The beneficiary, through her representative, filed a request for review of an Administrative Law Judge (ALJ) decision, dated August 10, 2001. In the decision, the ALJ found that the beneficiary was not "homebound," and held that six skilled nursing visits furnished to her by Visiting Nurse Alliance of Vermont and New Hampshire (VNA) were not covered by Medicare.

In addition, the home health agency was found liable for the non-covered services.

The Council has considered the record which was before the ALJ and the appellant's request for review dated August 18, 2001. The appellant's request for review is entered into the record as Exhibit MAC-1. The Council hereby vacates the ALJ's decision and grants the request for review because there is an error of law, and there is not substantial evidence to support the decision. See 20 CFR §§ 404.967 and 404.970, incorporated by reference in 42 CFR § 405.724.

The home health services at issue were furnished to the beneficiary from March 10, 1999 to May 26, 1999. At that time, the beneficiary was eighty-one years old and living independently. She was also legally blind, could ambulate only with assistance, and suffered from a variety of ailments, including heart disease. Prior to March 10, 1999, the beneficiary had been receiving services from VNA for about three years.(Exhibit 15) The VNA services were ordered by J.L., M.D., who was the beneficiary's treating physician from June 1 1996 up until her discharge from home health care on May 27, 1999.(Exhibit 17)

There are two certifications and plans of care in the record. The first certification covers the time period February 1, 1999 to April 1, 1999.(Exhibit 14-7 & 14-8) The second certification covers the time period April 1, 1999 to April 29, 1999. (Exhibit 14-9 & 14-10) The record does not contain a certification and plan of care for home health services provided after April 29, 1999, i.e., May 7, 21, and 26, 1999.(Exhibit 3-5)

Prior to the dates of service at issue in this case, the beneficiary was hospitalized for pneumonia from December 25, 1998 until December 28, 1998.(Exhibit 15-62) Her recovery from that illness was described as "very slow."(Exhibit 15-62) As of January 19, 1999, nurses continued to report her slow recovery.(Exhibit 15-66) The nurses also advised Dr. L. that the beneficiary had been experiencing increased pain, prompting an appointment to consider modifications to her medications. (Exhibit 15-70)

By January 26, 1999, the beneficiary was showing progress, but still complaining of discomfort in her rib cage.(Exhibit 15-74) In February, she was experiencing pain, and also was discharging phlegm.(Exhibit 15-77, 15-78, 15-79) After being prescribed the antibiotic drug Ceftin on February 19, 1999, her phlegm discharge started to clear.(Exhibit 15-80) However, the beneficiary continued to discharge yellow phlegm until the time she was discharged from home health care at the end of May. At that point, Ms. G. moved to her daughter's home.(Exhibits 15-83, 15-85, 14-87, 15-106, 15-107, 15-109)

Generally, the record indicates an elderly patient who was in need of care based on several medical ailments, and other conditions that were treated and then resolved or at least controlled. The ALJ found that the services were not reasonable and necessary because the beneficiary was not homebound, and there was "no indication of an unstable or changing medical condition."(Dec. at 5) He further noted that "[h]er condition was longstanding, there were no changes in the plan of care and there is no evidence to indicate that the care was of a complex nature requiring the skills of a nurse."(Dec. at 6) In reaching this conclusion, the ALJ erred in his recitation of and reliance on the applicable statutory and regulatory standards. Moreover, the ALJ's ultimate decision to deny Medicare coverage for the six skilled nursing visits at issue is not supported by substantial evidence.

As an initial matter, the Medicare Appeals Council notes that the record does not contain a plan of care for services rendered after April 29, 1999. Therefore, the three skilled visits that were provided between April 30, 1999 and May 26, 1999 are not covered by Medicare. See § 814(a)(1)(C) of the Act.

Intermittent Care

In determining whether a beneficiary qualifies for home health benefits, the threshold question is whether the beneficiary is in need of intermittent skilled nursing care. See § 1814(a)(2)(C) of the Social Security Act (Act); 42 CFR §§ 409.32, 409.33, 409.42(c), and 409.44(b).

