Settlement Says Medicare Can’t Deny Coverage of Declining Conditions


Medicare beneficiaries may soon find it easier to gain coverage for certain long-term care services, due to a recently settled lawsuit.

In a proposed resolution to Jimmo v. Sebelius—a 2011 claim brought by the Center for Medicare Advocacy (CMA), a nonprofit advocacy organization—the Department of Health and Human Services (HHS) has announced that it will correct a policy phrasing error which caused many chronically-ill elders to be illegally denied coverage for certain care services.

The settlement doesn't actually alter any Medicare rules—but it does demand clarification of a decades-old grey area.

For years, the so-called, "improvement standard," enabled Medicare contractors to refuse to pay for home health care, skilled nursing care and outpatient therapy for seniors whose conditions failed to get better.

Aging adults suffering from chronic or degenerative diseases (i.e. Alzheimer's, Parkinson's, stroke, etc.) could be denied coverage if they weren't able to demonstrate distinct improvement of their condition, or if the care they were receiving was regarded as "maintenance only."

Also, because this requirement was not explicitly stated in Medicare regulations, beneficiaries may not have been aware that the improvement criterion existed—until their claims were refused.

The settlement seeks to do away with the confusion surrounding the improvement standard by requiring Medicare to provide a more precise explanation of the rules that deal with care reimbursement.

In order to be covered by the program, a particular therapy must perform at least one of the following functions: improve a person's condition, prevent additional deterioration, or slow the progress of a disease.

Official court approval of the settlement is likely still a few months away.

Still, since the coverage rules are simply being clarified—not re-written—the proposed changes will be immediately effective, meaning caregivers and their loved ones should no longer be denied coverage for maintenance care.

Going forward, Medicare contractors (including those who work with Medicare Advantage plans) aren't allowed to withhold payment for care if a senior's condition fails to improve.

Additionally, if the settlement is given the green light, beneficiaries who were deprived of coverage prior to the filing of the lawsuit (January 28, 2011), can apply to have their claims re-reviewed by Medicare.

More details on exactly how the re-review process will work will be released by the Centers for Medicare and Medicaid (CMS) after the settlement has been approved.

For more information on the background and progress of the Jimmo settlement agreement, you can visit the CMA website .

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