Understanding Medicaid Home and Community Services: A Primer, 2010 Edition. Addressing Cost Concerns


States can address concerns about the cost of the Home Health benefit without using the impermissible homebound criterion. For example, states may establish criteria to determine who needs the service based on medical necessity, criteria which take account of beneficiaries’ unique needs, as described in the following examples.

  • When a condition--such as quadriplegia--prevents individuals from going to another health care setting to obtain the service.

  • When going to an outpatient setting for the service would constitute a medical hardship due to an individual’s condition, or is contraindicated by a documented medical condition, such as the need to be protected from exposure to infections.

  • When going to an outpatient setting for the service would interfere with the effectiveness of the service. Examples include (1) when hours of travel would be required; (2) when services are needed at a frequency that makes travel extremely difficult, such as IV care three times a day; (3) when a client needs regular and unscheduled catheter changes, and having home health services in place will prevent emergency room visits for unscheduled catheter changes due to blockage or dislodgment; and (4) when there is a history of noncompliance with outpatient services that has led to adverse consequences, including emergency room use and hospital admissions.12

States can also control costs for the Home Health benefit by limiting the amount, scope, and duration of the services provided--as long as all services listed in the State Plan are sufficient to meet the needs of most persons who need the services. The State Plan must include a list of services that will be provided, as well as their amount, scope, and duration. For example, some states limit the number and duration of daily home health aide visits, and preauthorization is required to exceed these limits. Other states require preauthorization for all services to ensure appropriateness.

The appropriate context for making decisions about limits on a state’s Home Health benefit is the state’s entire system of home and community services. A state may opt to cover registered nurse and home health aide visits through the Home Health benefit, for example, and not through a waiver program to ensure that all beneficiaries who need these services receive them, not just those who meet the nursing home level-of-care criteria. However, if a state uses institutional rules for the waiver program, doing so will limit services under the Home Health benefit to those who meet the stricter financial eligibility criteria for State Plan services.

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