It's almost certain that the proposed budget in its current form will not survive Congressional tinkering. While health maintenance organizations have been getting most of the press, the fastest-growing segment of health services paid for by Medicare is home health care. There is no sign that the growth in home health care will abate any time soon. Home health care is cheaper than a nursing home, and as more seniors obtain Medicare coverage through HMOs, the pressure to reduce reliance on providing health care in nursing homes will intensify. In a year long investigation by USA Today that appeared in the newspaper last November, reporter Peter Eisler found that home health is an industry without meaningful oversight.
Questionable schemes cost the taxpayers millions.
For example, HHS has found that many home health agencies are setting up offices in urban areas and billing Medicare for the more lucrative urban payment rate even when services are provided in rural areas. What has happened, without going into excruciating detail is, home health care was developed to be connected to a hospital stay. To limit overuse of services and curb gratuitous spending, the Administration proposed to set interim limits on payments to home health agencies. By 1999, a prospective payment system will be put in place. Moreover, payments will be based not on where the corporate office is located but where the services are furnished.