Regulatory Alert: Centers for Medicare and Medicaid Services: Medicare and Medicaid Programs; Home Health Prospective Payment System Rate Update for CY 2014, Home Health Quality Reporting Requirements, and Cost Allocation of Home Health Survey Expenses

On July 3, 2013, the Centers for Medicare and Medicaid Services (CMS) published in the Federal Register its proposed rule on Medicare and Medicaid Programs; Home Health Prospective Payment System Rate Update for CY 2014, Home Health Quality Reporting Requirements, and Cost Allocation of Home Health Survey Expenses. 78 Fed. Reg. 40272, July 3, 2013.  This proposed rule would update the Home Health Prospective Payment System (HH PPS) rates, including the national, standardized 60-day episode payment rates, the national per-visit rates, the low-utilization payment adjustment (LUPA) add-on, nonroutine medical supplies (NRS) conversion factor, and outlier payments under the Medicare prospective payment system for home health agencies (HHAs), effective January 1, 2014.

As required by the Affordable Care Act, this rule also proposes rebasing adjustments, with a 4-year phase-in, to the national, standardized 60-day episode payment rates; the national per-visit rates; and the NRS conversion factor. Finally, the proposed rule would also establish home health quality reporting requirements for CY 2014 payment and subsequent years and would clarify that a state Medicaid program must provide that, in certifying home health agencies, the state’s designated survey agency must carry out certain other responsibilities that already apply to surveys of nursing facilities and Intermediate Care Facilities for Individuals with Intellectual Disabilities (ICF–IID), including sharing in the cost of HHA surveys. For that portion of costs attributable to Medicare and Medicaid, we would assign 50 percent to Medicare and 50 percent to Medicaid, the standard method that CMS and states use in the allocation of expenses related to surveys of SNF/NF nursing homes.

Pursuant to the Regulatory Flexibility Act (RFA), CMS certified that the proposed rule will not have a significant impact on a substantial number of small home health agencies.  Advocacy is encouraging interested parties to comment on the rule especially as to CMS’ assumptions on any cost impacts associated with “rebasing” adjustments for home health agencies.

The comment deadline is August 26, 2013.