Home Health & Hospice

MedPAC and Partnership for Quality Home Healthcare at odds over CMS’ CY 2015 proposals

Homecare Insider, September 8, 2014

The Medicare Payment Advisory Commission’s (MedPAC) recent recommendations to CMS that the agency deepen proposed cuts to homecare funding for calendar year (CY) 2015 and retain the contentious narrative component of the face-to-face physician encounter requirement were met with dissent from a major industry advocacy group.

In a letter dated August 29, MedPAC offered its comments on CMS’ proposed rule to update Medicare's Home Health Prospective Payment System payment rates and wage index for CY 2015. In response, the Partnership for Quality Home Healthcare issued a June 3 press release to voice its concern with two areas of the Commission’s letter.
On January 1, CMS began implementing an annual 3.5% cut to home health payments for 2014-17, the maximum amount allowed under the Affordable Care Act. In its letter, MedPAC stated that it believes this reduction “will be too small,” citing technical factors that will enable agencies to experience lower reductions—and, in some cases, even increases—in payment.  
“We recommended to Congress that rebasing be implemented in a shorter period, and also recommended eliminating the annual payment update,” the Commission wrote.
In its press release, the Partnership for Quality Home Healthcare countered these recommendations, stating that additional cuts would jeopardize providers’ operations and patients’ access to care.
“Home health patients are already at risk of losing access to critical home health services due to the cuts imposed in 2014,” said Eric Berger, CEO of the Partnership, in the statement. “MedPAC’s suggestion to further reduce payments beyond CMS’ current proposal would create real vulnerabilities for homebound seniors, health care professionals, small businesses and the Medicare program as a whole.”
To support its position, the Partnership cited a previous projection from CMS that current cuts will leave “approximately 40%” of home health providers operating at a net loss by 2017, and estimates from Avalere Health that this burden would put at risk 1.3 million seniors and nearly 465,000 home health care jobs.
As an alternative, the Partnership supports legislation that calls for post-acute care bundling and the establishment of value-based purchasing programs. Two such pieces of legislation include “The Bundling and Coordinating Post Acute Care ACT” (BACPAC) and the “Securing Access Via Excellence” (SAVE).
According to the organization, the former bill would help manage patient care through a 90-day, site-neutral bundled payment initiated on the day of patient discharge from the hospital, while the latter would establish a value-based purchasing program that would reduce hospital readmissions by further incentivizing positive outcomes.
The Partnership also contended with MedPAC’s recommendation that CMS continue requiring the physician narrative for face-to-face encounter documentation.
Although MedPAC acknowledged the additional stress providers have felt under the requirement, it cited “the history of program integrity issues in the home health care benefit” as the basis for its continued support of the provision.
“Eliminating the narrative increases the risk of unnecessary or unauthorized home health care services,” MedPAC wrote. “The Commission believes that the narrative, perhaps in a modified form, should continue to be a requirement.”
Rather than imposing additional across-the-board cuts and retaining the face-to-face narrative requirement as MedPAC recommends, the Partnership advocates implementing program integrity measures that target isolated occurrences of fraud and abuse. For its contribution to such program reform, the Partnership has proposed the “Skilled Home Health Integrity and Program Savings” (SHHIPS) to prevent payment of aberrant claims and strengthen the claims review processes, among other measures to prevent excess growth.

In its letter to CMS, MedPAC also offered comment on CMS’ proposed recalibration of case-mix weights, upcoming quality reporting program requirements, and a value-based purchasing model for the industry.