[Congressional Record Volume 147, Number 21 (Wednesday, February 14, 2001)]
[Senate]
[Pages S1396-S1399]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Ms. COLLINS (for herself, Mr. Bond, Mr. Kerry, Mr. Reed, Mr. 
        Jeffords, Mr. Roberts, Mr. Levin, Mr. Hutchinson, Mrs. Murray, 
        Mr. Enzi, Ms. Mikulski, Mr. Smith of New Hampshire, Mr. 
        Santorum, Mr. Chafee, Mr. DeWine, Mr. Helms, Mrs. Hutchison, 
        Mr. Specter, Mr. Murkowski, Ms. Snowe, Mr. Warner, Mr. Gregg, 
        Mrs. Carnahan, Mr. Lugar, and Mr. Cochran):
  S. 326. A bill to amend title XVIII of the Social Security Act to 
eliminate the 15 percent reduction in payment rates under the 
prospective payment system for home health services and to permanently 
increase payments for such services that are furnished in rural areas; 
to the Committee on Finance.
  Ms. COLLINS. Mr. President, I am pleased to join with Senators Bond, 
Reed, Jeffords, Kerry, Roberts, Murray, Hutchinson, Levin, Enzi, 
Mikulski, Santorum, Hutchison, Chafee, DeWine, Helms, Specter, 
Murkowski, Warner, Bob Smith, Lugar, Snowe, and others in introducing 
the Home Care Stability Act of 2001 to eliminate the automatic 15 
percent reduction in Medicare payments to home health

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agencies that is currently scheduled to go into effect on October 1, 
2002. The legislation we are introducing this morning will also extend 
the temporary 10 percent add-on payment for home health patients in 
rural areas to ensure that these patients continue to have access to 
care.
  Health care has gone full circle. Patients are spending less time in 
the hospital. More and more procedures are being done on an outpatient 
basis, and recovery and care for patients with chronic diseases and 
conditions has increasingly been taking place in the home. Moreover, 
the number of older Americans who are chronically ill or disabled in 
some way continues to grow each year.
  Concerns about how to care effectively and compassionately for these 
individuals will only multiply as our population ages and as it is at 
greater risk for chronic disease and disability.
  As a consequence, home health care has become an increasingly 
important part of our health care system. The kind of highly skilled 
and often technically complex services that our Nation's home health 
agencies provide have enabled millions of our most frail and vulnerable 
senior citizens to avoid hospitals and nursing homes and to receive the 
care they need just where they want to be: in the security, privacy, 
and comfort of their own homes.
  By the late 1990s, home health care was the fastest growing component 
of Medicare spending. The program was growing at an average annual rate 
of 25 percent. For this reason, Congress and the administration, as 
part of the Balanced Budget Act of 1997, initiated changes that were 
intended to slow the growth in spending and make the program more cost-
effective and efficient.
  These measures, however, have unfortunately produced cuts in home 
health care spending that were far, far beyond what Congress ever 
intended. According to preliminary estimates by the CBO, home health 
care spending dropped to $9.2 billion last year, half the amount that 
was being spent just 3 years earlier, in 1997.
  On the horizon is yet an additional 15-percent cut that would put 
many of our already struggling home health agencies at risk and which 
would seriously jeopardize access to critical home health services for 
millions of our Nation's seniors.
  It is now crystal clear that the savings goals set for home health in 
the Balanced Budget Act of 1997 have not only been met, but far 
exceeded. The most recent CBO projections show that the post-Balanced 
Budget Act reductions in home health will be about $69 billion between 
fiscal years 1998 and 2002. That is more than four times the $16 
billion the CBO originally estimated for that time period, and it is a 
clear indication that the Medicare home health cutbacks have been far 
deeper and far more wide-reaching than Congress ever intended.
  As a consequence, we have home health agencies across the country 
that are experiencing acute financial difficulties and cashflow 
problems. These financial difficulties are inhibiting their ability to 
deliver much needed care. Approximately 3,300 home health agencies have 
either closed or stopped serving Medicare patients nationwide--3,300, 
Mr. President. That is how deep these cuts were.
