Medicare-Financed Home Health Care


Am Fam Physician. 1998 Nov 1;58(7):1542-1545.

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Until recently, Medicare-financed home health care has escaped negative public opinion and cost-cutting. It is an area of health care that has grown at a phenomenal pace, because there is no out-of-pocket deductible or co-payment for the beneficiary except for medical equipment items. Moreover, services have been provided and reimbursed to Medicare home health agencies (HHAs) at cost for every major service rendered with no cap per patient. The growth of Medicare HHAs has been so tremendous that a moratorium was placed on starting new HHAs for a period of time in 1997. The guidelines for obtaining Medicare-funded home health care are broad enough that most, if not all, homebound patients with Medicare Part A qualify. As outlined by Montauk in this issue of American Family Physician,1 a multitude of services are covered.

To control acute hospital costs, the Health Care Financing Administration, with authorization from the federal government, changed reimbursement from cost to the Prospective Payment System in the early 1980s. Faced with declining Medicare reimbursement with no change in overhead, acute care hospitals reduced the average length of stay for Medicare patients while depending on Medicare HHAs and skilled nursing units to provide posthospital or subacute care. A crisis may be looming for physicians, acute care hospitals, HHAs, patients and their families at some point in 1999 when reimbursement for Medicare-sponsored home health care also switches from cost to the Prospective Payment System. Like acute care hospitals, subacute nursing units and HHAs will be forced to reduce overhead to maintain financial viability. Feeling the squeeze from HHAs, patients and families, physicians will be placed in a tenuous situation to monitor home-bound patients more closely without support services.

As Montauk points out,1 about 25 percent of claims submitted to Medicare on behalf of beneficiaries may be inappropriate. Physicians are held liable for the home health care forms of Medicare that they sign each day. However, many physicians may not be aware of the requirement for a specific skilled need that must be met before the patient is eligible for the service. For example, physical therapy for general conditioning is not a specific skilled need. In some instances, the busy physician is approached by an HHA or a friend of the patient to request Medicare-financed home health care. Occasionally, the physician may even be asked to sign a retroactive authorization for Medicare-financed home health care that was instituted by an interested party, to sign a form on a patient that he or she has never seen, or to sign a form on a service authorized by another physician.

The services provided by Medicare-financed home health care are so comprehensive that families love it. The attending physician may find himself or herself in a difficult situation on the one hand of authorizing termination of the service when it is no longer necessary, yet feeling pressured by family members to continue the service. Physicians can protect themselves by becoming familiar with the specific Medicare home health guidelines mentioned in this editorial. They should also make an inquiry by telephone with any questions regarding the requested service. Physicians can play an important part in home health care by helping with the care plan in coordination with the home health care team and by being available when the team has questions.2

Physicians can become more involved in the administrative aspects of home health care. A physician can serve as medical director for a home health care agency. As medical director, a physician has many responsibilities, including taking part in the agency utilization review, pharmacy and research.3 Physicians can also join the American Academy of Home Care Physicians.

Clearly, home health care is an important aspect of care for elderly persons. Geriatric patients prefer to live at home where they have an improved sense of well-being. Because patients are grateful for the services provided by home health care, physicians need to play an active role and keep up-to-date on the criteria for Medicare-financed home health care.

Dr. Marziano is a family physician with Kaiser Permanente, Mid-Atlantic Permanente Medical Group, P.C., Rockville, Md. She completed a fellowship in geriatric medicine at Georgetown University Medical Center/Providence Hospital, Washington, D.C. Dr. Cefalu is a professor and chief of geriatric medicine in the Department of Family Medicine at Louisiana State University Medical Center, New Orleans. He completed a fellowship in geriatric medicine as well as a master of science in epidemiology at Bowman Gray School of Medicine in Winston-Salem, N.C.


1. Montauk SL. Home health care. Am Fam Physician. 1998;58:1608–14.

2. American Medical Association Home Care Advisory Panel. Guidelines for the medical management of the home care patient. Arch Fam Med. 1993;2:194–206.

3. Keenan JM, Hepburn KW. The role of physician in home health care. Clin Geriatr Med. 1991;7:665–74.



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