Prospective Payment System:
THREAT OF CUT FOR CASE MIX CREEP LOOMS LARGE
Published on Tue Jun 19, 2007
Wide variety of commenters furnish hundreds of pages of PPS rule recommendations.
Home health agencies are fighting an uphill battle against the payment cut, due to alleged case mix creep, proposed in the prospective payment system refinements.
The Centers for Medicare & Medicaid Services proposed a 2.75 percent cut to HHA Medicare payments every year for three years (see Eli's HCW, Vol. XVI, No. 16). The cut is needed because the average case mix under PPS has risen 8.7 percent, CMS says.
The overwhelming majority of commenters on the PPS rule denounced the cut, from trade groups (see Eli's HCW, Vol. XVI, No. 25) to individual nurses to multi-million-dollar publicly traded companies. The commenters provided hundreds of pages of explanations and evidence refuting CMS' rationale for the cut.
Uh-oh: But one important commenter played music to CMS' ears. The Medicare Payment Advisory Commission noted that "case-mix increases attributable to coding improvements are common when new payment systems are implemented." CMS found the same thing with inpatient hospitals, inpatient rehabilitation facilities and long-term acute care hospitals.
"An adjustment for home health is consistent with the experience in other systems," MedPAC says.
The influential advisory body to Congress does stop short of fully endorsing the cut, however. CMS' upcoding analysis "makes the best use of currently available data," MedPAC says. "But for the future it would be beneficial to have a more systematic approach to measuring changes in coding practices."
For example: CMS might try conducting OA-SIS assessments independently and comparing them to agencies' assessments, or visiting agencies "to check agency coding practices," MedPAC suggests.
Other hot topics addressed include: • Early/late episodes. Reaction to this new provision was mixed. CMS wants to pay more for third or later "adjacent" episodes under the revisions (see Eli's HCW, Vol. XVI, No. 20). Adjacent episodes occur within 60 days of one another and may take place at multiple providers for the same patient.
Basing payments on episode number will help adequately reimburse HHAs for long-term patients, praises the Home Care Association of New York State in its PPS comments.
But many providers came out against the payment differential, including the Home Care Network of Jefferson Health System in Radnor, PA. The designation adds unnecessary complexity to the proposed PPS system, the Network insists in its comment letter.
And except in rare cases, home care costs are generally front-loaded into the early episodes, the Network contends.
In fact, three-fourths of all Medicare patients receive all their care in the first or second episodes, claims national chain Gentiva Health Services Inc. in its comment letter. And the early/late episode differential may "reward overutilization" and encourage dependence in patients, the company argues.
Data dilemma: Providers also fear incorrect episode information in new OASIS item M0110 leading to incorrect payments, similar [...]
