Home Health & Hospice Week

Data helps pinpoint winners, losers under new payment system.

Aside from budget neutrality, the PDGM payment reform model Medicare has proposed for 2020 may look basically the same as last year’s HHGM model. But there is one area of difference — the information the Centers for Medicare & Medicaid Services is providing about the change.

CMS is offering agency-specific impact files to providers, it says in the 2019 Home Health Prospective Payment System proposed rule released July 2. “To support an assessment of the effects of the proposed PDGM, CMS will provide, upon request, a Home Health Claims-OASIS Limited Data Set (LDS) file to accompany the CY 2019 HH PPS proposed and final rules,” CMS says in a fact sheet about the rule. Providers can request the file by following the instructions at www.cms.gov/Research-Statistics-Data-and-Systems/Files-for-Order/Data-Disclosures-Data-Agreements/DUA_-_NewLDS.html.

The reports have “the potential to be very helpful for agencies trying to understand how the proposed model may impact them on an individual basis — so long as the information is comprehensible,” qualifies reimbursement expert M. Aaron Little with BKD in Springfield, Missouri.

HHAs seeing the biggest reimbursement drops will most likely be those providing therapy intensive episodes, experts predict.

As required by law, CMS also spells out its “behavioral assumptions” it made in calculating the payment reform model’s budget neutrality. According to the rule, “we propose to make three assumptions about behavior change that could occur in CY 2020 as a result of the implementation of the 30-day unit of payment and the implementation of the PDGM case-mix adjustment methodology outlined in this proposed rule:”

• Clinical Group Upcoding: As under current PPS and the proposed HHGM last year, a major factor in determining case mix category under PDGM is diagnosis codes. “We assume that HHAs will change their documentation and coding practices and would put the highest paying diagnosis code as the principal diagnosis code in order to have a 30-day period be placed into a higher-paying clinical group,” CMS says. “While we do not support or condone coding practices or the provision of services solely to maximize payment, we often take into account expected behavioral effects of policy changes related to the implementation of the proposed rule.”
• Comorbidity Coding: PDGM also adjusts payments based on secondary diagnoses reported on the claim. “While the OASIS only allows HHAs to designate 1 primary diagnosis and 5 secondary diagnoses, the home health claim allows HHAs to designate 1 principal diagnosis and 24 secondary diagnoses,” CMS explains in the rule. “Therefore, we assume that by taking into account additional ICD-10-CM diagnosis codes listed on the home health claim (beyond the 6 allowed on the OASIS), more 30-day periods of care will receive a comorbidity adjustment than periods otherwise would have received if we only used the OASIS diagnosis codes for payment.”

Why it matters: “The comorbidity adjustment in the PDGM can increase payment by up to 20 percent,” CMS points out.

• LUPA Gaming: “We assume that for one third of LUPAs that are 1 to 2 visits away from the LUPA threshold HHAs will provide 1 to 2 extra visits to receive a full 30-day payment,” CMS says. While responding to economic incentives is certainly a reasonable assumption, CMS’s expectation that the home care industry will engage in widespread fraud and abuse as described in the regulation is “shocking” and “offensive,” says attorney Robert Markette Jr. with Hall Render.