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OIG Fraud Recoveries Dropped $1.2B This Year

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Compliance, Healthcare, OIG, Payment Rates

The Office of the Inspector General Fraud Recoveries Dropped $1.2 Billion This Year

That might not be a bad thing.

 
The federal government brought in 30% less in fraud recovering in 2018 than it did the previous year, thanks to far few large settlements. But the could be a net benefit, according to the Centers for Medicare & Medicaid Services (CMS). The office of Inspector General (OIG) recovered $2.9 billion from fraud investigations during fiscal year 2018, according to the semiannual report to Congress released last week. That's  $1.2 billion decline from last year, when the agency pulled in $4.13 billion (Sweeney, 2018) The year prior, the agency hauled in a historic $5.6 billion. But lower recoveries are not indicative of lighter enforcement, according to OIG spokesperson Don White. Fraud recoveries fluctuate from year to year, based primarily on the volume of large settlements. In 2017, for example, the OIG inked a $155 million settlement with EHR vendor eClinicalWorks and Mylan paid $465 million in an EpiPen settlement. The prior year, Tenet Healthcare forked over more than $500 million (Sweeney, 2018). On another note…a little alarming because CMS does budget in a % of recovery dollars to justify their fraud investigation program. Resources Sweeney, E. (2018). OIG fraud recoveries dropped $1.2B this year. That might not be a bad thing. FierceHealthcare.com. Retrieved from: https://www.fiercehealthcare.com/payer/oig-fraud-recoveries-dropped-almost-1-2-b-year-might-not-be-a-bad-thing
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CMS Finalizes PDGM: PPS Final Rule Increases HHA’s Payments for 2019

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Clinical Practices, Healthcare, Legislation, Payment Rates, PDGM, Value-Based Purchasing

CMS Finalizes PDGM: PPS Final Rule Increases HHA's Payments for 2019

PPS final rule increases agencies' payments for 2019, finalizes PDGM

 
Wednesday, October 31, 2018, according to Decision Health, CMS has finalized a plan to launch a budget-neutral payment model for home health that utilizes 30-day periods of care and stops using the number of therapy visits to determine payment. That’s according to the 2019 PPS final rule posted Oct. 31 on the Federal Register website. The Patient-Driven Groupings Model (PDGM) will launch “on or after” Jan. 1, 2020, according to the final rule. That language differs from the proposed rule, when CMS indicated PDGM would start on Jan. 1, 2020 (Decision Health, 2018). Additionally, another major change with the final rule is that PDGM will have 432 HHRGs - which is of course double the number of HHRGs outlined in the proposed rule. Home health agencies have spoken and CMS has listened. The change is also likely to the 12 clinical groups that capture the most common primary diagnoses in home health. In the proposed rule, CMS only had sought six clinical groups: musculoskeletal rehabilitation, neuro/stroke rehabilitation, wounds, behavioral health care, complex nursing interventions and medication management, teaching and assessment (MMTA) (Decision Health, 2018). CMS wrote, “We note that although we are categorizing patients into [12] groups according to the principal diagnosis, these groups do not reflect all the care being provided to the home health patient during a 30-day period of care,” CMS states in the final rule. “Home health care remains a multidisciplinary benefit. Additionally, as stated in the CY 2019 HH PPS proposed rule, we will continue to examine trends in reporting and resource utilization to determine if future changes to the clinical groupings are needed after implementation of the PDGM in CY 2020” (Decision Health, 2018).

Payments to Rise in 2019

Decision Health writes, "Adjustments to Medicare’s home health payments under the final rule will increase agencies’ total reimbursement by 2.2%, or $420 million. What this increase means is that the effects of a 2.2% home health payment update percentage are now reflected from a 0.1% increase in payments due to decreasing the fixed-dollar-loss ration mandated by the Bipartisan Budge Act of 2018. Additionally, in order to pay no more than 2.5% total payments as outlier payments, a 0.1% decrease in payments due to the new rural add-on policy by the mandate. In contrast, the 2018 PPS final rue included a 0.4% or $80, payment reduction. The PPS final rule for 2019 now opens the  door for home health agencies to get paid by Medicare Part B to administer home infusion therapy for certain payments who don't qualify for the home health benefit. However, that change would not benefit home health agencies until 2021.

