Home-health agency for Madison, Estill and Powell counties says it has to cut staff because of issues with Medicaid and Medicare

Declining reimbursements from Medicaid and Medicare are behind the Madison County Health Department‘s layoff of seven home-health employees last week. Director Nancy Crew said the cuts should not mean a reduction in care but that cuts were being made because “we’ve done all we can do without involuntary layoffs,” Bill Robinson of the Richmond Register reports. The department’s MEPCO subsidiary, which has offered home-health services in Madison, Estill and Powell counties since 1974, has been under financial pressure for two years despite cutting costs and not filling eight now-vacant positions. It had a deficit last year of $610,000.

Only about 15 percent of MEPCO’s revenue comes from private insurance, said David Reed, the health department’s financial director. That leaves MEPCO with a disproportionate number of Medicaid patients at a time when those re-reimbursements often are denied by managed-care companies, Reed said. Challenging those denials is a complicated process, sometimes requiring going to court to recover costs.

The problem is not all with Medicaid. MEPCO’s Medicare reimbursements began a steep decline from nearly $3.24 million in 2008 to $2.55 million in 2012.  (Read more)