Improving health is our policy
Directs CMS to rebase Medicare home health agency (HHA) payments by 2014. Creates a 10% limit on the portion of an HHA’s reimbursement that may come from outlier payments from April 1, 2010 through 2015. Requires CMS to submit a report to Congress by March 1, 2011 making recommendations to improve the home health payment system and beneficiary access to these services, with authorization to launch a demonstration program based on the report’s findings.
CMS delivered the mandated report to Congress regarding home health payments on January 11, 2011. Implementation of rebasing is expected to be discussed in the 2014 home health regulations. For more information, see the CMS home page for home health services. On May 6, 2011, CMS issued a Medicare Learning Network (MLN) Matters article describing the limitations on home health outlier payments.
On June 27, CMS issued its CY14 Medicare Home Health Prospective Payment System (HH PPS) proposed rule. Under the rule, CMS outlines proposals that, if ultimately effectuated, would reduce Medicare payments to home health agencies (HHAs) by 1.5%, or $290 million. Per section 3131 of the ACA, CMS’ market basket (MB) update accounts for rebasing adjustments over a four-year period to the national, standardized 60-day episode payment rate and non-routine medical supplies (NRS) conversion factor. Note, however, that the 1 percentage point MB reduction called for under section 3401applied to MB updates for CYs 11-13 but does not subsequently apply in CY 14, and as such, was not included in CMS’ latest proposal. A CMS fact sheet is available here. Comments on the rule are due by 5pm ET on August 26.
On July 2, 2013, CMS issued an informational bulletin reiterating the opportunity states have under CMS’ CY14 Medicare Home Health Prospective Payment System (HH PPS) proposed rule to comment on CMS’ proposed cost allocation of HHA survey expenses. Comments on the rule are due by 5pm ET on August 26.
On Nov. 22, 2013, CMS issued its CY 2014 HH PPS final rule (slated to be published in the Federal Register on Dec. 2) in which the agency estimates home health agencies (HHAs) will see a 1.05 percent net cut—for an aggregate decline of $200M in Medicare payments to HHAs in CY 2014. The net -1.05 percent cut reflects (as outlined in Table 33 on p. 214 of the proposed rule): +2.3 percent in home health payment update percentage; -2.73 percent due to ACA-mandated rebasing adjustments; and -0.62 percent stemming from impacts of the HH PPS Grouper scoring changes. Also: CMS press release and fact sheet.
On July 1, CMS issued its CY15 Medicare HHA PPS proposed rule under which CMS estimates that HHAs will see a -0.3% update – for an aggregate decrease of $58 million in Medicare payments to HHAs in CY 2015. A CMS fact sheet is available here. These key ACA provisions are addressed in the underlying rule. Comments on the proposed rule are due by September 2, 2014.
In an October 6 announcement delineating recent initiatives aimed at improving the quality of post-acute care, CMS outlined a number of changes to the Medicare and Medicaid conditions of participation for HHAs (proposed rule; fact sheet). Comments are due by 5pm ET on Dec. 8, 2014.
On Dec. 1, 2014, CMS issued a notice extending the comment period for the underlying HHA Conditions of Participation proposed rule from Dec. 8, 2014 to 5pm EST on Jan. 7, 2015.
On Dec. 22, MedPAC released a report to Congress evaluating the impact of the statutory Medicare home health rebasing payment policy on beneficiaries’ access to and quality of care. The report concludes that “rebasing will not threaten beneficiary access to home health services or compromise quality of care.”
On Apr. 16, President Obama signed into law the Medicare Access and CHIP Reauthorization Act of 2015, which addressed these provisions of the ACA.
On Apr. 23 CMS released a revised fact sheet includes information regarding the Home Health Prospective Payment System (HH PPS) including background, consolidated billing requirements, criteria that must be met to qualify for home health services, therapy services, elements of the HH PPS, updates to the HH PPS, billing and payment for home health services, and Home Health Quality Reporting Program.
On July, 6, CMS issued a proposed rule (press release; fact sheet) enumerating CY 16 payments under the Medicare Home Health Prospective Payment System (HH PPS). Under the proposed rule, CMS estimates that home health agencies (HHAs) will see a -1.8% update, for an aggregate decrease of roughly $350 million in Medicare payments to HHAs in CY 16. The rule addressed this provision of the ACA. Comments on the proposed rule are due Sept. 4.
On Dec. 18, CMS released the Home Health Agency Utilization and Payment Public Use File. The data set details information on services provided to Medicare beneficiaries by home health agencies.
On June 27, 2016, CMS released its proposed rule on the calendar year (CY) 2017 home health prospective payment system rate update, which also proposes further policies for implementing a Home Health Value-Based Purchasing (HHVBP) Model beginning in CY 2018. CMS estimates that Medicare payments to home health agencies (HHAs) will decline by 1.0 percent in CY 2017, reflecting a $180 million decrease compared with CY 2016. Comments are due by Aug. 26, 2016.
