From the 2015 Home Health PPS Proposed Rule to CMS Value-Based Purchasing: A Home Health Roadmap for Tomorrow
CMS recently released the 2015 Home Health PPS Proposed Rule to outline Medicare benefit changes that will take effect next year. The Proposed Rule, open for public comment for 90 days, is an annual ritual for Home Health Providers as they assess the challenges they will quickly confront in care production and delivery. The subsequent 2015 PPS Final Rule will be released later this year, after public comments are addressed or incorporated. The 2015 Rule focuses on many of the traditional elements addressed in the yearly updates; payment reductions, face to face, therapy reassessments, Case-Mix and quality reporting. New areas of content in this year’s Proposed Rule include Speech Pathology participation conditions, CMS monetary penalty comments, Insulin injections, ICD-10, and Value-Based Purchasing. In fact, the comment solicitation on Value-Based Purchasing identifies a new direction for Home Health care in the future; the real-time implementation of Pay-for-Performance for community-service delivery.
When assessed together, the content of the Proposed Rule combines with Value-Based Purchasing (VBP) to illuminate a pathway to the care delivery of the future. Progressive Home Health Providers would be well-served to analyze and internalize the messages of both of these CMS initiatives. Assertively addressing the programming changes described by both of these updates serves the Home Health Provider in two important areas crucial to future success. First, the PPS updates describe the improved care of the future based on the PPS model; improving efficiencies, clinical control and outcomes produces improved financial returns that ALL Providers seek. Second, the introduction of the VBP philosophy marks an entirely new era for homecare; one where survival and success will be based on the level of clinical outcomes derived rather than the volume of care provided.
Below, we review the Proposed Rule and how it will affect care delivery in the Home Health industry. Then we analyze how Value-Based Purchasing will work, and the effect it will have on homecare, and how and why today is the time to prepare for VBP. Healthcare reform, ACOs, Care Transitions and Bundling, readmission concerns, co-payments; all are vital elements of the Home Health landscape of the future. Providers who are not assertively addressing and integrating the issues required for success under the new care models already find themselves behind the reform curve.
2015 Home Health PPS Proposed Rule
The specifics of the 2015 PPS Rule move the Home Health benefit forward in numerous areas that have been the focus of CMS in recent years. The primary area of concern for Providers is payment reductions, and this year’s Rule is no exception. CMS proposes a 2.2% payment increase for patient program claims, which is offset by year two Home Health Rebasing reductions of -2.5%. The net result is that CMS will reduce payments to Home Health agencies in 2015 by 0.3% ($485 million) compared to 2014.
CMS proposed simplification of the Face to Face requirements in numerous changes to the current F2F protocol for 2015. Initially, CMS would eliminate the MD narrative requirement from the basic F2F certification; this has been an area of concern for both Home Health Providers and the physicians who refer to them. Further clarifications as to when and who can perform the F2F are also included. In addition, CMS has declared the F2F certification a non-covered MD service for patients who are ultimately deemed ineligible for Home Health. Home Health Providers who have been seeking relief from F2F regulations may have found their prayers answered, but F2F certification is clearly here to stay.
Therapy revisions seem to be another major focus area for the 2015 Proposed Rule. A major overhaul of the reassessment regulations is based on therapy statistics over recent years regarding how to derive value from the therapy element of the care program. Initial installation of the therapy reassessment requirements in 2011 were part of a significant Home Health rehab rewiring. Objective tests were required as part of rehab evaluations to establish objective baselines against which to measure progress, or lack thereof, during the reassessments that would occur by the 13th and 19th visits (or every 30 days). At the time, CMS “anticipated that policy…would address payment vulnerabilities that have led to high use and overuse of therapy services.” The expectation was that regular and routine reviews from rehab therapists would lead them to understand what areas of their care programs are working, ultimately reducing rehab volumes as we decrease the amount of programs without objective progress.
