Statements on Introduced Bills and Joint Resolutions

Floor Speech

STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS -- (Senate - October 17, 2007)

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Ms. COLLINS. Mr. President, I am pleased to join Senators Casey, Bond, Cantwell, Roberts and Reed in introducing legislation, the Home Health Care Access Protection Act, to prevent the devastating 11.75 percent cut that the Centers for Medicare and Medicaid Services, CMS, is planning to make in Medicare home health payment rates over the next 4 years.

Home health has become an increasingly important part of our health care system. The kinds of highly skilled and often technically complex services that our Nation's home health agencies provide have helped to keep families together and enabled millions of our most frail and vulnerable older and disabled persons to avoid hospitals and nursing homes and stay just where they want to be--in the comfort and security of their own homes. Moreover, by helping these individuals to avoid more costly institutional care, they are saving Medicare millions of dollars each year.

That is why I find it so ironic that the Medicare home health benefit is once again under attack.

The House version of the SCHIP reauthorization bill proposed cutting Medicare home health spending by $2.6 billion over 5 years, and the Senate may soon be considering similar cuts.

To make matters worse, CMS has proposed additional administrative cuts that are estimated to total more than $6 billion over the next 5 years. If allowed to go forward, this ``double whammy'' for home care will result in
cuts in excess of $8.6 billion over 5 years from a program that costs less than $15 billion a year. This simply is not right, and it certainly is not in the best interest of our Nation's seniors who rely on home care to keep them out of hospitals, nursing homes and other institutions.

The administrative cuts proposed by CMS are based on the assertion that home health agencies have intentionally ``gamed the system'' by claiming that their patients have conditions of higher clinical severity than they actually have in order to receive higher Medicare payments. This unfounded allegation of ``case mix creep'' is based on what CMS contends to be an increase in the average clinical assessment ``score'' of home health patients over the last few years.

In fact, there are very real clinical and policy explanations for why the average clinical severity of home care patients' health conditions may have increased over the years. For example, the incentives built into the hospital DRG reimbursement system have led to the faster discharge of sicker patients. Advances in technology and changes in medical practice have also enabled home health agencies to treat more complicated medical conditions that earlier could only be treated in hospitals, nursing homes, or inpatient rehabilitation facilities.

These administrative cuts are proposed to go into effect on January l. This would be devastating to home health agencies in Maine and across the Nation, particularly given that there is no evidence of intentional ``gaming'' on the part of home health agencies to warrant such a severe financial penalty.

Moreover, CMS has not made public any of the details of the research method, data and findings they used to justify the planned cuts, making it impossible for Congress or the public to evaluate the reliability or the validity of its actions.

What is of most concern to me, however, is that this unfair penalty is being assessed across the board, even for home health agencies that showed a decrease in their clinical assessment scores. If an individual home health agency is truly gaming the system,

CMS should target that one agency, not penalize everyone.

The fact is that the Medicare home health benefit has already taken a larger hit in spending cuts over the past 10 years than any other Medicare benefit. In fact, home health as a share of Medicare spending has dropped from 8.7 percent in 1997 to 3.2 percent today, and is projected to decline to 2.6 percent of Medicare spending in 2015.

This downward spiral in home health spending began with provisions in the Balanced Budget Act of 1997, which resulted in a 50 percent cut in Medicare home health spending by 2001--far more than the Congress intended or the Congressional Budget Office projected.

And home health spending continues to be much lower than CBO projections. In 2000, the CBO projected that home health spending in 2006 would total $21.1 billion under the new home health prospective payment system. The actual total expenditures for home health last year were $13.2 billion. If home health agencies were engaging in the kind of widespread ``upcoding'' that CMS has alleged, home health spending would be exceeding CBO's projections. In fact, home health spending has been far less than expected.

Home health care has consistently proven to be a compassionate and cost-effective alternative to institutional care. Additional deep cuts will be completely counterproductive to our efforts to control overall health care costs. They will also place the quality of home health services at risk, particularly given ever-rising transportation, staffing, and technology costs. Cuts of this magnitude could leave some providers with no alternative but to reduce the number of home health visits or patient admissions, which would ultimately threaten seniors' access to care and clinical outcomes. Or they could cause them to close their doors altogether.

The legislation that we are introducing today will block the ``case mix creep'' cuts that were proposed by CMS as part of the final home health prospective payment system regulation in August. It will also establish a reliable and transparent process that the Department of Health and Human Services must use to justify that payment rate cuts are needed to account for improper changes in ``case mix scoring.'' A companion bill to our legislation is being introduced in the House by Representative Jim McGovern.

The Home Health Care Access Protection Act of 2007 will help to ensure that our seniors and disabled Americans continue to have access to the quality home health services they deserve, and I encourage all of my colleagues to sign on as cosponsors.

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