This week the government settled a federal class action lawsuit involving the Medicare program. The settlement will affect millions of Medicare recipients and involves those Medicare recipients who require rehabilitative services.
Every day, I meet with individuals who have a family member receiving rehabilitation services. Rehabilitative services are commonly received in a sub-acute care facility or a skilled nursing facility. In common parlance, a skilled nursing facility is a nursing home.
Rehabilitative services typically come into play in a situation such as the following: Mr. Smith is eighty years of age and is a Medicare recipient. Mr. Smith, who lives at home alone, falls and breaks his hip. Mr. Smith is taken to the hospital and has surgery performed to mend his broken hip. After spending several days in the hospital, Mr. Smith is discharged to a nursing home for skilled rehabilitative services.
The rehabilitative services that Mr. Smith receives in the nursing home are covered by the Medicare program. The Medicare program will pay for up to 100 days of rehabilitative services for Mr. Smith. The Medicare program pays the first twenty days of rehabilitative services in full. Days twenty-one through one hundred have a co-payment. Currently, the co-payment is $144.50 per day. Many private health insurance programs cover this co-payment, so even if Mr. Smith receives the full 100 days of service, his rehabilitation may be fully covered by either the Medicare program or his private health insurance.
The 100 days of coverage is not a guarantee, meaning that no patient is guaranteed that he will actually receive 100 days of coverage. Most Medicare recipients do not receive the full 100 days of coverage.
What the recent class action settlement involves is the standard that the Medicare program uses in order to permit a Medicare recipient to receive coverage under the Medicare program. The law (federal regulations) has always stated that the rehabilitative services must be necessary in order to maintain the Medicare recipient’s health status.
In other words, if Mr. Smith needs rehabilitative services in order to maintain his current health status, he is entitled to up to 100 days of coverage under the Medicare program. So, if Mr. Smith’s current health status would slide backwards if he did not receive rehabilitative services, then under the Medicare law as it has been written would permit Mr. Smith to receive Medicare coverage.
But that is not how the Medicare program has interpreted the law for many, many years. The Medicare manual, a policy manual the federal agency that administers the Medicaid program drafted, has always said that rehabilitative services must be necessary to improve the condition of the patient. In other words, unless the patient’s health status is improving as a result of the rehabilitation, then Medicare won’t cover the care.
The contrast is stark. The law has always said that the rehab must be necessary to maintain the patient’s health status. The government has always said that the rehab must be improving the patient’s health status.
I can tell you that a great number of patients who receive rehabilitative services do not improve but do require rehab to maintain their current health status. For that reason, this settlement, which affects all Medicare beneficiaries, will have a very large impact, and a positive impact, for Medicare recipients.