Better with Age: Exploring Medicare coverage of physical therapy

By Sanford R. Altman
Published: 2:00 AM – 02/27/11

Q. My father is in a nursing home for rehabilitation after his stroke made it difficult for him to get himself up or to walk. Although they originally told my mother that, given enough time and rehab, he would be able to return home to her, they now say that my father is no longer improving, so they are stopping physical therapy. If he came home, he would need much more help than my mother can ever give him. On top of that, they told us that when physical therapy ends, so does Medicare coverage, and it will cost us almost $400 per day. Can’t go home and can’t afford to stay there. Is that legal?

A. The answer to your question, unfortunately, depends upon which branch of the government you ask. The administration of Medicare is overseen by the Centers for Medicare and Medicaid Services (CMS). One of CMS’ rules is the “improvement standard” for continuing physical therapy, which the nursing home apparently utilized in this situation.

On the other side of the issue, federal court decisions have recently called the improvement standard improper. Many of us who practice elder law agree with the courts.
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Two-part series

This is the first in a two-column series on Medicare coverage for physical therapy. Part two will appear next Sunday.

Why is this so important?

If you are Medicare eligible (generally over age 65), spend several days in the hospital and are then transferred to a nursing home for rehab, Medicare will cover you — to some extent. Medicare will fully cover 20 days and partially cover 80, the remainder being your co-pay, which is now about $140 per day.

There are two general categories of care at a nursing home, skilled nursing care and custodial care. Medicare covers you only if you receive skilled nursing care.

What is not covered? The most obvious example is people who are in a nursing home as a result of some form of dementia such as Alzheimer’s, but are otherwise physically healthy. This is referred to as “custodial care.”

There are gray areas. One of my clients had one type of catheter, which was considered skilled nursing care, but when they changed the catheter, it was not. At the other end of the spectrum, physical therapy is clearly covered as skilled nursing care.

The implications of this are far-reaching. When individuals are admitted to a nursing home for rehabilitation, physical therapy is part of their treatment. After successful physical therapy, they return home. While the CMS passes down standards to nursing homes, the nursing homes determine on an individual basis who stays on Medicare. In the case of physical therapy, the nursing home decides when a patient has stopped improving. At that point, the “improvement standard” kicks in and Medicare will no longer cover the patient, who must either pay with private funds and stay longer or go home, ready or not. Terminating physical therapy can also result in a deteriorating physical condition and prevent any possibility of returning home, sentencing the patient to life in the nursing home.

Why is this standard used?

From this scenario, one may well ask why we use the “improvement standard” at all. Shouldn’t rehabilitation continue at least to keep the patient from losing any progress he or she has already achieved?

The federal courts’ answer to this question is “yes.” The proper legal standard for continuing Medicare benefits is whether the services are needed to enable the individual to maintain his or her level of function. Treatment would continue to prevent deterioration even if there was no promise of improvement.

CMS has yet to weigh in, but new developments may force their hand. I’ll tackle those in next week’s column.