Home Health & Hospice Week

Small fish in the big cohort pond are at risk of floundering, as are agencies in historically high utilization regions.

Among the biggest challenges home health agencies face under the Expanded Home Health Value-Based Purchasing Model is one over which they have very little control — the size-based cohort in which they will compete.

Background: HHAs overwhelmingly told the Centers for Medicare & Medicaid Services they wanted state cohorts for national VBP. For example, Laura Friend with the West Virginia Council of Home Care Agencies told CMS going with nationwide cohorts “has the potential to significantly shift resources across state lines, potentially depriving regions of funding for critical home health services” (see HCW by AAPC, Vol. XXX, No. 35).

But Medicare officials rebuffed the feedback and established two nationwide cohorts for competition anyway — small (fewer than 60 unique survey-eligible beneficiaries in the calendar year prior to the performance year) and large (60 or more unique survey-eligible beneficiaries).

The cohorts are extremely lopsided. In 2019, 7,084 HHAs fell within the larger-volume cohort and 485 HHAs fell within the smaller-volume cohort, CMS calculated in its 2022 proposed rule published in the July 7, 2021 Federal Register.

Nationwide cohorts could penalize a number of providers, according to experts. For one, they are “a very significant disadvantage for small providers in certain parts of the country,” says Pam Warmack with Clinic Connections in Ruston, Louisiana. “I don’t think CMS has ever truly recognized the differences in the cultures and impact of patient lifestyles and mores on the challenges providers face from region to region,” the consultant adds.

CMS’ approach “certainly adds a lot more competitors to the race,” notes Angela Huff, a consultant with BKD in Springfield, Missouri. “It feels like the smaller agencies that are in the large cohort may be at a real disadvantage,” Huff says. “But if they focus they can be successful. Time will tell how this plays out,” Huff adds.

Large program changes are “much harder on smaller agencies, with each major change which requires … training, implementation, etc.,” notes consultant Linda Scott of Scott Solutions in Arlington, Virginia. “The difference between a 40-patient agency and the largest of the agencies out there is pretty large,” she stresses.