Jimmo v. Sebelius: A Major Change in Medicare Coverage

The landmark settlement in Jimmo v. Sebelius eliminated the “improvement standard” that had prevented many chronically ill and elderly Medicare beneficiaries from receiving skilled care simply because their goal was to maintain their condition rather than improve it.

Why the Settlement Matters

This Medicare settlement may help individuals avoid more costly forms of care, such as hospitalizations or nursing home admissions, by making it easier to qualify for skilled nursing and therapy services provided at home.

For example, a nurse who regularly monitors a person with diabetes or heart disease—ensuring medications are taken correctly and vital signs remain stable—may help prevent a medical emergency that would otherwise require hospitalization.

Although expanding access to home health services could increase Medicare spending in the short term, many experts believe it has the potential to reduce healthcare costs over time.

Expanded Access to Skilled Home Health Care

In her USA Today article, “Medicare Settlement Would Expand At-Home Care,” Kelly Kennedy explains that the Department of Health and Human Services agreed to revise its Medicare guidelines so that skilled nursing and therapy services would no longer require proof that a patient’s condition is expected to improve.

The settlement applies to skilled medical services only and does not extend coverage to custodial care, such as cooking, housekeeping, or bathing assistance. Additionally, more than 10,000 individuals whose claims for skilled care were previously denied were given the opportunity to have their cases reconsidered.

Expert Perspectives on the Decision

Kenneth Thorpe, Chairman of the Department of Health Policy and Management at Emory University, noted:

“Ninety-five percent of health care costs come from those with multiple chronic health issues, and monitoring those could substantially lower costs.”

Health and Human Services spokeswoman Erin Shields Britt explained that the settlement clarifies Medicare policy so that providers’ claims will be reimbursed more consistently and appropriately.

Joanne Lynn, Director of the Center for Elder Care and Advanced Illness at the Altarum Institute, also praised the decision:

“The decision makes it clear that Medicare has to cover skilled services when the aim is to maintain function or to slow the rate of decline, and that is huge.”

The Potential Long-Term Impact

Many Medicare beneficiaries leave the hospital without adequate follow-up care. As a result, nearly one in five patients is readmitted within a month—often because they do not fully understand their discharge instructions, experience medication issues, or lack the support they need at home.

These avoidable hospital readmissions cost Medicare billions of dollars each year. While it is difficult to predict the exact financial impact of the Jimmo v. Sebelius settlement, expanding access to skilled home health care may ultimately improve patient outcomes while reducing long-term healthcare costs.

What are your thoughts on the Jimmo v. Sebelius settlement and its impact on Medicare beneficiaries? We’d love to hear from you.

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Disclaimer: The information provided above is for general informational purposes only and is not legal advice.