Friday, January 18, 2013

Important Medicare case settlement awaits final approval

UPDATE from the Center for Medicare Advocacy: "The Center for Medicare Advocacy, along with its co-counsel Vermont Legal Aid are pleased that the Settlement in the Medicare Improvement Standard case, Jimmo v. Sebelius,[1] was approved on January 24, 2013 during a scheduled fairness hearing, marking a critical step forward for thousands of beneficiaries nationwide. "
[Most low-income adults who are developmentally disabled are eligible for Medicaid when they turn 18. They may also become eligible for Medicare if a parent who has been paying into the Social Security System either dies, retires, or becomes disabled.] 
An agreement has been reached in a class action lawsuit that is especially important to people covered by Medicare who have chronic or debilitating medical conditions from which they may not recover or improve. In the final stage of the settlement process, a Fairness Hearing will be held on January 24, 2013 to determine whether the agreement is "fair, reasonable, and adequate", after which a final judgment may be issued to approve the settlement.

In  Jimmo v. Sebelius, No. 11-cv-17 (D.Vt.), the plaintiffs contend that Medicare has for years illegally restricted coverage of skilled nursing and therapy services  only to beneficiaries who showed improvement. Beneficiaries who needed services to maintain their status or to slow deterioration were denied services on the basis that they would not improve. A settlement that was signed by the Chief Judge for the District of Vermont on November 20, 2012 would overturn the "improvement standard" and require that skilled nursing and therapy services necessary to maintain a person's condition can be covered by Medicare.

[Visit the Web site for Center for Medicare Advocacy, Inc.  for the most complete information on the case that includes Frequently Asked Questions, personal stories, and links to important documents.]

The federal Centers for Medicare and Medicaid Services (CMS) has agreed to revise the Medicare Benefit Policy Manual to include new policy provisions. Skilled Nursing Facilities, Home Health Services, and Outpatient Therapy Services, including outpatient physical and occupational therapy and speech pathology services, will be covered "to perform a maintenance program [that] does not turn on the presence or absence of a beneficiary's potential for improvement from the therapy, but rather on the beneficiary's need for skilled care."


The Center for Medicare Advocacy, Inc. asks and answers an important question:

Q:  Will the Jimmo Settlement Agreement cost Medicare too much?

A:   The Settlement only provides Medicare coverage for services that the law has always covered, and for which people pay into Medicare to receive. The skilled maintenance nursing and therapy that is at the heart of the Settlement is usually low-cost, low-tech care that will often prevent the individual from declining further and requiring more intense, more expensive care.  In addition to being the right and legal thing to do, covering services such as those included in the Settlement Agreement may actually be more cost-effective than failing to provide these services.

A recent study regarding a Veterans Administration care model makes this point. In the VA program primary care teams are provided to assist the highest cost patients with multiple chronic diseases in their homes. The program operates in more than 250 locations, has an average daily census of more than 27,000 patients and has shown savings of 24% where costs are the highest. It has reduced hospitalizations by over 60% and has reduced nursing home use by over 80%. Many similar programs show savings on the highest cost patients of 50% or more, while showing very high patient/caregiver satisfaction.

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