Smart SpendingSmart Spending

A major change is coming to Medicare

A lawsuit settlement will end a Medicare policy that deprives chronically ill people of needed care.

By Karen Datko Oct 25, 2012 12:00PM

Senior woman on wheelchair looking out of window with blinds © Design Pics, Don Hammond, Design Pics, Getty ImagesHere's a Medicare rule I didn't even know existed until a lawsuit settlement dealt it a death blow last week: Medicare will not pay for skilled nursing care or therapy for patients who are not expected to get better.


That's right. It doesn't matter if the skilled care or therapy would make your life less miserable or slow your downhill slide. Think of the special care needed for those with Alzheimer's or Parkinson's or chronic lung disease.


That's going to change. The Los Angeles Times explains: "Under the terms of the settlement -- expected to be approved by a federal judge in Vermont in coming months -- Medicare would not deny skilled nursing care and various forms of therapy for beneficiaries, regardless of their prognosis."


The U.S. Department of Health and Human Services called the settlement a mere clarification of the rules and downplayed the impact.


But others say this is a huge development. The New York Times, which broke the story about the lawsuit settlement, said tens of thousands could expect to benefit. Other say it could help hundreds of thousands of Medicare recipients.


The New York Times said: "Under the agreement, which amounts to a significant change in Medicare coverage rules, Medicare will pay for such services if they are needed to 'maintain the patient's current condition or prevent or slow further deterioration,' regardless of whether the patient's condition is expected to improve."

According to The Associated Press:

"Those who stand to benefit include not only people with intractable conditions like Alzheimer's, multiple sclerosis, Parkinson's and chronic lung disease. Those who are growing weaker because of advancing age, placing them at greater risk of falls and other problems, also could be helped."

The class action includes more than 10,000 Medicare patients whose claims for skilled nursing care and therapy were denied before the suit was filed. But no one knows how many Medicare recipients have simply gone without these services because they were told that Medicare wouldn't pay for them and they couldn't afford the cost themselves.


Also unknown is the financial impact to Medicare, already a large drain on the federal budget. But paying for improved care now could reduce more costly treatment and hospital stays later on. 


Another odd aspect to this case is that the rule that's being rewritten -- the so-called "improvement standard" -- isn't in the law that created Medicare nearly a half century ago or in government regulations. It's spelled out in a Medicare manual and in the rules used by private contractors hired by Medicare to decide which claims are paid and which are not.


Who all stands to benefit after the judge approves the settlement? Medicare is a government health insurance program for those 65 and older and younger people with disabilities.


Have you or someone in your family been denied coverage under Medicare's improvement standard?


More on MSN Money:


Oct 25, 2012 5:33PM

Skilled nursing care and physical therapy should be covered under your heath insuance, but it isn't jsut because the insuance companies don't want that responsibility.


Skilled nursing is heathcare, cover it.....

Oct 25, 2012 5:30PM

My Father is in a Skilled Nursinf Facility and as great medical insurace but it won't pay for his skilled nursing because he has alzheimers and doesn't show emouh improvement with the physical and occupational therapy. So his savings is now being drained at a rate of over $200 per day for his care until he qualifies for medicaid.

 Such a shame to worek for everything and pay for good insurance to be denied coverage for a stupid rule of interpitation.

Oct 25, 2012 5:18PM
Oct 25, 2012 5:17PM
cut defense spending since most of it pads contractors n good ole boys a$$e$.
That rule that denied Medicare coverage in skilled nursing homes to those who wouldn't be expected to get better was rarely applied because the nursing home generally made the determination as to whether or not it thought it could help you,  but I'm still glad they struck it down.  The way it works is that I think you get the first 90 days of your coverage in a skilled nursing home covered by Medicare in full.  After that I think that your 20% supplemental policy picks up the next 90 days, or you have to pay it yourself if you don't have a supplemental policy.  However, in all cases the nursing home has to be a skilled nursing home (one where you go for rehabilitation) rather than just a retirement type of nursing home.
Oct 25, 2012 3:37PM
This is bs. Designed to influence the presidential race, just another Obama lie. Just like the lie that puts off Congress from deciding that medicare advantage plans will be outlawed, but after the election. Trump is right, Obama will never collect that five million because he very well could spend the rest of his life in prison if he did release the reports. Five million would not do Obama any good when he becomes a three hundred pound cook's boy.
Oct 25, 2012 3:36PM

Logically then Obama will put the oldstes before the Death Panel.


