Medicare, Rehab, and “Failure to Improve”

After a hospital stay, Medicare-covered people may need rehab to continue improving from the treatment that the hospital provided.  (As discussed in the March 10, 2017 installment, the hospital stay must be at least three days and a full “admission” to the hospital.)  In the past, as a way to save money, Medicare would cut off rehab for someone who wasn’t getting better (or wasn’t getting better fast enough.)

BUT, Medicare’s rules don’t allow for a cut-off of rehab for a failure to improve.  Medicare got sued to stop using the “improvement” standard.  A class action lawsuit was filed in 2011 in Vermont, Jimmo v. Sebelius (Kathleen Sebelius was the United States Secretary for Health and Human Services between 2009-2014.)  Jimmo and the other claimants pointed out that the Medicare rules do not set restoration of the patient’s condition as the only goal of rehab.  Instead, the rules specifically list the preservation of current capabilities and the prevention of further deterioration as alternate goals if restoration isn’t possible.

Now, restoration is listed in the rules as the goal of rehab when the patient is trying to recover from a malformed body part.  Unfortunately, that restoration goal came to be applied to most or all rehab programs, not just to malformed limbs.  Using a “failure to restore” the patient’s function test allows payment to be cut off earlier in the rehab process than would using a “preservation of current function/prevention of deterioration” test.  Cutting off rehab earlier saves Medicare and its insurance affiliates save a great deal of money when rehab gets shut down early.  As a result, bit by bit, most or all rehab patients came to be measured by their progress toward restoration of function, and when the patient failed to improve toward that goal, payment for rehab get cut off.

The Jimmo lawsuit forced Medicare to face its failure to follow its own rules.  The Jimmo lawsuit didn’t go to trial but, instead, led to a settlement agreement that Medicare would stop improper use of the “restoration” standard and its “failure to improve” test for ending rehab payments.  (The restoration goal still applies to malformed body parts.)  The judge approved the settlement as a court order.

Unfortunately, years later, rehab providers and Medicare’s insurers are still applying the failure to improve standard.  The Jimmo case went back to court to demand that Medicare follow the settlement agreement.  (Based on the resulting court order, it appears that the judge is not happy with Medicare.)  Under the new court order that adds to the original settlement agreement, Medicare must undertake an effort to educate the public that the failure to improve test does not apply.

To patients undergoing rehab, the Jimmo case is the basis to argue that rehab should not be ended.  The proposed ending of rehab must come in writing with an explanation of the right to appeal.  The Jimmo settlement is an argument to present in the appeal.

Unfortunately, many hearing officers are more familiar with the incorrect approach that “failure to improve” is a reason to end rehab than they are familiar with the Jimmo agreement.  Appeals about the continuation of rehab may require the help of an attorney who works in Medicare or Medicaid.

Also, the Jimmo settlement does not get rid of the 100-day limit on Medicare payments for rehab.  The 100 days of available rehab does not reset unless the patient can go 60 days without needing Medicare’s support for the health issue that led to rehab.  If the family is concerned about the patient going 60 days without needing more medical help, the family may not wish to push the Jimmo issue too far.  The family may wish to “save” some of the 100 days.

In summary, if a patient seems to be getting pushed out of rehab early and the patient or family wishes rehab to continue, argue that Medicare can’t cut off rehab for a failure to improve.  Use the name “Jimmo,” so the care provider, insurer, or hearing officer can look for the agreement.