  Moreover, the Health Care Financing Administration estimates that 
900,000 fewer home health patients received services in 1999 than in 
1997. This points to the most central and important consequence of 
these cuts. The fact is that cuts of this magnitude simply cannot be 
sustained without adversely affecting the quality and availability of 
patient care.
  The effects of these regulations and cuts have been particularly 
devastating in my home State of Maine. The number of home health 
patients in Maine dropped from almost 49,000 to 37,545. That is a 
change of 23 percent. This means there are 11,000 senior citizens or 
disabled citizens in Maine who are no longer receiving home health 
services.
  What has happened to those 11,000 individuals? I have talked with 
patients, and I have talked with home health nurses throughout the 
State of Maine, and I found that many of these patients have ended up 
going into nursing homes prematurely. Others have been repeatedly 
hospitalized with problems that could have been avoided had they been 
continuing to receive their home health benefits. Still others are 
trying to pay for the care themselves, often on very limited means. And 
yet others are going without care altogether.

  A home health nurse in Saco, ME, told me of a patient who she 
believes ultimately died because she lost her home health benefits. She 
lost those nurses coming to check on her condition. The result was that 
she developed an infection that the home health nurse undoubtedly would 
have caught. The result was a tragedy in this case.
  We have seen a 40-percent drop in the number of visits in the State 
of Maine and a 31-percent cut in Medicare reimbursements to home health 
agencies.
  Keep in mind that Maine's home health agencies have historically been 
very prudent in their use of resources. They were low cost to begin 
with. The problem is, when you have cuts of these magnitudes imposed on 
agencies that are already low-cost providers, they simply cannot 
sustain the cuts and continue to deliver the services that our seniors 
need.
  The real losers in this situation are our Nation's seniors, 
particularly those sicker Medicare patients with complex care needs who 
are already experiencing difficulty in getting the home care services 
they deserve.
  I am very concerned that additional deep cuts are already on the 
horizon. As I mentioned, on October 1, 2002, an additional automatic 
15-percent cut is scheduled to go into effect. We need to act.
  Last year we passed legislation, the Medicare, Medicaid, and S-CHIP 
Benefits Improvement and Protection Act, which did provide a small 
measure of relief to our Nation's struggling home health agencies. It 
did, for example, delay by another year the 15-percent cut I have 
discussed this morning, but I do not think that goes far enough. The 
automatic reduction should be eliminated completely. We do not need it 
to achieve the savings estimated by the Balanced Budget Act. Those have 
already been far surpassed, and the implications for health care for 
some of our most frail and ill senior citizens are enormous.
  The fact is, an additional 15-percent cut in Medicare home health 
payments would ring the death knell for those low-cost agencies which 
are currently struggling to hang on, and it would further reduce our 
seniors' access to critical home care services.
  This is the fourth year we have fought this battle. To simply keep 
delaying this cut by yet another year is to leave a sword of Damocles 
hanging over our home health system. It makes it very difficult for our 
home health agencies to plan how they are going to serve their Medicare 
patients in the future. It encourages them to turn away patients who 
are going to be very expensive to care for, and it forces us to spend 
valuable time, energy, and resources fighting for repeal every single 
year--time and resources that would far better be spent ensuring the 
success of the Medicare home health prospective payments system.
  The legislation we are introducing today would once and for all 
eliminate the automatic cut. It would also make permanent the temporary 
10-percent add-on for home health services furnished patients in rural 
areas. That was included in the legislation last year. We would make it 
permanent.
  As the Presiding Officer well knows, it is sometimes very expensive 
for home health agencies to deliver services to rural patients. They 
have to travel long distances, and it takes a long time to reach those 
patients. That all adds to the cost. In fact, surveys show that the 
delivery of home health services in rural areas can be as much as 12 to 
15 percent more costly because of the extra travel time required, 
higher transportation expenses, and other factors.