2017
On Jan. 9, CMS issued a final rule, which codifies a 2014 proposal delineating revisions to the Medicare and Medicaid conditions of participation (CoPs) for home health agencies (HHAs).
On a related note, on July 7, CMS finalized a six month delay in the effective date for a regulation that describes conditions of participation (CoPs) for home health agencies in Medicare and Medicaid. HHAs have until Jan. 13, 2018 to comply with the new CoPs.
SEC. 3131. PAYMENT ADJUSTMENTS FOR HOME HEALTH CARE. (a) REBASING HOME HEALTH PROSPECTIVE PAYMENT AMOUNT.— (1) IN GENERAL.—Section 1895(b)(3)(A) of the Social Security Act (42 U.S.C. 1395fff(b)(3)(A)) is amended— (A) in clause (i)(III), by striking ‘‘For periods’’ and inserting ‘‘Subject to clause (iii), for periods’’; and (B) by adding at the end the following new clause: øAs revised by section 10315(a)¿ ‘‘(iii) ADJUSTMENT FOR 2014 AND SUBSEQUENT YEARS.—‘‘(I) IN GENERAL.—Subject to subclause (II), for 2014 and subsequent years, the amount (or amounts) that would otherwise be applicable under clause (i)(III) shall be adjusted by a percentage determined appropriate by the Secretary to reflect such factors as changes in the number of visits in an episode, the mix of services in an episode, the level of intensity of services in an episode, the average cost of providing care per episode, and other factors that the Secretary considers to be relevant. In conducting the analysis under the preceding sentence, the Secretary may consider differences between hospital-based and freestanding agencies, between for-profit and nonprofit agencies, and between the resource costs of urban and rural agencies. Such adjustment shall be made before the update under subparagraph (B) is applied for the year. ‘‘(II) TRANSITION.—The Secretary shall provide for a 4-year phase-in (in equal increments) of the adjustment under subclause (I), with such adjustment being fully implemented for 2017. During each year of such phase-in, the amount of any adjustment under subclause (I) for the year may not exceed 3.5 percent of the amount (or amounts) applicable under clause (i)(III) as of the date of enactment of the Patient Protection and Affordable Care Act.’’. (2) MEDPAC STUDY AND REPORT.— (A) STUDY.—The Medicare Payment Advisory Commission shall conduct a study on the implementation of the amendments made by paragraph (1). Such study shall include an analysis of the impact of such amendments on— (i) access to care; (ii) quality outcomes; (iii) the number of home health agencies; and (iv) rural agencies, urban agencies, for-profit agencies, and nonprofit agencies. (B) REPORT.—Not later than January 1, 2015, the Medicare Payment Advisory Commission shall submit to Congress a report on the study conducted under subparagraph (A), together with recommendations for such legislation and administrative action as the Commission determines appropriate. (b) PROGRAM-SPECIFIC OUTLIER CAP.—Section 1895(b) of the Social Security Act (42 U.S.C. 1395fff(b)) is amended— (1) in paragraph (3)(C), by striking ‘‘the aggregate’’ and all that follows through the period at the end and inserting ‘‘5 percent of the total payments estimated to be made based on the prospective payment system under this subsection for the period.’’; and (2) in paragraph (5)— (A) by striking ‘‘OUTLIERS.—The Secretary’’ and inserting the following: ‘‘OUTLIERS.— ‘‘(A) IN GENERAL.—Subject to subparagraph (B), the Secretary’’; (B) in subparagraph (A), as added by subparagraph (A), by striking ‘‘5 percent’’ and inserting ‘‘2.5 percent’’; and (C) by adding at the end the following new subparagraph: ‘‘(B) PROGRAM SPECIFIC OUTLIER CAP.—The estimated total amount of additional payments or payment adjustments made under subparagraph (A) with respect to a home health agency for a year (beginning with 2011) may not exceed an amount equal to 10 percent of the estimated total amount of payments made under this section (without regard to this paragraph) with respect to the home health agency for the year.’’. (c) APPLICATION OF THE MEDICARE RURAL HOME HEALTH ADD- ON POLICY.—Section 421 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (Public Law 108–173; 117 Stat. 2283), as amended by section 5201(b) of the Deficit Reduction Act of 2005 (Public Law 109–171; 120 Stat. 46), is amended— (1) in the section heading, by striking ‘‘ONE-YEAR’’ and inserting ‘‘TEMPORARY’’; and (2) in subsection (a)— (A) by striking ‘‘, and episodes’’ and inserting ‘‘, episodes’’; (B) by inserting ‘‘and episodes and visits ending on or after April 1, 2010, and before January 1, 2016,’’ after ‘‘January 1, 2007,’’; and (C) by inserting ‘‘(or, in the case of episodes and visits ending on or after April 1, 2010, and before January 1, 2016, 3 percent)’’ before the period at the end. (d) STUDY AND REPORT ON THE DEVELOPMENT OF HOME HEALTH PAYMENT REVISIONS IN ORDER TO ENSURE ACCESS TO CARE AND PAYMENT FOR SEVERITY OF ILLNESS.—øReplaced by section 10315(b)¿ (1) IN GENERAL.