Home health officials are dissatisfied with CMS’s proposed changes to their salary for 2022 and warn that they could sue the federal agency if they attempt to reclaim overpayments with future changes.
Last year, CMS converted its case-mix system to the patient-driven grouping model, whereby the reimbursement rates are based on patient characteristics such as clinical conditions and functional impairments rather than on therapy hours. While the agency had cut payments preventively by 4.36% to encourage providers to cut unnecessary therapies as part of the new approach, CMS analysis found that Medicare was paying too much for home health services in 2020 anyway.
In its proposed 2022 home health insurance prospective payment scheme scheme, citing the COVID-19 pandemic, CMS said it would not reclaim any overpayments in 2022. But it left the door open for fund recovery in the years to come because law requires CMS to ensure that the new payment approach does not increase or decrease Medicare spending compared to the old way of calculating payments.
Providers are not happy with how the agency assessed the budgetary impact of the payments and the possible future impact on their reimbursement. Home health officials suggested they could sue the Biden government if regulators don’t reconsider how CMS assesses budget neutrality.
“To comply with Medicare law, CMS must employ a PDGM-related method of adjusting budget neutrality that focuses solely on PDGM-induced behavioral changes. The change assessment methodology proposed by CMS includes changes unrelated to HHA behavior changes as part of PDGM, ”the National Association for Home Care & Hospice wrote in a letter.
However, independent experts argue that CMS took a sensible approach to assessing the impact of the patient-centered grouping model on spending.
“A 6% cut in the base payment should not raise concerns about the adequacy of payments for HHAs; even with this cut, payments for 2022 would still be slightly above the commission recommended level, ”the Medicare Payment Advisory Commission said in a letter. “In our recommendation for the 2022 payment update, we concluded that a 5% reduction would not affect beneficiaries’ access to care or the quality of home health care. Therefore, a lower reduction of 4.3% should be sustainable. “
Providers argue that CMS cannot fairly compare the new payment system with the previous one, as the new case-mix approach and 30-day claims period reduced provider visits by almost 30% and changed provider behavior in other ways. The American Hospital Association also said, citing an industry-funded study, the agency’s predictions about how the patient-led grouping model would affect providers were wrong.
“These concerns raise serious doubts about the accuracy of both the initial 4.36% PDGM behavioral adjustment and the modified 6% overpayment now estimated by CMS. In order to be able to reliably compare the CMS forecasts with the actual behavior for the first year under PDGM, additional work is required. “Wrote the AHA in a letter.
Healthcare providers also believe it is a mistake to rebalance their case mixes for 2022 with the 2020 entitlement dates due to the impact of the pandemic on their patient populations.
“It is very unlikely that home health care in 2022 will be comparable to care in 2020,” wrote NAHC.
Health officials claim their patients were sicker in 2020 from the pandemic than they likely will be in 2022.
“All HHAs have provided services to the patient population considered to be at the highest risk of serious complications, including death, from Covid-19,” wrote the NAHC.
While that’s undoubtedly true, top experts don’t believe the pandemic explains all of the coding differences among home health care providers. They fear these providers are up-coding to make their patients look sicker than they are in order to increase their payments.
“The increase in 2020 could reflect some of the effects of COVID-19, but it is noteworthy that many other case-mixing measures in the payment system remained unchanged,” MedPAC wrote. “The Commission was concerned that the functional severity assessment could be vulnerable to the vendor’s coding practices and therefore a less reliable indicator of the severity of the mixed case.”