Health Law Daily Jimmo maintenance coverage policy still needs clarity, improvement
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Monday, August 22, 2016

Jimmo maintenance coverage policy still needs clarity, improvement

By Anthony H. Nguyen, J.D.

The Medicare beneficiary in a lawsuit that broadened Medicare physical therapy eligibility requirements was successful in demonstrating that HHS had, in an opinion issued by the federal court in Vermont, "failed to fulfill the letter and spirit of the Settlement Agreement with respect to at least one essential component of the Educational Campaign." The court, however, declined to find that HHS had made bad faith efforts in revising sections of a benefit policy manual pertaining to skilled services coverage. HHS was ordered to propose corrective action for consideration within 45 days (Jimmo v. Burwell, August 17, 2016, Reiss, C.).

Settlement. The beneficiary, who is legally blind and has a partially amputated leg, was the lead plaintiff in a class action lawsuit to have Medicare pay for physical therapy and other care from skilled professionals in circumstances where a beneficiary’s health status has plateaued, or is not improving. The policy, known as the "improvement standard" was effectively eliminated when HHS settled the class action and agreed that Medicare coverage was available for skilled services to maintain an individual’s condition. The settlement required revisions to the Medicare Benefit Policy Manual (MBPM) in order "to clarify the coverage standards for the skilled nursing facility (SNF), home health (HH), and outpatient therapy (OPT) benefits when a patient has no restoration or improvement potential but when that patient needs skilled SNF, HH, or OPT services."

Moreover, the improvement of a beneficiary’s health was not to be a factor in Medicare coverage determinations (see Medicare beneficiaries/Secretary reach proposed settlement to allow coverage for maintenance, October 23, 2012). Despite the change, the settlement was met with hesitation when some experts expressed concern that CMS would have to change written policies and standards, as well as overcome years of claim processing based upon applications of the mythical improvement standard (see Providers show inconsistency in providing skilled care in wake of Jimmo decision, CMS silence, March, 21, 2013).

Manual revisions. HHS argued that it made substantial revisions to chapters seven and eight of the MBPM as a result of the Jimmo decision; however, many of the revisions were unrelated to the maintenance coverage standard or the settlement and were instead made "pursuant to CMS' general authority to provide guidance on Medicare policy and implementation." The beneficiary conceded that HHS made substantial changes, but claimed that most of the changes either did not pertain to the maintenance coverage standard or did not clarify sections that arguably had given rise to the "improvement standard."

The beneficiary cited HHS’ refusal to eliminate a reference to a "3 week rule" in MBPM Sec. 40.1.2.1 governing skilled observation and assessment as conflicting with the maintenance coverage standard, which does not contain a three-week limitation. The beneficiary argued that there was no statutory support for the "3 week rule" and that it falsely suggested that skilled observation services are limited to that time period unless the patient is at risk for future complications. The district court disagreed and stated that MBPM Sec. 40.1.2.1 neither referred to the maintenance coverage standard nor incorporated it.

As a result, it can reasonably be interpreted as endorsing standards for determining coverage for skilled observation and assessment other than the maintenance coverage standard. Thus, skilled services can comply with both the maintenance coverage standard and MBPM Sec. 40.1.2.1. Although not a model of clarity, the court held that Sec. 40.1.2.1 neither expressly contained an improvement standard nor negated the application of the maintenance coverage standard. As a result, HHS did not violate the Settlement Agreement by refusing to revise this provision of the MBPM.

Educational activities. Since the publication of the MBPM revisions in late 2013, the beneficiary had repeatedly raised concerns regarding the adequacy of the revisions to reflect the maintenance coverage standard and alleged that HHS’ educational campaign was deficient. The settlement required HHS to engage in certain educational activities designed to implement the changes to the MBPM and to educate stakeholders regarding the maintenance coverage standard. In late 2015, HHS informed the beneficiary that it would not engage in additional educational activities and she subsequently filed the motion to enforce.

The beneficiary alleged that HHS failed to allow for proper comments on a national call, as well as "open door forums" related to the settlement and revisions to the MBPM. Moreover, she submitted declarations from stakeholders alleging that HHS’ training regarding the maintenance coverage standard was both minimal and inadequate, that there was no follow-up, and that CMS had made little effort to address the confusion in the Medicare community regarding the import of the Jimmo settlement.

The district court found that the beneficiary provided persuasive evidence that at least some of the information provided by HHS in the educational campaign was inaccurate, nonresponsive, and failed to reflect the maintenance coverage standard. The court pointed out the most compelling example was the HHS’ "Summary of the questions posed and answers provided during a national call for contractors and adjudicators, which (1) failed to mention the maintenance coverage standard; (2) did not provide the parties' agreed upon definition of it; and (3) reflected virtually no effort to educate participants regarding the impact of the Jimmo settlement and the implementation of the maintenance coverage standard.

The case is No. 5: 11-cv-17.

Attorneys: Alice Bers (Center for Medicare Advocacy, Inc.) for Glenda Jimmo. M. Andrew Zee, U.S. Department of Justice, for Sylvia Mathews Burwell, Secretary, U.S. Department of Health and Human Services.

Companies: U.S. Department of Health and Human Services

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