—The Secretary of Health and Human Services (in this section referred to as the ‘‘Secretary’’) shall conduct a study on home health agency costs involved with providing ongoing access to care to low-income Medicare beneficiaries or beneficiaries in medically underserved areas, and in treating beneficiaries with varying levels of severity of illness. In conducting the study, the Secretary may analyze items such as the following: (A) Methods to potentially revise the home health prospective payment system under section 1895 of the Social Security Act (42 U.S.C. 1395fff) to account for costs related to patient severity of illness or to improving beneficiary access to care, such as— (i) payment adjustments for services that may involve additional or fewer resources; (ii) changes to reflect resources involved with providing home health services to low-income Medicare beneficiaries or Medicare beneficiaries residing in medically underserved areas; (iii) ways outlier payments might be revised to reflect costs of treating Medicare beneficiaries with high levels of severity of illness; and (iv) other issues determined appropriate by the Secretary. (B) Operational issues involved with potential implementation of potential revisions to the home health payment system, including impacts for both home health agencies and administrative and systems issues for the Centers for Medicare & Medicaid Services, and any possible payment vulnerabilities associated with implementing potential revisions. (C) Whether additional research might be needed. (D) Other items determined appropriate by the Secretary. (2) CONSIDERATIONS.—In conducting the study under paragraph (1), the Secretary may consider whether patient severity of illness and access to care could be measured by factors, such as— (A) population density and relative patient access to care; (B) variations in service costs for providing care to individuals who are dually eligible under the Medicare and Medicaid programs; (C) the presence of severe or chronic diseases, which might be measured by multiple, discontinuous home health episodes; (D) poverty status, such as evidenced by the receipt of Supplemental Security Income under title XVI of the Social Security Act; and (E) other factors determined appropriate by the Secretary. (3) REPORT.—Not later than March 1, 2014, the Secretary shall submit to Congress a report on the study conducted under paragraph (1), together with recommendations for such legislation and administrative action as the Secretary determines appropriate. (4) CONSULTATIONS.—In conducting the study under paragraph (1), the Secretary shall consult with appropriate stakeholders, such as groups representing home health agencies and groups representing Medicare beneficiaries. (5) MEDICARE DEMONSTRATION PROJECT BASED ON THE RESULTS OF THE STUDY.— (A) IN GENERAL.—Subject to subparagraph (D), taking into account the results of the study conducted under paragraph (1), the Secretary may, as determined appropriate, provide for a demonstration project to test whether making payment adjustments for home health services under the Medicare program would substantially improve access to care for patients with high severity levels of illness or for low-income or underserved Medicare beneficiaries. (B) WAIVING BUDGET NEUTRALITY.—The Secretary shall not reduce the standard prospective payment amount (or amounts) under section 1895 of the Social Security Act (42 U.S.C. 1395fff) applicable to home health services furnished during a period to offset any increase in payments during such period resulting from the application of the payment adjustments under subparagraph (A). (C) NO EFFECT ON SUBSEQUENT PERIODS.—A payment adjustment resulting from the application of subparagraph (A) for a period— (i) shall not apply to payments for home health services under title XVIII after such period; and payment amounts applicable for such services after such period. (D) DURATION.—If the Secretary determines it appropriate to conduct the demonstration project under this subsection, the Secretary shall conduct the project for a four year period beginning not later than January 1, 2015. (E) FUNDING.—The Secretary shall provide for the transfer from the Federal Hospital Insurance Trust Fund under section 1817 of the Social Security Act (42 U.S.C. 1395i) and the Federal Supplementary Medical Insurance Trust Fund established under section 1841 of such Act (42 U.S.C. 1395t), in such proportion as the Secretary determines appropriate, of $500,000,000 for the period of fiscal years 2015 through 2018. Such funds shall be made available for the study described in paragraph (1) and the design, implementation and evaluation of the demonstration described in this paragraph. Amounts available under this subparagraph shall be available until expended. (F) EVALUATION AND REPORT.—If the Secretary determines it appropriate to conduct the demonstration project under this subsection, the Secretary shall— (i) provide for an evaluation of the project; and (ii) submit to Congress, by a date specified by the Secretary, a report on the project. (G) ADMINISTRATION.—Chapter 35 of title 44, United States Code, shall not apply with respect to this subsection.
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