1996 was approximately $8,200. While all Texas agencies are being hit with substantial cuts under the IPS, TAHC claims more than 75% of agencies in Texas will be reimbursed only $2,600 to $3,400 per patients.
TAHC spokeswoman Sara Speights argues, "That means agencies are supposed to deliver the same care for only 30% to 40% of the cost. It cannot be done. HCFA claims 60% of the home health agencies in the nation are spending more than these new limits to care for their patients. We believe a far greater number of Texas agencies are over these limits and will find it impossible to continue serving the elderly."
The patients initiated the Connecticut lawsuit both as individuals and as representatives of a nationwide class of similarly situated Medicare beneficiaries. They are asking the Court to issue a declaratory judgment holding Shalala's home health notice and appeals procedures to be in violation of the U.S. Constitution and the Medicare statute. They also ask the Court to order Shalala to enforce notice requirements for home health agencies that contract with the Medicare/ Medicaid programs, to establish expedited predetermination hearing procedures for home health appeals, and to provide necessary care pending what they hope will be expedited decisions.
The patients further claim that Medicare manuals, the Medicare Act, federal regulations, and the U.S. Constitution, require that beneficiaries be given written notice when services are reduced or terminated. According to the patients, however, Shalala has not enforced this notice requirement.
Although plaintiffs acknowledge there is theoretically a Medicare procedure for appealing terminations and reductions of home health services, they argue nonetheless that several characteristics of the design of these procedures render it useless for most beneficiaries. They say these procedures are ineffective because appeals are allowed only with respect to services actually received. Most home health agencies will not provide services after a reduction or termination in services. The plaintiffs further complain about agencies that agree to provide services only if the beneficiary pays for the services pending an appeal. Most beneficiaries cannot afford an appeal, the suit says. Finally, the suit argues that the appeal process is so slow, that decisions come long after the need for services.
Attorneys for the plaintiffs ask for declaratory, injunctive, and mandatory relief with regard to all of these issues.
Scrutiny will increaseAlthough it is significant that the only defendant in this lawsuit is the Secretary of HHS, agencies still should be prepared to face increased scrutiny when they terminate services as a result of this lawsuit, regardless of which party ultimately prevails in court.
Here are some suggestions for agencies:
· Be meticulous.
Give verbal and written notice to patients when services are terminated.
· Develop and implement a discharge plan prior to termination of services as required by the Conditions of Participation.
Note, however, that the discharge plan does not need to provide that alternative services are already in place before services are terminated. Such a requirement may produce what amounts to a "standoff" between patients and agencies, if patients know that agencies will not terminate services until alternate providers are rendering care to patients.
· When terminating services, agency staff members must be careful about the reasons they give for termination.
They should not state that services are being terminated or reduced because the criteria for the Medicare program have changed. Likewise, they should not indicate that changes in care are necessary because of provisions of the Balanced Budget Act or IPS. Rather, services are being terminated because the agency no longer has the resources to meet the needs of such patients as required by the Conditions of Participation.
· Despite hard decisions that must be made, agency staff must always demonstrate their concern for the well-being of patients, even when services must be discontinued.
Providers beware - although lawsuits are now turning the heat up on HCFA, providers are still subject to intense scrutiny. Don't break out the Maalox just yet.
(For an in-depth analysis of abandonment and a set of policies, procedures, and forms that will assist agencies to terminate services without liability for abandonment or risk of decertification, send a check for $105 to Elizabeth E. Hogue, Esq.,15118 Liberty Grove Drive, Burtonsville, MD 20866.)
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