Recent Developments in Medicare Affecting Long-Term Care Hospitals Page: 2 of 6
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to rate year (RY) 2007 Medicare payments have attracted attention. Also, past actions
from the Centers for Medicare and Medicaid Services (CMS) regarding requirements
imposed on LTCHs that are physically located as part of other providers (also known as
hospitals-within-hospitals, or HwHs), as well as RY2007 proposals for payments for
short-stay admissions, have elicited concern among providers and their advocates.
Identifying Appropriate Post-Acute Care Settings
The Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act of
2000 (BIPA) required the Secretary to submit a report to Congress by January 1, 2005, on
the development of standard instruments for the assessment of the health and functional
status of Medicare patients who receive hospital, rehabilitation, SNF, home health,
therapy, or other specified services. The report has not yet been received. The
Subcommittee on Health within the Committee on Ways and Means held a hearing on
June 16, 2005 to examine what progress had been made in that area and to discuss the
status of and solicit recommendations on Medicare's current post-acute payment systems.
In that hearing, CMS presented an overview of several different agency initiatives
that may result in the development of a standard PAI, common health information
terminology, and consistent coding practices.1 MedPAC and industry representatives also
testified on different issues affecting LTCHs.2 MedPAC discussed the problems with
integrating the current post-acute patient assessment tools and indicated that a new PAI
is needed.3 As part of its testimony, MedPAC reiterated its recommendation (made in
2004) that LTCHs be defined by facility and patient criteria to ensure the patients
admitted to these facilities have medically complex conditions and a good chance for
improvement.4 MedPAC also recommended that quality improvement organizations
(QIOs) review LTCH admissions for medical necessity and monitor facilities' compliance
with yet-to-be-determined LTCH criteria. Testimony from one group representing the
LTCH industry spoke to the critical yet distinct roles of each provider in the post acute
care sector, generally supported efforts to develop a comprehensive PAI, and supported
1 See [http://waysandmeans.house.gov/hearings.asp?formmode=view&id=2790] for testimony
delivered for CMS.
2 The Government Accountability Office also testified on its work with respect to the appropriate
classification criteria for IRFs.
s See MedPAC, Report to the Congress: Issues in a Modernized Medicare Program, June 2005,
pp.114-119, for more information of the existing PAIs.
4 MedPAC considered facility-level criteria such as staffing, patient evaluation and review
processes, and mix of patients as characteristic of this level of care. Relevant patient-level
criteria include specific clinical characteristics (such as open wounds) and treatment modalities
(such as need for frequent intravenous fluid or medication). For more information, see MedPAC,
Report to the Congress: New Approaches in Medicare, June 2004, pp. 121-135.
s MedPAC discussed interim measures that could be adopted until a common PAI is developed,
such as admission criteria for LTCHs, front-end assessments of acute care patients prior to post-
acute care admissions, or care coordination by a case manager. See [http://waysandmeans.
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Tilson, Sibyl. Recent Developments in Medicare Affecting Long-Term Care Hospitals, report, March 14, 2006; Washington D.C.. (digital.library.unt.edu/ark:/67531/metadc822533/m1/2/?q=medicare: accessed February 18, 2019), University of North Texas Libraries, Digital Library, digital.library.unt.edu; crediting UNT Libraries Government Documents Department.