Under section 1814(a)(2)(C) of the Social Security Act, a beneficiary is eligible (i.e., qualifies) for coverage of home health care only when he or she needs either (1) skilled nursing care on an intermittent basis; (2) physical or speech therapy; or (3) continuing occupational therapy (in the case of an individual who has been furnished home health services based on the need for qualifying skilled nursing care or physical or speech therapy, and who no longer has the need for such care or therapy). ⁽¹⁾ The regulations at 42 CFR 409.42 similarly provide that in order to qualify for Medicare coverage of home health services, the beneficiary must need at least one of these skilled services.

If skilled services are needed for less than seven days each week and a beneficiary has a medically predictable need for the services, then the "intermittent" requirement is met. See HCFA Home Health Manual (HHM) § 205.1.C. In the case at issue, a nurse visited the beneficiary at two or three week intervals. (Exhibit 15) The beneficiary's treating physician certified the recurring need for these skilled services for the period February 1, 1999 to April 29, 1999.(Exhibit 14-7, 14-9) Thus, the Council concludes that there is evidence that the beneficiary needed and received home health services on an "intermittent" basis from March 10, 1999 to April 29, 1999.

In the decision, the ALJ did not address the issue of the need for intermittent care. Rather, his basis for denial of coverage rests primarily on a finding that the beneficiary was not homebound.(Dec. at 6)

Homebound Status

In finding that the beneficiary was not homebound, the ALJ states that the beneficiary "was capable of going out up to ten times during a sixty two day [sic] period."(Dec. at 6) The ALJ cites an "OASIS form" in support of that finding.(Dec. at 5) Presumably, the ALJ was referring to the Follow-Up Assessment dated April 26, 1999. ⁽²⁾(Exhibit 15-92) On this form, a nurse indicated that the beneficiary went to medical appointments about ten times in sixty-two days.(Exhibit 15-94)

The ALJ stated that the beneficiary left her home for doctor appointments and "for other reasons."(Dec. at 5 and 6) He failed to recognize that the Act specifically excludes medical appointments as a basis for determining that a beneficiary is capable of leaving her home and possibly not homebound. See

§ 1814(a)(8) of the Act. Moreover, the Council has reviewed the entire record and can not find substantial evidence in support of the proposition that the beneficiary left her home for non-medical reasons. In addition, her treating physician certified that the beneficiary was homebound.(Exhibits 14-7, 14-9) As opined by the treating physician, the beneficiary had difficulty with mobility.(Exhibit 17) The doctor's opinion is supported by the visiting nurses' frequent notations that it would require a taxing effort for Ms. G. to leave her home.(e.g., Exhibit 15-83) In light of the fact that the record does not contain substantial evidence that the beneficiary left her home for any reason other than for medical appointments, the Council finds that the beneficiary was homebound. ⁽³⁾

Skilled Care

Since the beneficiary was homebound, the next consideration is whether she required skilled, as opposed to custodial, care. Generally, skilled care is provided by a nurse, physical therapist, or speech therapist, or under certain circumstances, an occupational therapist. See 42 CFR §§ 409.31 and 409.42(c); HHM § 205.1. In this case, the services were provided by a registered nurse. However, merely because services are provided by a nurse, does not render the services "skilled" within the meaning of the Act. Skilled services are those that are "so inherently complex that [they] can be safely and effectively performed only by, or under the supervision of, professional or technical personnel." 42 CFR § 409.32(a). If a service can ordinarily be performed by a layperson, then generally it is not considered skilled. See 42 CFR §§ 409.32(a) and 409.33(d). However, there are exceptions to the rule. Where the beneficiary suffers from "special medical complications," what are ordinarily considered non-skilled services may be viewed as skilled when performed (or supervised) by a nurse. See 42 CFR 409.32(b).

The beneficiary's total condition must guide the determination of whether services are non-skilled or skilled. See 42 CFR § 409.33. Three examples of circumstances in which the services may be skilled are identified in the regulations: overall management and evaluation of a care plan; observation and assessment of a patient's changing condition; or patient educational services. See 42 CFR § 409.33.

In the case before the Council, there is ample evidence to support the conclusion that the beneficiary was receiving skilled services. The visiting nurses were needed for observation and assessment.

Observation and Assessment

The ALJ erred to the extent his decision rests on his statement that the "six skilled nursing visits were not considered medically reasonable and necessary."(Dec. at 5) Apparently he believed that there was evidence to support a finding that the beneficiary's condition was stable, and therefore a nurse was not required for observation and assessment. The Council has determined that there is not substantial evidence to support such a finding. The ALJ writes in his decision:

The medical records reveal that from March 10, 1999 through May 26, 1999 there is no indication of an unstable or changing medical condition. There were no documented medication changes or changes in [the beneficiary's] baseline medical status.

