Your Assistance Needed to Combat Medicare Payment Reductions for Home Health

The Health Group 

The National Association for Home Care & Hospice (“NAHC”) needs the industry to be vocal regarding the CY 2023 Medicare home health services Proposed Rule, which includes 2023 payment rates and a variety of other changes.

NAHC has submitted comments on the proposed rule which include:

• More than 300,000 Medicare beneficiaries have lost access to home health services in recent years, with over 1,000 HHAs having closed, and Medicare spending in 2020-2021 at its lowest point since 2010.
• Congress required that CMS institute a budget neutral payment model in 2020. That model underpaid home health agencies by 2.5 to 3.2 percent in contrast to the 6.9 percent overpayment alleged by CMS.
• CMS’s evaluation as to whether the new payment model was “budget neutral” is fatally flawed in its methodological approach and is inconsistent with comparable evaluations that CMS applied in other sectors.
• CMS’s evaluation methodology is at odds with the clear mandates established by Congress in 2018 in all respects.
• CMS compounds the risks to patient care by adding new, unnecessary costs while failing to adequately recognize the significant labor and transportation cost inflation that has hit home health services.
• CMS is pulling resources from home health care at a time it is depending on that care to reduce Medicare spending on hospitalizations and other care.

You can go to Ask Congress to Prevent Home Health Cuts that Will Devastate Access to Care. Support S.4605/H. R. 8581 (p2a.co) to show your support for the Preserving Access to Home Health Care Act and help to avoid home health payment cuts.  NAHC has also scheduled September 14, 2022 for a Capitol Hill Day of Advocacy. You can register for this event at NAHC Advocacy Day • RSVPify.

The proposed payment rate cut of 7.69 percent will place many home health agencies at financial risk.

Here are 4 Key Health Policy Items in the Inflation Reduction Act

Fierce Healthcare | By Robert King

The House passed on late Friday a sweeping healthcare, climate and taxes package that includes major reforms on drug prices and extends boosted Affordable Care Act subsidies through 2025.

But the sweeping Inflation Reduction Act, which now heads to President Joe Biden for his signature, could reshape many other aspects of the healthcare industry. It would give Medicare the power for the first time to negotiate a small subset of Part D and Part B drugs.

Here are four other health policy changes to look for in the bill:

• Expands eligibility for low-income Part D subsidies. The bill expands who can qualify under the Low-Income Subsidy Program that helps meet Part D cost-sharing burdens like deductibles. Currently, a beneficiary qualifies for the program if they earn up to 135% of the federal poverty level and get partial benefits for 135% to 150% of the level. The law would expand full benefits to those who earn between 135% and 150%, according to an analysis from the Kaiser Family Foundation.

• Gets rid of the cost sharing for adult vaccines for Medicare Part D. It also requires states to cover all vaccines for Medicaid and Children’s Health Insurance Program beneficiaries. The benefit though only applies to any vaccines that get cleared by the Centers for Disease Control and Prevention's Advisory Committee on Immunization Practices.

• Delays the controversial Part D rebate rule, again. The Trump-era rule would get rid of the safe harbor for Part D rebates, leaving them open to prosecution under federal anti-kickback laws. The rule passed at the tail end of Trump’s term but has never gone into effect. The law would delay the rule from going into effect again into 2032.

• Limits the premium growth on Medicare Part D to no more than six percent a year from 2024 through 2029. The cap on premium growth is intended to mitigate the impact of other changes to Part D, said Ryan Urgo, managing director of the policy practice at consulting firm Avalere Health. The legislation includes a $2,000 out-of-pocket cost cap on Part D drugs, spread out in installments for the beneficiary over a calendar year. Part D plans will also have to pick up more of the costs for spending in the catastrophic coverage phase, which a beneficiary reaches when their drug costs reach a certain level.

Experts say regulating the bill will have a big impact on providers, including those that rely heavily on reimbursements for Medicare Part B drugs. 

Some providers purchase their own products under a buy and bill model and then get reimbursed by Medicare for the average sales price of the Part B drug plus 4% for storage and handling costs. The problem is that model doesn’t work if Medicare will reimburse for a smaller negotiated rate, experts say.

“If you are buying high and getting paid low you are, in essence, underwater,” Urgo told Fierce Healthcare. “If you are buying a drug at $1,000 and the reimbursement under Medicare with [the negotiated price] is only $800 you are $200 in the red. To address that there is going to be a need for providers to purchase products at the [negotiated rate] as opposed to market prices.”

The Community Oncology Alliance has raised concerns about this potential change. 

