1. Humphrey, Carolyn J. MS, RN, FAAN

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Without a formal public announcement and little fanfare from the Administration, Medicare authorized a change in its coverage for patients with Alzheimer's disease (AD) in early April. Medicare beneficiaries can no longer be denied reimbursement for the costs of mental health services, hospice care, or home care just because they have AD.


The Alzheimer's Association estimates that 10% of adults >65 years old and nearly 50% of those age >85 have AD, a brain disorder that causes loss of memory, changes in personality and behavior, and a decline in thinking abilities. Previously, many Medicare claims for assessment, treatment, and supportive home care, hospice, and other outpatient services were automatically denied on the assumption that treatment for these patients was futile because patients were incapable of medical improvement.


Increasingly, studies show that adults with AD can often benefit from psychotherapy, physical and occupational therapy, and other services. The government reportedly revised its policy because doctors and psychologists can now diagnoses AD in its early stages, when patients are likely to derive significant benefits from treatment and therapy. The CMS policy memorandum was sent late in 2001 to the fiscal intermediaries (FIs) who have begun to implement the change.


In the past, nearly all claims for patients with AD and other types of dementia were rejected upon submission, the new policy bans such computer screenings and forbids FIs from denying claims simply because a person has AD; the needs and treatment approaches indicated by assessment and diagnosis must first be assessed.


Although many specifics regarding coverage criteria and overall costs to the program remain vague, it's important to understand that the coverage is not for the AD condition but for treatments from which patients with AD can benefit (i.e., pharmacologic, physical, occupational, speech-language, and other therapies).


As specifics emerge, check the following for clarification:


The Program Memorandum (Transmittal AB-02-135) can be found at:


The Alzheimer's Association news release on the rule change can be found at:


The April 1, 2002, press release issued by CMS Administrator Tom Scully can be found at: