Physical therapy helps Leon Beers get out of bed in the morning and maneuver around his home using his walker. Occupational therapy strengthens the 73-year-old man’s throat muscles so that he can communicate and swallow food, says his sister Karen Morse. But in mid-January, his home health care agency told Morse it could no longer provide these services because he had used all his therapy benefits allowed under Medicare for the year.
Beers, a retired railroad engineer who lives outside Sacramento, Calif., has a form of Parkinson’s disease. The treatments help slow his condition’s destructive progress and “he will need it for the rest of his life,” Morse says.
Under a recent revision in federal law, Medicare patients who qualify for these services will no longer lose them solely because they used too much.
“It is a great idea,” says Beers. “It will help me get back to walking.”
It’s also one of several important provisions tucked into the federal budget agreement approved by Congress last month that could improve the health of 59 million Americans who have Medicare, the federal health insurance program for older or disabled adults. Here are three of the key changes, and a bit more about what each means for patients.
Expands Medicare’s coverage of physical, occupational and speech therapy
The two-year budget deal removes annual caps on how much Medicare pays for physical, occupational or speech therapy and streamlines the medical review process. It applies to people in traditional Medicare as well as those with private Medicare Advantage policies.
As of Jan. 1, Medicare beneficiaries are eligible for these types of therapy indefinitely as long as their doctor — or, in some states, physician assistant, clinical nurse specialist or nurse practitioner — confirms their need for therapy, and they continue to meet other requirements.
The Centers for Medicare & Medicaid Services last month notified health care providers about the change. And under a 2013 court settlement, patients won’t lose coverage simply because they have a chronic disease that doesn’t get better.
“Put those two things together and it means that if the care is ordered by a doctor and it is medically necessary to have a skilled person provide the services to maintain the patient’s condition, prevent or slow decline, there is not an arbitrary limit on how long or how much Medicare will pay for that,” says Judith Stein, executive director of the nonpartisan Center for Medicare Advocacy.
The webpage for patients describing the changes in physical, occupational and speech therapy benefits was taken down for updating three weeks ago and was still missing, as of Tuesday afternoon. But patients and providers can find a CMS update posted last month for providers that explains the change. And information from the 800-Medicare helpline (800-633-4227) has been updated with the new information.
Shrinks the ‘doughnut hole’ a year earlier
Beneficiaries have long complained about a coverage gap in Medicare drug plans — the so-called doughnut hole.
That gap arises when the initial coverage phase of the plan ends— this year, that happens after the beneficiaries and their insurers have paid $3,750 for covered drugs. At that point, a patient’s share of prescription costs shoots up. This year, when people hit this stage, they are responsible for paying up to 35 percent of brand-name drug costs, until a higher threshold of expenses is reached.
When beneficiaries’ total yearly drug expenses reach a certain amount ($5,000 this year), they enter a new stage of coverage, paying just 5 percent of the costs after that amount. But studies have shown that fewer than 10 percent of beneficiaries spend enough to reach that last stage.
The Affordable Care Act had called for the patient’s share of drug costs in this “doughnut hole” gap to be narrowed to 25 percent by 2020; the budget deal moved that adjustment earlier, to 2019.
Much of the drug cost will be shouldered by pharmaceutical companies. And those payments by drug makers will count as money paid by patients, which will help Medicare patients progress to the far side of the doughnut hole gap more quickly, according to Caroline Pearson, senior vice president at Avalere Health, a research firm.
The deal could have an added attraction. “Premiums will come down because the drug plans are not being required to cover as much as they used to,” Pearson adds.
Lower premiums will also save money for the government because it will spend less on subsidies for low-income beneficiaries.
Expands Medicare Advantage benefits
Another important change allows private Medicare Advantage plans in 2020 to offer special benefits to members who have a chronic illness and meet other criteria.
Currently these private insurance plans, which limit members to a network of providers, treat all members the same.
But under changes in the budget law, benefits in 2020 that target certain members who have chronic diseases do not have to be primarily health-related, and need only a “reasonable expectation” of improving health. Some examples that CMS has suggested include devices and services that assist people with disabilities, minimize the impact of health problems or help patients avoid emergency room visits.
This wider range of benefits might help some people remain in their homes instead of entering nursing homes, or could increase the quality of life of some Medicare Advantage patients and help reduce unnecessary medical expenses.
“We’re really excited that the law is catching up with what plans have known for a long time,” says Mark Hamelburg, senior vice president of federal programs at America’s Health Insurance Plans, an industry association.
But the changes will affect only those beneficiaries enrolled in these private plans — about a third of the Medicare population.
“We would like to see some of these innovations happen in the traditional Medicare program as well, so that all beneficiaries would be able to reap these benefits,” says Lindsey Copeland, federal policy director at the Medicare Rights Center.