New Challenges in Home Health CareWhen the Balanced Budget Act of 1997 went into effect a few years ago, it resulted in major reductions in Medicare reimbursement for home health services. The result was that 3,000 home health agencies around the country and 35 in Massachusetts were forced to permanently close their doors, limiting accessibility to patients in need of home health services. In response to these challenges, Affiliated Community Visiting Nurse Association, Newton-Wellesley Home Health Services, MGH/Spaulding Home Health Agency and most recently, the Visiting Nurse Association of Greater Salem joined to form Partners Home Care. This merger allowed the agencies to continue offering quality home health services provided by local clinicians while reducing costs by consolidating administrative functions. It also allowed PHC to develop outstanding state-of-the-art programs and services enhanced by its affiliation with the Partners HealthCare System and its founding hospitals, Massachusetts General Hospital and Brigham & Women's Hospital. Now PHC, like other non-profit home health agencies around the country, is facing new challenges. As of October 1, 2002, Congress allowed a 15% cut to take effect that has dramatically altered Medicare reimbursements for Massachusetts home health agencies. While this cut may seem small, it is in addition to the 40% cut the industry experienced with the initial enactment of the Balanced Budget Act of 1997 which resulted in home health agencies in Massachusetts serving 30,000 fewer Medicare beneficiaries. The new rates will now mean a projected loss of another $15 million for Medicare-covered home health care in Massachusetts. At an average visit cost of $75.52 per visit, this translates into 200,000 home health visits. While PHC is financially stable and will continue to provide services to patients, these cuts will present a great challenge and require the agency to increase its fundraising activities. "Oftentimes we are asked why we do fundraising if we get reimbursed for our services," explains Joanne O'Regan, Vice President of Development. "Most of the revenue we raise is for free care. In addition, some of our programs, such as our pediatric services and our services to Medicaid patients, are reimbursed at a lower rate than the actual cost. With these new reductions in reimbursement, we need more than ever to look to the generosity of the community." The agency receives fundraising revenue from a number of sources. It sponsors three special events—the Golf Tournament, Great Chefs and the Halloween Hustle Road Race & Walk. Memorial donations are a major funding source as is the annual appeal. The agency is also the recipient of a number of grants from private foundations, and some patients have bequeathed money to the agency in their wills. "We are hoping that these cuts will be rescinded," says O'Regan. "But as an agency, we are committed to providing quality care to all patients regardless of their ability to pay, and I believe our staff and those who support our mission will work together to meet this latest challenge."
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