Trends in Medicare home health care use: 1997-2001

The Balanced Budget Act of 1997 mandated a major overhaul in Medicare payment for home health care with an interim payment system (IPS) preceding a prospective payment system (PPS). This study extends an earlier analysis of the impact of the IPS to determine whether home health use and spendingtrends changed after the introduction of the PPS. The rapid decline in the incidence of use and visits per user under the IPS slowed in its final year and then picked up again in the first year of the PPS. In addition, average payment per visit increased sharply under the PPS. Little is known about the impact of continued large reductions in home health services since 1999.     

Impact of the Medicare interim payment system on length of use in home care among patients with Medicare-only payment source

Using data from the 1996 and 2000 National Home and Hospice Care Surveys (N = 2,455), we examined length of use in home care among patients with Medicare-only payment source before and during the Medicare interim payment system (IPS). Logistic regression analyses revealed that patients were 2.9 times more likely to be discharged within 60 days during IPS than before IPS. The impact of Medicare IPS on length of use in home care among patients with Medicare only was stronger than what the existing literature indicates, which combines Medicare patients with multiple payment sources and patients with Medicare-only together.     

Effects of state Medicaid home care Medicare maximization programs on Medicare expenditures

Some state Medicaid programs have attempted to shift home health care costs to Medicare by using retrospective Medicare maximization billing practices. We used a two-part model with random effects to analyze whether retrospective billing practices increase Medicare expenditures for dual eligibles by analyzing primary data collected from 47 state Medicaid offices supplemented with Medicare Current Beneficiary Survey (MCBS) data from 1992-1997. Retrospective billing practices were projected to increase Medicare home health care expenditures by 73.8 million dollars over six years, although this was not statistically significant. We also found significantly higher Medicare spending in states with lower Medicaid spending levels, suggesting that states with high Medicaid utilization have potential to shift some of these expenditures to Medicare.     

Use of covered services in Medicare home health care

Using data on 295 patients entering Medicare home health care at discharge from Medicare hospital stays, we explain receipt of Medicare home health nursing, PT and OT visits, and length of stay. Care reflected need, but other factors also affected service allocation. Medicare program requirements, as well as variation in provider structure and case load, appear to introduce inequities. Critical in light of recurrent proposals to change Medicare coverage and benefits, findings underline the need to reconsider Medicare home health policies that lead to denial of needed services, inequitable allocation of benefits, and premature termination of care.     

Impact of Medicare managed care market withdrawal on beneficiaries

The 2001 Survey of Involuntary Disenrollees was conducted to investigate the impact of Medicare+Choice (M+C) plan withdrawals on Medicare beneficiaries. Eighty-four percent of a total of 4,732 beneficiaries whose Medicare managed care (MMC) plan stopped serving them at the end of 2000 responded to the survey. Their responses indicated that the withdrawal of plans from Medicare affected beneficiaries in terms of concerns about getting and paying for care, increased payments for premiums and out-of-pocket costs, and changes in health care arrangements. Of particular concern were the impacts on those in vulnerable subgroups such as the disabled, less educated, and minorities.     

Contemplating home health PPS: current patterns of Medicare service use

Implementing a per-episode prospective payment system (PPS) for home health services is one option for Medicare policy makers facing rapid increases in service use and expenditures. Analysis of data on recent episodes of Medicare home health care identified systematic differences in service patterns across provider types; these indicate potential differences in the capacity of agencies of different types to adjust to PPS. The second phase of a national demonstration, which is about to be implemented, will provide information on the extent to which the agency practices that generate much of the observed variation (such as the number of visits provided per episode) are susceptible to management decisions; and whether managers can and do respond to the incentives of per-episode prospective payment.     

Rolling back Medicare home health

The Balanced Budget Act (BBA) of 1997 included major changes to Medicare's home health benefit designed to control spending and promote efficient delivery of services. Using national data from Medicare home health claims, this study finds the initial effect of the BBA was to steeply reduce use of the home health benefit and intensify its focus on post-acute skilled nursing and therapy services. The striking responsiveness of home health agencies (HHAs) to altered financial incentives suggests that we may again see large shifts in patterns of care under the new incentives of Medicare's prospective payment system (PPS) for home health.     

Agency and market area factors affecting home health agency supply changes

OBJECTIVE: To use the natural experiment created by the Medicare interim payment system (IPS) to study supply change behavior of home health agencies (HHAs) in local market areas. DATA SOURCES: One hundred percent Medicare home health claims for 1996 and 1999, linked with Medicare Provider of Service and Denominator files, and the Area Resource File. STUDY DESIGN: Medicare home health care (HHC) claims data were used to distinguish HHAs that changed the local market supply of Medicare HHC by their market exit or by significant expansion or contraction of their geographic service area between 1996 and 1999 from other HHAs. Multinomial logit models were estimated to analyze how characteristics of agencies and the market areas in which they served were associated with these different agency-level supply changes. PRINCIPAL FINDINGS: Changes in local HHA supply stemming from geographic service area expansions and contractions rivaled those owing to agency closures and market entries. Agencies at greater risk of closure and service area contraction tended to be smaller, newer, freestanding agencies, operating with more visit-intensive practice styles in markets with more competitor agencies. Except for having much less visit-intensive practice styles, similar attributes characterized agencies that increased local supply through service area expansion. CONCLUSIONS: Supply changes by HHAs largely reflected rational market responses by agencies to significant changes in financial incentives associated with the Medicare IPS. Recently certified agencies were among the most dynamic providers. Supply changes were more likely among agencies operating in more competitive market environments.     

