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Home Health & Hospice Week

Regulations:

New PPS Rates May Change More Than Expected

Published on Thu Jan 01, 2004

Prepare for inflation update revamp.

The market basket index for home health agencies is back in the spotlight.

A description of the Centers for Medicare & Medicaid Services' upcoming regulatory plans is making agencies fear they'll see more than a 0.8 percent reduction to payment rate inflation updates in fiscal year 2005.

CMS publishes a routine notice of annual updates to home health prospective payment system rates every year in July for Oct. 1 implementation. But the agency's most recent semiannual regulatory agenda, published in the Dec. 22, 2003 Federal Register, says CMS plans an earlier proposed rule rather than a routine notice in July, points out Bob Wardwell with the Visiting Nurse Associations of America.

The change is "interesting," says Wardwell, a former CMS top official. It could indicate CMS plans to make significant changes that HHAs will want to comment upon.

Further evidence of that possibility is a description of the forthcoming proposed rule. "We are proposing to rebase and revise the home health market basket to reflect total cost," CMS says in the regulatory agenda.

And CMS plans to modify "certain variables for some of the cost categories." Experts have long expected CMS to rejigger the PPS allocation for certain types of patients. Recent discussions by the Medicare Payment Advisory Commission called for paying more for patients who need supportive services from aides or intensive services such as complicated wound care.

Industry observers suspect CMS may reduce payments for patients who require 10 or more therapy visits. Whether the changes will include such drastic revisions remains to be seen.

Other home care-related items in the agenda include:

  • COPs. Once again, CMS has placed new home health conditions of participation on the agenda, this time setting a final rule date of June. The agency has delayed publishing new home health COPs for years as other changes have taken priority, but a CMS official in the December home health Open Door Forum expressed renewed dedication to getting the COPs out without further extensions.

    Since they are written and in the regulatory clearance process, "there is certainly no reason why the COPs could not get out in time," Wardwell notes. But due to new burdens put on CMS by the recently enacted Medicare legislation, changes in top-level staff at the agency and other pressures, "there is no way to know if it will again be sidetracked," he tells Eli.

  • OASIS. Likewise, CMS seeks to add reporting of OASIS data to the COPs in the next six months, according to the agenda. The current OASIS requirements are based on an interim final rule published in January 1999.

    Many items not specific to home care will affect HHAs as well, Wardwell points out. For example, CMS plans to issue a final rule on Medicare electronic billing requirements in September. "We urged that the final rule continue to allow and liberalize paper billing for low-volume providers," Wardwell says. Providers will have to stay tuned for the outcome.

    Forthcoming regulations on Provider Reimbursement Review Board appeals as well as appeals of local coverage determinations (which have replaced local medical review policies) also will significantly impact home care providers, he adds.

    Editor's Note: CMS' regulatory agenda, under the Health and Human Services Department, is at www.access.gpo.gov/su_docs/fedreg/a031222c.html.

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