Home Health & Hospice Week

FDL will increase under time-based system.

Medicare officials have already anticipated ways to game the new outlier calculation, and are moving to head them off.

The Centers for Medicare & Medicaid Services would cap the time that counts toward outliers. It would limit the amount of time per day (summed across the six disciplines of care) to eight hours or 32 units per day when estimating the cost of an episode for outlier calculation purposes, according to the HHS PPS proposed rule for 2017.

You would get credit for the priciest discipline, however. “The discipline of care with the lowest associated cost per unit will be discounted in the calculation of episode cost in order to cap the estimation of an episode’s cost at 8 hours of care per day,” CMS proposes.

CMS also plans to up the cost threshold agencies must exceed to qualify for outlier payments.

CMS wants to the increase the Fixed Dollar Loss (FDL) ratio from 0.45 to 0.56, in order to retain the 0.80 loss ratio for agencies, it explains in the rule. That will keep outliers under the 2.5 percent of total payments CMS requires, the agency predicts.