NACH Analyzes Latest Proposed Rule for Home Health

Friday, June 26th, 2020

WASHINGTON, D.C. (June 26, 2020)—The preview of the CY 2021 home health proposed rule, Medicare and Medicaid Programs; CY 2021 Home Health Prospective Payment System Rate Update; Home Health Quality Reporting Requirements; and Home Infusion Therapy Services Requirements, has been posted. The proposal is light compared to recent years’ proposed rules, but does contain meaningful updates and changes.

“CMS has issued the proposed Medicare home health services payment rule in June for the first time in several years,” noted Bill Dombi, President of the National Association for Home Care & Hospice. “It is evident from the rule that its early release was made possible by the limited changes that CMS proposes. NAHC appreciates CMS’s recognition that any significant changes during the infancy of the PDGM system would be premature given the limited data available from 2020, combined with the chaos created by the Covid-19 pandemic. This proposal should help home health agencies achieve some semblance of stability during these difficult times.”

Below is a summary of each of the areas addressed by the Centers for Medicare & Medicaid Services (CMS) – payment rates, telehealth, quality program and home infusion therapy.

Payment Rates
The 2021 proposed Medicare home health rates represent a simple inflation rate update, a significant change in wage index area designations, no change in the structure of the Patient Driven Groupings Model (PDGM) payment model, a scheduled phasing-out of the rural add-on, and a continuation of outlier payment standards. Overall, this proposal would bring a rare year of relative stabilization in Medicare payments for most home health agencies. However, it is noteworthy that the wage index changes will have a significant impact on HHAs that serve certain geographic areas. This reimbursement factor does not get the headlines, but it can be very meaningful for some providers.

Generally, CMS explains that it is doing very little to change the payment model and the payment rates because it has only limited data from the new PDGM model. That limitation is compounded by the chaotic impacts on patient case mix, service modalities, and patient volume triggered by the COVID-19 pandemic. Earlier this year, NAHC advocated for CMS to roll back the 2020 behavioral adjustment that was set at 4.36% due to these changes. CMS later responded that it felt that is was premature to do so given the data limitations even though there were strong signs pointing to a significant increase in LUPAs. Here are some of the details on the 2021 reimbursement proposals.

• Base payment rates are increased by a net Market Basket Index of 2.7%. An annual inflation update of 3.1% is reduced by a 0.4% Productivity Adjustment to net at 2.7%. The results is that:
  • The base 30-day payment rate is increased from $1864.03 to $1911.87 after application of wage index budget neutrality factor of 0.9987. HHAs that did not submit required quality data have that rate reduced by 2%.
  • The LUPA per visit rates are set at:
    • SN $153.54
    • PT $167.83
    • SLP $182.42
    • OT $168.98
    • MSW $246.10
    • HHA $69.53
  • LUPA rates are also reduced by 2% for those HHAs that did not submit required quality data.
  • The LUPA add-on for LUPA only patient continues. For example, for SN as the first LUPA visit the add-on results in a first visit payment of $283.30. Each discipline would get its own add-on rate.
  • The area Wage Index that applies based on the patient’s residence has changed significantly to reflect updated census information. Due to the significant change, CMS proposes to cap any reduction in the wage index at 5%. There is no cap on wage index increases.
  • The Outlier Fixed Dollar Loss ratio stays a 0.63. That would mean that no increase or decrease in the national volume of outlier episodes is expected.
  • The rural add-on phase-out continues
    • High Utilization areas—0% add-on
    • Low Population Density areas—2% add-n
    • All other areas—1% add-on
  • The PDGM case mix weights and LUPA thresholds stay at the 2020 levels

The combination of these changes is projected to increase Medicare home health services spending by $540 million in CY 2021.

Telehealth
CMS is proposing to finalize the plan of care requirements at §409.43(a) related to telehealth as was issued in the COVID-19 Interim final rule published on March 30. The plan of care must include any provision of remote patient monitoring or other services furnished via a telecommunications system and describe how the use of such technology is tied to the patient-specific needs as identified in the comprehensive assessment and will help to achieve the goals outlined on the plan of care. The amended plan of care requirements at §409.43(a) also state that these services cannot substitute for a home visit ordered as part of the plan of care and cannot be considered a home visit for the purposes of patient eligibility or payment. CMS is also proposing to allow HHAs to continue to report the costs of telehealth/telemedicine as allowable administrative costs on line 5 of the home health agency cost report. Additionally, CMS is proposing to include not only remote patient monitoring, but other communications or monitoring services, consistent with the plan of care for the individual.

Quality Program
In the CY 2020 HH PPS final rule, twenty measures for the CY2022 quality reporting program (QRP) were finalized. These are listed in the table below for reference. No new changes to the HH QRP were proposed in the CY2021 proposed rule.

There are, however, proposed changes to the OASIS testing requirements for new home health agencies. Section 484.45(c)(2) of the home health agency conditions of participation (CoPs) requires that new home health agencies must successfully transmit test data to the Quality Improvement & Evaluation System (QIES)or CMS OASIS contractor as part of the initial process for becoming a Medicare-participating home health agency. This required a virtual private network (VPN) and use of a fake CMS Certification Number (CCN) for the test transmission since new HHAs do not yet have a CCN, and limited the number of users to two.

CMS recently enhanced the system that HHAs use to submit OASIS data to be more user friendly. The new CMS data submission system, Internet Quality Improvement & Evaluation System (iQIES), is now internet-based. Under this new system, HHAs are no longer limited to two users for submission of assessment data. In addition, the new iQIES data submission system requires users to include a valid CCN with their iQIES user role request that will allow them to submit their OASIS assessment data to CMS; the new data system no longer supports the use of test or fake CCNs, making it impossible for new HHAs that do not yet have a CCN to submit test data. Therefore, the requirement at §484.45(c)(2) is obsolete. CMS proposes to remove the requirement at §484.45(c)(2). HHAs must be able to submit OASIS assessments in order for the claims match process to occur and relay the data needed for payment under the PDGM system. This link to the payment process gives HHAs strong incentive to ensure that they can successfully submit their OASIS assessments in the absence of this regulatory requirement.

Home Infusion Therapy
This proposed rule reiterates the home infusion therapy supplier policies for coverage and payment finalized in the CY 2019 and CY 2020 HH PPS final rules. This proposed rule includes regulation text changes from Section 5012 of the 21st Century Cures Act that amended section 1861(m) of the Act to exclude home infusion therapy from the definition of home health services, effective on January 1, 2021.

In the proposed rule, CMS sets out the Medicare provider enrollment policies for qualified home infusion therapy suppliers. Providers wanting to become a home Infusion therapy supplier must be currently and validly accredited by a CMS-recognized home infusion therapy supplier accrediting organization (AO), comply with Home Infusion Therapy Supplier Standards; enroll in Medicare using Form CMS- 855B and pay the application fee; be in compliance with all Medicare provider enrollment requirements; and comply with screening requirements based on assigned provider risk .

NAHC will continue to review the proposed rule in the coming days.