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Michigan Elder Law Today

Sunday, July 22, 2012

Medicare Coverage Issues in the Nursing Home

Whether Medicare will pay for skilled nursing facility services depends upon if the patient needs a “skilled level of care” on a daily basis.  Generally, a skilled level of care is defined to mean the patient needs and will benefit from physical therapy, speech therapy and other such rehab. services that will restore or improve their health.  Many patients also need custodial care in addition to such daily skilled care/rehab.  The Medicare regulations do not define custodial care other than providing it is care that does not meet the definition of skilled care.  However, custodial care is generally defined to mean the nursing home resident needs assistance with the following activities of daily living:  eating, bathing, assistance in the bathroom, medication management, transferring, and the need to live in a protective environment where help is available 24 hours a day.

If a patient is discharged from the hospital to a nursing home that provides skilled nursing services, the nursing facility must give the patient a written notice of whether the facility staff believes the patient needs a skilled level of care that will indeed be covered by Medicare.  If the facility initially considers the patient as needing a skilled level of care, which is covered by Medicare, but later determines the patient just needs custodial care, the facility must provide a written notice regarding termination of the Medicare coverage.  This is important because custodial care is not paid for by Medicare and, in Michigan, custodial nursing home care costs, on average $7,032 per month which is $234 per day.

After receipt of this Medicare non-coverage notice, the patient, or his or her patient advocate, can ask that the decision regarding Medicare non-coverage be reviewed.  The nursing home will then submit the patient’s medical records to an insurance company hired by Medicare, called an intermediary, which will review the facility’s determination that the patient just needs custodial care.

There is no charge for this review and it might result in more days of Medicare coverage. 

While the review is occurring, the patient is not required to pay the nursing home at their daily private pay rate, which tends to be in excess of $210 per day in the Oakland County, Michigan area.  However, if the patient loses the review, they will be required to pay the nursing home retroactively for the care that was provided during the review period.  As such, a patient who loses his or her review is no worse off; they would have had to pay the nursing home at the private pay rate anyway even if they had foregone requesting a review of the denial of Medicare coverage.

The nursing home resident can next appeal the intermediary’s decision that they do not need a skilled level of care to an administrative law judge.  These appeals can take months and probably will require the assistance of a lawyer.  Beyond this administrative hearing, additional appeals can be taken to a federal district court.

The issue in these reviews and appeals is always whether the patient needs daily skilled nursing services, or if they have plateaued or will not improve, and just need custodial nursing home care.  This improvement standard is controversial and litigation is currently occurring at the federal level regarding exactly what services should be covered by Medicare under the skilled level of care standard contained in the Medicare law and regulations. 

Remember, that even if a review or appeal is won to obtain more Medicare coverage, the maximum period that Medicare will pay for skilled care in a nursing home is just 100 days, so this review process is not a solution to the issue of how to pay for long-term care in a nursing home. 

The most Medicare coverage anyone is going to get is 100 days per spell of illness.  This would be true even if the result of the litigation mentioned above is a more expansive definition of what constitutes skilled care falling within Medicare’s 100 days of coverage.  Congress would have to change the law to increase the number of days of skilled care provided under Medicare.  Given the current political climate, that is not going to happen because any expansion of government benefits seems to be viewed skeptically.

As an elder law attorney who assist older people and their families with the above Medicare issues and in qualifying for Medicaid, families often come to me after they have received the Medicare termination notice and a $7,000 to $14,000 bill from the nursing home.  The $7,000 bill is the charge for the first month of nursing home care, billed in advance.  The $14,000 bills are when some nursing homes include a security deposit.  Families then realize that even 6 to 12 months of nursing home care may deplete all of the elder’s savings.

My point is do not waste the period of time with inaction when your family member is getting Medicare coverage in the nursing home, be it if they get a week or all 100 days.  The fact that an older person has been hospitalized and then discharged to the nursing home for skilled care is a sign that they either need long-term care now, or there is a high likelihood they will have a need for it in the future.  As such, the period of time when Medicare is paying for the nursing home is the time to step back and consider your loved one’s future.  Be proactive and use the time when Medicare is paying to get information and make plans.  If you are not sure if your relative will be able to return to their home or what level of care they may need, it might be a good idea to hire a geriatric care manger or geriatric nurse to do an in-depth assessment of their needs.   Such an assessment might include whether it is reasonable for the person to return home with home modifications and/or home care or if they might be able to live in a less restrictive care setting then the nursing home, such as an assisted living facility.

As the elder care attorney, I prepare a similar analysis regarding the elder’s estate plan, the benefits that are available to them to pay for care, and what they have to do to qualify.  We call this written analysis a long-term care plan.

The point of such assessments is to provide information that can be used to making good decisions, instead of just letting events unfold.  If this process is started while the elder is receiving Medicare coverage, we might be able to help you get more Medicare days, improving the elder’s care and saving money, and also use the time to make a long-term care plan to qualify for benefits.


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