Bill would require full Medicaid reimbursement for hospice care

A bill that seeks to increase hospice care reimbursement for certain Medicaid recipients was considered by the Health and Human Services Committee Feb. 19.

LB944, introduced by Sen. Myron Dorn of Adams, would require the state Department of Health and Human Services to provide full reimbursement for hospice care services provided to a Medicaid eligible individual who resides in a nursing or intermediate care facility, beginning no later than Aug. 1.

The bill also would require such reimbursement be provided directly to the care facility rather than to the hospice care provider.

Dorn said nursing facilities currently receive full reimbursement for the cost to provide room and board to eligible Medicaid recipients, but only 95% of expenses are reimbursed when the same patient elects to enter hospice care at the facility.

“It is the hospice provider who bears the financial burden of the reduction in reimbursement,” Dorn said. “The state needs to accept this financial responsibility and not pass it off to providers.”

Marilee Malcom, director of the Nebraska Hospice and Palliative Care Association, testified in support of the measure. She said many nursing facilities have been unable to absorb the additional costs associated with the reduced reimbursement rate, resulting in several choosing not to accept or refer certain Medicaid recipients to hospice care.

“LB944 addresses a structural flaw in Nebraska’s Medicaid payment process,” Malcolm said. “The result is a system in which hospice agencies are fronting Medicaid room and board payments at a loss [and] absorbing administrative burden and financial risk that was never intended under the hospice benefit.”

Proponent Anne Paulmeyer, a physician’s assistant and co-owner of Cottonwood Hospice, said the level of care provided to a patient is not reduced once they enter hospice care. In fact, she said, state and federal regulations require that residents continue receiving the exact same care they previously received in addition to hospice services.

“So, while nothing about the patient’s care decreases, payment to the facility does,” Paulmeyer said.

Matthew Ahern, deputy director of the DHHS Division of Medicaid and Long-Term Care, opposed the provision that would change the state’s billing mechanism to allow direct payments to nursing facilities.

He said federal law requires that reimbursement for room and board be paid to the hospice agency for patients eligible for both Medicaid and Medicare to prevent inconsistent and duplicative billing.

“The law and communication from our federal partners clearly [states] that we have to pay a hospice provider first,” Ahern said.

The committee took no immediate action on LB944.