Fortunately the Liberals running our Government are not using the gas chanbers & electric chairs to put criminals to death so we can use them on the oldsters. Since we no longer put murderers and Rapists to death, at least here in NJ we don't, we use the Gas Chamber and Electric Chair on the Oldsters.


On a flowchart I see someone rejected by a skilled nursing facility and they walk thru a door and come out before the Death Panel who sends them immediately to the Electric Chair.


Liberals ought to re-examine their priorities.

We abort babys but protect murderers.

We write laws about guns but don't punish those who commiit violence with a Gun very severely.

And now the Death Panel will be putting the Oldsters to death.

You too will get old one day.


In fact Biden is looking kinda old and Obozo is getting gray.


I'm 65 and trust me, they willl never take me alive.




Oct 25, 2012 3:35PM

The government already covers Long Term Care. State Medicaid begins after the personsl assets are used up because the government can't afford $3500 per month on the low side per beneficiary until the that person has used up their own funds. And the State programs are funded or subsidized by the Federal Government. Doing the math at 10,000 known denied claims means an additional 35 million dollars per month from the tax coffers, and that's before opening the flood gates for the mass population. Medicare just can't afford that, and the tax payers can't support it.

Oct 25, 2012 3:22PM

It is my understanding that when it becomes a chronic problem, Medicade takes over. This allows the state to first use the patient's money to fund the long term care and then the state pays. If Medicare pays, then rich people will get to keep their money and go to the nursing home of choice for free, at the expense of the tax payers! Everyone gets care, its just a matter of who pays for it. This law only helps the rich....what a great idea (sarcasm)...Only in California!

If we let California keep Hollywood, can we give them to Mexico?

Oct 25, 2012 3:13PM
The number one denier of payments and procedures by FAR is Medicare, not some "evil" insurance company.   Sorry brain dead sheeple.   Palin was right.   There are built in panels whose entire purpose is to deny access to health care.   Call them what you will, but when you or your loved one is denied the newest chemotherapeutic agent, you might call it a death panel.
Oct 25, 2012 2:52PM

I would rather waste the money here then of overseas. As long as one US citizen need help the rest of the world can go to hell. If we can't afford to help ourselves we can't afford to help anyone else including being the world’s police force.

Oct 25, 2012 2:51PM

I would rather waste the money here then of overseas. As long as one US citizen need help the rest of the world can go to hell. If we can't afford to help ourselves we can't afford to help anyone else including being the world’s police force.

Oct 25, 2012 2:42PM

First the truth. Do you think active and retired senior senators and congessmen and presidents DON'T get whatever care they or their family members need?

Doesn't  logic show that a senior cared for in their home by a trained, well paid care giver is tremendously LESS expensive then care in a hospital? Billions less! over the next 10-20 years. Would not training these care givers create hundreds of thousands of jobs?  In the next 10-20 years over 1/4 of our citizens will be over 65.

Now the real truth, where are the compassionate, republicans and democrats that believe that all Americans deserve the dignity and care. We all know someone in our family, a friend, who does or will need care.

Oct 25, 2012 1:43PM

I have worked and paid into SS for nearly 50 years and I'm still working a fulltime job because I love working, being needed, being respected for my input into the workplace and the check isn't bad either.  For anyone to lump me into some "bracket" like the 47%, the 60% of takers per Paul Ryan just makess my blood boil.


