Know Your Facts:
MedPAC Predicts Higher Profit Margin Under PDGM
Published on Fri Dec 13, 2019
Agency number and episode volume fall — again.
Take a look at the facts and figures that law- and policymakers will use to decide your future reimbursement. The Medicare Payment & Advisory Commission cites these 2018 statistics in its leadup to its March report to Congress:
- Medicare spent $17.9 billion on fee-for-service home health, up from $17.7 billion in 2017.
- The number of home health agencies declined 1.2 percent, to 11,556. The supply of agencies increased more than 80 percent from 2002 to 2013, but has declined steadily since that year.
- Home health volume also decreased 1.2 percent to 6.3 million episodes. The number of episodes decreased 8.3 percent since 2011, but had increased 67 percent between 2002 and 2011.
- The Medicare profit margin for 2018 was 15.3 percent, up a hair from 15.2 percent the year earlier. The all-payer margin was 4.3 percent.
- For-profit agencies had “better” profit margins than nonprofits, and urban agencies had higher margins than rural ones.
- Average payment per episode in 2018 (after Affordable Care Act-required rebasing) was 7 percent higher than in 2013 (before rebasing).
- MedPAC deems access to home health good, with 83 percent of beneficiaries living in a zip code served by five or more HHAs and 98 percent living in a zip code served by at least one agency.
- About 55 percent of HHAs’ reimbursement comes from fee-for-service Medicare. Around 15 percent of reimbursement comes from Medicare Advantage.