“History has clearly documented that bluntly cutting Medicare payments like proposed in the reconciliation bill, will lead to cancer practice closures and consolidations,” said COA Executive Director Ted Okon in a statement back in July when the drug price reform text was introduced. 

Sen. John Barrasso, R-Wyoming, proposed an amendment to the bill that would have required drugmakers to rebate the government any excess costs above the negotiated prices. The amendment was not agreed to before the final passage earlier this month. 

Special Report — Complying with Wage and Hour Regulations

The SESCO Report July/August, 2022 (Part 1 of 3*)

Common Misconceptions and Compliance Issues

SESCO is available through a Professional Service Agreement or through a per diem fee to conduct a thorough Wage and Hour as well as HR and employment law audit. Contact SESCO to learn more about our Professional Service Agreement and services provided to clients in all industries across the country — [email protected] or 423-764-4127.

Salary Basis

To qualify for exemption from overtime, Administrative, Executive and Professional employees have to be paid at least $684 per week on a guaranteed basis. Note that the Outside Sales Exemption requires no guaranteed salary, more less minimum wage. The Computer Exemption requires at least $684 per week on a salaried basis or paid on an hourly basis at a rate not less than $27.63 per hour.

Misconception 1: If an employee is paid on a guaranteed salary basis of at least $684, regardless of duties, they are exempt from overtime. This is incorrect as to be exempt from overtime under the white-collar exemptions as noted, the employee must meet the duties test as set forth under each exemption by the FLSA and meet the salaried basis requirements.

Misconception 2: Nonexempt employees cannot be paid on a salaried basis. Nonexempt employees are simply required to receive overtime for hours worked in excess of 40 hours per week (federal basis) based on their regular rate of pay. They also must meet at least federal or state minimum wage requirements. As such, a nonexempt employee can be paid on a salaried basis, salary plus commission, commission only, hourly plus commission or other types of pay plans. As long as the employee receives on average for each hour worked minimum wage and receives time and one-half of their regular rate for hours in excess of 40 hours per week, the pay plan is compliant.

In computing the regular rate for overtime purposes, the regular rate is determined by totaling all monies earned for the given workweek (hourly/salary wages, commissions and bonuses, spiffs and other incentives). These total earnings are then divided by total hours worked. The additional half-time is calculated by multiplying the overtime hours times half-time of this regular rate.

Misconception 3: Under the salaried basis rule, we cannot deduct from the salary for any reason. An exempt employee's salary can be reduced for specific reasons. These include:

• Deducting pay for violations of safety rules
• Suspending an exempt employee for disciplinary reasons
• Reducing pay, even on a partial day's absence for intermittent family and medical leave
• When an exempt employee is out sick for the whole day and does not have any accrued or earned sick/leave/PTO time

Please note that the only time we can deduct from the salary in partial day's work is for intermittent family and medical leave. However, we can require the exempt salaried employee to utilize any earned, unused sick time/leave/PTO. Once exhausted, an exempt employee missing time in partial day increments must be paid for the full day.

If out of accrued/earned time, an employer can deduct in full-day increments for those reasons as noted above.

Misconception 4: We can make deductions from an exempt employee's salary while they are out for jury duty. An employer cannot make deductions from the pay of an exempt employee for absences caused by jury duty, attendance as a witness or a temporary military leave. However, an employer can offset fees received such as jury fees, witness fees or military pay for a particular week against the salary for that week.

Misconception 5: If an exempt employee is separated from the company, we must pay him/her for the full week of salary regardless of the number of days worked. An employer is not required to pay the full salary in the first or last week of employment if the employee does not work the full week. You are only required to pay the salary for the actual days worked.

Misconception 6: If we have exempt employees working more than 40 hours or performing extra duties and we pay them overtime or additional monies based on hours of work, they lose their exemption status. The only requirement for an exempt position's compensation is the guaranteed salary basis of $684 per week (less Outside Sales Exemption). An employer can provide additional monies based on hours worked, commissions based upon results, etc. without losing the exemption status.

*Tune-in next newsletter for Part 2 of 3

Updated NHPCO Hospice Standards of Practice

The Hospice Standards of Practice and the Standards of Practice for Pediatric Palliative Care are two resources among the extensive suite of tools NHPCO provides in support of the hospice and palliative care community. 

The Standards are organized around the core components of quality in hospice care, which provide a framework for developing and implementing Quality Assessment and Performance Improvement. Specific standards and practice examples are included for each component, and appendices provide additional standards for a hospice inpatient facility, nursing facility hospice care, and hospice residential care facility.

See a downloadable pdf of the Standards attached for HHAC members.