  This provision will ensure that our seniors living in rural areas 
continue to have access to critical high-quality home health services.
  Mr. President, the Home Health Care Stability Act will provide a 
needed measure of relief and certainty for cost-efficient home health 
agencies across the country that are experiencing acute financial 
problems that are inhibiting their ability to deliver much needed care, 
particularly to chronically ill Medicare patients with complex care 
needs. I urge all of my colleagues to join us in cosponsoring this 
important legislation.

[[Page S1398]]

  Let's get the job done once and for all this year. Let's repeal that 
15-percent cut that otherwise would go into effect. Let's remove that 
uncertainty that is hanging over our home health agencies, and let's 
recommit ourselves to providing quality home health care benefits to 
our seniors and our disabled citizens.
  Mr. BOND. Mr. President, I rise today to join with my colleague from 
Maine, Senator Collins, to introduce legislation that addresses the 
ongoing crisis in home health care. Twenty-two of our colleagues join 
with us today to offer the Home Health Payment Fairness Act to deal 
with this crisis and to try to ensure that seniors and disabled 
Americans have appropriate access to high-quality home health care.
  Home health care is an important part of Medicare in which seniors 
and the disabled can get basic nursing and therapy care in their home, 
if their health or physical condition makes it almost impossible to 
leave home. Often home health is an alternative to more expensive 
services that may be provided in a hospital or a skilled nursing 
facility--and thus is a cost-effective way to provide needed care.
  It is convenient, but much more importantly, patients love it. They 
love it because home health care is the key to fulfilling what is 
virtually a universal desire among seniors and those with 
disabilities--to remain independent and within the comfort of their own 
homes despite their health problems.
  Yet we have a crisis in home health--too many seniors who could and 
should be receiving home health are not getting it. They may be 
suffering, in their home, without getting the health care they need. 
Or, they may be getting care, but only because they have been forced 
into a nursing home rather than being able to stay in the comfort and 
the dignity of their home. Either way, they are not getting the most 
appropriate care--and this is tragic.
  As with so many other problems with Medicare in the last few years, 
the problem comes from two sources--the Balanced Budget Act, and the 
Health Care Financing Administration.
  We all know the basic story by now--in an effort to balance the 
budget, Congress in the BBA tried to cut the growth in Medicare 
spending. Yet the real-world results went much further than we 
intended--partially because of things beyond anyone's control, but 
largely due to faulty implementation and the excessive regulatory zeal 
of HCFA. As the cuts and regulation went out-of-control, health care 
providers struggled to survive, but many were forced to close entirely 
or to stop serving Medicare. This harmed patients because they lost 
care options that had been available previously.
  This basic storyline applies to patients and providers in all parts 
of Medicare--hospitals, nursing homes, home health care--everyone. But 
there are two things that distinguish the home health crisis from all 
of the other problems that stem from the Balanced Budget Act.
  First and most importantly, no other group of Medicare patients and 
providers have endured as many difficulties. This is a big claim, given 
the many horror stories we've heard about the Balanced Budget Act. But 
absolutely nobody has suffered like home health patients and home 
health agencies. The numbers don't lie.
  Two years after the Balanced Budget Act, almost 900,000 fewer seniors 
and disabled Americans were receiving home health care than previously. 
That's upwards of a million patients--one of every four who had been 
receiving home health--who simply disappeared from the world of home 
care. Unfortunately, the explanation is not a miraculous improvement in 
the health of our nation's seniors that drastically reduced the need 
for home health care. No, almost one million fewer people were 
receiving home care because the help just wasn't available.
  This is partly because more than 3,300 of the nation's 10,000 home 
health agencies have either gone out-of-business, or have stopped 
serving Medicare patients. That's one-third of the home health 
providers--gone. Can you imagine the outrage we would have in this 
country if one-third of the hospitals simply disappeared?