Other Changes Finalized in the Rule

  • No more requirement for a physician estimate - On or after Jan. 1, 2019 the requirement that the certifying physician estimate are required to estimate how much longer skilled services are needed for continued care. Thank you CMS.
  • Value-base purchasing changes (again) - Among the biggest changes to value-based purchasing is CMS’ decision to remove two OASIS-based measures and replace three other, existing OASIS-based measures with two new composite measures designed to evaluate improvement in activities of daily living (ADLs) (Decision Health, 2018).
  • Remote patient monitoring update - It seems CMS is embracing innovation and modernization of health care by allowing the cost of remote patient monitoring to be reported by home health agencies as allowable coast on the Medicare cost report. CMS stated in the final rule, “This is expected to help foster the adoption of emerging technologies by home health agencies and result in more effective care planning, as data are shared among patients, their caregivers and their providers" (Decision Health, 2018).
Read the final PPS rule at: https://s3.amazonaws.com/public-inspection.federalregister.gov/2018-24145.pdf Resources Centers for Medicare & Medicaid Services (2018). Center for Clinical Standards and Quality /Quality, Safety & Oversight Group. Department of Human and Health Services. CMS.gov. Retrieved from: https://www.cms.gov/Medicare/Provider-Enrollment-and-Certification/SurveyCertificationGenInfo/Downloads/QSO-18-13-HHA-.pdf Cornell Law School (2018). 42 CFR 484.60 - Condition of participation: Care planning, coordination of services, and quality of care. Legal Information Institute. Retrieved from: https://www.law.cornell.edu/cfr/text/42/484.60
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CMS Updates Pricer to Support Value Based Purchasing Model

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Clinical Practices, Compliance, Healthcare, Payment Rates

CMS Updates Pricer to Support Value Based Purchasing Model

New Payment Adjustments to HHA's

 
The 2016 Home Health Prospective Payment System (HH PPS) final rule required the implementation of the Home Health Value Based Purchasing (HHVBP) Model in nine states that represent each geographic area in the United States. All Medicare-certified HHAs that provide services in Arizona, Florida, Iowa, Maryland, Massachusetts, Nebraska, North Carolina, Tennessee and Washington will have their payment adjusted based on the HHA’s total performance score on a set of measures already reported with the Outcome and Assessment Information Set (OASIS) and the Home Health Care Consumer Assessment of Healthcare Providers and Systems (HHCAHPS) for all patients serviced by the HHA. Three new measures are included in which performance points are achieved for reporting data. The HHVBP Model, now finalized, will be tested by CMS and revisions are needed to update the HH Pricer program to accept the necessary adjustment factor and capture the adjusted amount on the claim record. MACs will place the HH VBP adjustment amount on the claim as a value code QV amount. This may be a positive or negative amount. The Pricer has been updated to reflect standardized payment amounts. CR 10167 requires that standardized amounts be calculated by Medicare systems and passed on to claims history databases using the field created for hospital standardized payment amounts. Standardized claims payment amounts are actual payment amounts adjusted to remove sources of variation not directly related to decisions to utilize care. Examples of these variations include hospital wage indexes, geographic cost indexes (GPCIs), incentive payment and penalty adjustments. CR 10167 requires system changes to ensure HH and hospice claims processing are consistent. CR 6550 created edits on hospice claims to ensure that G-codes for service visits are reported with the corresponding revenue code for the service discipline. Editing does not exist for HH claims even though the same G-codes and revenue codes are required. The system has been updated to include these edits. Providers should be aware that the MACs will return to the HHA the following claims:
  • Home health claims (TOB 032x other than 0322) reporting revenue code 042x if the HCPCS code is other than Q5001, Q5002, Q5009, G0151, G0157, or G0159
  • Home health claims (TOB 032x other than 0322) reporting revenue code 043x if the HCPCS code is other than Q5001, Q5002, Q5009, G0152, G0158, or G0160
  • Home health claims (TOB 032x other than 0322) reporting revenue code 044x if the HCPCS code is other than Q5001, Q5002, Q5009, G0153, or G0161
  • Home health claims (TOB 032x other than 0322) reporting revenue code 055x if the HCPCS code is other than Q5001, Q5002, Q5009, G0162, G0299, G0300, G0493, G0494, G0495, G0496
  • Home health claims (TOB 032x other than 0322) reporting revenue code 056x if the HCPCS code is other than Q5001, Q5002, Q5009, or G0155
  • Home health claims (TOB 032x other than 0322) reporting revenue code 057x if the HCPCS code is other than Q5001, Q5002, Q5009, or G0156
References The official instruction, CR 10167, https://www.cms.gov/Regulations-andGuidance/Guidance/Transmittals/2017Downloads /R3933CP.pdf
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Final Rule CY 2016 Home Health Prospective Payment System (HH PPS)

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Payment Rates

Home Health Prospective Payment System (HH PPS) Rate Update for Calendar Year (CY) 2016

CR 9406 informs providers about updates to the 60-day national episode rates, the national per-visit amounts, Low-Utilization Payment Adjustment (LUPA) add-on amounts, and the non-routine medical supply payment amounts under the HH PPS for CY 2016. Make sure your billing staff is aware of this update.

