CMS Proposes Cut, Dx Changes for Home Health for 2014

Home health agencies may see a payment cut for diagnostic code payments in the Centers for Medicare & Medicaid Service’s (CMS) proposed changes to the home health prospective payment system (HH PPS) for 2014.

In the proposed rule announced June 27th, Medicare payments will be reduced by 1.5 percent. The rule proposes routine updates to the HH PPS payment rates, such as updating the payment rates by the HH PPS payment update percentage and updating the home health wage index for 2014.

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The proposed rule would remove two categories of ICD-9-CM codes from the HH PPS Grouper: diagnosis codes that are “too acute,” meaning the condition could not be appropriately cared for in a home health setting; and, diagnosis codes for conditions that would not affect the home health plan of care, or would not result in additional resources when providing home health services to the beneficiary. ICD-10-CM codes will be included in the HH PPS Grouper to be used starting on October 1, 2014. The new ICD-10-CM codes will replace the existing ICD-9-CM codes used to report medical diagnoses and inpatient procedures.

The rule proposes a reduction to the national, standardized 60-day episode rate of 3.5 percent in 2014 through 2017. The proposed national, standardized 60-day episode payment for 2014 is $2,860.20. This reduction primarily reflects fewer visits per episode since establishment of the HH PPS in 2000.

For episodes with four or fewer visits, Medicare pays on the basis of a national per-visit amount by discipline, referred to as a Low-Utilization Payment Adjustment (LUPA). The rule proposes an increase to each of the per-visit payment rates of 3.5 percent 2014 through 2017 to account for changes in the costs of providing these services since the establishment of the HH PPS in 2000.

Two new claims-based quality measures would be added: (1) Rehospitalization during the first 30 days of a home health stay, and (2) Emergency department use without hospital readmission during the first 30 days of home health. The proposed rehospitalization measures would home health agencies to further identify patients who entered home health after a hospitalization and reduce the number of home health quality measures reported to home health agencies. This simplifies their use for quality improvement activities.


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