Medicare Home Infusion Therapy Reimbursement Gap

This research seeks to address the home infusion therapy reimbursement gap found within Medicare Part D. In particular, the research explored the reimbursement gap's impact on home health utilization, its contribution to the national health expenditure growth, and the potential fix of the problem by restructuring Medicare Part B to include a home infusion therapy benefit under its coverage. Previous studies found that there is a great cost avoidance opportunity available through home health and home infusion treatment, because such treatment avoids the high costs associated with hospitalization and nursing home and other long-term care facilities. Future implications of this topic are unclear, as the Affordable Health Care for America Act is equipped to cut Medicare services and reimbursements, in spite of current bipartisan legislation in both houses to cover the home infusion reimbursement gap.     

Voluntary disenrollment from Medicare managed care: market factors and disabled beneficiaries

Disenrollment rates from Medicare managed care plans have been reported to the public as an indicator of health plan quality. Previous studies have shown that voluntary disenrollment rates differ among vulnerable subgroups, and that these rates can reflect patient care experiences. We hypothesized that disabled beneficiaries may be affected differently than other beneficiaries by competitive market factors, due to higher expected expenditures and impaired mobility. Findings suggest that disabled beneficiaries are more likely to experience multiple problems with managed care.     

Medicare beneficiaries rate their medical care: new data from the MCBS (Medicare Current Beneficiary Survey)

The Medicare Current Beneficiary Survey (MCBS) contains a wealth of information about the people whose care is financed by the program. This article examines their satisfaction with medical care received and explores the relationship of these attitudes with the characteristics of subgroups of the enrolled population. Satisfaction with medical care among Medicare beneficiaries is found to be generally high (80-90 percent). Disabled Medicare beneficiaries are less satisfied than the aged, and health maintenance organization (HMO) enrollees less satisfied than fee-for-service (FFS) patients. Others with lower-than-average satisfaction are people with poorer health status, those covered by Medicaid, and those without supplementary insurance.     

Medicare payment changes and nursing home quality: effects on long-stay residents

The Balanced Budget Act of 1997 dramatically changed the way that Medicare pays skilled nursing facilities, providing a natural experiment in nursing home behavior. Medicare payment policy (directed at short-stay residents) may have affected outcomes for long-stay, chronic-care residents if services for these residents were subsidized through cost-shifting prior to implementation of Medicare prospective payment for nursing homes. We link changes in both the form and level of Medicare payment at the facility level with changes in resident-level quality, as represented by pressure sores and urinary tract infections in Minimum Data Set (MDS) assessments. Results show that long-stay residents experienced increased adverse outcomes with the elimination of Medicare cost reimbursement.     

Utilization of Medicare services by beneficiaries having partial Medicare coverage.

With the rapid increases in Medicare expenditures, policymakers are constantly reevaluating the use of and the need for services provided. One approach to better understand these issues is to identify major subgroups of the Medicare population for more detailed evaluation. A disaggregation of the data can pinpoint critical high expenditure areas for further study and may suggest potential cost containment strategies. With funding from the Health Care Financing Administration (HCFA), a series of investigations were designed to study utilization of services by particular types of Medicare beneficiaries. These include: Those who are continuously enrolled in the program over time. Those who died. Those who recently joined Medicare. Those who have one part of Medicare without the other part. This article discusses findings concerning beneficiaries who have only partial Medicare coverage (such as those who are enrolled under one part of Medicare without the other part).     

Changes in the Use of Postacute Care during the Initial Medicare Payment Reforms

Objective. To examine changes in postacute care (PAC) use during the initial Medicare payment reforms enacted by the Balanced Budget Act of 1997.
Data Sources. We used claims data from the 5 percent Medicare beneficiary sample in 1996, 1998, and 2000. Linked data from the Denominator file, Provider of Service file, and Area Resource File provided additional patient, hospital, and market-area characteristics.
Study Design. Six disease groups with high PAC use were selected for analysis. We used multinomial logit regression to examine how PAC use differed by year of service, controlling for patient, hospital, and market-area characteristics.
Principal Findings. There were major changes in PAC use, and a portion of services shifted to settings where reimbursement remained cost-based. During the first reform, the home health agency interim payment system, home health use decreased consistently across disease groups. This decrease was accompanied by increased use in skilled nursing facilities (SNFs). Following the implementation of the prospective payment system for SNFs, the use of inpatient rehabilitation facilities increased.
Conclusions. The shift in usage among settings occurred in two stages that corresponded to the timing of payment reforms for home health agencies and SNFs. Evidence strongly suggests the substitutability between PAC settings. Financial incentives, in addition to clinical needs and individual preferences, play a major role in PAC use.     

