The 21st Century Cures Act: What Home Care Agencies Need to Know

Jan 5, 2017 8:45:35 AM

The 21st Century Cures Act includes sweeping changes to funding biomedical research, approving drugs and medical devices, and improving mental health. Several of these changes have direct implications for the home care industry – from major new regulations on Medicaid reimbursements to more minor tweaks to the small business insurance market and hospital readmission penalties.

Regulations and ComplianceThe effects are so far-reaching, in fact, that Sen. Lamar Alexander (R-Tenn.), chairman of the Health, Education, Labor and Pensions Committee, called the Cures Act a “Christmas miracle … that will help virtually every American family.”

We’ve highlighted the major impacts the Cures Act is likely to have on your business, so you can be prepared for the changes coming your way.

Overarching Goals of the 21st Century Cures Act

As one of the largest pieces of health care-focused legislation, the Cures Act contains $6.3 billion in provisions to foster such health care modernizations as:

  • Biomedical Innovation: Establishes a “breakthrough device pathway” to help bring new medical device technologies to market faster.
  • Disease Research: Provides resources to research and target currently incurable diseases, such as cancer.
  • Opioid Abuse: Advances mental health reform to help addicts break the cycle of abuse and addiction.
  • Drug Development: Includes several reforms that will establish an FDA review pathway, shorten the drug development time and reduce the failure rate in drug development. It also requires all pharmaceutical companies to develop compassionate-use policies for drugs that treat serious or life-threatening conditions.
  • Medicaid Fraud: Attempts to reduce system abuse by requiring electronic visit verification (EVV) to provide proof of services rendered and by establishing a centralized database to ensure the legitimacy of caregivers.
  • Readmission Penalties: Potentially changes the way hospitals are evaluated and penalized when patients are readmitted.
  • Affordable Care Act (ACA) Stabilization: Lets small businesses reimburse workers for out-of-pocket health care costs and premiums on the individual market.
  • Electronic Health Records (EHRs): Aims to facilitate patient care coordination by encouraging the interoperability of of EHRs

Of these changes, we believe four areas will have the biggest impact on the home care industry:

  1. Medicaid fraud prevention strategies

  2. Adjustments to the way penalties are calculated against hospital readmissions

  3. Changes to the ability for small businesses to reimburse individual workers for health care costs

  4. Incentives to push the industry toward interoperable EHRs

Let’s explore these changes and their implications for agencies further.

Preventing Medicaid Fraud

The dollar amount of improper Medicaid payments has more than doubled since 2013 — skyrocketing to $29.1 billion in fiscal 2015 from $14.4 billion in fiscal 2013. The Cures Act seeks to fight Medicaid fraud through two provisions: creating a centralized database of caregivers and implementing EVV systems to provide proof of services rendered.

Centralized Medicaid Database of Caregivers

A growth in Medicaid fraud has been an unintended consequence of the growth in home care services. Verifying caregiver credentials has remained an elusive challenge for CMS.

The Cures Act seeks to address the issue by creating a national, centralized database that will:

  • Allow state Medicaid agencies and health plans to confirm caregiver identities and credentials
  • Prevent providers terminated from Medicaid (usually due to fraud or other criminal acts) in any state from relocating to another state, creating new identities or credentials, and providing services.
  • Improve communication among government agencies
  • Build centralized enrollment standards that detail what doctors must submit to enroll in Medicaid

Potential Impact: With this database, states themselves would submit information received from providers upon caregiver enrollment. Currently, providers in most states are required to submit the caregiver’s name, specialty, date of birth, Social Security number, national provider identifier, federal taxpayer identification number, and the state license or certification number.

Providers will need to continue to either collect this information from their caregivers or require the caregivers to verify that they have submitted the data to the appropriate regulatory bodies.

It’s also noteworthy that many industry experts view registries as unnecessary for several reasons.

Not only are they not likely to improve access to home care, but registries would also add development and maintenance costs, could be an invasion of caregiver privacy, and could even promote an underground economy where consumers make cash arrangements directly with caregivers. Furthermore, EVV already addresses issues around the accuracy of care delivery and claims submissions.

EVV Requirements

As fraud in the home health industry escalates, agencies are facing increased scrutiny over their ability to verify services delivered in order to receive payment.

