Home Health & Hospice Week

The reimbursement cuts due to case mix creep may be making all the headlines, but there are other important provisions in the newly proposed 2012 prospective payment system rule published in the July 12 Federal Register. Take note of these PPS proposed rule items:

• Outliers. The Centers for Medicare & Medicaid Services' 10 percent cap on outlier payments that began last year seems to be doing the trick to reduce overuse of the payments. By midthird quarter of 2010, CMS had paid 1.68 percent of HHA payments in outliers. That compares to percentage exceeding 6 percent in the previous three years, CMS says in the proposed rule. The agency aims to pay out 2.5 percent in outliers annually.

Despite that success, CMS proposes to leave outlier calculations the same, including the fixed dollar loss ratio of 0.67 percent. "However, in the final rule, we will update our estimate of the FDL ratio using the most current and complete year of HH PPS data available," CMS says. The FDL ratio determines how much money agencies must lose before outlier payments kick in.

• Homebound clarification. To align with Medicare manual language and help in court challenges, CMS proposes clarifying the definition of homebound. The provision addresses absences from the home for religious and other purposes and makes clear that patients don't need to be bedridden.

• Payment reform. Under the Affordable Care Act, CMS must deliver a report on home health payment reform to Congress by March 2014. Work on that report continues with CMS awarding a new contract this summer. The new contract "will refine the analytic plan, perform the detailed analysis and ultimately recommend payment model options," according to the proposed rule.

• CAHPS. A payment reduction for not reporting CAHPS patient satisfaction survey data will continue in 2012, CMS points out.