On June 26, 2024, the Centers for Medicare & Medicaid Services (CMS) unveiled its proposed rule for the Calendar Year (CY) 2025 Home Health Prospective Payment System (HH PPS). This update aims to refine Medicare payment policies and rates for Home Health Agencies (HHAs), ultimately improving patient care and reducing hospital readmissions.
Key Proposals in the CY 2025 Rule
1. Payment Rate Adjustments: CMS proposes a -4.067% permanent adjustment to the CY 2025 home health payment rate. This adjustment addresses discrepancies between expected and actual impacts of the Patient-Driven Groupings Model (PDGM) introduced in 2020. Previous reductions were -3.925% for CY 2023 and -2.890% for CY 2024, only partially addressing the required permanent adjustment.
2. PDGM and Case-Mix Updates: The proposed rule includes recalibrating PDGM case-mix weights and updating thresholds for low utilization payment adjustments (LUPAs) based on CY 2023 data. It also proposes a new occupational therapy LUPA add-on factor.
3. Wage Index Revisions: The rule suggests updating the home health wage index using data from the 2020 Census to better reflect current labor market conditions.
4. Quality Reporting Enhancements: CMS plans to introduce new data elements for the Home Health Quality Reporting Program (QRP) starting CY 2027, focusing on social determinants of health such as living situations and food insecurity.
5. Expanded Home Health Value-Based Purchasing (HHVBP): An upcoming Request for Information (RFI) will seek input on potential new performance measures to enhance the HHVBP Model, focusing on patient function and care activities.
6. Health Equity and Conditions of Payment (CoPs): CMS proposes new standards for HHAs to develop patient acceptance policies and provide transparent service information. They also seek feedback on rehabilitative therapists’ roles and HHA service scopes.
7. Long-Term Care Facility Reporting: Starting January 1, 2025, CMS proposes to broaden respiratory illness reporting requirements to include COVID-19, influenza, and RSV data.
8. Medicare Provider Enrollment: The rule suggests adding reactivating providers to the categories subject to enhanced oversight, aimed at reducing fraud and abuse.
These updates are designed to refine payment systems, enhance patient care, and maintain Medicare’s sustainability. CMS is inviting public comments on these proposals to further inform their final decisions.
