PrintMarch 8, 2010
Medicare Part B Therapy Caps: A Preview of Life under Obamacare
Many Americans are justifiably leery about health care reform, fearing that reforms will lead to arbitrary government rationing of health care, denial of services, and choice taken from consumers and placed under government control. What many Americans may not know, however, is that we don't have to wait for Obamacare to experience these effects. These conditions hang over the lives of the institutionalized elderly due to Medicare Part B therapy caps.
Some definitions will help clarify the discussion. Medicare Part A is an entitlement program offered to Americans who have reached age 65, or those with certain medical conditions such as end-stage renal disease of blindness. Medicare Part B, on the other hand, is an insurance which must be purchased by the consumer, who pays a monthly premium of $96.40 to obtain the benefits. Medicare Part B covers such services as durable medical equipment, ambulance, and physical, occupational, and speech therapy.
To be fair, the issue of Part B therapy caps predates Obama by several years. Government-imposed therapy caps were first introduced in the Balanced Budget Amendment of 1997 and went into effect in 1999, with Part B beneficiaries limited to only $900 a year of therapy reimbursement. The backlash over rationing health care to older adults led to temporary reversals of the caps, mainly through a cap exception process. The exception process exempted certain conditions or diagnoses from the caps. The process was temporary, so long-term care providers, therapists, and consumers again had to struggle with a capped environment for three months in 2003 and a short period in 2006. The current cap is $1860 annually for occupational therapy, and another $1860 annual cap for speech therapy and physical therapy combined.
The latest cap exception expired on December 31, 2009, and until this past week, it was unclear whether America's elders would get another reprieve. Long-term care operators and therapy providers were in limbo through the first two months of 2010, but last Tuesday, President Obama signed the Temporary Extension Act of 2010, which extended the cap exception process through March 31, 2010, retroactive to the start of 2010. Senators Reid and Baucus have introduced another bill, the American Workers, State and Business Relief Act, which would continue the exception process through 2010. At this time, it is unclear whether that bill will pass, so the March 31 date looms large for Part B patients.
Business in a Part B-capped environment offers a preview of the worst possibilities of government-led health care reform. I was working in Indiana as a physical therapist assistant when the 1999 caps came into effect. By February, my employer had cut therapist salaries across the board by 20% as a significant chunk of revenue was lost. It is hard to believe in these days of therapist shortages, but some therapy companies operating in long-term care laid off therapists in 1999 as business contracted. It took a few years for the therapy economy to recover once an exception process was in place.
Even worse than the loss of therapist employment is the ethical position therapists and operators are placed in under a Part B cap. Long-term care operators have a duty to maintain the highest practicable functional level of their clients, and therapy services play a huge role in addressing reversible declines and restoring function. In effect, the therapist becomes a case manager, as clinical decisions must be made based on financial considerations.
For example, say "Mrs. X," a resident in a long-term care setting, develops leg weakness and begins to fall repeatedly. Physical therapy works with her for about six weeks at a total cost of around $1760, which is billed to Medicare Part B. Then, later in the year -- September, for example -- Mrs. X begins to have trouble swallowing her food and pills. She would be an ideal candidate for speech therapy, but in a capped environment, she has only $100 in reimbursement remaining for the year. In retrospect, should physical therapy have rationed their services earlier in the year and risked a lesser functional outcome to "preserve" the reimbursement under the cap for speech therapy? Assuming the resident does not have the resources to pay for the speech therapy out of pocket, does the therapy company provide the service pro bono? How long will the therapy company remain a going concern in such an environment?
Most therapists went into their profession to help the less fortunate, and they should not be forced into a bureaucratic role, deciding who gets services and when. The risk arises that subtle functional changes will not be treated and overall functional status will deteriorate within a capped environment.
For consumers seeking a sneak-peek into what life under Obamacare may resemble, careful study of the Part B therapy caps is essential. Increased unemployment of health care workers, decreased functional results, and rationing of care are three potential outcomes under both scenarios.
Anthony Ughetti is a health care manager and Tea party Patriot living in Texas.
