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CMS to Revamp Payment Methodology for Home Health Agencies

The Centers for Medicare and Medicaid Services (CMS) has issued a proposed rule under which Medicare payments and quality reporting would change for home health agencies (HHAs).

The HHA unit of payment would change from 60 to 30 days in 2020. And according to CMS, the Home Health Value-Based Purchasing Model, the Home Health Quality Reporting System, and the case-mix adjustment methodology for the Home Health Prospective Payment System would change to better align with the agency’s goal of moving from volume- to value-based care.

CMS projects that its proposed changes would increase payments to HHAs by 2.1 percent, or $400 million, in 2019 and that HHAs would have net annualized savings of $60 million in 2020.

Congress has mandated that CMS change the payment system for HHAs so that Medicare stops using the number of therapy visits provided to patients to determine payments. The current proposal would shift to the “Patient-Driven Grouping Model,” which according to CMS “removes the current incentive to overprovide therapy” and focuses “more heavily on clinical characteristics and other patient information to allow payments to more closely coincide with patients’ needs.”

CMS says the Home Quality Reporting Program and the Home Health Value-Based Purchasing Model also would change to make measures reported to the agency more meaningful. Further, CMS wants to decrease the regulatory burden on home health practitioners and physicians by changing the home health delivery system.

To that end, CMS says it would among other things “eliminate the requirement that the certifying physician estimate how much longer skilled services are required when recertifying the need for continued home healthcare.” CMS says that change “would result in annualized cost savings to certifying physicians of $14 million.”

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