 

National Standardized 60-Day Episode Payment

"As described in the CY 2016 final rule, to determine the CY 2016 national, standardized 60-day episode payment rate, CMS applies a wage index budget neutrality factor of 1.0011 and a case-mix budget neutrality factor of 1.0187 to the previous calendar year's national, standardized 60-day episode rate ($2,961.38). In order to account for nominal case-mix growth from CY 2012 to CY 2013, CMS applies a payment reduction of 0.97 percent to the CY 2016 national, standardized 60-day episode payment rate. This reduction will also be applied to the CY 2017 and CY 2018 national, standardized 60-day episode payment rate. CMS then applies an $80.95 reduction (which is 3.5 percent of the CY 2010 national, standardized 60-day episode rate of $2,312.94) to the national, standardized 60-day episode rate. Lastly, the national, standardized 60-day episode payment rate is updated by the CY 2016 HH payment update percentage of 1.9 percent for HHAs that submit the required quality data and by 1.9 percent minus 2 percentage points or -0.1 percent for HHAs that do not submit quality data. These two episode payment rates are shown in Tables 1 and 2 below. These payments are further adjusted by the individual episode's case-mix weight and by the wage index." (source: MLN Matters Number MM9406, Related Change Request (CR)#: CR 9406, Effective Date: January 1, 2016, Implementation Date: January 4, 2016)

Market Basket Update

"The CY 2016 HH market basket update is 2.3 percent which is then reduced by a multifactor productivity (MFP) adjustment of 0.4 percentage points. The resulting HH payment update is equal to 1.9 percent. HHAs that do not report the required quality data will receive a 2 percentage point reduction to the HH payment update of 1.9 percent." (source: MLN Matters Number MM9406, Related Change Request (CR)#: CR 9406, Effective Date: January 1, 2016, Implementation Date: January 4, 2016)

2016 Rate Change Impact

CMS estimates in the final rule that overall Medicare payments to home health providers will be reduced 1.4% ($260 million) by the 2016 rate changes compared to 2015.  However, results for individual agencies will vary significantly.   Even if an agency’s patient mix is stable, both the case mix weights and the wage index are updated annually and any fluctuations in either number can influence agency results either positively or negatively.

Clarification Regarding the Use of the “Initial Encounter” Seventh Character, Applicable to Certain ICD-10-CM Code Categories, under the HH PPS

"The ICD-10-CM coding guidelines regarding the use of the seventh character assignment for diagnosis codes in Chapter 19, “Injury, Poisoning, and Certain Other Consequences of External Causes (S00–T88)” were revised. Based upon the revised guidance, coding certain diagnosis codes as “initial encounters” would be appropriate when the patient is receiving active treatment during a home health episode. Initial encounters are not based on chronology of care or whether the patient is seeing the same or a new provider for the same condition."

"A revised translation list effective January 1, 2016, will be posted on the CMS website. Also effective, January 1, 2016, the Home Health Prospective Payment System Grouper logic will be revised to award points for certain initial encounter codes based upon the revised ICD-10-CM coding guidelines for M0090 dates on or after October 1, 2015. HHAs should review their OASIS records and claims submitted between October 1, 2015 and December 31, 2015, to determine if they should submit a modification of their assessment and adjust their claim with a revised HIPPS code that was assigned to the OASIS record based upon the revised grouper logic." (source: MLN Matters Number MM9406, Related Change Request (CR)#: CR 9406, Effective Date: January 1, 2016, Implementation Date: January 4, 2016)

Background on Home Health Prospective Payment System (HH PPS)

"The Affordable Care Act mandated several changes to Section 1895(b) of the Social Security Act (the Act) and hence the HH PPS Update for CY 2016. Section 3131(a) of the Affordable Care Act mandated that starting in CY 2014, the Secretary must apply an adjustment to the national, standardized 60-day episode payment rate and other amounts applicable under Section 1895(b)(3)(A)(i)(III) of the Act to reflect factors such as changes in the number of visits in an episode, the mix of services in an episode, the level of intensity of services in an episode, the average cost of providing care per episode, and other relevant factors. In addition, Section 3131(a) of the Affordable Care Act mandates that this rebasing must be phased-in over a 4-year period in equal increments, not to exceed 3.5 percent of the amount (or amounts), as of the date of enactment, applicable under Section 1895(b)(3)(A)(i)(III) of the Act, and be fully implemented by CY 2017."

"Section 3401(e) of the ACA requires that the market basket percentage under the HH PPS be annually adjusted by changes in economy-wide productivity for CY 2015 and each subsequent calendar year."

