As the country approaches our "fiscal cliff" our representatives in Congress are searching for ways to reduce the deficit. An easy target is the portion of Medicare that goes to funding rehabilitation services. Below is the letter I have written to Senators Merkley and Wyden and Congressman Walden of Oregon.
Re: Protecting Access to Medical Rehabilitation
On behalf of Rogue Regional Medical Center (RRMC) in Medford, Oregon, I am writing to request your help in protecting patient access to medical rehabilitation care. Our inpatient rehabilitation unit (IRU) provides medically necessary, inpatient rehabilitation and therapy to patients with conditions such as strokes, neurological impairments, spinal cord injuries, and traumatic injuries that require intensive rehabilitation. Our goal is to provide rehabilitation care that gives patients the opportunity for a quick recovery and enables them to resume an active, productive lifestyle in their home, work, and community. RRMC’s Inpatient Rehabilitation Center improves patient outcomes and reduces costs by maximizing patient health and functional skills and preventing subsequent medical complications and readmissions. Ultimately the result is that we reduce the burden of care on society and the caregivers for these patients, in addition to providing a much higher quality of life to the patients themselves.
In light of the importance of medical rehabilitation, I am concerned with proposals that would: (1) impose additional reimbursement cuts on Inpatient Rehabilitation Facilities (IRFs); (2) establish site neutral payments; and (3) reinstitute the 75% Rule. I urge you to reject these proposals in any future Medicare physician fee fix or deficit reduction legislation. IRFs are not part of the health care spending and growth problems. The rehabilitation field has appropriately responded to payment changes and has kept spending flat since 2004, and growth has been negative in three of the last five years.
In addition—in the arena of outpatient rehabilitation services—I ask that Congress extend the therapy caps exceptions process permanently or at least indefinitely until CMS can implement a new payment system. Medicare beneficiaries who are recovering from conditions that require intensive therapy will not be able to receive all of the necessary therapy with the therapy caps in place.
Reimbursement Cuts
We also ask that you reject efforts to impose additional targeted market basket cuts or freezes for IRFs. Medical rehabilitation represents only a tiny portion of Medicare spending, yet IRFs have been subject to numerous payment cuts in recent years. For example, most recently, Congress enacted the Middle Class Tax Relief and Job Creation Act of 2012, which reduces Medicare bad debt payments beginning in Fiscal Year 2013. Inpatient rehabilitation hospitals and units will also be subject to a sequestration cut of up to 2 percent beginning in 2013. Additionally, the Affordable Care Act subjects IRFs, inpatient hospitals, long-term care hospitals, psychiatric hospitals and outpatient hospitals to across the board cuts and productivity adjustments totaling $156.6 billion. These hospital and outpatient payment cuts will be incurred in addition to a $4 billion cut to IRFs enacted as part of the MMSEA.
Any additional cuts will disproportionately and unfairly affect IRFs when growth or spending problems simply do not exist in the hospital rehabilitation sector. Medicare spending on rehabilitation hospitals and units has been flat since 2004, while Medicare spending on other post acute care providers has soared. Since 2003, inpatient rehabilitation hospitals and units have had the lowest Medicare spending growth of any post-acute care provider and growth has been negative in three of the last five years.
Site Neutral Payments
The President and the nursing home industry have proposed equalizing Medicare reimbursement for certain conditions regardless of whether the patient is served in a skilled nursing facility (SNF) or an IRF. This proposal ignores fundamental differences between the care provided and the outcomes achieved in IRFs as compared to SNFs.
Medicare requirements for IRFs are stringent and different from other post acute care providers. To be classified as an IRF, the hospital must have medical directors and nurses who specialize in physical medicine and rehabilitation, have 60% of admissions come from 13 specific diagnoses, and only admit patients who can sustain 3 hours of therapy a day and have the potential to meet predetermined goals. Other post-acute care providers do not share these requirements.
The proposal also fails to compare the total costs per episode of care in an IRF versus a SNF, the quality of care, and the patients’ health status at discharge. The Medicare Payment Advisory Committee (MedPAC) reports that IRF patients have an average length of stay of 13.1 days compared to SNF patients with an average length of stay of 34 days in 2009. Our unit at RRMC averages closer to 12.5 days average length of stay. According to CMS, 81.1% of IRF patients are able to be discharged home after rehabilitation compared to 45.5% of SNF patients. MedPAC reports that patients in IRFs demonstrated significantly higher Functional Independence Measure (FIM) motor scores than those in nursing homes. In short, IRFs provide superior, cost-effective care. Furthermore, SNF patients are re-admitted to acute care hospitals within 30 days at over twice the rate for IRF patients.
75% Rule
Some have proposed reinstating the 75% Rule compliance threshold for IRFs. Congress should oppose this outdated, rejected, and arbitrary policy that fails to recognize the current state of the rehabilitation field.
In 2004, CMS began phasing in regulations that would require 75% of IRF patients to have one of 13 specified conditions before the hospital or unit could qualify as an IRF for payment purposes. Congress recognized that the 75% Rule was adversely affecting access to medically necessary rehabilitation services for patients and that IRFs were forced to decline admission of patients based on their condition category rather than their clinical needs. Accordingly, Congress enacted statutory language to permanently reduce the compliance threshold to 60% in the Medicare, Medicaid, and SCHIP Extension Act (MMSEA) of 2007. Rehabilitation hospitals and units paid for this statutory relief by agreeing to a zero percent market basket update for eighteen months.
Since that time, there has been virtually no Medicare spending growth in the rehabilitation sector, and the number of IRFs has declined. In addition, CMS adopted new, more restrictive medical necessity coverage criteria in January 2010, which has further constrained the growth of admissions to IRFs. Reinstating the 75% Rule would drastically reduce the ability of IRFs to admit clinically appropriate patients and does not take into account the challenges facing the field. Congress should not relitigate the outdated 75% Rule proposal, which was rejected overwhelmingly on a bipartisan basis by previous Congresses.
Therapy Caps Exceptions Process
Therapy caps discriminate against the oldest and sickest Medicare beneficiaries should there be no exception for patients suffering from acute conditions, such as a stroke or hip fracture, or patients with multiple rehabilitation episodes in one year. Congress has recognized the need to extend the exceptions process by including an extension most recently in the Middle Class Tax Relief and Job Creation Act of 2012, which extends the exceptions process for outpatient therapy caps through December 31, 2012. Congress should include an extension of the therapy caps exceptions process in any end of year legislation.
I will add that the current methodology of applying for and administering exceptions to the caps is cumbersome, costly, and burdensome for providers, and it is counter-productive and intimidating for Medicare beneficiaries. This system needs revision.
Conclusion
Again, thank you for considering these issues. Additional cuts to IRFs could seriously jeopardize access to care for Medicare beneficiaries and individuals with disabilities. These vulnerable populations should not be expected to shoulder unfairly the burden of offsetting the costs of the Medicare physician fee fix or deficit reduction legislation. Further, extension of the therapy caps exceptions process is critical to maintaining access to medically necessary inpatient rehabilitation care for the oldest and sickest Medicare beneficiaries.
Please feel free to contact me at if you have any questions or concerns. And please consider this an invitation to visit our unit and see for yourself the kind of services we provide for your constituents.
Sincerely,
Bob Perlson
Director, Rehabilitation Services
Rogue Regional Medical Center
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