Although I'm not wealthy and will never be able to have millions in the Caymans or in Swiss Bank Accounts to hide thereby avoiding paying taxes in the coutry that made me rich, I find the reasoning by any American that this is "okay" to do repulsive and totally unacceptable.  This is the country where we are born raise families, send our sons and daughters to fight in wars, and our jobs that we need to survuve have been sent to China, India and other foreign nations at our expense and this man running for president is a key player in  the market responsible for doing just that.  Yet, there are those that think  this too is "okay." Why?  Do you feel  that its okay for your neighbor's job to be sent to China as long as it's not YOUR job?  Because rest assured, one day very soon, it could be YOUR JOB that's sent there.


When you vote, you are NOT voting one ONE ISSUE, you are voting on a myriad of issues and the person who will best address them all for you, your family and your livelihood.  If you vote like that, then there is absolutely no way that anyone could vote for Romney. You don't even have to like the president to know of the two, he is the best person for  the job.


Stock market is up, jobs are up, war is out, no new wars, we will no longer have to pay for other people's illnesses, children and adults with pre-existing conditions can be insured, women can get equal pay for equal work, abortions is NOT a choice for the masses to make for any one woman, it is her personal choice and she will have the right to make that choice.  I do not personally believe in abortion but I know that it IS NOT my right  to decide what others are to do with their bodies since I'm not God and saving their souls is their responsibility, not mine or yours and the samething goes for same sex marriages.  Not your business.  Get some business so you can tend to  that instead of trying to tend to that which doesn't concern you.


Forward 2012!!

Oct 25, 2012 1:43PM
Oct 25, 2012 1:40PM

Where has the author of this piece been?  If she isn't knowlegeable about Medicare policies, why is she chosen to present an article on this policy, which has been in place for years, and is, like most Medicare policy, a complex issue.  There are clearly rationale, and humane benefits from this change in policy. Maitenance of function and prevention of further decline are desirable objectives, but because of the "self-pilot" nature of much of Medicare's payment methods, this change will lead to much abuse. People who view therapy as a paid-for exercise club or social event will try to take advantage of the new policy.  Medicare will have to design policies that require evidence the therapy helps achieve these desirable objectives, just as it now requires that evidence of improvement is present.  This will not be easy, as EVERYONE in my age group (78) is declining in one way or another. By the way, my wife is an amputee in a wheel chair (routine knee replacement gone bad) who has had lots of therapy in the past two years.  This new policy will surely raise Medicare costs further, just when how to reduce those costs is central to the political debate.  I am a retired health policy analyst, if you couldn't tell. 


Oct 25, 2012 1:26PM

As a former manager of a Home Health Agency, it's great to know that soem coverage will be offered and this type of coverage should be limited and regulated by number of days per week and hours allowed per patient over a 12-month span.


Medicare is a wonderful thing but as with all wonderful things should not be abused because the abuse makes those who really need it have to suffer.


This is one of the main reasons we needed Obamacare and as the ONLY nation without any form of Universal Health Care for an aging mass, we would be broke paying for the health care of others and the ER is not the answer since ER Service is the MOST Expensive form of healthcare available.


Hopefully in his next term the president will have Medicare fine tuned as he's done with Obamacare and also work out some the issues and loopholes to eliminate waste as he has done eliminating fraud and catching the perpertrators of fraud.


Forward 2012!!

Oct 25, 2012 1:01PM

Hold on to your wallet. This IS NOT what medicare was created for.

If you paid into Medicare, you are entitled to help with some health care costs. You are not entitled to 100% paid coverage for every little pill and device on the market. Medicare is meant to keep you healthy and preserve your life. It is not meant to make you 100% comfortable. That is why you are to save your own money.

Please help us to maintain a healthy and vibrant community by reporting any illegal or inappropriate behavior. If you believe a message violates theCode of Conductplease use this form to notify the moderators. They will investigate your report and take appropriate action. If necessary, they report all illegal activity to the proper authorities.
100 character limit
Are you sure you want to delete this comment?


Copyright © 2014 Microsoft. All rights reserved.

Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.


Smart Spending brings you the best money-saving tips from MSN Money and the rest of the Web. Join the conversation on Facebook and follow us on Twitter.