"In addition to the Affordable Care Act mandates, Section 421(a) of the Medicare Modernization Act (MMA), as amended by Section 210 of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) (Pub. L. 114-10), provides an increase of 3 percent of the payment amount otherwise made under Section 1895 of the Act for home health services furnished in a rural area (as defined in Section 1886(d)(2)(D) of the Act), with respect to episodes and visits ending on or after April 1, 2010, and before January 1, 2018. The statute waives budget neutrality related to this provision, as the statute specifically states that the Secretary shall not reduce the standard prospective payment amount (or amounts) under Section 1895 of the Act applicable to home health services furnished during a period to offset the increase in payments resulting in the application of this section of the statute." (source: CMS Manual System, Pub 100-04 Medicare Claims Procesing, Transmittal 3383, Change Request 9406, dated October 23, 2015)

Frequently Asked Questions

What Table do I use if I DO NOT Submit Quality Data?

Table 1: For HHAs that DO Submit Quality Data – National 60-Day Episode Amounts Updated by the MFP adjusted Home Health Market Basket Update for CY 2016 Before Case-Mix Adjustment, Wage Index Adjustment Based on the Site of Service for the Beneficiary Question

CY 2015 National, Standardized 60-Day Episode Payment Wage Index Budget Neutrality Factor Case-Mix Weights Budget Neutrality Factor Nominal Case-Mix Growth Adjustment 2016 Rebasing Adjustment CY 2016 HH Payment Update Percentage CY 2016 National, Standardized 60-Day Episode Payment
$2,961.38 X 1.0011 X 1.0187 X 0.9903 -$80.95 X 1.019 =$2,965.12

What Table do I use if I DO Submit Quality Data?

Table 2: For HHAs that DO NOT Submit Quality Data – National 60-Day Episode Amounts Updated by the MFP adjusted Home Health Market Basket Update for CY 2016 Before Case-Mix Adjustment, Wage Index Adjustment Based on the Site of Service for the Beneficiary Question

CY 2015 National, Standardized 60-Day Episode Payment Wage Index Budget Neutrality Factor Case-Mix Weights Budget Neutrality Factor Nominal Case-Mix Growth Adjustment 2016 Rebasing Adjustment CY 2016 HH Payment Update Percentage CY 2016 National, Standardized 60-Day Episode Payment
$2,961.38 X 1.0011 X 1.0187 X 0.9903 -$80.95 X 0.999 =$2,906.92

What table do I use if I DO NOT submit Quality Data for LUPA and Outlier Calculations?

National Per-Visit Rates

To calculate the CY 2016 national per-visit payment rates, CMS starts with the CY 2015 national per-visit rates. CMS applies a wage index budget neutrality factor of 1.0010 to ensure budget neutrality for LUPA per-visit payments after applying the CY 2016 wage index, and then applies the maximum rebasing adjustments to the per-visit rates for each discipline. The per-visit rates are then updated by the CY 2016 HH payment update of 1.9 percent for HHAs that submit the required quality data and by -0.1 percent for HHAs that do not submit quality data. The per-visit rates are shown in Tables 3 and 4.

Table 3: For HHAs that DO Submit Quality Data – CY 2016 National Per-Visit Amounts for LUPAs and Outlier Calculations Updated by the MFP adjusted HH Market Basket Update, Before Wage Index Adjustment

HH Discipline Type CY 2015 Per-Visit Payment Wage Index Budget Neutrality Factor 2016 Rebasing Adjustment CY 2016 HH Payment Update Percentage CY 2016 Per-Visit Payment
Home Health Aide $57.89 X 1.0010 +$1.79 X 1.019 $60.87
Medical Social Services $204.91 X 1.0010 +$6.34 X 1.019 $215.47
Occupational Therapy $140.70 X 1.0010 +$4.35 X 1.019 $147.95
Physical Therapy $139.75 X 1.0010 +$4.32 X 1.019 $146.95
Skilled Nursing $127.83 X 1.0010 +$3.96 X 1.019 $134.42
Speech-Language Pathology $151.88 X 1.0010 +$4.70 X 1.019 $159.71

 

Table 4: For HHAs that DO NOT Submit Quality Data – CY 2016 National Per-Visit Amounts for LUPAs and Outlier Calculations Updated by the MFP adjusted HH Market Basket Update, Before Wage Index Adjustment

