[Congressional Record (Bound Edition), Volume 149 (2003), Part 14]
[Extensions of Remarks]
[Pages 18735-18736]
[From the U.S. Government Publishing Office, www.gpo.gov]




                      MEDICARE ADVISORY COMMISSION

                                 ______
                                 

                           HON. PETER DEUTSCH

                               of florida

                    in the house of representatives

                        Thursday, July 17, 2003

  Mr. DEUTSCH. Mr. Speaker, I rise today to submit into the Record a 
letter from the Medicare Payment Advisory Commission, MEDPAC, to the 
Administrator of the Centers for Medicare and Medicaid Services 
Administrator regarding CMS's proposed rule entitled Medicare Program; 
Inpatient Rehabilitation Facility Prospective Payment System for FY 
2004; Proposed Rule, 68 Fed. Reg. 26786 (May 16, 2003). This letter 
calls upon CMS to construct a fair rule that allows Medicare 
beneficiaries to receive appropriate rehabilitation services. To 
achieve this goal, in effect, MEDPAC recommends a revision to the ten 
diagnoses--conceived twenty years ago in 1983--in an effort to better 
characterize today's patient population.
  Based on my concern for the critical need of my constituents in 
Florida to continue to have access to inpatient rehabilitation 
facilities, I rise to express my support for MEDPAC's recommendation 
and feel that a modernization of the ``75 percent rule'' to include 20 
of the 21 rehabilitation inpatient categories, all except 
miscellaneous, is necessary.
  Under CMS's proposed rule, 86 percent of Intensive Rehabilitation 
Facilities would be exclude from reimbursement. If promulgated, this 
rule would place an increased burden on acute care hospitals. Patients 
with serious conditions such as stroke, brain injury, hip fracture, as 
well as those individuals recovering from cardiac surgery, oncology 
surgery and severe pulmonary conditions could potentially be denied 
access to critically needed rehabilitative care. It is my sincere hope 
that CMS will take into account MEDPAC's recent recommendations on this 
matter.

