On July 25, 2017, CMS released the CY 2018 Home Health Prospective Payment System Rate Update and Proposed CY 2010 Case-Mix Adjustment Methodology Refinements; Home Health Value-Based Purchasing Model; and Home Health Quality Reporting Requirements. CMS is projecting that Medicare payments to Home Health Agencies in CY 2018 will be reduced by 0.4 percent, estimated at $80 million, based on the proposed policies in this rule. In addition, CMS is proposing to reduce the period of care to 30-days in CY 2019.

Public comments are due no later than 5 p.m. on September 25, 2017.

Please leave us a comment, give us a call at 202-558-5272, or email gmandel@appliedpolicy.com if you have questions, would like help determining how these proposals could affect your organization, or if you would like to engage CMS on any of these issues.

Home Health Payment Update is 1 Percent, Adjustments Made to Reflect Case-Mix Growth

For CY 2018, the home health payment update percentage will be 1 percent based on a requirement passed in the Medicare and CHIP Reauthorization Act (MACRA) of 2015. Since statute also requires that the update be decreased by 2 percentage points for agencies that do not submit quality data, these home health agencies (HHAs) will have a payment update of -1 percent. This reduction would only apply for the designated calendar year and is not considered in computing amounts for subsequent calendar years.

In addition, CMS is proposing to implement a 0.97 percent reduction to the national standardized 60-day episode rate for 2018 in order to account to nominal case-mix growth that occurred from 2012 to 2014. CMS is predicting that this will result in an estimated decrease of 0.9 percent in home health prospective payment system (HH PPS) payments for CY 2018.

For episodes and visits ending before January 1, 2018, MACRA had extended the rural add-on for home health agencies, which was an increase of 3 percent of the payment amount made for services furnished in a rural area. Therefore, episodes during CY 2018 will not have a rural add-on payment. CMS is estimating a $100 million decrease from the sunset of the rural add-on provision.

CMS Proposes to Revise the Definition of “Applicable Measure” for Home Health Value-Based Purchasing Model (HHVBP)

In the proposed rule, CMS is proposing to use a minimum of 40 completed Home Health Care Consumer Assessment of Healthcare Providers and Systems (HHCAHPS) surveys under the Home Health Value-Based Purchasing Model (HHVBP). Previously, the minimum had been 20 completed HHCAHPS surveys. CMS is inviting public comments on this proposal.

In addition, CMS is proposing to remove the Outcome and Assessment Information Set (OASIS)-based measure, Drug Education on All Medications Provided to Patient/Caregiver during all Episodes of Care, from the set of applicable measures.

New, standardized measures across settings of post-acute care; with data to become publicly available

Since 2007, and as amended by the IMPACT Act of 2014, Home Health Agencies have been required to submit performance measures under the Home Health Quality Reporting Program (HH QRP) or face reductions to their reimbursement for services. In addition, NQF is currently engaged in a two-year trial to determine whether and how risk adjustment for social risk factors can be applied to these measures. CMS continues to seek comments as to whether HH QRP measures should take into account social risk factors, and which might be most appropriate to the home health setting. In this proposed rule, CMS also proposes to remove 247 data elements from 35 OASIS (CMS’ home health data reporting system) items. These are not used for quality measurement or payment purposes.

Beginning in 2019, HHAs are required to report standardized patient assessment data across six categories:

  • Functional status
  • Cognitive function
  • Special services, treatments, and interventions
  • Medical conditions and comorbidities
  • Impairments
  • Other

At a minimum, this data must be reported at the beginning of care and at discharge. CMS intends to standardize this data across all settings of post-acute care, including long-term care hospitals, inpatient rehabilitation facilities, and skilled nursing facilities. Each of these settings has their own assessment instrument (similar to OASIS), and CMS proposes to standardize questions and response options across these instruments in order to compare data across care settings. The agency seeks comment on this proposal.

After significant analysis by researchers and technical experts, in CY 2019 CMS has decided to retain the 23 measures currently contained in the HH QRP, with some modifications to the pressure ulcer measure. The summary reports are available at https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Post-Acute-Care-Quality-Initiatives/IMPACT-Act-of-2014/IMPACT-Act-Downloads-and-Videos.html. In 2020, CMS proposes to add measures related to changes in functional status and cognitive function and incidence of major falls. In future years, CMS may add measures related to self-care and mobility.  Beginning in CY 2019, CMS will publicly report data on both pressure ulcers and drug regimen review measures, as well as three claims-based measures related to spending and discharge, with HHAs with fewer than 20 eligible cases not publicly reported. CMS seeks comments on all of these proposals.

 CMS Proposes Moving to 30-Day Period of Care for CY 2019

For CY 2019, CMS is proposing case-mix methodology refinements through implementation of the Home Health Groupings Model (HHGM). With HHGM, CMS is proposing to use 30-day periods rather than the 60-day episode that is used under the current payment system.  CMS states that the case-mix methodology refinements with HHGM rely more heavily on clinical characteristics and patient information to place the 30-day periods into meaningful payment categories. Should the proposed HHGM be implemented in a fully non-budget neutral manner, CMS is estimating a decrease of 4.3 percent, about $950 million, in payments to HHAs in CY 2019.

The HHGM system will still include payment adjustments called Low Utilization Payment Adjustments (LUPAs). However, CMS is proposing to change the approach to calculating LUPA thresholds because of the proposed change to 30-day periods of care so that the LUPA threshold varies based on the HHGM payment group to which it is assigned. The proposal would set the LUPA threshold at the 10th percentile value of visits or 2 visits, whichever is higher.

Additionally, with HHGM, CMS is proposing to add an admission source category, to create six clinical groups used to categorize periods of care based on the patient’s primary reason for home health care, and to add a comorbidity adjustment.

CMS is not proposing a change to the split percentage payment approach with the change to 30-day periods of care, but is soliciting comments on the phase-out of the split percentage payment approach in the future.

CMS Issues Request for Information

Remaining consistent with requests made in other proposed rules, CMS is requesting input from stakeholders about reducing burdens while increasing quality and decreasing costs. CMS is asking that these proposals be clear and concise proposals with specific examples, but notes that they will not respond to submissions in the final rule. Instead, the agency says it will actively consider the input as they develop future regulatory policies and guidance.

Thank you to Greg Pugh for his analysis and contribution to this post. 

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