HH Discipline Type CY 2015 Per-Visit Payment Wage Index Budget Neutrality Factor 2016 Rebasing Adjustment CY 2016 HH Payment Update Percentage CY 2016 Per-Visit Payment
Home Health Aide $57.89 X 1.0010 +$1.79 X 1.019 $59.68
Medical Social Services $204.91 X 1.0010 +$6.34 X 1.019 $211.24
Occupational Therapy $140.70 X 1.0010 +$4.35 X 1.019 $145.05
Physical Therapy $139.75 X 1.0010 +$4.32 X 1.019 $144.07
Skilled Nursing $127.83 X 1.0010 +$3.96 X 1.019 $131.79
Speech-Language Pathology $151.88 X 1.0010 +$4.70 X 1.019 $156.58

What are the LUPA Add-On Payments for CY2016

LUPA episodes that occur as initial episodes in a sequence of adjacent episodes or as the only episode receive an additional payment. Beginning in CY 2014, CMS calculates the payment for the first visit in a LUPA episode by multiplying the per-visit rate by a LUPA add-on factor specific to the type of visit (skilled nursing, physical therapy, speech-language pathology). The specific requirements for the new LUPA add-on calculation are described in CR 8380, Transmittal 2828 dated November 27, 2013. The LUPA add-on adjustment factors are displayed in Table 5.

Table 5: CY 2016 LUPA Add-On Factors

HH Discipline Type Add-On Factor
Skilled Nursing 1.8451
Physical Therapy 1.6700
Speech-Language Pathology 1.6266

How do I calculate Non-Routine Supply Payments?

Payments for non-routine supplies (NRS) are computed by multiplying the relative weight for a particular NRS severity level by an NRS conversion factor. To determine the CY 2016 NRS conversion factors, CMS starts with the CY 2015 NRS conversion factor ($53.23) and applies a 2.82 percent rebasing adjustment as described in the CY 2016 final rule. CMS then updates the conversion factor by the CY 2016 HH payment update of 1.9 percent for HHAs that submit the required quality data and by -0.1 percent for HHAs that do not submit quality data. CMS does not apply a standardization factor as the NRS payment amount calculated from the conversion factor is not wage or case-mix adjusted when the final payment amount is computed. The NRS conversion factor for CY 2016 payments for HHAs that do submit the required quality data is shown in Table 6a and the payment amounts for the various NRS severity levels are shown in Table 6b.

Table 6a: CY 2016 NRS Conversion Factor for HHAs that DO Submit the Required Quality Data

CY 2015 NRS Conversion Factor 2016 Rebasing Adjustment CY 2016 HH Payment Update Percentage CY 2016 NRS Conversion Factor
$53.23 X 0.9718 X 1.019 $52.71

Table 6b: CY 2016 Relative Weights and Payment Amounts for the 6-Severity NRS System for HHAs that DO Submit Quality Data

Severity Level Points (Scoring) Relative Weight CY 2016 NRS Payment Amount
1 0 0.2698 $14.22
2 1 to 14 0.9742 $51.35
3 15 to 27 2.6712 $140.80
4 28 to 48 3.9686 $209.18
5 49 to 98 6.1198 $322.57
6 99+ 10.5254 $554.79

 

The NRS conversion factor for CY 2016 payments for HHAs that do not submit quality data is shown in Table 7a and the payment amounts for the various NRS severity levels are shown in Table 7b.

Table 7a: CY 2016 NRS Conversion Factor for HHAs that DO NOT Submit the Required Quality Data

CY 2015 NRS Conversion Factor 2016 Rebasing Adjustment CY 2016 HH Payment Update Percentage CY 2016 NRS Conversion Factor
$53.23 X 0.9718 X 0.999 $51.68

Table 7b: CY 2016 Relative Weights and Payment Amounts for the 6-Severity NRS System for HHAs that DO NOT Submit Quality Data

Severity Level Points (Scoring) Relative Weight CY 2016 NRS Payment Amount
1 0 0.2698 $13.94
2 1 to 14 0.9742 $50.35
3 15 to 27 2.6712 $138.05
4 28 to 48 3.9686 $205.10
5 49 to 98 6.1198 $316.27
6 99+ 10.5254 $543.95

What tables do I use for Rural Add-Ons?

As stipulated in section 421(a) of the MMA, the 3 percent rural add-on is applied to the national standardized 60-day episode rate, national per-visit payment rates, LUPA add-on payments, and the NRS conversion factor when home health services are provided in rural (non-CBSA) areas for episodes and visits ending on or after April 1, 2010, and before January 1, 2018. Refer to Tables 8 through 10b for the CY 2016 rural payment rates.

