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Hospices Given Room to Fight New Medicare Rules

(CN) - The government must face claims that it is "nearly impossible" to satisfy new requirements for doctors to articulate why Medicare patients need in-home care, a federal judge ruled.

Among other challenged portions of the federal health care reform law, the Affordable Care and Patient Protection Act requires a referring doctor to "document" his "face-to-face encounter" with a Medicare patient if that provider wants payment for in-home services.

The recently issued interpretation of that requirement by Sylvia Mathews Burwell, secretary of Department of Health and Human Services (HHS), says the doctor must both certify that the encounter occurred and explain in writing why the patient is homebound.

This newly issued "narrative requirement" prompted a federal complaint in Washington from the National Association for Home Care and Hospice Inc., or NAHC, a trade group representing some 6,000 home health service providers.

Calling Burwell's interpretation unauthorized and vague under the Fifth Amendment, the hospice association called it "nearly impossible" to achieve compliance.

NAHC argued that Health and Human Services should consider the entire patient record - not solely the narrative requirement - to find out if a patient needs home-health services.

The providers blamed a high number of Medicare denials on the narrative requirement, but nine of the 11 cited denials were later reversed, according to the ruling.

Burwell moved to dismiss the action for lack of standing and failure to exhaust administrative remedies, as well as for failure to state a claim, and U.S. District Judge Christopher Cooper agreed Tuesday that NAHC's members should attempt to resolve their constitutional claims administratively.

"By reviewing NAHC's members' claims in the first instance, the agency will have the necessary opportunity to correct improperly denied claims, ensuring that the court will not review narratives that the agency ultimately would have determined were satisfactory," Cooper wrote. "Administrative review would also enable the court and the parties to rely on HHS's expertise, as the agency can better explain in further proceedings why certain narratives are insufficient."

Indeed, the members' successful claims "demonstrate that the appeals process is far from futile despite the alleged vagueness of the narrative requirement," according to the ruling.

As for the hospice group's statutory claim - that the secretary exceeded her authority in issuing the narrative requirement - the court deferred ruling on the matter at this time.

NAHC's "statutory argument and the surrounding regulatory regime are complex, and the parties' briefing on this motion to dismiss has focused predominantly on the question of exhaustion," Cooper wrote. "Accordingly, to give the parties a greater opportunity to brief this issue, the court will deny the Secretary's motion to dismiss under Rule 12(b)(6)."

Standing is not an issue because the NAHC "has identified at least one member that was denied Medicare payments based on a failure to comply with the narrative requirement," Cooper added.

The association has sued Health and Human Services before, by challenging its 8.7 percent reduction in payment rates for Medicare-covered home health services in 2008.

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