Home Health & Hospice

MedPAC Issues Annual Report to the Congress

Homecare Insider, March 24, 2014

 The Medicare Payment Advisory Commission (MedPAC) issued its annual report to Congress. This year’s report is very similar to reports in years past. In fact, there is only one new recommendation and the remainder of recommendations are the same as the 2011 recommendations.

The report’s new recommendation to Congress is as follows:
               The Congress should direct the Secretary to reduce payments to home health agencies with relatively high risk-adjusted rates of hospital readmission.
MedPACs rationale for the recommendation:
A hospital readmission policy for HHAs would create an incentive for agencies to improve the quality of care they provide and would lower Medicare spending. It would align HHA incentives with those of hospitals under the HRRP, and it would complement the incentives that skilled nursing facilities would have if Medicare were to implement the Commission’s recommendation for a readmission policy for these facilities. Such a policy would also recognize home health care’s unique role as a provider that facilitates the transition from inpatient settings to the community. Other providers may be unable to reduce avoidable readmissions without assistance from home health care, and HHAs would be better partners if they were subject to the same financial incentives.
The incentive could take several forms but should rely on a risk-adjusted measure of readmission. The clinical scope of the measure should include all post hospital home health stays but only measure readmissions that are due to causes considered potentially avoidable. The period covered by the measure should include the entire home health stay and 30 days after discharge. Including a follow-on period would recognize that the goal of home health care is to successfully transition a patient back to community-based care and would be conceptually similar to the 30-day post-discharge period included in the HRRP measure. The amount of the incentive should be large enough to motivate agencies to improve, particularly given the substantial costs of readmission to the beneficiary and the Medicare program.
CMS could use a modified version of the readmissions measure developed for hospitals to implement this recommendation. Its claims-based measure of readmission for hospitals focuses on the first 30 days of the stay, and it could use the same definition of potentially avoidable readmissions for the hospital-wide readmissions measure. The measure is risk-adjusted for clinical and functional severity. If the period were modified to include the entire home health stay with a 30-day home health window afterward, the measure would be consistent with the Commission’s recommendation. CMS may also need to take measures to ensure that risk-adjustment information submitted by HHAs is accurate.
To read the full report click here.