Table 8a: CY 2016 Payment Amounts for 60-Day Episodes for Services Provided in a Rural Area Before Case-Mix and Wage Index Adjustment for HHAs that DO Submit Quality Data

CY 2016 National, Standardized 60-Day Episode Payment Rate Multiply by the 3 Percent Rural Add-On CY 2016 Rural National Standardized 60-Day Episode Payment Rate
$2,965.12 X 1.03 $3,054.07

Table 8b: CY 2016 Payment Amounts for 60-Day Episodes for Services Provided in a Rural Area Before Case-Mix and Wage Index Adjustment for HHAs that DO NOT Submit Quality Data

CY 2016 National, Standardized 60-Day Episode Payment Rate Multiply by the 3 Percent Rural Add-On CY 2016 Rural National Standardized 60-Day Episode Payment Rate
$2,906.92 X 1.03 $2,994.13


Table 9a: CY 2016 Per-Visit Amounts for Services Provided in Rural Area, Before Wage Index Adjustment for HHAs that DO Submit Quality Data

Home Health Discipline Type CY 2016 Per-Visit Rate Multiply by the 3 Percent Rural Add-On CY 2016 Rural Per-Visit Rate
HH Aide $60.87 X 1.03 $62.70
MSS $215.47 X 1.03 $221.93
OT $147.95 X 1.03 $152.39
PT $146.95 X 1.03 $151.36
SN $134.42 X 1.03 $138.45
SLP $159.71 X 1.03 $164.50

Table 9b: CY 2016 Per-Visit Amounts for Services Provided in Rural Area, Before Wage Index Adjustment for HHAs that DO NOT Submit Quality Data

Home Health Discipline Type CY 2016 Per-Visit Rate Multiply by the 3 Percent Rural Add-On CY 2016 Rural Per-Visit Rate
HH Aide $59.68 X 1.03 $61.47
MSS $211.24 X 1.03 $217.58
OT $145.05 X 1.03 $149.40
PT $144.07 X 1.03 $148.39
SN $131.79 X 1.03 $135.74
SLP $156.58 X 1.03 $161.28

Table 10a: CY 2016 Conversion Factor for Services Provided in Rural Areas

For HHAs that DO Submit Quality Data For HHAs that DO NOT Submit Quality Data
CY 2016 Conversion Rates Multiply by the 3 Percent Rural Add-On CY 2016 Rural Conversion Factor CY 2016 Conversion Rates Multiply by the 3 Percent Rural Add-On CY 2016 Rural Conversion Factor
$52.71 X 1.03 $54.29 $51.68 X 1.03 $53.23

Table 10b: CY 2016 Relative Weights and Payment Amounts for the 6-Severity NRS System for Services Provided in Rural Areas

For HHAs that DO Submit Quality Data For HHAs that DO NOT Submit Quality Data
Severity Level Points (Scoring) Relative Weight Total CY 2016 NRS Payment Amount for Rural Areas Relative Weight Total CY 2016 NRS Payment Amount for Rural Areas
1 0 0.2698 $14.65 0.2698 $14.36
2 1 to 14 0.9742 $52.89 0.9742 $51.86
3 15 to 27 2.6712 $145.02 2.6712 $142.19
4 28 to 48 3.9686 $215.46 3.9686 $211.25
5 49 to 98 6.1198 $332.24 6.1198 $325.76
6 99+ 10.5254 $571.42 10.5254 $560.27

What Measures are affected by the Home Health Value-Based Purchasing (HHVBM) Initiative?

CMS estimates the net impact of the payment provisions will result in a decrease of 1.4 % or $260 million in Medicare payments to Home Health Agencies in CY 2016.

Effective January 1, 2016, it also implements a Home Health Value-Based Purchasing (HHVBM)  in selective states requiring all Medicare certified agencies in those states to participate. Those states include Arizona, Florida, Iowa, Massachusetts, Maryland, Nebraska, North Carolina, and Tennessee.

The final measures to be assessed in this HHVBM initiative include:

Notice how closely aligned these measures are to the Star Rating Outcome and Process Measures.

CY 2016 HH PPS with Stars-01

Helpful Tip


CR 9406 informs providers about updates to the 60-day national episode rates, the national per-visit amounts, Low-Utilization Payment Adjustment (LUPA) add-on amounts, and the non-routine medical supply payment amounts under the HH PPS for CY 2016. CMS estimates the net impact of the payment provisions will result in a decrease of 1.4 % or $260 million in Medicare payments to Home Health Agencies in CY 2016. Make sure your billing staff is aware of this update.

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Home Health PPS

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Payment Rates

Home Health PPS

Under prospective payment, Medicare pays home health agencies (HHAs) a predetermined base payment. The payment is adjusted for the health condition and care needs of the beneficiary. The payment is also adjusted for the geographic differences in wages for HHAs across the country. The adjustment for the health condition, or clinical characteristics, and service needs of the beneficiary is referred to as the case-mix adjustment.

