Home Health & Hospice Week

New HHAs no longer will receive RAP payments under PDGM.

Despite many strident industry comments opposing the elimination of Requests for Anticipated Payments, Medicare has started down that path anyway.

In July, the Centers for Medicare & Medicaid Services proposed requiring “new” home health agencies to submit so-called “no-pay” RAPs under the Patient-Driven Groupings Model starting in January 2020. True to their name, agencies would not receive any payments for the RAPs, but instead would just establish the home care benefit period for the patient with the submission.

Under this provision, “new” agencies would be those enrolled Jan. 1, 2019, or later.

While not making official proposals, CMS also floated the ideas of reducing the amount of upfront payment provided via RAPs to current agencies (currently set at 60 percent for first episodes, 50 percent for later episodes) and of eliminating RAPs for all agencies altogether. In the case of total RAP elimination, CMS suggested implementing a Notice of Admission process similar to the Notice of Election process for hospices.

Many HHAs and their representatives blasted all of these ideas in their comments on the proposed rule. “Commenters stated they do not want any type of phase-out of RAPs and remarked that RAPs should continue under the PDGM to ensure no disruption in cash flow,” CMS acknowledges in the 2019 HH PPS final rule issued Oct. 31.

Despite the industry’s vehemence on the matter, “we are finalizing the split-percentage proposal as proposed with an effective date of January 1, 2020,” CMS says in the final rule. “This means that newly-enrolled HHAs, that is HHAs certified for participation in Medicare effective on or after January 1, 2019, would not receive RAP payments beginning in CY 2020. HHAs that are certified for participation in Medicare effective on or after January 1, 2019, would still be required to submit a ‘no pay’ RAP at the beginning of care in order to establish the home health period of care, as well as every 30-days thereafter.”

CMS brushes aside agencies’ concerns about cash flow disruption and difficulty securing needed physician documentation before submitting an end-of-episode claim 30 days after the start of care. “We continue to believe that as a result of a reduced timeframe for the unit of payment from a 60-day episode to a 30-day period, that a split percentage approach to payment may not be needed for HHAs to maintain an adequate cash flow,” CMS says in the rule. “We also believe that by eventually phasing-out the submission of RAPs with each 30- day period, that this will significantly streamline claims processing for HHAs.”

Being new HHAs will make the elimination of RAPs easier, CMS contends — contradicting industry arguments that new providers need more, not less, reimbursement up front. “Eliminating RAP payments for newly-enrolled HHAs … would allow these HHAs to structure their operations without becoming dependent on a partial advanced payment and take advantage of receiving full payments every 30 days,” CMS responds.

On the contrary, “this will be difficult for new providers,” maintains billing expert M. Aaron Little with BKD in Springfield, Missouri. “The Medicare certification is a lengthy and expensive process. Historically, the prospect of being able to bill RAPs and engage cash flow after the lengthy certification process has been crucial for new providers.”

Plus: As finalized, Medicare will pay RAPs to newly enrolled providers in 2019, just not in 2020, notes reimbursement expert Melinda Gaboury with Healthcare Provider Solutions in Nashville, Tennessee. Eliminating RAPs for these providers is “a joke,” she tells Eli.

Under this plan, “CMS is going to create dependency, only to then take the RAP payments away from those new providers,” Little says.

Because the current median length of days for RAP submission is 12 days from the start of the 60-day episode, CMS argues that “there is the possibility that HHAs could be simultaneously submitting a RAP and a final claim for each 30-day period of care,” according to the rule. “This defeats the purpose of the RAP to maintain adequate cash flow and only increases complexity for HHAs in their claims processing. With monthly billing, HHAs have the ability to receive an ongoing cash flow, which we believe would mitigate concerns over having adequate funds for the provision of care.”

Of course, that scenario is predicated on the extremely improbable idea that an HHA that takes four weeks-plus to submit a RAP will simultaneously be ready to submit an End of Episode claim right at the conclusion of the 30-day episode. As in the current billing environment, “signed orders are what’s going to hold everything up,” Gaboury points out.

Future RAP Elimination For All?

While on one hand CMS assures agencies it is axing RAP payments for new providers only, it also repeatedly raises the idea of getting rid of them altogether later.

“Nurses, supplies, PT are all very expensive to be paying without an ongoing reimbursement,” Lynn Olson, owner of billing company Astrid Medical Services in Corpus Christi, Texas, tells Eli.

HHAs at least have a breather on that one — for the time being. “We understand that HHAs may need time to adapt to the PDGM so any phase-out of RAP payments for existing HHAs would be addressed in future rulemaking,” CMS promises in the final rule.

“I am glad to see that CMS is not completely rocking the boat by trying to phase out RAPs — yet — for existing providers,” Little says. “Hopefully they will hold off until PDGM can be fully implemented, allow providers to adjust, and then collect data to determine whether RAPs continue to be needed for cash flow.”

If CMS does indeed scrap RAPs altogether, Olson hopes the agency can formulate a creative solution to keep cash flowing to providers, he says.

CMS says if it does away with RAPs, as it stongly hints at, it wants to replace them with a new “Notice of Admission” similar to hospices’ NOEs (see box, this page).

Note: CMS addresses the RAP topic in pp. 162-167 of the 682-page rule at https://s3.amazonaws.com/public-inspection.federalregister.gov/2018-24145.pdf.