Center for Medicare Advocacy Launches Initiative
to End Use of "Improvement Standard"
to Deny Medicare Coverage

 

Medicare is supposed to cover up to 100 days of skilled nursing facility care as long as the resident needs skilled care.  However, most facilities apply a standard that is not in the law, which unfairly restricts coverage.  The Center for Medicare Advocacy is launching a new advocacy and education initiative to eliminate the use of the Medicare "improvement standard," which requires that Medicare beneficiaries be able to improve in order to qualify for coverage. Although the improvement standard conflicts with the law, it has become deeply ingrained in the system and ardently followed by those who provide care and those who make coverage determinations throughout the health care continuum.

This Medicare tradition has become virtually an urban myth among the providers and contractors who are largely responsible for making Medicare coverage decisions. The myth denies Medicare coverage to a beneficiary who has “plateaued,” is “medically stable,” or needs services for “maintenance only.” All of these shorthand terms essentially impose an improper requirement that results in termination of Medicare coverage for beneficiaries who have chronic conditions and who, sadly, are probably most in need of the care that is being denied them. Neither the Medicare statute nor its implementing regulations mention or suggest an improvement standard in the context of diagnosis or treatment of illness or injury. In fact, the notion of "improvement" is only mentioned once in the Medicare Act – and it is not about coverage for nursing home care. The improvement standard derives instead from references in some Medicare manual provisions, which have been refined, simplified, and emphasized in contractors’ internal guidelines over time.

The employees who apply this phony coverage standard are simply following the guidelines laid out for them by their employers. Those improper guidelines, rather than federal statutes or regulations, are the basis for the rules that they apply. The improvement standard has become so much a part of Medicare culture that, even when presented with contrary evidence in the form of regulations and manual provisions, employees simply ignore it and state unequivocally that the improvement standard requires that coverage be terminated. Indeed, many advocates are unaware that the policy has little basis in the law and fail to challenge terminations of Medicare coverage based on it. 

For the most part, the CMS Medicare Benefit Policy Manual provisions support and reiterate the regulations in their respective areas. Confusion arises, however, when the manual provisions are inconsistent with the regulations. In short, the manual provisions are all over the lot, with some reinforcing the regulations and some contradicting them. But the situation is made more confusing by the existence of Local Coverage Determinations, which are developed by individual contractors to guide the jurisdictions in which they operate.  Although Local Coverage Determinations are not binding on administrative law judges, contractors’ employees tend to rely on these determinations to make decisions—even when in conflict with the regulations. Consequently elimination or correction of inappropriate language in the manual provisions would have only a limited effect unless and until the Local Coverage Determinations are also corrected and the employees are retrained to expunge the concept of an improvement standard.

Because the improvement standard is not the product of notice-and-comment rule making, in theory the policy could be easily corrected. The Centers for Medicare and Medicaid Services (CMS) could simply correct the language of the offending guidelines to reflect the proper legal standard and then ensure compliance by educating and monitoring the responsible agencies and contractors. If CMS declined to act on its own, the president could issue an executive order directing CMS to take the appropriate steps to cleanse the manuals and to clarify the policy for those applying it. Neither straightforward approach has yet occurred.  

In a perfect world CMS would recognize the error and unilaterally act to eliminate the improvement standard as a condition of coverage. This change could be accomplished without rule making since the regulations enunciate the correct standard and do not need to be altered. Changes in the inappropriate manual provisions would be the first step, which should be followed by a review of Local Coverage Determinations to correct those that establish more restrictive coverage conditions than the statute and regulations allow. Even if CMS would not act on its own, the president could issue an executive order that would require CMS to take those steps. For the time being, however, those avenues do not appear to be imminent. Litigation thus may be the more effective tool. 

Important Advocacy Tips

If a nursing home or Medicare Advantage plan says Medicare coverage is not available and the patient seems to satisfy the criteria above, ask the nursing home to submit a claim for a formal Medicare coverage determination. The nursing home must submit a claim if the patient or representative requests; the patient is not required to pay until he/she receives a formal determination from Medicare.

-Adapted from “News from Margolis & Bloom, LLP - May 31, 2010”, Margolis & Bloom, LLP, May 31, 2010; “How the ‘Improvement Standard’ Improperly Denies Coverage to Medicare Patients with Chronic Conditions” by Gill Deford, Margaret Murphy, and Judith Stein in Clearinghouse Review, Journal of Poverty Law and Policy, January–February 2010 Volume 43, Numbers 9–1010, http://www.medicareadvocacy.org/Projects/Improvement/PublishedArticle.pdf retrieved 6/1/10 and “Medicare Skilled Nursing Facility Self Help Packet”, Medicare Advocacy.org, http://www.medicareadvocacy.org/InfoByTopic/SkilledNursingFacility/SNFSelfHelpPacket.2010.pdf, retrieved 6/1/10.

 

6/10