                                         Medicare Payment Advisory


                                                   Commission,

                                     Washington, DC, July 7, 2003.
     Re: File code CMS-1474-P

     Thomas Scully, Administrator, Centers for Medicare & Medicaid 
         Services Department of Health and Human Services, Hubert 
         H. Humphrey Building, Washington, DC.
       Dear Mr. Scully: The Medicare Payment Advisory Commission 
     (MedPAC) welcomes the opportunity to comment on the Centers 
     for Medicare & Medicaid Services (CMS) proposed rule entitled 
     Medicare Program; Inpatient Rehabilitation Facility 
     Prospective Payment System for FY 2004; Proposed Rule, 68 
     Fed. Reg. 26786 (May 16, 2003). We appreciate your staff's 
     careful work on this prospective payment system, particularly 
     considering the competing demands on the agency.
       Inpatient rehabilitation facilities (IRFs) are one of 
     several settings that provide Medicare patients with 
     rehabilitation services. Medicare also covers rehabilitation 
     services in skilled nursing facilities, long-term care 
     hospitals, at home from home health agencies, and on an 
     outpatient basis (e.g., from a hospital outpatient 
     department). Medicare generally varies its payments based on 
     the setting and type of services.
       CMS's criteria to distinguish IRFs from acute care 
     hospitals and other settings for payment purposes require 
     IRFs to:
       Have provider agreements to participate in Medicare as a 
     hospital.
       Determine whether patients are likely to benefit 
     significantly from intensive inpatient hospital programs or 
     assessments by preadmission screening.
       Ensure that patients receive close medical supervision and 
     furnish rehabilitation nursing, physical therapy, 
     occupational therapy, speech therapy, social or psychological 
     services, and orthotic and prosthetic services.
       Have full-time medical directors experienced in medical 
     management of inpatients requiring rehabilitation.
       Use physicians to establish, review and revise the plan of 
     care for each IRF patient.
       Use coordinated multidisciplinary team approaches in the 
     rehabilitation of each inpatient.
       Have 75 percent of their cases in 10 diagnoses--stroke, 
     spinal cord injury, congenital deformity, amputation, major 
     multiple trauma, fracture of femur (hip fracture), brain 
     injury, and polyarthritis, including rheumatoid arthritis, 
     neurological disorders, and burns.
       Further, in order to be eligible for IRF care, patients 
     must be able to sustain three hours of therapy a day.
       Only one of the IRF standards is under debate: the rule 
     requiring IRFs to have 75 percent of their cases in 10 
     diagnoses (the ``75 percent rule''). Many have argued that 
     the 10 diagnoses no longer represent a clinically appropriate 
     standard for defining IRF services. The issue of variation in 
     patient need within diagnoses has always existed. Finally, an 
     estimated 87 percent of IRFs are currently out of compliance 
     with the rule.
       We recognize the need to distinguish IRFs from other 
     Medicare providers in order to pay appropriately for their 
     services. As you know, IRFs are paid more than acute 
     hospitals. Given the current state of clinical evidence and 
     patient classification systems, the dilemma is how to 
     construct a fair rule that allows Medicare beneficiaries to 
     receive appropriate rehabilitation services and avoids 
     undesirable financial incentives to expand the types of 
     patients in IRFs beyond what is clinically necessary. On the 
     one hand, an unchanging list of 10 diagnoses to characterize 
     an appropriate patient population for the IRF setting is a 
     blunt instrument. Medical practice may have changed since 
     1983, when the 10 diagnoses were first included in the 75 
     percent rule. On the other hand, using instead the 20 
     diagnoses in the IRF-prospective payment system (PPS) 
     reflects IRFs' past admitting practice but does not 
     necessarily identify a clinically appropriate population.
       In the short term, the Secretary has few other options but 
     to enforce the 75 percent rule consistently; the issue is 
     which diagnoses should go into the calculation. One short-
     term strategy that the Secretary could pursue is to lower the 
     percentage of cases (required to be from 10 diagnoses) in the 
     current 75 percent rule to 50 percent for some period of 
     time, not to exceed one year. According to CMS's analysis, 
     most IRFs could meet this standard. During that period of 
     time, the Secretary could consult with an expert panel of 
     clinicians to reach a consensus on the diagnoses to be 
     included in the 75 percent rule as well as the appropriate 
     clinical criteria for patients within the respective 
     diagnoses. It is most imperative that the panel resolve the 
     joint replacement issue because a large and growing 
     proportion of IRF patients likely fall into this category. If 
     the Secretary can complete this consultation prior to the 
     October 1, 2003 proposed implementation date, it may be 
     unnecessary to lower the 75 percent to 50 percent.
       Over the long run, the Secretary also may want to 
     periodically revisit the list of diagnoses and clinical 
     criteria for rehabilitation patients. The expectation would 
     be to move away from simple diagnosis-based criteria to 
     patient-based criteria. Consistent with that objective, 
     MedPAC is interested in linking payment to high-quality 
     outcomes, as evidenced by our recommendation in the June 2003 
     Report to the Congress. In that report, we find that IRFs are 
     particularly suited to linking payment for quality because 
     the patient assessment instrument is standardized, credible, 
     and data are routinely collected; also a risk-adjustment 
     mechanism is built into the PPS. In the future, the IRF 
     payments could be based on the patient-specific criteria and 
     linked to outcomes. This also could be part of the criteria 
     CMS could use to decide whether a facility would be 
     designated as an IRF, potentially eliminating the need for 
     criteria such as the 75 percent rule, although practically we 
     see the need for such rules in the short term.
       We look forward to offering any assistance we can to CMS in 
     these endeavors.
           Sincerely,
                                         Glenn M. Hackbarth, J.D.,
                                                            Chair.

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