CMS Releases 2018 Final Rule Fact Sheet

Home Care Technology: The Rowan Report- Article 2529 

Published by the Centers for Medicare and Medicaid Services

Today, the Centers for Medicare & Medicaid Services (CMS) issued a final rule (CMS-1672-F) that updates the calendar year (CY) 2018 Medicare payment rates and the wage index for home health agencies (HHAs) serving Medicare beneficiaries.

The rule also finalizes proposals for the Home Health Value-Based Purchasing (HHVBP) Model and the Home Health Quality Reporting Program (HH QRP).

CMS is not finalizing the Home Health Groupings Model and will take additional time to further engage with stakeholders to move towards a system that shifts the focus from volume of services to a more patient-centered model. CMS will take the comments submitted on the proposed rule into further consideration regarding patients’ needs that strikes the right balance in putting patients first.

Reforming Regulations

CMS recently launched the “Patients Over Paperwork” Initiative, a cross-cutting, collaborative process that evaluates and streamlines regulations with a goal to reduce unnecessary burden, increase efficiencies, and improve the beneficiary experience. This effort emphasizes a commitment to removing regulatory obstacles that get in the way of providers spending time with patients. The 2018 HHPPS final rule includes the following as part of this initiative:

  • CMS removed 33 items from the OASIS assessment instrument collected at various time periods during the HH patient stay because they are no longer required for the calculation of quality measures, prospective payment, provider survey, the HH Value Based Purchasing (VBP) Model or care planning. The removal of these items will reduce time and paper required to complete HH patient assessments.
  • In addition, CMS is finalizing exception and extension requirements, and reconsideration and appeals procedures.
  • The estimated net burden reduction associated with the changes to the HH QRP in this year’s rule, which includes the removal of these OASIS items, was over $145 million. This corresponds to an estimated net reduction in HH clinician burden of over 2 million hours annually.

Final Rule Details

Payment Policy Provisions for CY 2018

CMS projects that Medicare payments to HHAs in CY 2018 will be reduced by 0.4 percent, or $80 million, based on the finalized policies. This decrease reflects the effects of a one percent home health payment update percentage ($190 million increase); a -0.97 percent adjustment to the national, standardized 60-day episode payment rate to account for nominal case-mix growth for an impact of -0.9 percent ($170 million decrease); and the sunset of the rural add-on provision ($100 million decrease).

Annual Home Health Payment Update Percentage

Section 411(c) of the Medicare Access and Children’s Health Insurance Program (CHIP) Reauthorization Act of 2015 (MACRA) requires the market basket percentage increase to be one percent for home health payments for CY 2018. Therefore, the home health payment update percentage for HHAs that submit the required quality data for the HH QRP will be one percent. The home health update is decreased by 2 percentage points for those HHAs that do not submit quality data as required by the Secretary. For HHAs that do not submit the required quality data for CY 2018, the home health payment update will be -1 percent (one percent minus 2 percentage points).

Adjustment to Reflect Nominal Case-Mix Growth

CMS is implementing a 0.97 percent reduction to the national, standardized 60-day episode rate in CY 2018 to account for nominal case-mix growth from 2012 to 2014. CY 2018 will be the third year of the three-year phase-in of the reduction to account for nominal case-mix growth. The -0.97 percent adjustment to the national, standardized 60-day episode payment rate to account for nominal case-mix growth results in an estimated decrease in Home Health Prospective Payment System (HH PPS) payments for CY 2018 of -0.9 percent.

Sunset of the Rural Add-on Provision

Section 210 of the MACRA extended the rural add-on, which is an increase of 3 percent of the payment amount otherwise made for home health services furnished in a rural area, to episodes and visits ending before January 1, 2018. Therefore, for episodes and visits that end on or after January 1, 2018, a rural add-on payment will not apply.