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How Medicare's Reimbursement System Changed Nursing Home Therapy Culture
Patients getting ultra-high therapy, at least 720 minutes a week, generate nursing homes’ biggest payments from the federally funded Medicare program. In 2013, Medicare’s ultra-high rate averaged about $560 a day, $445 for very high therapy, and $325 for low therapy.
Medicare adopted the payment rules in 1998, replacing the system based on costs. Since then, nursing homes have billed for increased therapy levels. In 2002, nursing homes gave ultra-high therapy to about 7% of its residents. In 2013, ultra-high therapy billing increased to almost 54% of residents.
That same year, a 96 year-old resident fell and broke his hip. Post-surgery, he needed therapy and entered a skilled nursing facility. His treatment notes illustrated that his therapy included strengthening exercises and awareness training to prevent falls. During his final days at the facility, he became very agitated and struck a therapist. On that day, he had received 61 minutes of physical therapy, 50 minutes of occupational therapy, and 60 minutes of speech therapy. The resident was transferred to a hospital after a laceration of unknown cause was noticed. The hospital diagnosed the resident with severe dehydration and referred him to hospice care. Less than three weeks later, he passed away.
According to recent studies, many residents have received therapy until near death. A Journal’s analysis found that between 2010 and 2013, about 110,000 residents died within five days of ultra-high therapy billings. University of Michigan professor, Brant Fries, says that if after ultra-high therapy “a large number of people are ending up in hospice, that’s not a good outcome. If you have lots of people who are dying, it doesn’t make any sense why you’re giving them rehab.”
Medicare’s 1998 reimbursement system “changed the incentives, which changed the culture” says Vincent Mor, a Brown University health-services professor. Medicare’s own rules can provide financial incentives for facilities to give high levels of rehabilitative therapy. The benefits of rehabilitative therapy in nursing homes are well-established and crucial to recovery. However, a resident receiving ultra-high therapy does not guarantee better outcomes. Therapy is far too often inappropriately delivered to residents that are unresponsive and are not likely to benefit from such services. The monetary incentive for placing residents on ultra-high therapy can negatively impact the care received by residents, often times distressing vulnerable residents that are not capable of receiving intense therapy.