Dive Brief:
- Medicare is allowing beneficiaries at dozens of hospitals participating in pilot projects across the U.S. to be exempted from a controversial requirement limiting nursing home coverage to those seniors who are admitted to the hospital for at least three days.
- The projects' aim is to ascertain whether new payment arrangements with hospitals and other healthcare providers dropping the three-day rule can reduce costs or keep costs the same while improving quality of care. Some projects involve bundled payments, under which Medicare pays a set fee for certain procedures.
- Projects are being conducted under a provision of the Affordable Care Act that created the Center for Medicare and Medicaid Innovations within CMS to develop ways of improving Medicare. The reform law allows the government to expand successful pilot projects nationwide.
Dive Insight:
Massachusetts General Hospital in Boston is among the hospitals participating in Medicare's pilot projects. Its waiver on Medicare's three-day observational care requirement "gets patients to the care they need much quicker and prevents them from clinically declining at home," Dr. Eric Weil, clinical affairs associate chief for Massachusetts General's general internal medicine division, told Kaiser Health News. If patients spend less time in the hospital, he said that frees up resources for sicker patients; and Medicare saves money because nursing home or home healthcare is less costly than hospitalization.
Medicare's three-day hospital admission rule has frustrated seniors who don't qualify for nursing home coverage because they were in the hospital under observation care, considered outpatient, instead of being admitted. The number of observation patients ineligible for Medicare-covered nursing home care has increased by 88% in just six years, to 1.8 million in 2012, Kaiser Health News reported. Regulators have argued that only Congress can change the rule.
Diane Paulson, a Boston attorney who is handling observation care appeals for some beneficiaries, told Kaiser Health News that Medicare should get rid of the requirement without waiting for the pilot projects' results. "Nursing home care and other benefits are supposed to be covered if medically necessary, and are not based on alleged cost savings," she said. The president of a hospital in The Cleveland Clinic's system said Medicare at least should get credit for saying it is willing to waive its rules in order to evaluate whether it leads to better care.