Home Health & Hospice Week

PAC PPS would cut tens of billions.

A requirement that home health payment reform be budget-neutral may have just been signed into law, but the Trump administration has other ideas about the matter.

Watch out: While most observers agree the Trump administration's budget proposal is DOA as an entire document, politicians looking for ways to raise funds for their initiatives are likely to cherry pick cost-cutting ideas from the plan.

And the proposal sets out a juicy $16.7 bil- lion in savings over 10 years by recommending implementation of "a more accurate payment sys- tem for home health," according to the Department of Health & Human Services budget overview. "This proposal implements a new patient case-mix classification methodology to more accurately account for clinical differences among patients in Medicare's payments to home health agencies," the document says. "This proposal shifts the focus from volume of services to a more patient-centered model that relies on patient characteristics."

The proposal refers to the change as "the home health grouping model" and sets a January 2020 implementation date.

The budget also proposes a sizeable $80.2 billion in savings by switching from setting-specific payment systems for postacute care providers to a cross-setting PAC PPS. The Medicare Payment Advisory Commission has also been pushing this idea for a while (see Eli's HCW, Vol. XXVII, No. 2).

A PAC PPS has the potential to benefit home care providers, due to the low-cost care setting compared to institutional PAC providers.

And Trump administration suggests a provi- sion already enacted into law - penalizing hospi- tals for "quickly discharging" patients to hospice care (see story, p. 61). The proposal offers a $1.3 bil- lion savings from that move.

The Trump budget also suggest charging surveyed providers a user fee for survey revisits.

And, as usual, it singles out home health as an area in need of fraud and abuse enforcement. The document calls for "additional funding to address fraud, waste, and abuse in home health and other noninstitutional-based services."

Hospices aren't immune, either. "Services provided in a beneficiary's home or other noninstitu- tional settings, including home health, hospice, and other home- and community-based services, are sus- ceptible to fraud," the budget says. The HHS Office of Inspector General "will develop new recommen- dations for targeted program safeguards for benefici- aries in homes- or community-based settings and prevent fraud by bad actors while limiting the burden on legitimate providers," the proposal says. "Through data analytics, OIG would also detect new and emerging fraud schemes, enabling us to monitor trends and evolution of known fraud schemes."

ROI: Centers for Medicare & Medicaid Services "actuaries conservatively project that, for every new dollar spent by HHS to combat health care fraud, about $2 is saved or avoided," the budg- et says.

The proposed budget does suggest increas- ing the Home and Community-Based Supportive Services (HCBSS) program, which furnishes servic- es such as transportation, case management, person- al care services, homemaker assistance, adult day care, and physical fitness programs.

Big picture: Overall, the proposal would cut $554 billion from Medicare spending in the next 10 years, notes the National Association for Home Care & Hospice. About $47 billion of that would come from a cut to "spending on prescription drugs over a decade by having senior citizens move more slowly through the 'doughnut hole' coverage gap and preventing most people from ever reaching the catastrophic part of the program where the federal government pays 80 percent of the cost for drugs," NAHC notes. 

Note: See the HHS budget summary at www.hhs.gov/sites/default/files/fy-2019-budget-in- brief.pdf.