Therapy thresholds: New codes in place for 2008

HHPPS requires agencies to start preparation now

Three different therapy thresholds, a new payment model for non-routine medical supplies, and additional questions for OASIS are just a few of the changes in the Centers for Medicare & Medicaid Services' (CMS) Home Health Prospective Payment System (HHPPS) for 2008.

While some items related to OASIS and diagnosis codes were not expected to be finalized until mid-September or early October, Mary St. Pierre, MA, BSN, vice president for regulatory affairs at the National Association for Home Care and Hospice (NAHC) in Washington, DC, began preparing early. "Agencies will have to change software, change OASIS forms, and change billing forms," she says. "There are now 153 case-mix groups and 51 different clinical and financial items that need to be addressed by each agency."

Case-mix creep

There is a reduction in payment for all home health agencies to account for "case-mix creep," points out St. Pierre. The reduction in the national standardized 60-day episode payment rate will take place over a four-year period. The reduction will be taken at 2.75% per year for three years beginning in CY 2008 and at 2.71% for the fourth year in calendar year (CY) 2011. "The increase in payments based on case mix that home health agencies have seen over the years is due to improved coding and documentation rather than the actual condition of the patients, so CMS is adjusting reimbursement," she adds.

It is hard to predict how agencies will do financially under the new payment system because the case mix is so complex, says St. Pierre. Therapy thresholds are now set at six, 14, and 20 visits compared to the single 10-visit threshold in the previous system, and early episode vs. late episode must be documented, she points out. (For an item-by-item comparison of HHPPS changes, visit

Agency managers should be working with their software vendors now to make sure that changes in the PPS system are reflected in the software, suggests St. Pierre. "OASIS forms need to be updated and staff members need to be educated about the changes," she says. "Not only are there new codes but staff members will need to differentiate between early and late episode care for accurate reimbursement."

The 2008 PPS also requires agencies to report data for two additional quality measures — emergent care for wound infections, and deteriorating wound status and improvement in status of surgical wound — to the 10 measures currently reported, for a total of 12 measures to be reported on the Home Health Compare web site.

The first step to prepare for the new PPS is to carefully review CMS documents, says St. Pierre. Then, meet with software vendors and evaluate your OASIS forms, printed or electronic, she says.

The key to successful preparation is to start now, suggests St. Pierre. "Everyone needs time to reprint forms if they are using paper, or reprogram electronic forms, as well as update software to handle the changes," she points out. In addition to making the changes, be sure to allow enough time to test the forms or software changes to make sure that your processes flow smoothly on Jan. 1, she adds.

Another important part of preparing for the new PPS is to thoroughly educate your staff, recommends St. Pierre. "Clinicians do have to answer a few different questions and use some different codes, and they must be careful to accurately document items, such as infected surgical wounds, abscesses, chronic ulcers, gangrene, dysphagia, tracheostomy, and cystostomy, because scores are now given for these conditions."

This article originally appeared in the October 2007 issue of Hospital Home Health.