Home Health & Hospice Week

Warning: ED visits and observational stays do not count.

Home health agencies gave Medicare officials an earful in their comments on the proposed HH PPS rule, but most of it failed to make a difference in the newly released final rule.

One exception: “Several commenters suggested the inclusion of inpatient psychiatric facility (IPF) stays in the institutional category for the purposes of the PDGM,” the Centers for Medicare & Medicaid Services notes in the 2019 Home Health Prospective Payment System final rule published in the Nov. 13 Federal Register.

CMS agrees “that inpatient psychiatric facility (IPF) stays should be included in the institutional category for the payment system under the PDGM,” the agency says in the final rule. “We agree that admission to an inpatient psychiatric facility would merit inclusion as an institutional source under the PDGM and therefore, we will include this site of service as part of the institutional category case-mix variable.”

But CMS shoots down providers’ other criticisms of the case mix factor. Among proposed rule commenter complaints:

• Accuracy. Commenters told CMS that “some community entrants sometimes require more intensive resources than their institutional counterparts, presenting with complex conditions such as psychiatric and neurological conditions, pressure and stasis ulcers, and a history of falls,” the rule notes. CMS responds that the case mix clinical group function, based on diagnosis coding, should account for those needs.
• Value. “Several commenters … stated that we are ‘devaluing’ community entrants by providing lower reimbursement for those beneficiaries when compared with institutional entrants,” according to the rule. “We do not seek to ‘devalue’ or show preference to any particular patient profile, but rather aim to better align home health payment with the costs observed in providing care,” CMS rebuts.
• Inappropriate incentives. Some commenters compared the institutional designation to the outgoing therapy thresholds, with both having “the potential to create inappropriate incentives.” CMS disagrees in the rule, noting “the data supports that resource utilization is higher among those with beneficiaries who have had a previous institutional stay prior to admission to home health, which accounts for the explanatory power of this particular variable. Conversely, increased payment associated with the therapy thresholds is directly correlated with the number of therapy visits provided.”
• Pay differential. “Commenters believe that the payment differences by admission source [are] too great,” the rule indicates. “However, we reiterate that the analytic findings presented in the CY 2019 HH PPS proposed rule point to clear differences in resources utilized by beneficiaries with differing sources of admission,” CMS responds.
• Cherry picking. Commenters worried that HHAs would target facilities for referrals and neglect community referrals. CMS promises to “closely monitor for any concerning trends in provider behavior, including such metrics as proportion of cases in a provider’s caseload referred from both the community and institutional settings.” However, CMS seems skeptical of such abuses. “Research has shown that many agencies seek referrals from any setting, institutional or otherwise,” CMS maintains in the final rule.
• Access problems. “Several commenters stated that the addition of the admission source category and potential payment differential could negatively affect agencies’ ability to provide the care for beneficiaries in the community and that the admission source categories placed a higher value on care provided to a beneficiary referred to home health care from an acute setting,” the rule notes. CMS responds, “given our analyses as well as clinical observations regarding the resource needs of the institutional entrants to home health, we believe that differentiated admission source categories are merited.”
• Including ED visits and observational stays. Commenters recommended counting observational hospital stays and emergency department visits toward the institutional designation. CMS shoots down that idea. The agency doesn’t deny that observational stays and ED visits may indicate higher resource needs. But it says “the volume of patients utilizing such settings prior to a home health episode is very low. Given that the proportion of home health periods with admissions from ED visits and observational stays is low relative to community and institutional counterparts, we believe that creating a third community admission source category for observational stays and ED visits could potentially introduce added complexity into the payment system in order to address a small portion of home health stays, which could in turn lead to the creation of payment groups that contain very few stays with very little difference in case-mix weights across the landscape of groups.” Plus, CMS wishes to avoid creating an incentive for patients to visit the emergency room, the agency adds.
• Other types of stays. Likewise, CMS denies commenters’ suggestions to have other types of stays, including those for inpatient hospices and Ambulatory Surgical Centers, count toward an institutional stay. The data is not clear enough for their inclusion, including for joint replacement patients discharged from ASCs, CMS maintains.