  In some areas, this hasn't been a major problem because there were 
other local home health agencies to pick up the slack. But in many 
parts of America--particularly in rural America--this has led to a 
serious problem of getting access to care.
  In one sense, what's bad for the patient is good for the budget. 
Medicare home health spending has actually gone down for three straight 
years--dropping by 46 percent from 1997 and 2000. In Medicare, these 
types of cuts in spending are absolutely unprecedented. No other type 
of health care service in Medicare has ever seen drastic cuts like 
this. Remember, our goal in the Balanced Budget Act was to slow down 
the growth of the program, not to slash almost half of the spending out 
of vital services like home health care. In 1997, we envisioned $16 
billion in savings from home health over five years--but the most 
recent estimates show that we are on target to get $69 billion in 
savings, more then four times the target figure. This is not how 
anybody wanted to balance the federal budget.

  No State has been spared this crisis, but the seniors and the 
disabled in my home state of Missouri have been particularly hard-hit. 
27,000 fewer patients are receiving home care than before--that's a 
drop of 30 percent. And while Missouri had 300 home health agencies 
when the Balanced Budget Act passed, we now have just 161. That's 
almost 140 health care providers that Missourians need--but that are 
now gone.
  All of this points to the fact that the breadth and the depth of the 
post-Balanced Budget Act problems are undeniably worse in home health 
care than any other part of Medicare. That's the first thing that 
distinguishes home care from other struggling Medicare providers.
  The second thing that is unique about home health--the biggest cuts 
may be yet to come.
  While hospitals, nursing homes, hospice programs, and other Medicare 
providers still face some additional Balanced Budget Act cuts, most of 
the BBA provisions have already either taken effect or been erased by 
the two ``Medicare giveback'' bills we have passed into law.
  But home health care patients and providers still have the largest 
BBA cut of all staring them in the fact--the 15-percent across-the-
board home health cuts that are now scheduled for October of 2002. 
That's a 15-percent cut on top of everything else that has happened 
thus far--on top of the loss of 900,000 patients, on top of the loss of 
3,000-plus home health agencies, and on top of the loss of almost half 
of Medicare home health spending.
  I do not believe this should happen, and I actually don't know of 
anybody who believes the 15-percent home health cuts should go into 
effect. That's why Congress has already delayed the 15-percent cuts 
three separate times.
  To impose these cuts, given all that home health care has been 
through, would be adding insult to injury. It would risk putting 
thousands more home health agencies out-of-business, perhaps risking 
the care for a million more patients.
  Today, Senator Collins and I propose to fix this once and for all--no 
more mere delays, no more half-measures. The key provision in the Home 
Health Payment Fairness Act would permanently eliminate these 15-
percent cuts. This will be expensive--probably more than $10 billion 
over 10 years. I don't think anybody in Congress wants to drop the 
guillotine on home health by imposing these cuts--that's what the three 
delays have shown. We need to just bite the bullet and get rid of them 
once and for all.
  The one additional key provision in our bill would make permanent the 
10-percent bonus payments that we are about to start giving rural home 
health agencies. These new rural payments recognize that, historically, 
rural patients have been more expensive due to the added transportation 
and labor costs incurred as home health nurses travel longer distances 
between visits. The second Medicare ``giveback'' bill that Congress 
just passed into law in December authorized these bonus payments for 
the first time--but only for a two-year period. The reasons that rural 
patients cost more are going to last for more than two years--we 
believe the added rural payments should as well.
  This policy change will provide desperately-needed assistance to help 
home health care in rural America--which, as I mentioned earlier, has 
been much harder hit by the home health

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crisis. These added payments would be similar to the 10-percent 
incentive bonus Medicare currently pays to doctors in rural areas, and 
would serve the same purpose as the various Medicare mechanisms we have 
to protect rural hospitals. The rural incentives for doctors and 
hospitals are part of permanent law; the rural incentives for home 
health should be too.
