Medicare Advantage (MA) plans are allowed to cover non-skilled home care services starting in 2019. Seniors and home care providers are excited at the prospect of expanded coverage which will include Home Care Services.
The Centers for Medicare & Medicaid Services (CMS) finalized the policy in a recently issued call letter This is an historic and long-awaited move by CMS to recognize how important non-medical home care can be for maintaining the health of older adults
Interpreting the change
When it gets to the details, though, there’s less certainty about what the policy shift means.
In its call letter, CMS stated that it is relaxing a prohibition on Medicare Advantage coverage of “daily maintenance” services. This paves the way for the private insurance companies that administer Medicare Advantage—including heavyweights such as UnitedHealthcare and Humana—to cover private duty home care services through a supplemental benefit.
The call letter is also explicit on the purposes of the benefit expansion, including to “compensate for physical impairments” or “reduce avoidable emergency and health care utilization.” Personal care providers appear to be ideally positioned to deliver on these goals.
However, CMS also put parameters around the new benefit, including that it must address “specific illnesses and/or injuries.” This could mean that MA plans will limit the benefit to people with a particular diagnosis, perhaps starting with diabetes.
The call letter alludes to this as well, noting that provisions of the Bipartisan Budget Act of 2018, passed in February, further expand supplemental benefits in Medicare Advantage. Under this law, MA plans will be permitted to offer even more varied benefits packages to chronically ill people, starting in 2020.
The conventional wisdom is that MA providers will be incentivized to control costs through this new benefit but providing ongoing personal care services is not cheap and the Medicare Advantage business model for most insurers is based more on enrollment volume than cost control.