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GREG DILL: How Medicare covers mental health services

Let’s hope it never happens, but there may come a time in your life when you need mental health care. Your Medicare covers a wide variety of such services, in both hospital inpatient and outpatient settings.

If you have Medicare Part A (hospital insurance), you’re eligible for mental health services when you’re admitted to a hospital as an inpatient. You can get these services either in a general hospital or a psychiatric hospital that only cares for people with mental health conditions.

If you’re in a psychiatric hospital (instead of a general hospital), Part A only pays for up to 190 days of inpatient psychiatric hospital services during your lifetime.

Medicare pays for inpatient hospital stays on the basis of “benefit periods.” A benefit period begins the day you’re admitted to a hospital as an inpatient. It ends when you haven’t received any inpatient care for 60 days in a row.

If you go into a hospital after one benefit period has ended, a new benefit period begins. You must pay the inpatient hospital deductible ($1,340 in 2018) for each benefit period.

There’s no limit to the number of benefit periods you can have. But remember, there’s a lifetime limit of 190 days for inpatient psychiatric hospitals.

After you pay the deductible, Medicare covers inpatient hospital care for the first 60 days with no coinsurance on your part for each benefit period.

For days 61-90, your coinsurance is $335 per day of each benefit period.

If you’re in the hospital beyond 90 days, your coinsurance is $670 per “lifetime reserve day” for each benefit period (you have up to 60 reserve days over your lifetime).

In addition, you’ll pay 20 percent of the Medicare-approved amount for mental health services you get from doctors and other providers while you’re a hospital inpatient.

Your Medicare Part B (medical insurance) covers partial hospitalization in some cases. 

Partial hospitalization provides a structured program of outpatient psychiatric services as an alternative to inpatient psychiatric care. It’s more intense than care you get in a doctor’s or therapist’s office. This treatment is provided during the day and doesn’t require an overnight stay.

Medicare helps cover partial hospitalization services when they’re provided through a hospital outpatient department or community mental health center. Along with partial hospitalization, Medicare may cover occupational therapy that’s part of your mental health treatment and/or individual patient training and education about your condition.

Medicare only covers partial hospitalization if the doctor and the partial hospitalization program accept Medicare as full payment.

For Part B to cover a partial hospitalization program, you must meet certain requirements, and your doctor must certify that you would otherwise need inpatient treatment.

Under Part B, you pay a percentage of the Medicare-approved amount for each service you get from a doctor or other qualified mental health professional if they accept Medicare rates.

You also pay coinsurance for each day of partial hospitalization services provided in a hospital outpatient setting or community mental health center. The Part B deductible ($183 in 2018) applies as well.

Your doctor or other health care provider may recommend you get services more often than Medicare covers. Or they may recommend services that Medicare doesn’t cover. If this happens, you may have to pay some or all of the costs. It’s important to ask questions so you understand why your doctor is recommending certain services and whether Medicare will pay for them.

All of the above applies to people with Original Medicare. If you’re in a Medicare Advantage (Part C) health plan, check with the plan for details of how it covers mental health care.

For more information on your Medicare mental health benefits, I recommend this Medicare-mental health brochure at . Look for it under the “publications” tab. 

Greg Dill is Medicare’s regional administrator for Arizona, California, Nevada, Hawaii, and the Pacific Territories. You can always get answers to your Medicare questions by calling 1-800-MEDICARE (1-800-633-4227).


ACOs flock to Medicare Shared Savings Program

Dive Brief:

Dive Insight:

The sharing savings program lets providers and hospitals earn a bonus if they meet spending and quality targets, in an effort to improve care coordination and lower healthcare costs. ACOs in the program now include about 10.5 million Medicare beneficiaries, an increase from 9 million in 2017.

“This growth is an encouraging sign that more ACOs are preparing to take on risk, but it’s vital to recognize all the time and effort for these ACOs to be ready to assume risk. We need to continue to improve the ACO program as a whole to provide the stability and demonstrated success necessary for ACOs to feel confident to enter into these risk-based ACO models.”

