Rebuilding home care

Unless Congress tears up the funding policies for home health care it created in the 1997 Balanced Budget Amendment, this will be the final year many care agencies, including those in Maine, operate. Their loss will not only deprive many elderly residents of needed care, it will raise the cost of health care in Maine, depriving more people of services they need.

Members of Congress are now well aware that they erred badly when they tried to save money by changing the Medicare payment system to home health care. Instead of saving $16 billion over five years, as first anticipated, the Congressional Budget Office estimates home care’s interim payment system and a new one scheduled to begin in October will cut spending by $69 billion over the same period, which ends in 2002, a drop of 45 percent.

This reduction has no doubt wiped away some of the fraud that Medicare watchers think inhabited the home-health system, but it also resulted in about 1 million people nationwide losing care. In Maine, 16 home-care agencies – 40 percent of the total — have closed since the Balanced Budget Amendment. Agency budgets have been reduced by 25 percent on average, with staff benefits among the first cuts made. Approximately 90 percent of agencies in Maine have costs that exceed reimbursements.

The alternatives to home health care, for many people, is no professional care at all or institutional care. Both can be more costly, to a person’s health or to taxpayers, than an adequately funded home health system. The current payment system, especially injurious to places like the Northeast, which had low cost margins to begin with, discourages the care of sicker people, sending them to hospitals or nursing homes. People with less serious health problems but who need but cannot get home health care may end up there as well eventually.

Dick Israel, finance director for Community Health and Counseling Services in Bangor, recently reviewed these conditions and came to this conclusion: “What was a vibrant and cost-effective site for the provision of care will atrophy, and draconian measures will have to be undertaken to gain control of rising hospital costs. And then some hero or heroine will rediscover home health.”

Congress can prevent things from getting this far out of hand, first, by rejecting further cuts to home health (another 15 percent slice is scheduled for the fall) and, second, by raising reimbursement levels under its new payment system to meet only the $16 billion savings originally envisioned. Sen. Susan Collins has started on this reform by proposing to eliminate the 15 percent reduction, but the scheduled reimbursement levels, even under the improved payment system, won’t save needed services.

Another way to look at the problem comes from Bruce D. Cummings and Linda Abernethy of Blue Hill Memorial Hospital and Hancock County HomeCare. Because of its size, ruralness and relationship with a larger medical center (Eastern Maine) and its patients’ length of stay, Blue Hill Memorial qualifies as a Critical Access Hospital. This means the hospital receives significantly higher reimbursement rates from Medicare, the same source of funding for home health. Why not, the two ask, create a critical access home health agency using similar criteria? They point out that the new payment system for home care “does not account for extraordinary distances staff must travel, extreme geography or climate or the special clinical management problems engendered by attending isolated clients in areas with limited or nonexistent collateral services.”

While a home care giver in, say, Los Angeles might point out that it takes her the same hour to travel six miles across town as it does her Maine counterpart to travel 30 miles between distant homes, the observations of Mr. Cummings and Ms. Abernethy are important. With so few alternatives in rural Maine, it is crucial that home care agencies be reimbursed at levels that will allow them to stay in business.

That currently is not happening, and merely stopping future cuts will not save this industry either. It needs the federal government to stop looking at it as merely a mechanism for balancing the budget and start respecting its role, particularly in rural states, of delivering health care to the elderly in their homes.