For decades, the decision on whether Medicare would pay for coverage for chronically ill patients has been based on the whether the patient’s condition would improve with additional care. That was a very high bar. Many patients undergoing needed physical and occupational therapy would be notified that Medicare would no longer pay because they had reached a plateau.

The rehab facility would essentially tell the patient – or their family – that they had reached their maximum level, and any further stay would have to be paid for privately. With the high cost of care, this was devastating news.

In October, the Obama administration announced a proposed settlement to a class action lawsuit that would direct Medicare to pay for services if those services are needed to “maintain the patient’s current condition or prevent or slow further deterioration.”

This is a very different standard than the one previously used by Medicare, and should result more Medicare coverage for patients who need the additional care. The proposed settlement would apply to Medicare and private Medicare Advantage programs, and applies to in-home services as well as those provided in a re-hab or nursing home setting.

Additional Information:

New York Times: Settlement Eases Rules for Some Medicare Patients

AARP: Class Action Lawsuit Against the Federal Government Terminates Medicare Improvement Standard


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