So far, results from ACOs have been mixed, but there have been notable successes. A recent analysis from the focusing on the first three years showed that most ACOs in the program reduced spending and improved care quality.

The report found that the groups cut spending by a total of $3.4 billion in the three years studied for a net reduction of nearly $1 billion, but also discovered large differences between an ACO’s success. About half of the reduction came from 36 ACOs, and three in that group were responsible for a quarter of that amount.

The inspector general report also found the highest performing ACOs usually have sicker beneficiaries and were more likely to include only physicians. ACOs also, on average, had better quality scores than fee-for-service providers in more than 80% of 33 individual measures.

The most improved quality measures were in areas like flu vaccines, depression screening, fall risk and body mass index, according to the report. 

Recommended Reading:

  • Healthcare Finance News CMS: Medicare adds 124 ACOs for 2018
  • Modern Healthcare More Medicare ACOs will take on risk in 2018


A Sign National Improved Medicare For All Is Winning

In The Road to Medicare for Everyone, Jacob Hacker is once again working to dissuade single payer healthcare supporters from demanding National Improved Medicare for All and use our language to send us down a false path. Hacker comes up with a scheme to convince people to ask for less and calls those who disagree “purists”. Hacker calls his “Medicare Part E” “daring and doable,” I call it dumb and dumber. Here’s why.

Hacker makes the same assertions we witnessed in August of 2017 when other progressives tried to dissuade single payer supporters.

He starts with “risk aversion,” although he doesn’t use the term in his article. Hacker asserts that those who have health insurance through their employers won’t want to give it up for the new system. Our responses to this are: there is already widespread dislike for the current healthcare system; people don’t like private insurance while there is widespread support across the political spectrum for Medicare and Medicaid; there is also widespread support for single payer; and those with health insurance can be reassured that they will be better off under a single payer system. It is also important to note that employers don’t want to be in the middle of health insurance. Healthcare costs are the biggest complaint by small and medium sized businesses and keep businesses that operate internationally less competitive.

Next, Hacker brings up the costs of the new system and complains that it will create new federal spending. He points to the failures to pass ‘single payer’ in Vermont and California. First, it must be recognized that the state bills were not true single payer bills, and second, states face barriers that the federal government does not, they must balance their budgets. Hacker ignores the numerous studies at the national level, some by the General Accounting Office and the Congressional Budget Office that demonstrate single payer is the best way to save money. Of course there would be an increase in federal spending, the system would be financed through taxes, but the taxes would replace premiums, co-pays and deductibles, which are rising as fast as health insurers can get away with. Hacker proposes a more complex system that will fail to provide the savings needed to cover everyone, the savings that can only exist under a true single payer system.

Hacker also confuses “Medicare for All” with simply expanding Medicare to everyone, including the wasteful private plans under Medicare Advantage. This is not what National Improved Medicare for All (NIMA) advocates support. NIMA would take the national infrastructure created by Medicare and use it for a new system that is comprehensive in coverage, including long term care, and doesn’t require co-pays or deductibles. The system would negotiate reasonable pharmaceutical prices and set prices for services. It would also provide operating budgets for hospitals and other health facilities and use separate capital budgets to make sure that health resources are available where they are needed. And the new system would create a mechanism for negotiation of payment to providers.

Finally, Hacker tries to convince his readers that the opposition to NIMA will be too strong, so we should demand less. We know that the opposition to our lesser demands will also be strong. That was the case in 2009 when people advocated for the ‘public option’ gimmick. If we are going to fight for something, if we are going to take on this opposition, we must fight for something worthwhile, something that will actually solve the healthcare crisis. That something is NIMA. We are well aware that the opposition will be strong, but we also know that when people organize and mobilize, they can win. Every fight for social transformation has been a difficult struggle. We know how to wage these struggles. We have decades of history of successful struggles to guide us.