(Dec. at 5) The ALJ's decision relies on a post hoc evaluation. This is not legally permitted. In determining an issue of reasonableness and necessity, the evidence should be

viewed from the perspective of the condition of the patient when the services were ordered and what was, at that time, reasonably expected to be appropriate treatment for the illness or injury throughout the certification period.

HHM § 205.1.A.4. Furthermore, whether a beneficiary's condition has been stabilized must be considered in determining coverage for observation and assessment services. See 42 CFR § 409.33(a)(2).

The preponderance of the evidence supports the conclusion that the beneficiary's condition was not stable. In the certification covering services from December 1, 1998 to February 1, 1999, the beneficiary's medications included Day Pro, Hy-Nate, Atrovent, Albuteral, and Flonase.(Exhibit 14-5) As indicated previously, in a separate order, the beneficiary was also prescribed Ceftin in February 1999.(Exhibit 15-79) None of the aforementioned medications were prescribed or managed by the home health nurses during March and April of 1999.(Exhibits 14-7, 14-8, 14-9, 14-10) However, the nurses instructed the beneficiary on the use of a newly-prescribed medication, Ceftin, and monitored her for possible side effects and interactions. There is also evidence suggesting that the beneficiary had difficulty understanding her medicine regime, and was allergic to at least one medication. (Exhibits 15-83, 15-85, 15-87, 15-88) Finally, there is still other evidence to support Dr. L.'s opinion that the beneficiary was not medically stable. On March 31, 1999, a nurse recorded that the beneficiary's heart rhythym was slightly irregular.(Exhibit 15-85) The vital signs of her lungs also vacillated from clear (Exhibit 15-83, 15-107) to wheezing.(Exhibit 15-87)

The treating physician was concerned that, in light of the beneficiary's age and various health concerns, she was at risk for future medical complications, particularly those related to cardio-pulmonary health.(Exhibits 14-7, 14-9,17) This was an on-going concern. At the end of April, Dr. L. agreed with a nurse's description of the beneficiary's cardio-pulmonary status as "fragile."(Exhibit 15-90) Dr. L.'s concern is also supported by records of the nursing visits. Just prior to the period of service at issue here, beginning on March 10, 1999, the beneficiary's heart rate was irregular on several occasions. (Exhibits 15-18, 15-19, 15-22, 15-77) As indicated previously, she had also recently been treated for pneumonia. Faced with that information and the beneficiary's diagnoses, including various cardiac and cardiac-related ailments, it is not surprising that Dr. L. was concerned about the need to monitor potential fluctuations in the beneficiary's indicators for heart health.

Given the totality of the evidence, the Council concludes that a preponderance of evidence exists to support the conclusion that the beneficiary's condition was not stable during the period of time at issue, and that she was in need of skilled observation and assessment services.

It is the decision of the Medicare Appeals Council that the three home health services provided between March 10, 1999 and April 29, 1999 are covered by Medicare. The provider remains financially responsible for the three home health services provided between April 30, 1999 and May 26, 1999. The Administrative Law Judge's decision is reversed to the extent it denies Medicare coverage for home health services provided to the beneficiary from March 10, 1999 to April 19, 1999.

Thomas E. Herrmann

Adminstrative Appeals Judge

M. Susan Wiley

Administrative Appeals Judge

Date: June 2, 2003

1. Once an individual qualifies for coverage of home health services under section 1814(a)(2)(C) (e.g., because of a need for intermittent skilled nursing care), the individual may receive Medicare covered part-time or intermittent skilled nursing and home health aide services under section 1861(m) of the Act.

2. The only other evidence that might fit the description provided by the ALJ on page 5 of the opinion as "the OASIS form completed by VNA/VNH" would be Exhibit 15-43. However, that form was completed on February 24, 1999, prior to the dates of service in question.

3. An OASIS form indicates that, in addition to doctor appointments, the beneficiary may go out with her daughter once a week.(Exhibit 15-94) However, the preponderance of the evidence demonstrates that the beneficiary was homebound as "leaving home requir[ed] a considerable and taxing effort...and that absences...from the home [were] infrequent or of relatively short duration." See § 1814(a) of the Act. Generally, the beneficiary had "a normal inability to leave home." Id.