VNAA Position on Home Health Proposals (as of October 2011):
- There is broad consensus that a moratorium is needed.
- Copayments are opposed.
- Proposals that call for moving up rebasing are not acceptable. CMS must incorporate the findings of the CMS Vulnerable Patient study in rebasing. CMS also needs time to do rebasing right.
- An episode cap might be a good management tool if it is created in such a way as to allow nonprofits to serve vulnerable patients so the cap number must be right and there must be a "safety valve" for vulnerable patients.
- A LUPA floor is a good idea - again if it is created in such a way as to allow nonprofits to serve vulnerable patients so the number must be right and there must be a "safety valve" for vulnerable patients.
On August 2, 2011, President Obama signed into law the "Budget Control Act of 2011." The legislation amended section 251 of the "Balance Budget and Emergency Deficit Act of 1985," more commonly known as "Gramm-Rudman-Hollings." The legislation aims to reduce the national debt by at least $2.1 trillion over 10 years: $917 billion in budget deficit reductions and at least $1.2 trillion in legislation stemming from actions from a Joint Select Committee. Read further analysis about how the debt ceiling deal could impact home health agencies and hospices.
Policy Proposals on Budget and Deficit ReductionPolicy proposals to enact a federal budget and reduce the deficit are complex. But it is important that VNAA members have a general understanding of what is being considered as Congress or the Administration could seek legislative changes in home health and hospice as these proposals progress. For that reason, VNAA will send you periodic information alerts and as well as include timely information in VNAA Member Update.
House Passed BudgetOn Friday, April 15, 2011, the House of Representatives passed a 2012 budget resolution (H.Con.34) on a party-line vote of 235-193. This resolution establishes a budget for 2012, and sets forth budgetary levels for 2013-2021. A primary focus of the House passed budget is deficit reduction.
Find out if your Representative voted for or against the budget proposal.
This budget proposal was drafted by House Budget Committee Chairman Paul Ryan (R-WI) and was reported out of the House Budget Committee on a party-line vote on April 11, 2011.
Chairman Ryan's budget proposal would modify Medicare and Medicaid in the following ways:
Beginning in 2022, when Americans turn 65 years old they would be entitled to $8,000 per year, on average, which would be paid by the government to private insurance carriers though an exchange. The funds would be used to purchase a policy on behalf of the enrollee. Lower-income and sicker beneficiaries would get larger subsidies than wealthy or healthy people.
Medicare Proposed Changes
The amount that beneficiaries would receive each year would increase as the enrollee aged, and with the rise of the Consumer Price Index. The plan also gradually raises the age that seniors become eligible for federally subsidized health insurance. It would rise to age 67 years old by 2033. Americans who turn 65 years old before 2022 would remain in the current Medicare program; however, they would have the option to move to the new program.
Medicaid Proposed ChangesThe Ryan proposal would end the Medicaid entitlement, and would instead provide a fixed-dollar-amount funding to states in the form of a block grant block grant, and cuts $771 billion from the Medicaid program over the next 10 years. The plan would give greater flexibility to states to design their own Medicaid program and to determine eligibility levels and benefit design.
Although the House has passed Chairman Ryan's budget proposal, experts note that is unlikely to win approval in the Democratic Senate. But Ryan’s proposal has set the stage for a debate over long-term fiscal challenges and potential solutions. These solutions are almost certain to involve some changes to entitlement programs such as Medicare, Medicaid or Social Security.
For further information, please see the attached handouts:
- Ryan Budget - Highlights - from Congressional Quarterly
- Comprehensive Ryan Budget Fact Sheet - from Congressional Quarterly
On Wednesday, April 13, President Obama offered his own proposal for deficit reduction. The President's plan aims to reduce the deficit by $4 trillion over the next 12 years, by putting in place both spending cuts as well as tax increases. The President's proposal would affect Medicare and Medicaid programs in the following key ways:
President Obama’s Deficit Reduction Plan
Strengthen the Independent Payment Advisory Board: The IPAB was established by the Patient Protection and Affordable Care Act and has broad authority beginning in 2018 to implement changes to the Medicare program for the purpose of restraining Medicare spending. The President's budget proposal would give set a target for the IPAB of holding Medicare cost growth per beneficiary to GDP per capita plus 0.5 percent. If costs exceeded this target, the IPAB would have authority to make changes to the Medicare program, such as adjusting payment rates, to keep costs in line.
Create a "Debt Failsafe Trigger": Beginning in 2015, when the deficit has reached a certain percentage of the nations GDP (2.8%), an across the board spending reduction will be put in place. While the President has said this spending reduction will not effect Social Security payments, low-income programs, or benefits to Medicare enrollees, it is unknown whether payments to Medicare providers could still be reduced.
Create a single federal matching rate for Medicaid spending: The President's framework would replace the current Federal matching formulas with a single matching rate that rewards states for efficiency and automatically increases during a recession.
For further information, please see the attached handouts:
White House Fact Sheet outlining President Obama's deficit reduction framework