One gaping hole in Hacker’s approach is that it prevents the social solidarity required to win the fight and to make the solution succeed. Hacker promotes a “Medicare Part E” that some people can buy into. Not only will this forego most of the savings of a single payer system, but it also leaves the public divided. Some people will be in the system and others will be out. This creates vulnerabilities for the opposition to exploit and further divide us. Any difficulties of the new system will be blown out of proportion and those in the system may worry that they are in the wrong place. When we are united in the same system, not only does that create a higher quality system (a lesson we’ve learned from other countries), but it also unites us in fighting to protect and improve that system.

Hacker succeeded in convincing people who support single payer to ask for something less in 2009 and we ended up with a law that is further enriching the health insurance, pharmaceutical and private healthcare institutions enormously while tens of millions of people go without care. Now, Hacker rises again to use the same scare tactics and accusations that he used then to undermine the struggle for NIMA. This is to be expected. The national cry for NIMA is growing and the power holders in both major political parties and their allies in the media and think tanks are afraid of going against the donor class. Social movements have always been told that what they are asking for is impossible, until the tide shifts and it becomes inevitable.

Our task is to shift the tide. We must not be fooled by people like Jacob Hacker. We know that single payer systems work. We have the money to pay for it. We have the framework for a national system and we have the institutions to provide care. Just as we did in 1965 when Medicare and Medicaid were created from scratch, and without the benefit of the Internet, we can create National Improved Medicare for All, a universal system, all at once. Everybody in and nobody out.

We know that we are close to winning when the opposition starts using our language to take us off track. “Medicare Part E” is not National Improved Medicare for All, it is a gimmick to protect the status quo and convince us that we are not powerful. We aren’t falling for it. This is the time to fight harder for NIMA. We will prevail.


A Sign National Improved Medicare For All Is Winning

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More Medicare ACOs will take on risk in 2018

About 18% of accountable-care organizations in the Medicare shared savings program will participate in a downside risk contract in 2018, a jump from the just 9% of ACOs who took on risk last year, new CMS data shows.

There are 561 Medicare ACOs in the program this year and 101 are in a downside risk-based contract. The majority of those ACOs, 55, have joined Track 1+, the newest risk model that doesn’t require ACOs to take on as much financial risk as Tracks 2 or 3 of the program. The CMS introduced the track this year as a stepping stone for ACOs to take on potential financial losses gradually.

There are 8 ACOs in Track 2 and 38 ACOs in Track 3.

“Certainly (the numbers) are showing that more ACOs are taking on risk, but it’s not going to be mad dash. It is going to be a gradual, sustained movement,” said David Muhlestein, chief research officer at Leavitt Partners who studies ACOs.

“Delivery transformation is really hard — if you want to effectively change how you are delivering care it takes a lot of work over a long period of time,” he added.

The Medicare shared savings program is only profitable for the CMS if ACOs participate in downside-risk based contracts because the agency can penalize ACOs that miss performance targets. The CMS actually lost $39 million from ACOs in 2016 because it had to pay $691 million in bonuses. Only 5% of ACOs were in advanced tracks in 2016.

Physicians have an incentive to join the advanced tracks as well. Track 1+ and Tracks 2 and 3 are considered advanced alternative payment models under MACRA so doctors can qualify for a 5% bonus payment.

Muhlestein said he expects more ACOs to venture into the risky tracks as MACRA takes hold. The organizations will be able to see how they are performing under MIPS and decide whether or not they are ready to venture into an advanced APM with opportunity for more bonuses.

About 76% of the ACOs up for contract renewal this year decided to do so, the CMS data shows. That’s up from the roughly 64% of ACOs last year that decided to stick with the Medicare program.

“There is certainly continued evidence that organizations are starting to figure this out,” Muhlestein said.

