Monday, September 12 | Post-Acute Care, Thought Leadership, Netsmart in the Community, Legislative/Policy

A Call for Action: Devastating Medicare Rate Cut Proposed for Home Health

By Jen Sherman, Community Strategist, Post-Acute

Ready access to quality home healthcare services is critical to the future of our nation’s healthcare system and the millions receiving these services today. Home health providers would face devastating negative economic and operational impacts from proposed rate cuts by the Centers for Medicare and Medicaid Services (CMS) in its Home Health Prospective Payment System (HH PPS) for CY2023.


These include:


  • A permanent -7.69% cut to Medicare home health services. According to the Partnership for Quality Home Healthcare (PQHH), this equates to a $1.33 billion payment reduction in 2023 alone.
  • Additional cuts of more than $2 billion in 2024 and the years beyond. This is a clawback of payments provided for healthcare services during the COVID-19 pandemic in 2020 and 2021.
  • In total, proposed cuts could reach $18 billion over the next 10 years.

A National Association for Home Care & Hospice (NAHC) analysis indicates that 44% of freestanding home health agencies will be operating with costs exceeding revenue if the current proposed payment rule were to go into effect in 2023.

There are many concerns about the proposed rate reduction, including the use of flawed data and inaccurate behavioral assumptions to gauge the effects on providers of the home health Patient-Driven Groupings Model (PDGM) and COVID-19 Public Health Emergency (PHE). It also does not account for the reduction in therapy visits under PDGM.


Legislation introduced to delay rates cuts


The Preserving Access to Home Health Act of 2022 was introduced in the U.S. Senate and House in late July.  In short, this legislation prevents the proposed cuts to home health rates from taking effect prior to 2026. This provides time to implement a payment system update based on full, current, accurate information and ensures that any adjustment for budget neutrality under the PDGM can still be made within the budget window.


On September 14th, I will be attending the NAHC Advocacy Day on Capitol Hill alongside industry partners, home health and hospice provider organizations to meet with members of Congress and urge them to help with these vital issues. You can tune into our advocacy day experience on our Netsmart LinkedIn, Twitter and Facebook, as well as check out the conversation amongst industry partners and providers participating in the event by following the #NAHCAdvocacy conversation across all social media channels.


In the meantime, I encourage you to visit the NAHC Call to Action web page for a fast and easy way to ask your members of Congress to support the Preserving Access to Home Health Act of 2022 and prevent these unwarranted rate reductions for home health providers.


To learn more about the home health care industry’s fight to legislate against CMS’ proposed rate cut for 2023 check out these resources for more information:


In Crucial Step, Preserving Access to Home Health Act Is Introduced in House, Home Health Care News (July 28, 2022).


Assessment of 2020 PDGM Budget Neutrality using the FY 2023 SNF PPS Proposed Rule Parity Adjustment Methodology, Provided by Partnership for Quality Home Healthcare (June 10, 2022).


Meet the Author

Jen Sherman · Community Strategist, Post-Acute

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