[Congressional Record Volume 146, Number 106 (Tuesday, September 12, 2000)]
[Senate]
[Pages S8418-S8419]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. KERRY:
  S. 3034. A bill to amend title XVIII of the Social Security Act with 
respect to payments made under the prospective payment system for home 
health services furnished under the Medicare Program; to the Committee 
on Finance.


               HOME HEALTH REFINEMENT AMENDMENTS OF 2000

  Mr. KERRY. Mr. President, I am pleased to introduce the Home Health 
Refinement Amendments of 2000. This legislation will protect patient 
access to home health care under Medicare, and ensure that providers 
are able to continue serving seniors who reside in medically 
underserved areas, have medically complex conditions, or require non-
routine medical supplies.
  Medicare was enacted in 1965, under the leadership of President 
Lyndon Johnson, as a promise to the American people that, in exchange 
for their years of hard work and service to our country, their health 
care would be protected in their golden years. Today, over 30 million 
seniors rely on the Medicare home health benefit to receive the care 
they need to maintain their independence and remain in their own homes, 
and to avoid the need for more costly hospital or nursing home care. 
Home health care is critical. It is a benefit to which all eligible 
Medicare beneficiaries should be entitled. But, this benefit is being 
seriously undermined. Since enactment of the Balanced Budget Act, BBA, 
of 1997, federal funding for home health care has plummeted. According 
to the Congressional Budget Office, CBO, Medicare spending on home 
health care dropped 48 percent in the last two fiscal years--from $17.5 
billion in 1998 to $9.7 billion in 1999--far beyond the original amount 
of savings sought by the BBA. Across the country, these cuts have 
forced over 2,500 home health agencies to close and over 900,000 
patients to lose their services.
  In my own State of Massachusetts--a state that, because of economic 
efficiency, sustained a disproportionate share of the BBA cuts in 
Medicare home health funding--28 home health agencies have closed, 6 
more have turned in their Medicare provider numbers and chosen to opt 
out of the Medicare program, and 12 more have been forced to merge in 
order to consolidate their limited resources. The home health agencies 
that have continued to serve patients despite the deep cuts in Medicare 
funding reported net operating losses of $164 million in 1998. The loss 
of home health care providers in Massachusetts has cost 10,000 patients 
access to home health services. Consequently, many of the most 
vulnerable residents in my state are being forced to enter hospitals 
and nursing homes, or going without any help at all.
  To compound the problem, without Congressional action, Medicare 
payments for home health care will be automatically cut by an 
additional 15 percent next year. It is critical that we defend 
America's seniors against future cuts in home health services, and this 
bill will eliminate the additional 15 percent cut in Medicare home 
health payments mandated by the BBA. However, we must do more than 
attempt to stop future cuts. Indeed, it is equally as important that we 
begin to provide relief to home health providers who are already 
struggling to care for patients.
  During the first year of implementation of the Interim Payment 
System, IPS, agencies were placed on precarious financial footing 
because of insufficient payments, particularly for high-cost and long-
term patients. Accordingly, it is critical that we bolster the efforts 
of home health care providers to transcend their current operating 
deficits, especially as they transition from the Interim Payment System 
to the Prospective Payment System, PPS.
  The Home Health Refinement Amendments of 2000 would ensure that 
providers are able to treat the sickest, most expensive patients who 
rely on home health care. Independent studies indicate that, under IPS, 
thousands of patients have been denied home health care benefits--while 
``outlier'' patients (those who require the most intensive services) 
have been most at risk of losing access to care. To address the costs 
of treating the sickest homebound patients, this legislation provides 
additional funding for outliers under PPS. Specifically, this bill 
would set the funding level for outliers at 10 percent of the total 
payments projected or estimated to be made under PPS each year. This 
would double the current 5 percent allocation without reducing the PPS 
base payment.
  In addition, the Home Health Refinement Amendments of 2000 would 
remove the costs of non-routine medical supplies from the PPS base 
payment and, instead, arrange for Medicare reimbursement for these 
supplies on the basis of a fee schedule. PPS rates include average 
medical supply costs, but some agencies' patient populations have 
greater or lesser supply needs than the average. Thus, current rates 
would underpay agencies that treat patients with high medical supply 
needs and overpay agencies that treat patients with low medical supply 
needs. Agencies that treat our most ill, frail, and vulnerable should 
not be punished with low payment rates.
  Agencies that treat patients in medically underserved communities 
also deserve equitable reimbursement for the services they provide. In 
order to address the unique costs of treating patients in underserved 
areas, the Home Health Refinement Amendments of 2000 would establish a 
10 percent add-on to the episodic base payment for patients in rural 
areas, to reflect the increasing costs of travel, and a ``reasonable 
cost'' add-on for security services utilized by providers in our urban 
areas. These add-ons ensure that patients in all types of communities 
across the country continue to receive the home care they need and 
deserve.
  Finally, this legislation would encourage the incorporation of 
telehealth

[[Page S8419]]

technology in home care plans by allowing cost reporting of the 
telemedicine services utilized by agencies. Telemedicine has 
demonstrated tremendous potential in bringing modern health care 
services to patients who reside in areas where providers and technology 
are scarce. Cost reporting will provide the data necessary to develop a 
fair and reasonable Medicare reimbursement policy for telehomecare and 
bring the benefits of modern science and technology to our nation's 
underserved.
  Unless we increase the federal commitment to the Medicare home health 
care benefit, we can only expect to continue to imperil the health of 
an entire generation. We must act to deliver on that promise that 
President Johnson made 25 years ago--our nation's seniors deserve no 
less.
                                 ______