Final rule gives home health agencies wiggle room for HHVBP and Medicare sequestration

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Now that the final 2022 home healthcare payment rule has been floating for a few days, industry insiders have had time to separate it and focus on key changes, including expansion to scale. National Home Health Value-Based Purchasing (HHVBP) Model.

A significant difference between the finalized expansion of HHVBP and the original U.S. Centers for Medicare & Medicaid Services (CMS) proposal is that the model will now begin on January 1, 2023.

The delay will give home care providers across the United States more room to breathe, Valerie Cornett, chief strategy and innovation officer at MAC Legacy, told Home Health Care News.

“This will allow agencies that were not part of the previous event to prepare more operationally,” she said. “This will allow agencies to do financial analysis and get more OASIS training for accuracy among their staff. It will also give them time to get a better handle on quality metrics now that there are more hard lines around it.

MAC Legacy is a Denton, Texas-based home health care and hospice coding and consulting company.

Another benefit for providers is that although the start date for HHVBP has been extended, the majority of its provisions remain unchanged from the proposal stage.

“We’ve had the proposed rule since the summer and have had some time to get used to it,” Aaron Little, BKD general manager, told HHCN. “Knowing that there have been no significant changes compared to what was proposed and finalized to us, at the level of the structure of the HHVBP, is good. It just gives even more time to absorb and think about the potential impact this will have on agencies. “

BKD is a Springfield, Missouri-based accounting services company that provides billing cycle and revenue outsourcing services. BKD and MAC Legacy announced at the end of October a strategic collaboration to give their customers access to more resources.

Generally speaking, HHVBP has many supporters in the home health industry because of its ability to increase Medicare quality scores and savings.

HHVBP is a Medicare demonstration that links reimbursement to quality of care. Under this model, home care providers are paid based on how well they keep their patients healthy and out of hospital. Since 2016, Medicare-certified home health agencies in Massachusetts, Maryland, North Carolina, Florida, Washington, Arizona, Iowa, Nebraska, and Tennessee have participated in the demonstration.

“One of the advantages of the HHVBP is that it was not designed to take new performance metrics that agencies don’t know or are not used to,” Little said. “If you aim for quality, that should translate well into your bottom line as well. It’s about linking information from OASIS, information from patient experience surveys and hospital readmissions, which agencies are already focusing on managing.

Since its implementation in 2016, the model has resulted in an average 4.6% improvement in home health agency quality scores and an average annual Medicare savings of $ 141 million, according to CMS.

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Yet some home health care providers believe there is still room for improvement when it comes to HHVBP.

The National Association for Home Care & Hospice (NAHC) pushed CMS to take a risk-sharing approach for HHVBP, for example.

“The concept of risk sharing is no stranger to value-based purchasing programs,” Bill Dombi, president of NAHC, said in a webinar Friday. “We thought it was a really good match for a refinement and improvement of [HHVBP]. The home care program has one agency competing with another for either a bonus or a penalty, but some of the below average providers who would be penalized are actually saving the Medicare program.

Dombi noted that those agencies that score “below average” on performance improvement are still expected to contribute nearly $ 3.4 billion in savings to the Medicare program over five years.

In addition to the expansion of the HHVBP, the rule establishes a 3.2% increase in the home health insurance rate for next year. It seems like a $ 570 million bump.

The increase of 3.2% modifies an increase of 1.7% initially presented in the proposal.

The rate hike, one of the biggest for the home health industry in years, could help offset Medicare sequestration that was initially postponed to help providers throughout the COVID emergency -19.

“We expect sequestration to return in January, so it’s good to see that the increase has been over 2%,” Little said.

As the public health emergency continues, an additional financial cushion will be overall aid for providers, according to Cornett.

“More than the imminent return of forcible confinement, any small gesture will help,” she said. “Since the start of the public health emergency, the agencies have had to be really creative. Ensuring the safety of patients and staff comes at additional costs. Suppliers need to be relieved of this.

Cornett noted that these costs include supplies, technology, increased wages and revenue.

It’s also worth noting that the rule finalized a recalibration of parts of the Patient-Oriented Grouping (PDGM) model, although the rule essentially maintains the structure of the model in terms of case categories and LUPA cutoffs.

“[This includes] the recalibration of the 432 case-mix weights and [the finalization] of the transition to the new CBSA wage index that CMS started this current year, but started with a 5% cap on any negative change in the wage index, ”Dombi said. “And in this case, they took the cap off.”

One thing that hasn’t changed is the behavioral adjustment of 4.36% of the PDGM.

“CMS’s explanation for wanting nothing to do with this is that they still don’t have a full year of clean data from 2020,” Dombi said. “We advocated for 4.36% to drop or even give up altogether, as our observations… indicate that the changes in CMS behavior that were expected have not materialized.”

For example, CMS expected that LUPA’s volume would decrease in response to the new payment model; instead, they increased significantly, possibly due to the public health emergency.

Additionally, CMS planned that the behavior changes would include coding for the primary diagnosis, which did not happen, according to Dombi.

Overall, the NAHC believes the final rule will usher in some stabilization in home health

“[There are] not really big architectural changes within the payment model itself, although some [have] material impact, ”said Dombi.


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