  Home health care has been through enough. Our Nation's dedicated home 
health providers--and you know they are dedicated if they have struck 
with it through the difficulties of the last few years--deserve to be 
left along and given a rest. They deserve to be left alone to recover 
from the post-Balanced Budget Act chaos. They deserve to be left alone 
in order to adjust to a brand new home health payment system that 
Medicare put into place a few months ago--a new payment system 
specifically designed to reduce overuse of service in a much more 
intelligent and appropriate way than arbitrary cuts like those that are 
scheduled. And they deserve to be left alone to focus on providing 
high-quality care to Medicare patients. The seniors and disabled 
Americans who rely on home health for their health care, and for their 
independence, deserve no less.
  Mr. ALLARD. I thank the Senator from Missouri for his leadership on 
home health care. I agree with him. It does save money for the patient, 
and we want to encourage it as far as health care is concerned.
  Mr. REED. Mr. President, I rise today to join the chorus of support 
for the Home Health Payment Fairness Act. The intent of this important 
legislation is two-fold--first, eliminate the impending 15 percent 
reduction in home health payments scheduled to take effect in October 
2002, and second, restore a modicum of stability and predictability to 
the home health funding stream after years of volatility and turmoil. I 
was pleased to introduce similar language with Senator Collins last 
Congress; I am pleased to do so again.
  Over the past several years, Congress has worked to address the 
unintended consequences of the 1997 Balanced Budget Act, BBA. 
Specifically, we have sought to alleviate the tremendous financial 
burdens that have been borne by the home health industry and the 
patients who rely on these agencies for care. Since the enactment of 
the BBA, there has been a remarkable 48 percent decline in Medicare 
home health expenditures. Moreover, across the nation, home health 
agencies have been forced to cut back on services, and in some cases, 
close their doors forever. As a result, vulnerable and frail Medicare 
beneficiaries are being deprived of medically needed health services 
that enable these populations to receive care while remaining in the 
comfort of their homes and communities.
  While we have been able to correct for a number of the problems, one 
issue we have yet to resolve affirmatively is the impending 15 percent 
for home health services. This reduction, which was originally 
scheduled to take effect in October 2000, has been delayed since 2002. 
While this delay is certainly significant, we can and must do more to 
restore predictability to the home health reimbursement system. We must 
see to it that the 15 percent cut is eliminated--and I hope we can 
achieve that goal this year.
  As we have already seen, reductions of this magnitude are all too 
often shouldered by small, nonprofit home health agencies and the 
elderly and disabled beneficiaries they serve. Home health care 
agencies in my home state of Rhode Island have been especially hard hit 
by these changes. We have seen a significant decline in the number of 
beneficiaries served and access to care for more medically complex 
patients threatened by these cuts. These reductions have clearly had 
negative impact on patients who heavily rely on home health services.
  Nationally, between 1997 and 1998, the number of Medicare 
beneficiaries receiving home health services has fallen 14 percent, 
while the total number of home health visits has fallen by 40 percent. 
We have seen a similar trend in Rhode Island, where over 3,000 fewer 
beneficiaries are receiving home health care--representing a decline of 
16 percent--and the total number of visits has fallen 38 percent. These 
individuals are either being forced to turn to more expensive 
alternatives, such as institutional-based nursing homes and skilled 
nursing facilities for their care, or these individuals are simply 
going without care, which places an immeasurable burden on the family 
and friends of vulnerable beneficiaries.
  I truly do not believe this is the path we want to remain on when it 
comes to home health care. In light of the impending ``senior boom'' 
that will be hitting our entitlement programs in a few short years, we 
should be doing all we can to preserve and strengthen the Medicare home 
health benefit. We can begin to do so by eliminating the 15 percent 
reduction in home health payments. By taking this step, we will 
alleviate an enormous burden that has been looming over financially 
strapped home health agencies as well as the frail and vulnerable 
Medicare beneficiaries who rely on these critical services.
  I urge my colleagues to join us in supporting this critical 
legislation, and I look forward to working with Senator Collins and my 
other colleagues on the home health issue this Congress.
                                 ______