The Cures Act establishes new requirements for electronic visit verification (EVV) for Medicaid-covered personal and home health services, such as attendant services, in-home respite services and private-duty nursing.

Potential Impact: Mandated EVV can be viewed as either another regulatory hurdle to overcome – or an opportunity to improve operational efficiencies.

Instead of selecting a solution that merely meets the EVV mandate, agencies can derive more value from the change by choosing a comprehensive care delivery management solution that goes beyond EVV and enables caregivers and offices to communicate in real time, facilitates point-of-care documentation, and provides highly valuable information that sets the stage for better care and service delivery at a lower overall cost.

Adjusting Penalties for Hospital Readmissions

The Cures Act sets forth a new standard for judging hospitals with high patient readmission rates: CMS must now consider patients’ backgrounds when assessing hospital readmission penalties. This risk-adjustment approach may benefit so-called “safety net” hospitals, encouraging them to provide the right level of care for their most vulnerable patients.

Potential Impact: As penalties are eased for certain hospitals, they may be less focused on reducing readmissions and therefore less inclined to invest in home care services.

To counteract this possibility, home care agencies should be prepared to collect, analyze, and present comprehensive data showing their efficacy and cost benefit to hospitals. Integrated technology to analyze the delivery of care will make this data more all-inclusive and easier to collect.

Stabilizing the ACA Exchanges

Tucked in at the end of the Cures Act is a small provision for the Small Business Health care Relief Act (SBHRA) that may significantly affect workers who don’t receive health insurance through their employer.

The provision will allow small businesses (fewer than 50 employees) to reimburse workers for some out-of-pocket health care costs and premiums that workers pay for insurance obtained in the individual market.

Although the intention is to boost enrollment in ACA exchanges, some are worried about a rebound effect: Small businesses may now find there’s less incentive to directly offer insurance to their workers. This may have broad implications for the insurance market as a whole.

Potential Impact: If fewer businesses offer health coverage, more workers may obtain coverage through the individual market. Cost is often a major deciding factor for these individuals; therefore, they might choose to purchase less comprehensive coverage.

This narrow coverage may significantly restrict an individual’s access to home care agency services, making it difficult (or impossible) for agencies to reach everyone who can benefit from its services.

Creating Interoperable EHRs

Curating, securing and sharing patient information adds significant value to the health care system by allowing all providers to gain a full and complete view of patients and their care.

Traditionally, EHRs have largely been standalone solutions serving a single health care organization — not records to be shared among providers. Because vendors use proprietary, nonstandard formats to record and store data, communication between systems has been impossible.

The Cures Act aims to drive interoperability by:

  • Requiring HHS to collaborate with the industry to develop a “trusted exchange framework” that will allow full network-to-network exchange of data
  • Requiring the Government Accountability Office (GAO) to evaluate how patient records are matched currently and make recommendations for a scalable solution within two years
  • Allowing HHS to investigate and penalize practices that interfere with the lawful sharing of information

Potential Impact: With true interoperability, care coordination will become easier as the full constellation of caregivers will have improved access to each patient’s medical history and current treatment plans. This holistic, transparent patient view will facilitate greater efficiencies for home care agencies while simultaneously allowing a higher quality of care.

Interoperability will also raise data exchange expectations throughout the health care ecosystem; home care agencies must be prepared to provide more detailed information as well as to analyze a greater amount of information in a client’s medical record.

The most forward-thinking agencies will use this opportunity to implement best-in-class technologies across their business areas. It may take more than one supplier to build the infrastructure necessary to efficiently coordinate client care across teams, streamline processes, and improve both compliance and communication.

Will the Cures Act Transform Modern Health Care?

Undoubtedly, the Cures Act directives have immense potential to modernize and personalize health care over the long term. However, there is still quite a bit of uncertainty surrounding how the act will be implemented in the short term. The best advice is to stay informed and aware, so that course corrections can be made quickly should the need arise.

CellTrak offers unique solutions that can help you integrate the Cures Act changes into your agency’s daily operations and stay compliant in a cost-effective manner.

Please visit our extensive resource section to stay up-to-date on emerging and trending issues, such as choosing the right EVV solution.


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Topics: Compliance, EVV