The number of ACOs overall in the program rose by 81 from 480 in 2017 to 561 this year. About 10.5 million Medicare beneficiaries now receive care from a clinician in a Medicare ACO, up from 9 million beneficiaries last year. Of the beneficiaries, 12.6% are disabled and 6.7% are dual eligibles, according to the CMS.

Maria Castellucci

Maria Castellucci is a general assignment reporter covering spot news for Modern Healthcare’s website and print edition. She writes about finances, acquisitions and other healthcare topics in markets across the country. Castellucci is a graduate of Columbia College Chicago and started working at Modern Healthcare in September 2015.


Insulet’s Omnipod Now Eligible for Medicare Coverage

By Ben Pallant, Adam Brown, and Kelly Close

New Medicare decision leads to coverage for the Omnipod, which will be available in pharmacies and covered under Medicare Part D.

While Insulet’s tubeless Omnipod insulin pump has been available in the US since 2005, it was the only FDA-cleared insulin pump not covered by Medicare – until this week. New clarification from the Centers for Medicare and Medicaid Services (CMS) allows the Omnipod to be covered under Medicare Part D, which is dedicated to prescription drug coverage. (This is different from most insulin pumps, as well as therapeutic CGMs, which are covered by Part B – you can learn more about the different parts of Medicare coverage here.) This decision means that Omnipod will available to eligible Medicare beneficiaries in pharmacies in the near future.

In addition, because many insurers follow the decisions of Medicare, its coverage of the Omnipod could pave the way for state-run Medicaid programs to also cover it, as well as some private insurers who have not yet done so. Combining Medicare and the potential for expanded Medicaid access, Omnipod could now become available to an additional 450,000 people with type 1 diabetes in the US. Great news!

When and How Can Someone on Medicare Get the Omnipod?

Insulet still needs to work with Medicare Part D plans to get the Omnipod on “formularies,” the lists of what is covered on different plans (and what things cost). This could take several months. For now, individuals with Part D coverage can apply to get the Omnipod covered through a “formulary exception.” Insulet has an FAQ here with more details.

Once the Omnipod is available on Medicare formulary lists, it will require a prescription and will be offered through pharmacies, in much the same way that prescription drugs might be. The formulary decisions will also formalize what out-of-pocket costs might look like and what criteria someone must meet to qualify for a pump.

Insulet also believes that people with type 2 diabetes might qualify for Omnipod coverage. We’ll have to see what happens once the formulary negotiations are finalized.

Why Wasn’t the Omnipod Covered Before?

The Omnipod wasn’t covered under Medicare Part B because of a bizarre Medicare guideline that said tubeless insulin delivery devices, like the Omnipod, couldn’t be counted as insulin pumps. The new “guidance” document from Medicare, however, says that “medical supplies associated with the injection of insulin,” which aren’t already covered by Part B, are covered by Part D. With this “benefit category” now figured out, Omnipod can get coverage.   

Advocacy at Work!

Multiple professional groups (AADE, AACE, Endo), patient groups (diaTribe, DPAC, JDRF, NDVLC), and countless people with diabetes that helped demonstrate to CMS how much it would mean to get coverage of the Omnipod. See the summary of letters here from patient advocacy organizations. It took too long, but CMS finally made the right decision. 


The downside of Medicare Advantage: Members more likely to end up in lower-quality nursing homes

Medicare Advantage plans, the increasingly popular privatized insurance option for seniors, appear to steer enrollees to lower-quality nursing homes than traditional Medicare does, according to a new study.

The study, published in the January edition of Health Affairs, examined data for all elderly Medicare beneficiaries who were newly admitted to skilled nursing facilities (SNFs) between 2012 and 2014.

It found that compared to Medicare Advantage enrollees, fee-for-service Medicare patients have a substantially higher likelihood of entering high-quality SNFs—defined as those with lower readmission rates and those that are rated four stars or higher by the Nursing Home Compare quality rankings.

