Editor’s Note: Journalist Philip Moeller is here to provide the answers you need on aging and retirement. His weekly column, “Ask Phil,” aims to help older Americans and their families by answering their health care and financial questions. Phil is the author of the new book, “Get What’s Yours for Medicare,” and co-author of “Get What’s Yours: The Revised Secrets to Maxing Out Your Social Security.” Send your questions to Phil.
Many older Americans will need some type of extended care as they age. It may come in a nursing center or at home. Some individuals, through excellent lifestyle choices, inherited genetic traits and not a little bit of luck, may be able to minimize or even avoid such episodes. But there are so many aging people in the country today that no amount of healthful living will prevent enormous increases in demand for older-age caregiving.
This inevitability has been known for decades, ever since the size of the baby boom generation became clear. Such are the long-term implications of demographics. Yet here we are, faced with another aging “crisis” – an elephant that is not only in the room today but took up residence decades ago.
Medicare and Medicaid are the two safety-net programs we now have to provide the care we will need. Unless you’ve been living in an unwired biosphere, you might have noticed that these programs are the subject of many Republican proposals that would dramatically change them. The common theme of these proposals is a big cut in funding, and thus care, in comparison with current program rules and government spending commitments.
If you scratch the surface, you will not find much knowledge in many of these proposals about the realities of an aging population’s future health care needs.
But to be fair, Republicans are admitting one very compelling point that many Democrats have been politically hampered from acknowledging: As things presently stand, we cannot afford to pay for all the care that older Americans will need. Budgets at the federal and state levels will not be able to foot this health care bill, and Lord knows that nearly all of us can’t afford to pay for it out of our own pockets.
The Republicans’ message has been lost in the meanness of many of their proposals. They have forfeited any claim to the fiscal high ground with plans that would package steep health care cuts for most Americans with tax cuts for people who are already rich by nearly anyone’s standards.
Faced with this stand-off, one can only applaud nascent efforts by some brave Republicans and Democrats to actually begin working together. Health care reforms cannot survive without bipartisanship, and for bipartisanship to work, the parties must be willing to compromise. We are nowhere near this point today, but we need to get there, and soon.
In the meantime, older citizens and their families need to be vigilant about efforts to raise the price of their health care, restrict their access to care or deny it to them altogether. Today, I would like to draw your attention to three such efforts: the use by hospitals of so-called observational stays, the desire by the nursing home industry to deny patients and their families the right to sue nursing homes over disputes and the growing shortage of federal funding for at-home care, coupled with rising problems in finding enough qualified caregivers to do this often low-paying work.
If Medicare enrollees are admitted to a hospital, stay there for a few days, and then require care in a skilled nursing facility, Medicare will cover that subsequent nursing care. This is a big benefit. Both the hospital and skilled nursing facility care are covered under Part A of Medicare.
However, if hospitals instead classify such visits as observational, as opposed to a formal admission, the person will not be covered by Medicare if they later need skilled nursing facility care. Further, their stay in the hospital will not be covered under Part A of Medicare but under Part B. These different parts of Medicare do not pay the same amounts for covered services.
For those wishing to receive extra credit from Ask Phil, I have written about observational stays here and here. The reasons hospitals admit people on an observational basis are discussed in those pieces. Some past patients, it turns out, never even knew their hospital visit was treated as an observational stay. A recent law requires hospitals to at least tell them on a timely basis if this is so. Still, horror stories about observational stays still crop up. The good news here is that the Center for Medicare Advocacy, which filed a lawsuit to help people avoid observational stay expenses, says its suit has been certified by a Connecticut court as a class action.
Nursing home lawsuits
Last year, the Obama administration issued a rule that prevented nursing homes from requiring patients to agree, as a condition of admittance, to submit disputes to binding arbitration and thus waive their rights to sue the home over allegations of poor care or excessive billing. Many if not nearly all nursing homes would prefer arbitration; it usually results in more favorable and less costly outcomes for the homes.
The nursing home industry sued to stop the rule, and its implementation was placed on hold while the litigation was pending. Now, there are Trump appointees at the U.S. Department of Health and Human Services (Secretary Tom Price) and the Centers for Medicare & Medicaid Services (Administrator Seema Verma). They have reversed last year’s rule and dropped legal efforts to defeat the nursing operators’ challenge. Not surprisingly, consumer groups are alarmed, and three dozen of them have protested. Further, 31 Senate Democrats also have protested. Accuse me of being cynical here, but I am not holding my breath waiting for Price to change his mind because Sen. Al Franken, among others, has asked him to do so.
Home care funding
Many Medicare beneficiaries incorrectly believe Medicare covers long-term custodial care in their homes. Such care is commonly needed by frail seniors, helping them with domestic and personal care needs. However, Medicare does not cover this care.
It does cover medically proscribed home care for people who qualify as homebound, meaning they can’t leave their homes easily. The rules for at-home care are complicated, and as a past Ask Phil column explained, it can be very hard to find an agency to provide such care, even when it is covered.
Under terms of the Affordable Care Act, Medicare was charged with reducing charges for at-home care, which had been identified as too generous for at-home care providers.
Maybe that was true for shoddy providers. But it is hard to accept that Medicare’s rates are too high for those agencies that provide trained and caring home aids. These people are hard to find, and the task is made much harder when agencies are unable to pay them more than $12 to $15 an hour for what can be very demanding work.
After trimming relatively small amounts from Medicare’s at-home reimbursement formulas in recent years, program administrators have announced reimbursement changes that would lead to an estimated $1 billion cut in at-home benefits for 2019. Given that Medicare spending on these benefits was $18 billion in the 2015 program year, this is nearly a 6 percent nominal cut, at a time when health care costs are rising.
These reductions are not so clearly a case of Republican appointees reducing Medicare benefits. There are solid reasons to change how home health agencies are reimbursed. Logical or not, however, this shift would further hurt an already weakened industry.
Families already face growing problems finding affordable and reliable caregivers for their aging parents. Where will future caregivers come from? As some experts have noted, President Trump’s efforts to sharply restrict unskilled immigrants could have a dramatic impact on the supply of old-age caregivers.
This difficult situation would be made untenable under the sharp funding cuts to Medicare and Medicaid contained in any number of Republican proposals. Health care advocates have devoted most of their energy to recent GOP efforts to repeal Obamacare. That’s understandable. But there are many times more people on Medicare and Medicaid than are covered on state Obamacare exchanges. This is where the real fight is now taking place.
Our regular reader questions will resume next week.