CMS released the 2017 Proposed Home Health Payment Rule and while some things are a bit of a surprise, most are not.

2017 brings the 4th and final year of this round of rebasing.  Different from the prior three years we find an decrease in the base rate of $2,936.65 from the current $2,965.12.  In the prior three years there has primarily been a decrease due to significant adjustments to the case mix weights and the recalibration of the tables that feed the case mix weight calculations.  While there is still some of that, the primary decrease this year is in the actual standard rate.  Due to this, HPS feels that there will be a more wide spread realization of the decrease versus in the prior years there being a variance depending on the overall case mix weights of agency’s patient episodes.
LUPA payment rates are also affected by rebasing.  LUPA rates will rise 3.5% through rebasing and an additional 2.3% through the annual inflation update. Non-routine medical supply rates are decreasing through the rebasing by a factor of 2.82 percent offset by a 2.3% MBI.


The proposed rule is proposing changes to the calculation of outlier episodes that will cause many current outlier episodes to no longer qualify for outlier payments and the ones that do qualify will receive less payments, unless the agency is providing one hour (4 units) or more on each visit.
The Home Health Value Based Purchasing (HHVBP) program gets some important updates. Among them are:

  • Establishing a minimum of 8 HHAs as a cohort for measure application
  • Removing 4 measures that had not been fully developed that include care management; prior function; influenza vaccine data collection; and reason pneumococcal vaccine not received
  • The reporting periods are adjusted
  • Timeframe for submitting New Measure data is increased
  • A progress report on the HHVBP public reporting development
  • The institution of a formal appeals process

Another interesting item in the proposal relative to payment for disposable negative pressure wound treatment devices (NPWT). Under the proposal, the payment for the NPWT would be outside of and separate from the home health payments. If the patient requires skilled nursing care for the “sole purpose” of NPWT, the visits will be reimbursed under Medicare Part B without a home health benefit payment. If the patient requires other Medicare-covered home health nursing services, the time spent on NPWT will be excluded, but will be separately covered under Part B. These items are subject to a 20% coinsurance.

More analysis on this final rule to come!  Comment period ends on August 26, 2016.