Seniors' need for and use of Medicare home health services

This study examined: (a) nature and extent of seniors' need for care both at time of admission to and discharge from Medicare home health services, and (b) relationships among admission need, service utilization, need at discharge, and discharge disposition for one episode of home care services. The sample of 195 was stratified by home health discharge disposition: (a) acute group, (b) chronic group, and (c) stable home group. Two classification systems were used to access the seniors' level of need, the mandated Medicare case-mix system (CMS) and a holistic intensity of need system. Findings show that there were no differences in services received by the three groups, that discharge did not mean seniors' need for home care services had been eliminated or reduced, and that caregiver support impacts seniors' need for home care.     

Post-hospital home health care for Medicare patients

Medicare patients in five diagnosis-related groups (DRGs) associated with heavy use of post-hospital care discharged from 52 hospitals in 3 cities were followed up at 6 weeks, 6 months, and 1 year to determine the factors associated with their being discharged home with or without home health care and the correlates of improvement in their functional status. Models correctly predicted those discharged home from those going to institutions in a range from 54 to 82 percent of cases. The amount of the variance in the change in function for those who went home (with or without home health care) explained by the models tested ranged from 19 percent to 73 percent. Total Medicare costs for the patients who went home were considerably less in the year subsequent to the hospitalization compared with those discharged to institutional care.     

Examining Black-White Disparities Among Medicare Beneficiaries in Assisted Living Settings in 2014

ObjectiveAssisted living (AL) provides housing and personal care to residents who need assistance with daily activities. Few studies have examined black-white disparities in larger (25 + beds) ALs; therefore, little is known about black residents, their prior residential settings, and how they compare to whites in AL. We examined racial differences among a national cohort of AL residents and how the racial variation among AL Medicare Fee-For-Service (FFS) beneficiaries compared to differences among community-dwelling and nursing home cohorts.Study designRetrospective cohort study.ParticipantsWe included (1) a prevalence sample of 442,018 white and black Medicare beneficiaries residing in large AL settings, (2) an incidence sample of new residents (n = 94,741), and (3) 10% random samples of Medicare FFS community-dwelling and nursing home beneficiaries in 2014.MeasuresThe Medicare Master Summary Beneficiary File was used to identify AL residents and provided demographic, entitlement, chronic condition, and health care utilization information. We used the American Community Survey and prior ZIP code tabulation areas of residents to examine differences in prior neighborhoods. Medicare claims and the Minimum Data Set yielded samples of Medicare FFS community-dwelling older adults and nursing home residents.ResultsBlacks were disproportionately represented in AL, younger, more likely to be Medicaid eligible, had higher levels of acuity, and more often lived in ALs with fewer whites and more duals. New black residents entered AL with higher rates of acute care hospitalizations and skilled nursing facility utilization. Across the 3 cohorts, blacks had higher rates of dual-eligibility.ConclusionsBlack-white differences observed among AL residents indicate a need for future work to examine how disparities manifest in differences in care received and residents’ outcomes, as well as the pathways to AL. More research is needed to understand the implications of inequities in AL as they relate to quality and experiences of residents.     

Beneficiary survey-based feedback on new Medicare informational materials

In response to the Balanced Budget Act (BBA) of 1997, the Center for Medicare & Medicaid Services (CMS) initiated a massive information and education campaign to promote effective health plan decision-making. Early results suggest that the pilot version of the Medicare & You handbook and other new Medicare informational materials were viewed favorably overall. Despite their limitations, most beneficiaries found the information useful. The longer, more comprehensive materials were not perceived to be more useful than the shorter, less complicated version. Additional research is needed to determine which subgroups of beneficiaries may need more and, possibly less, information.     

Interactions between Medicare and Medicaid home care in Connecticut: responses to the 1997 BBA

Although overlaps exist in the provision of home care services financed by Medicare and Medicaid, interactions of the two funding sources at the beneficiary and home care provider levels have not been widely studied. The recent dramatic declines in Medicare home health spending present a rare opportunity to examine how changes in Medicare spending can affect the provision of Medicaid home care services. We conducted a study of Medicare-Medicaid dynamics in the state of Connecticut to shed light on the inter-relationships of the two funding sources.     

Prevalence of multiple chronic conditions in the United States' Medicare population

In 2006, the Centers for Medicare & Medicaid Services, which administers the Medicare program in the United States, launched the Chronic Condition Data Warehouse (CCW). The CCW contains all Medicare fee-for-service (FFS) institutional and non-institutional claims, nursing home and home health assessment data, and enrollment/eligibility information from January 1, 1999 forward for a random 5% sample of Medicare beneficiaries (and 100% of the Medicare population from 2000 forward). Twenty-one predefined chronic condition indicator variables are coded within the CCW, to facilitate research on chronic conditions.