That disparity was less significant when comparing fee-for-service Medicare and higher-quality MA plans, since members of the latter were more likely to select a better-quality nursing home than members of low-quality MA plans.

Overall, however, the findings suggested that in a plan of 1,000 MA enrollees, up to 42 fewer patients would enter a higher-quality SNF than in a sample of 1,000 Medicare fee-for-service patients.

RELATED: ‘Big five’ insurers depend heavily on Medicare, Medicaid business

One explanation for the results, according to the study authors, may be that unlike their MA counterparts, Medicare fee-for-service enrollees aren’t limited by network design when they select a nursing home. Indeed, narrower networks are common in MA plans: An analysis released in October found that 35% of people enrolled in such plans for 2018 have policies that cover 30% or fewer of physicians in the counties where they live. 

To encourage MA plans to contract with higher-quality nursing homes, researchers suggested that CMS could require insurers to be more transparent with beneficiaries about the quality of the facilities in their networks. CMS could also include Medicare Advantage patients in its rehospitalization measures for SNFs, or include SNF outcomes in HEDIS ratings, they said.

In recent years, MA plans have become a bigger and bigger part of the Medicare landscape, accounting for 33% of overall Medicare enrollment in 2017. But the new study on MA and nursing homes adds to a growing body of evidence that these privatized plans have drawbacks.

For example, another study published in this month’s issue of Health Affairs found that MA plans with lower star ratings had significantly higher rates of disenrollment by patients with end-stage renal disease in the year after they enrolled, relative to plans with higher star ratings. Those findings suggest, according to the study authors, that “low plan quality may lead to increased expenditures, as this high-cost population generally must shift from Medicare Advantage to traditional Medicare upon disenrollment.”

Similarly, a 2015 study found that patients who needed a long-term nursing home switched from MA plans to traditional Medicare at almost six times the rate of those who did the opposite—a trend that “appears to transfer responsibility to traditional Medicare just as patients enter a period of intensive healthcare needs.”

And a Government Accountability Office report released this summer, which reviewed 126 MA plans, found that 35 of them had disproportionately high numbers of sicker people dropping out—many citing difficulty accessing their preferred providers.


VA provides fewer unnecessary end-of-life interventions than Medicare, new study shows

At the end of life, less is usually more. Less pain, of course, but also fewer visits to the hospital and fewer treatments in the last few months of life are preferred by most patients and families. Nonetheless, many dying patients find themselves hospitalized, receiving unnecessary, and expensive, interventions in their last weeks.

Now, a team led by Stanford and Department of Veterans Affairs health economist Risha Gidwani-Marszowski, DrPH, decided to investigate how health care systems affect care given at the end of life. She found two groups that could be easily compared: veterans with cancer who receive care through the VA and veterans with cancer who receive care through Medicare.

Their work appears in Health Affairs.

VA physicians are salaried, while physicians and organizations that provide care through Medicare bill for each service they provide, a system known as fee for service. Those differing incentives make it unsurprising that Medicare patients received more unnecessary services than VA patients, Gidwani-Marszowski told me. Specifically, as explained in the press release:

The study showed that Medicare patients were more likely to receive unduly intensive care at the end of life including chemotherapy, hospitalization, admission to the intensive care unit, longer stays in the hospital and death in the hospital than those who received care through the VA.

This research is particularly relevant given the ongoing conversations that propose restructuring the VA toward a Medicare-like model where it pays for, rather than provides, services.

Here’s Gidwani-Marszowski:

The findings are not just important for veterans and VA policy, but for anybody who needs medical care at the end of life, which is a majority of us. We as a society need to ensure we are setting up the organization of health care and its financial incentives to ensure that the services patients receive are the ones that are in their best interests at the end of life.

Previously: New tools to improve end-of-life communication available, Conflict and compromise: How clinicians can improve end-of-life conversations and Desire for quality end-of-life care crosses ethnic groups
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