CMS releases proposed home health payment rule for 2020: Comments accepted through Sept. 9

The proposed Home Health Prospective Payment System (HH PPS) proposed rule was posted in the July 18, 2019 Federal Register.  

Those wishing to comment must submit by September 9, 2019, to the Centers for Medicare and Medicaid Services (CMS) in order for them to be considered.

Key takeaways from the proposed rule

In the CY2019 HH PPS Final rule, CMS outlined a new payment system called the Patient Driven Grouping Model (PDGM) which goes into effect for episodes beginning 1/1/2020 and after. 

The PDGM outlines a new 30-day episode of care payment model which requires providers to submit a Request for Anticipated Payment (RAP) at the beginning  and a final claim at the end of the 30-day period.  

This shift from a 60-day payment calculation requires CMS to develop a new set of 30-day period payment rates for CY2020.  The current HH PPS is in effect until 12/31/2019, which means that episodes that begin before that date but end after 1/1/2020 will continue to be reimbursed at a 60-day episode rate, and CMS proposes a CY2020 60-day payment rate of $3,221.43 (reduced by 2% for HHAs that do not submit quality data).  

They proposed to continue the use of CY2019 case-mix weighting because of the minimal impact to these transitional episodes.
Beginning 1/1/2020, the 60-day episode of care will contain two, 30-day payment periods at a base rate of $1,791.73 (reduced by 2% for HHAs that do not submit quality data). This is an increase of 14% above the estimated amount in the CY2019 HH PPS final rule, but it also includes an 8.01% decrease for behavioral assumptions, or those anticipated HHA behaviors in relation to the implementation of a new payment system.  

This also reflects a minimal wage-basket update of 1.5% and -0.5% for HHAs that do not submit quality data. CMS also recalibrated the case-mix adjustment tables based on updated 2018 claim information, including the removal of 64 diagnosis codes from the valid code list. 

It will be important for HHAs to closely analyze those removed diagnosis codes because they will impact the number of 'questionable encounters' a provider might have. We are currently updating the PPS Impact Projector (our PDGM calculator) to account for the refinements included in the proposed rule. (See other articles within this newsletter)
One of the major changes proposed in this rule is an update to the split-percentage payment model for the RAP and final claim submissions. Currently, a RAP submitted would result in a payment of 50% or 60% of the total episode amount (based on the early or late timing of the episode). 

CMS proposes to reduce this to a flat 20% payment upon RAP submission for all providers, regardless of episode timing, that were not a new provider on or after January 1, 2019 (New providers on or after January 1, 2019 do not qualify for RAP payments as finalized in the CY2019 final rule.)  

Further, CMS proposes a full elimination of the split-percentage payments starting January 1, 2021, and the full 30-day period of care payment would be applied upon the final claim submission.
The current RAP submission process also provides a "placeholder" for the HHA on the patient record in the CMS common working file (CWF). The proposed elimination of the RAP submissions would remove that function, so CMS is proposing a new Notice of Admission (NOA) starting January 1, 2021, which would provide the "placeholder".  

This NOA is proposed to work similar to the Notice of Election (NOE) process currently required of Hospice providers. The HHA would submit the NOA within 5 calendar days of the start of care for the patient admission. 

Only one NOA would be required for the patient admission, a new NOA would not be required unless the patient discharged and readmitted. Should the HHA not submit a timely NOA, CMS proposes a reduction in payment for each episode day until the NOA is submitted (there are no penalties if submitted within the first  calendar days).  

CMS also includes an "exceptional circumstance" provision for HHAs that experience circumstances outside of their control which preclude them from submitting a timely NOA.
CMS proposes two new measures for the Home Health Quality Reporting Program (HHQRP), which aligns with the Transfer of Health data standardization and cross setting measure requirement from the IMPACT Act of 2014.  The measures determine if the HHA provided a reconciled medication list to the patient or the next provider of service.  This would be required for the CY2022 quality reporting.
Finally, CMS proposes new standardized patient assessment data elements (SPADEs) for clinical categories, also required by the IMPACT Act of 2014. These SPADEs were originally proposed in the CY2018 HH PPS proposed rule, but were ultimately removed from the final rule so CMS could continue to analyze the impacts across the post-acute care settings.  

CMS re-introduces them in this CY2020 HH PPS proposed rule, and proposes to capture these new data elements for episodes beginning on or after January 1, 2021. The data categories for the elements include: Cognitive Function and Mental Status; Special Services, Treatments and Interventions Data; Medical Conditions and Comorbidity Data; Impairment Data; and a new Social Determinants of Health category.  

While many of the data elements specified in this rule look similar to data elements already captured in the Home Health OASIS patient assessment, CMS is aligning the data elements across the post-acute care patient assessments and many of these data elements captured in the OASIS assessment will be changing or will be new data collection points.
CMS provides for other updates within this rule, including requirements for HHAs to embark in the Home Infusion Therapy Services, but they have not been included in this summary.
Netsmart intends to provide comments to the HH PPS proposed rule, and we welcome any comments you would like to share with our team.  Please send you ideas and comments to