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As I am sure everyone has heard by now, CMS issued the Home Health Proposed Regulation for 2016 rates and Value Based Purchasing (VBP) Pilot on July 6, 2015! There has been much to do about the VBP Pilot and all that surrounds it. There are the “Nervous Nine” states that are subject to the pilot and have no choice. Then there is the remaining 41 plus Puerto Rico, Guam The Virgin Islands, that are “breathing easy”, but should they?

They absolutely should NOT! The rebasing decline in payment continues at 3.5% and in addition there will be a 1.72% reduction due to case mix “creep” in both 2016 2017. The sequestration reduction of 2% continues into 2016, etc. For the states that didn’t get slammed with the VBP pilot, that is proposed to last for 5 consecutive years, there is still the issue of rates continuing to decline.

One of the changes that has occurred, and is proposed to occur in 2016, to make rebasing a reality is to adjust case mix weights and in doing are also adjusting the point structure for OASIS M items used to calculate the HHRG. Some of the items that took a hard hit in 2015 were the Vision, Pulmonary & Psychiatric diagnoses and the Functional Domain M items. One of the questions we have gotten quite often in 2015: Why can we not seem to get a F3 in the calculation of the HHRG under the 2015 restructuring of the methodology? The answer: What most agencies don’t understand is the table used to calculate the HHRG. The points were recalibrated so that in order to get a F3, in most cases, your patient has to be chairfast or bedbound or it has to be an early episode with less than 14 therapy visits and even then a high functionally deficient patient. This is continuing in the proposed regulation for 2016 and in fact has gotten worse.

In addition to the HHRG point structure being revamped again, the case mix weights are proposed to be adjusted, as well and that is for all 153 HHRGs. Following is a recap of the top four largest cuts in case mix weighs for 2016.

If you continue to believe that the patients being recertified for additional therapy episodes are winners for you then you need to really study the reimbursement for those episodes in 2015 and what is proposed for 2016.

Following is a link to the proposed regulation and ensure that you are using the updated tables for analysis that CMS published at this link. The case mix weights in original issue of the proposed regulation were incorrect:

Following is a link to the proposed regulation and ensure that you are using the updated tables for analysis that CMS published at this link. The case mix weights in original issue of the proposed regulation were incorrect:

Proposed Regulation