CMS is seeking to reduce agency payments even more than expected to account for assumed behavioral changes agencies will make as part of the Jan. 1, 2020, implementation of the Patient-Driven Groupings Model (PDGM).
Even with the shift from 6.42% to an 8.01% reduction in agencies’ payments due to behavioral changes, the home health industry is expected to see a 1.3% increase in payments next year, according to the 2020 PPS proposed rule posted on the Federal Register website July 11.
That increase was established as part of the Balanced Budget Act of 2018 (BBA). The increase would have been higher, but the BBA capped the payment update percentage at 1.5% with a 0.2% decrease because of rural add-on percentages.
“We finally get to the point for the first time in years when we’re getting an increase, and now it’s capped,” says Bob Markette, attorney with Indianapolis-based Hall, Render, Killian, Heath and Lyman.
Along with that cap, however, came a requirement for the new payment model to be implemented in a budget-neutral fashion and delayed until 2020, notes Bill Dombi, president of the National Association of Home Care and Hospice (NAHC).
CMS’ previous proposal for a new payment model, known as the Home Health Groupings Model (HHGM), would have cut $950 million from the home health industry. CMS did not finalize HHGM, and instead, proposed the budget-neutral PDGM to align with the requirements of the BBA.
With these factors in mind, the payment increase cap was the best-case scenario for the industry.
“I’ll take that deal any day,” Dombi says.