Are you in need of Home Health Care? One of the “Medicare savings” in the proposed 2014 budget – $730 million– calls for a Proposed Co-Pay for Home Health Care of $100 per episode of home health care. An “episode of care” means 5 or more visits over a period of 60 days or less not immediately preceded by a hospital stay.

What is Medicare Home Health Care?

Home health care is covered by Medicare for beneficiaries who are homebound and need frequent visits by a physical therapist, speech therapist, occupational therapist, or nurse, but who do not need to be in a hospital. Home health care can be used, as it was for my father, as a step-down after a nursing home stay. After being hospitalized briefly for a serious infection, he was too weak to move around on his own, so he was released to a skilled nursing facility for physical therapy. The skilled nursing facility stay was paid for by Medicare because it followed a hospital stay. After about a month he was on his feet enough to come home, but still needed some therapy and monitoring by a nurse. The availability of home health care allowed him to return home sooner than he could have otherwise.

What are the Proposed Changes to Medicare Home Health Care?

The proposed $100 co-pay is only a small portion of the average cost of an episode of home health care, which is about $3,000. The co-pay is not enough to bring about the projected $730 million savings to the program. The real purpose of the co-pay, according the Medicare Payment Advisory Commission, is to ensure the appropriate use of home health care. In other words, to discourage its use by those who can’t afford the co-pay. The real savings expected to be generated by the co-pay will result from home health care being used less frequently.

The real problem with instituting a co-pay to discourage use of home health care is that using it less will most likely increase rather than decrease the overall health care expenses of those who would otherwise use it appropriately. For example, without the free availability of home health care, my father would likely have stayed another week or two in a nursing home, at greater expense to Medicare. In other instances, keeping seniors more healthy at home can avoid the necessity of more expensive hospitalization. A doctor may be willing to leave a patient at home in the care of relatives when a nurse or other professional is available on a frequent basis to supervise or administer particular treatments. The other choice is hospitalization, or a period in a nursing home, either of which is much more expensive. When the patient has Medicare supplement insurance that pays Medicare co-pays for hospital visits, they can be perceived as “free” just as home health care without a co-pay is perceived.

The fact is, anything that keeps seniors healthier at home ultimately costs less than allowing them to become so unhealthy that hospitalization or nursing home care is required. A study in the New England Journal of Medicine reported that higher co-pays for doctor visits did result in seniors having fewer doctor visits. But those same seniors had more, and longer, hospitalizations. The study compared Medicare Advantage plans, finding that those with higher co-pays for outpatient visits lost more on increased inpatient care than they saved on reduced outpatient care.

If, indeed, home health care is being used inappropriately, the way to deal with that is directly, identifying fraud and prosecuting those responsible. Instituting a co-pay is not a reasonable way to curtail “inappropriate use” and is likely to result in increasing rather than reducing overall costs to Medicare system.

Can Medicare Supplements Help Pay for Home Health Care?

Yes!  Medicare Supplements or Medigap plans can cover your Home Health Care co-pay.  Please call 1-866-466-9118 to speak with one of our Benefit Advisors or click here to get a quote.