In recent years, the Centers for Medicare and Medicaid Services (CMS) has issued and implemented various changes that affect home health care companies. On July 11, 2019, they released another proposed rule change that would go into effect in 2020.
The Home Health Prospective Payment System will implement a previously released and finalized reimbursement system to home health agencies (HHAs). This is called the Patient-Driven Groupings Model (PDGM).
The focus, according to CMS, is to create a value-based payment model within the Medicare program. Until recently, home health agencies were being paid based on a prospective payment model, essentially being paid for services that were necessary. Now, though, these same agencies will be paid based on services provided, with adjustments for regional wage discrepancies, specificities of care required, and some other factors.
This new reimbursement system has caused frustration for some home health agencies, especially with regard to delays in reimbursements and the time required to fill out and submit the forms. Under the Bipartisan Budget Act of 2018, though, the reimbursement period will be reduced from 60 to 30 days.
As noted in The National Law Review article summary, CMS Proposes Changes to the Home Health Agency Prospective Payment System:
“Implementation of the PDGM may necessitate operational changes for HHAs. HHAs should prepare for the shift from a 60 to 30-day episode of care, as well as 30-day billing periods. Given the PDGM’s focus on clinical indicators as payment determinants, thorough and accurate documentation will be critical to HHA reimbursement. To that end, HHAs should ensure they are accurately capturing primary and secondary diagnosis codes, as well as clinical indicators related to functional impairment. HHAs should maintain an understanding of the LUPA thresholds applicable to their patient population. Finally, changes under the PDGM may justify HHAs spending the time and resources necessary to update their policies and procedures related to claims management, as well as staff training.”
There will also be 432 case-mix adjustment payment groups. This new rule change has caused confusion for several home health agencies and it has also received criticism among many in the industry for its complicated paperwork requirements and extra time required for these home agencies to fill out and submit.
It remains yet to be seen how these changes will affect the home health care sector, but for an industry that has grappled with Medicaid reimbursement cuts, minimum wage pressures in certain states, and high turnover, some are hoping it offers a measure of relief with faster reimbursement times.
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