 

History of Home Health PPS

The Balanced Budget Act of 1997, as amended by the Omnibus Consolidated and Emergency Supplemental Appropriations Act (OCESAA) of 1999, called for the development and implementation of a prospective payment system (PPS) for Medicare home health services. The BBA put in place the interim payment system (IPS) until the PPS could be implemented. Effective October 1, 2000, the home health PPS (HH PPS) replaced the IPS for all home health agencies (HHAs). The PPS proposed rule was published on October 28, 1999, with a 60-day public comment period, and the final rule was published on July 3, 2000. This section contains useful information for understanding and implementing the prospective payment system for home health agencies.

Summary of Home Health PPS

Under prospective payment, Medicare pays home health agencies (HHAs) a predetermined base payment. The payment is adjusted for the health condition and care needs of the beneficiary. The payment is also adjusted for the geographic differences in wages for HHAs across the country. The adjustment for the health condition, or clinical characteristics, and service needs of the beneficiary is referred to as the case-mix adjustment. The home health PPS will provide HHAs with payments for each 60-day episode of care for each beneficiary. If a beneficiary is still eligible for care after the end of the first episode, a second episode can begin; there are no limits to the number of episodes a beneficiary who remains eligible for the home health benefit can receive. While payment for each episode is adjusted to reflect the beneficiary's health condition and needs, a special outlier provision exists to ensure appropriate payment for those beneficiaries that have the most expensive care needs. Adjusting payment to reflect the HHA's cost in caring for each beneficiary including the sickest, should ensure that all beneficiaries have access to home health services for which they are eligible.

The Home Health PPS is Composed of Six Main Features

Payment for the 60-day Episode

The unit of payment under HHA PPS will be for a 60-day episode of care. An agency will receive half of the estimated base payment for the full 60 days as soon as the fiscal intermediary receives the initial claim. This estimate is based upon the patient's condition and care needs (case-mix assignment). The agency will receive the residual half of the payment at the close of the 60-day episode unless there is an applicable adjustment to that amount. The full payment is the sum of the initial and residual percentage payments, unless there is an applicable adjustment. This split percentage payment approach provides reasonable and balanced cash flow for HHAs. Another 60-day episode can be initiated for longer-stay patien

Case-mix adjustment - Adjusting payment for a beneficiary's condition and needs

After a physician prescribes a home health plan of care, the HHA assesses the patient's condition and likely skilled nursing care, therapy, medical social services and home health aide service needs, at the beginning of the episode of care. The assessment must be done for each subsequent episode of care a patient receives. A nurse or therapist from the HHA uses the Outcome and Assessment Information Set (OASIS) instrument to assess the patient's condition. (All HHAs have been using OASIS since July 19, 1999.) OASIS items describing the patient's condition, as well as the expected therapy needs (physical, speech-language pathology, or occupational) are used to determine the case-mix adjustment to the standard payment rate. This adjustment is the case-mix adjustment. 153 case-mix groups, or Home Health Resource Groups (HHRG), are available for patient classification. 

Outlier payments - Paying more for the care of the costliest beneficiaries

Additional payments will be made to the 60-day case-mix adjusted episode payments for beneficiaries who incur unusually large costs. These outlier payments will be made for episodes whose imputed cost exceeds a threshold amount for each case-mix group. The amount of the outlier payment will be a proportion of the amount of imputed costs beyond the threshold. Outlier costs will be imputed for each episode by applying standard per-visit amounts to the number of visits by discipline (skilled nursing visits, or physical, speech-language pathology, occupational therapy, or home health aide services) reported on the claims. Total national outlier payments for home health services annually will be no more than 2.5 percent of estimated total payments under home health PPS.

Adjustments for beneficiaries who require only a few visits during the 60-day episode

The proposed home health PPS has a low-utilization payment adjustment for beneficiaries whose episodes consist of four or fewer visits. These episodes will be paid the standardized, service-specific per-visit amount multiplied by the number of visits actually provided during the episode. A savings from reduced episode payments would be redistributed to all episodes paid under the PPS.

Adjustments for beneficiaries who change HHAs or are discharged and readmitted within a 60-day episode

The home health PPS will include a partial episode payment adjustment (PEP). A new episode clock will be triggered when a beneficiary elects to transfer to another HHA or when a beneficiary is discharged and readmitted to the same HHA during the 60-day episode.  When a new 60-day episode begins, a new plan of care and a new assessment are necessary. The original 60-day episode payment is proportionally adjusted to reflect the length of time the beneficiary remained under the agency's care before the intervening event. The new episode is paid an initial episode payment of one half of the new case mix group, or HHRG, and the 60-day clock is restarted.

