Home Health & Hospice Week

Program set to dock HHAs’ pay up to 8% in 2022.

If you’re maximizing your quality scores, a newly announced Home Health Value-Based Purchasing model expansion will come as good news. If not, you could be looking at an 8 percent reduction to your Medicare reimbursement rates — if not more.

“The Home Health Value-Based Purchasing (HHVBP) Model has been certified for expansion through rulemaking beginning no sooner than Calendar Year (CY) 2022,” the Centers for Medicare & Medicaid Services says. “The HHVBP Model adjusts payments to Medicare-certified home health agencies (HHAs) on the quality of care provided, rather than the volume of services rendered. These payment adjustments are determined based on a home health agency’s quality performance measures relative to peers in its state,” CMS explains in a release.

“This Model is a great example of how the Innovation Center can design successful models that both improve quality for Medicare beneficiaries and lower costs,” CMS Innovation Center Director Brad Smith adds in the release. “We are excited that HHVBP has met our gold standard for expansion as laid out by Congress.”

Specifically, the model, which is running in Massachusetts, Maryland, North Carolina, Florida, Washington, Arizona, Iowa, Nebraska, and Tennessee, has resulted in an average 4.6 percent improvement in HHAs’ quality scores as well as average annual savings of $141 million to Medicare so far, CMS touts.

Currently, the demonstration is budget-neutral within the home health sector, points out publicly traded chain Amedisys in an advocacy document about the model shared with AAPC. But HHVBP creates Medicare savings through decreased hospitalization and skilled nursing facility usage.

The VBP model has ramped up the financial stakes as it has progressed. It started out affecting participating HHAs’ pay rates by adding or deducting up to 3 percent in 2018. That rate increases by 1 percentage point each year to top out at 8 percent in increases or reductions in 2022, CMS highlights on its HHVBP web page.

An analysis by consulting firm The Moran Company projects a nationwide expansion of the HHVBP demonstration would result in about $6.3 billion in savings over 10 years using Congressional Budget Office scoring methodology, says Amedisys, which commissioned the report.

CMS ties HHVBP to priorities under COVID-19 in its release. “The Coronavirus pandemic has tragically illustrated how important it is for elderly Americans to have a robust set of options outside of nursing homes,” CMS Administrator Seema Verma says. “Nursing homes will always be an important part of the care continuum — especially for those who need an intensive level of care — but home health services are often preferred by seniors. Expansion of this model would improve the overall value and quality of that home health care — and seniors stand to benefit.”

Just how an expansion will work remains unclear, since CMS hasn’t initiated rulemaking for the move.

For example: “A nationwide expansion was being considered,” notes the National Association for Home Care & Hospice in its member newsletter. But “at this time, it is unclear if the expansion is nationwide or only certain states/ territories,” the trade group says.

Amedisys has been advocating for a nationwide expansion of the program to boost quality, a company spokes­person confirms to AAPC. HHVBP rewards high-quality providers and penalizes low-quality providers, the Amedisys summary notes.

Providers in affected states must participate in HHVBP; there are no opt outs. “In 2018, there were approximately 2,000 HHAs in the nine HHVBP states, representing 18 percent of all HHAs and 1.4 million home health episodes in the U.S.,” CMS points out in its latest annual report on the model.

Just how much reimbursement will be at stake also remains to be seen. HHAs in HHVBP states have protested that an 8 percent payment adjustment is too much.

Amedisys has suggested to CMS that it could realize further savings within the HHVBP model if it would ratchet down incentives. For example, in 2022 CMS could decrease the incentive to +7 percent while maintaining the penalty at -8 percent to realize a savings, its advocacy document offers.

Model Has Many Drawbacks, Say Agencies That Are Living It

The feds should expect pushback from many HHAs on HHVBP's expansion. With COVID, the Patient-Driven Groupings Model, OASIS-E in 2022, the Review Choice Demonstration, and more on their plates, many providers would just as soon see HHVBP left on the back burner.

That goes doubly for small providers without the resources to polish their data-collection practices and the financial cushion to absorb HHVBP losses.

Members of the Nebraska Association for Home Healthcare and Hospice have found that “the increased administrative work and time focused on submitting data and documentation for VBP is overly burdensome and takes time away from patient care,” relates NAHHH head Janet Seelhoff. And “agencies have not found VBP to significantly impact delivery of care in the home,” Seelhoff adds.

The model does have some good points, Seelhoff allows. “VBP has helped agencies look more closely at the areas affecting quality,” she tells AAPC. “It draws attention to where agencies need to focus on better documentation relative to quality outcomes and measures.”

In addition to the drain on resources for not much benefit, the model’s reimbursement structure is overly complicated and confusing to many, Seelhoff maintains. “Agencies that are performing well (the majority) don’t receive the same amount of reimbursement,” she details. “It’s been unclear how the reimbursement is determined, and comparative data has not been readily available.”

In addition to these drawbacks, HHVBP is already at least somewhat redundant, some argue.

“The HHVBP program has been less impactful in driving agencies to quality improvement [than] other changes occurring across the delivery system,” assesses Pat Kelleher, head of the Home Care Alliance of Massachusetts. “Even without HHVBP, agencies in Massachusetts are needing to keep their scores up as referral partners such as Medicare Advantage plans and ACOs want to work with high-performing agencies,” Kelleher explains. “In our market, these types of systems control an increasing state of the market,” she tells AAPC.

Note: Model details and links to the expansion release, evaluation reports, and more are at https://innovation.cms.gov/ innovation-models/home-health-value-based-purchasing-model.