[Congressional Record Volume 144, Number 118 (Wednesday, September 9, 1998)]
[Extensions of Remarks]
[Page E1666]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


         WHY WE SHOULD QUESTION HOSPITAL HOME HEALTH REFERRALS

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                        HON. FORTNEY PETE STARK

                             of california

                    in the house of representatives

                      Wednesday, September 9, 1998

  Mr. STARK. Mr. Speaker, on August 6, the Ways and Means Health 
Subcommittee held a hearing on the problems facing home health agencies 
because of payment changes made in the Balanced Budget Act of 1997.
  In theory, for good and honest agencies, the BBA should not have 
created problems. It simply asks home health agencies (HHAs) to 
practice the type of care they practiced in 1994, before many HHAs 
greatly increased their number of visits per patient and their costs 
per visit. The theory assumed, of course, that HHAs are serving the 
same kind of patients they received in 1994.
  But between 1990 and 1996, the number of HHAs owned by hospitals 
nearly doubled, and today, about half the nation's hospitals own HHAs.
  So what, you say? At the August 6 hearing, one independent HHA 
testified, saying what several HHAs have told me privately:

       As a freestanding agency, Great Rivers Home Care receives 
     few referrals from hospitals since most have their own home 
     health agencies. Our experience is that the hospitals refer 
     the short term, less complex cases to their own agencies and 
     the sicker, more costly, long term patients are then cared 
     for by agencies like ours.

  I do not know the quality of care provided by Great Rivers, but I do 
know they dared say what others are only saying privately. Before we 
casually throw more money at the home health sector, we should ask 
whether there is a self-referral abuse that is causing serious 
distortions in this part of Medicare.

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