What you need to know about the forces reshaping our industry.


November 2, 2018

What you need to know about the 682-page Home Health Prospective Payment System final rule

Daily Briefing

    CMS on Wednesday finalized a 2.2% payment increase for home health agencies in 2019, as well as a new Medicare reimbursement process that will take effect in 2020.

    3 key questions to answer before investing in remote patient monitoring

    Final rule details

    CMS said the final rule includes "significant changes to the Home Health Prospective Payment System" that are intended "to strengthen and modernize Medicare, drive value, and focus on individual patient needs rather than volume of care." In particular, the agency said it finalized changes that aim "to improve access to solutions via remote patient monitoring technology, and to update the payment model for home health care."

    Payment adjustment for 2019

    CMS in a fact sheet estimated that overall payments to home health agencies in calendar year 2019 will increase by 2.2%, or about $420 million, based on the policies included in the final rule. That figure is up slightly from a 2.1%, or $400 million, increase the agency proposed in July.

    CMS finalizes new payment model for 2020

    CMS also finalized plans to implement a new payment model for home health payments beginning Jan. 1, 2020, as required under a federal spending bill enacted earlier this year. According to CMS, Medicare currently pays home health agencies for 60-day episodes of care, and payments are based on the number of services provided to beneficiaries.

    Under the new model, called the Patient-Driven Groupings Model (PDGM), CMS will base home health reimbursements on 30-day episodes of care and on patient characteristics. CMS under the new model will no longer would determine home health reimbursements based on the number of services provided to beneficiaries.

    As required by law, the agency also set an episode payment reduction of 6.42% to account for expected behavioral changes in coding or other home health agency practices after the model is implemented.

    CMS said the new payment model will advance Medicare toward a value-based system that focuses on beneficiaries' unique care needs, while also reducing administrative burdens associated with the current model.

    CMS OKs remote patient monitoring reimbursement

    Under the final rule, CMS said it will allow home health agencies to bill Medicare for the cost of remote patient monitoring—which involves using digital tools to remotely collect patients' health information data.

    CMS said the change is expected to help "foster the adoption of emerging technologies by home health agencies and result in more effective care planning, as data is shared among patients, their caregivers, and their providers." In addition, CMS said the change will help further the Trump administration's MyHealthEData initiative.

    Other changes

    To further scale back administrative burdens, CMS finalized changes to certain quality measures under the Home Health Quality Reporting Program.

    CMS also finalized a proposed temporary transitional payment for home infusion therapy services in 2019 and 2020, as required under a federal spending bill enacted earlier this year.

    Stakeholders push back against behavioral adjustment

    According to Inside Health Policy, some stakeholders during the comment period had raised concerns with the behavioral adjustment included in the new payment model.

    Since CMS opted to keep the proposed adjustment in place, Bill Dombi, president of the National Association for Home Care and Hospice, said his organization plans to ask Congress to change the behavioral adjustment. He said, "We will continue to work collaboratively with CMS and lawmakers in Congress to refine this new payment system to ensure it is based on a data-driven approach and will support the delivery of uninterrupted, high quality home health care to older Americans" (Castellucci, Modern Healthcare, 10/31; Holly, Home Health Care News, 10/31; Stein, Inside Health Policy, 10/31).

    3 key questions for remote patient monitoring

    To succeed with remote patient monitoring, providers need to answer three questions: Is it technically feasible? Is it clinically relevant? Is it cost effective?

    Download Now

    Have a Question?


    Ask our experts a question on any topic in health care by visiting our member portal, AskAdvisory.