CMS analysis performed in 2013 revealed that episodes with therapy visits reaching 14 and 20 visits did not change substantially as a result of the new reassessment rules. Less than a single visit reduction was noted at either level from 2010 through 2013, and this comes as no surprise to the author or HHSM. In our consulting practice, we regularly encounter under-performance in this area in excess of 60% of all rehab care found in Home Health episodes. Objective baselines, from which to propel skilled, objective rehab progression, are often lacking from the Initial Evaluation; similar findings exist for LT/ST goals, vitals, and compliance-based home programs. Home Health rehab has struggled to connect to these quality control concepts.
The 2015 Proposed Rule addresses this issue in a not so subtle manner by eliminating the 13th and 19th or every 30 day reassessment requirement. By substituting an every 14th day requirement for reassessments, CMS proposes to reduce the counting and rehab coordination Home Health providers struggle with today. This new requirement to perform a therapy reassessment at least once every 14 calendar days would apply to all episodes regardless of the number of therapy visits provided. Quoting from the Proposed Rule, CMS states “the qualified therapist…would still be required to functionally reassess the patient using objective measurements,” and they continue, “We also believe that this proposal will reduce the risk of non-covered visits, while still promoting therapist involvement and quality treatment…regardless of the level of therapy involved.”
Case-Mix changes further address therapy issues as they de-emphasize the role of therapy volumes in the HHRG Case-Mix determination of the episodic value. Also quoting from the 2015 Proposed Rule, CMS states; “Specific therapy indicator variables that were in the 2012 4-equation model were dropped in the 2015 4-equation model so that the number of therapy visits provided has less of an impact on the process used to create case-mix weights” Initial HHSM analysis of therapy-related case-mix value items reveals that there may be some additional hidden cuts for Providers that use high levels of therapy, and that other case-mix changes may increase the regression found in rehab payment tables. Providers should consider this the latest installation in the movement to de-emphasize the role of therapy in the Home Health fiscal structure.
The 2015 Proposed Rule also referenced the Value-Based Purchasing program coming to the Home Health model. CMS views the implementation of VBP as an important step in rewiring how Medicare pays for health care services, moving programming towards rewarding better value, outcomes, and patient-focused care instead of the volume of service provided. Under this model, value-based payments would be made to Home Health Providers meeting performance standards within a fiscal year. By using financial incentives to reward quality, Medicare aims to hold Providers accountable for the quality of care they deliver. The goals of VBP, referencing elements of the Affordable Care Act, are better care, healthier people and communities, and affordable care cost reduction.
In order to create a link between payment and performance, CMS will begin demonstration programs to determine the payment adjustment involved, quality improvements that ink to those payments, and the funding for those payments. Initially, CMS will develop the VBP program to align with the current the existing pay-for-reporting system. The VBP effort is focused on eliminating payment and Provider silos to improve care quality and better align care transition models between hospitals and Post-Acute Providers.
As currently envisioned, the Home Health VBP model would reduce Medicare payments by 5-8%, depending on the degree of quality performance to be measured. Agencies meeting or exceeding performance standards based on quality and efficiency metrics would be eligible to earn performance standards. Agencies failing to meet performance standards would receive lower payments than would have been reimbursed under the traditional fee-for-service payment system; creating a net payment decrease to Medicare payments as a result of this VBP program.
The road to the future is clear, and the marked differences between what we will be doing then and what we are doing now is clear. Home Health will need to improve patients as a road to acceptable payment in the future. The challenge will be to adopt current practices, staff, and protocols to align with the new programming. Home Health will need to integrate care practices with other Part A Providers, including hospitals who, as the ACOs of the future, will staff their care programs episodically with Home Health delivery. The question is; what agencies will be ready? Today is the day to get on the path to tomorrow; help your clinicians, your patients, and your programs into the new care era.
Arnie Cisneros, P.T., President of Home Health Strategic Management, is the most progressive speaker in homecare today. He provides coaching and consulting services to providers on a national basis regarding S.U.R.C.H. and other clinical management protocols for quality outcomes.