Home Health & Hospice Week

What the FECCA?

Home care industry experts have expected Medicare to come back with a payment reform proposal for the benefit in 2018 rulemaking, but that possibility may become a certainty thanks to the bill aiming to head off a government shutdown.

Background: The Centers for Medicare & Medicaid Services issued its Home Health Groupings Model proposal in the 2018 Home Health Prospective Payment System proposed rule last July. HHGM included a switch to 30-day payment episodes and elimination of therapy from the PPS methodology, and was estimated to strip nearly a billion dollars from Medicare's home health spending in its first year alone. After home health agencies, their representatives, and allies submitted an avalanche of comments opposing the model, CMS pulled it back for further consideration in the final rule.

Now, it - or something much like it - is back. On Feb. 6, the House of Representatives passed the "Further Extension of Continuing Appropriations Act, 2018," which would stave off a government shutdown set for Feb. 8. That bill, which is an amendment to an amendment of H.R. 1892, contains a provision requiring home health payment reform by 2020, including a switch to a 30-day episode and elimination of therapy as a PPS factor.

The big difference, however, is that the pending legislation also requires the reform to be budget-neutral, note attorneys Sheila Burke and Amit Rao with Baker Donelson Bearman Caldwell & Burkowitz in analysis of the legislation.

And the resolution also calls for Technical Expert Panel consultation on the new payment methodology, notes the National Association for Home Care & Hospice in its member newsletter.

The bill takes on one of the big criticisms of the HHGM model with its provision on assumptions used to set rates. "In calculating such amount (or amounts), the Secretary shall make assumptions about behavior changes that could occur ... and the case-mix adjustment factors established ... and shall provide a description of such assumptions in the notice and comment rulemaking used to implement this clause," it says. Many commenters on the PPS rule proposing HHGM lambasted CMS for failing to provide this specific type of information.

Under the legislation, the Medicare Payment Advisory Commission also would be required to produce a report by 2026 "including an analysis of the level of payments provided to home health agencies as compared to the cost of delivering home health services, and any unintended consequences, including with respect to behavioral changes and quality" under the reformed methodology.

While the bill contains other important topics, the payment reform provisions will impact agencies the most, NAHC expects.

Add-On Draws Down

Another important section in the bill addresses the rural add-on, which expired Jan. 1. The continuing resolution would reinstate the 3 percent add-on for 2018, then would change the add-on methodology for 2019 to give more to frontier areas and less to higher-utilizing rural areas, NAHC notes.  The add-on would be gradually phased out by 2022, note policy experts Katie Weider and Rodney Whitlock with ML Strategies, in analysis on law firm Mintz Levin's website.

Specifics: The bill calls for the add-on to drop to 1.5 percent in 2019 and 0.5 percent in 2020 for agencies "in the highest quartile of all counties ... based on the number of Medicare home health episodes furnished per 100 individuals." But in areas with "a population density of 6 individuals or fewer per square mile," the add-on would be 4 percent in 2019, 3 percent in 2020, 2 percent in 2021 and 1 percent in 2022. All agencies not fitting in those two categories would see an add-on of 3 percent in 2019, 2 percent in 2020, and 1 percent in 2021.

The bill also calls for the HHS Office for Inspector General to generate a report on "whether such payments should continue to be made based on county data."

Your Documentation May Count Again

The bill also includes language allowing CMS to "use documentation in the medical record of the home health agency as supporting material, as appropriate to the case involved," for physician certifications and recertifications. The change would take place in 2019.

And it would eliminate therapy caps for Part B outpatient therapy altogether. Other home health issues addressed in the bill include:

• Payment rates. The bill would set the payment update for 2019 at 1.4 percent. The update for 2020 is expected to be around 2.5 percent, NAHC notes. While any pay reduction is bad news, "NAHC was concerned that the rate reductions would be more severe," the group says.
• Appeals. The bill sets out new claims settlement provisions, although that seems to already be in process, NAHC notes.

What's Next?

There are a number of wins for the home care industry in this legislation, but that's not the whole picture. "This CR is a mixed bag for home health," NAHC judges. "There are favorable, unfavorable, and to-be-determined provisions included."

As this issue went to press, the clock was ticking toward the unpopular Feb. 8 shutdown. The Senate must approve the House version without change to send it the President's desk, or more likely senators will approve their own version of the bill and the Senate and House will have to work out the differences in a conference committee.

At press time, the Senate and House were expected to vote on a proposed budget deal on Feb. 8, averting a shutdown starting that night. However, the legislation's fate is far from assured. It faces opposition from factions in both political parties.

Keep your eyes glued to Washington, D.C. to see whether the bill achieves passage and which provisions end up in the final law.

At press time, NAHC was lobbying senators for changes such as requiring a pilot test for payment reform and requiring the inclusion of HHA documentation in reviewing eligibility instead of merely allowing it, the trade group says.