Consolidated billing

Under the PPS a HHA must bill for all home health services which includes nursing and therapy services, routine and non-routine medical supplies, home health aide and medical social services, except durable medical equipment (DME). DME was excluded from the BBA established consolidated billing requirement by the BBRA. The law requires that all home health services paid on a cost basis be included in the PPS rate. Therefore, the PPS rate will include all nursing and therapy services, routine and non-routine medical supplies, and home health aide and medical social services.

Helpful Tip


For a one-stop resource web page focused on the informational needs and interests of Medicare Fee-for-Service (FFS) home health agencies, go to the Home Health Agency Center at cms.gov.

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Therapy Changes: Visit Counting and Case-Mix

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Case-Mix, Coding, Payment Rates, Therapy

January 1, 2015 found many changes occurring in the Home Health industry. Many of those changes involved therapy. The therapy reassessment changes of 409.44 became effective for episodes that began on or after January 1, 2015. The new regulations require a qualified therapist, not an assistant, to provide the Home Health beneficiary functional and therapy service reassessment at least every thirty (30) days. When fulfilling that assessment requirement, agencies should pay attention to documentation of BOTH long and short term goals. MACS, such as Palmetto, have been honing in on documentation and reinforcing that requirement.  Local Coverage Determination (LCD) of Palmetto states that long and short term goals must be stated in “objective measureable terms and the date of their accomplishment.” Be certain all components are present or risk denials of claims. January 1, 2015 also saw the end of case-mix attachment for nearly 200 diagnoses. Those included certain delusional disorders, depression, schizophrenia, profound impairment of both eyes, and dementia to name a few diagnoses losing that case-mix attachment. Certain blood disorders such as 281, 282 anemias, CA of the lip and CA in-situ, diabetes and specific GI disorders with ostomy have case-mix attached if there are 14+ therapy visits and OASIS items are answered in a specific manner: M1030 (1,3) M1342 (3), M100 (2,3,4), M1620 (2,3,4,5). The following diagnoses have been changed with no case-mix unless there are 0-13 therapy visits and specific OASIS answered items: diabetes 250, heart disease and HTN Ischemic heart disease 420, 411, 414 CAD unspecified vessel, 428, 403-405 (Early episode only). The following OASIS items also must have the following answers: M1242 (3,4), M1810 (1,2,3), M1860 (1,2,3). Therapy will play a key role this year for agencies clinically and financially and for patients and outcomes achievement. Educating clinicians will be vital, so that accurate OASIS answers are present. An incorrect OASIS answer and a coding error could cost your agency hundreds of dollars. For more in depth review: See Final Rule, Table 8 Case-mix Adjustment Variables and Scores Federal Register Vol 79, Number 215 November 6, 2014 Health and Human Services. Who is watching out for your agency? Contact Select Data for further information at (800) 332-0555.

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CODING 2015: OASIS C1, 2015 PPS Final Rule, and ICD-10

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ICD-9 CM, OASIS C1, Payment Rates

Many changes are coming with OASIS C1, 2015 PPS Final Rule, and ICD-10. Agency leaders know that now more than ever, coding, assessment,  documentation, and proper learning of  the complex ICD-10 coding process is imperative for financial stability. Agency leaders want appropriate payment and compliance. OASIS C1/ICD-9 becomes effective midnight January 1, 2015 along with the 2015 PPS rule which includes face to face documentation changes, therapy changes, and losing case mix points for nearly 200 codes that can impact upon an agency’s success.   OASIS C1/ICD 9 Version The OASIS C1/ICD-9 version goes into effect at 12:00 am on January 1, 2015 and will remain in effect until ICD is implemented or CMS makes another disposition. The current OASIS C is only effective through December 31, 2014 11:59 PM. The modified OASIS C1/ICD-9 version has been created and the changes have been actively shared. Typing in CMS OASIS C1/ICD-9 Document Tracking Tool on your browser will take you to the tool on the CMS.gov website that reflects the changes. CMS has currently also posted modules that include OASIS C instruction on the following OASIS domains:

  • Overview and Conventions
  • Patient Tracking
  • Clinical Record Items
  • Patient History, Diagnoses, and Medication
  • Integumentary Status
  • Pressure Ulcers (2 Parts)
  • Integumentary Status: Stasis Ulcers, Surgical Wounds, and Skin Lesions
  • ADLs/IADLs (2 Parts)
  • Living Arrangements and Sensory Status
  • Respiratory and Cardiac Status
  • Neuro/Emotional/Behavioral
  • Case Management Therapy Need
  • Emergent Care
  • Care Planning and Intervention
Agency leaders should become familiar with the OASIS C1 Guidance Manual. National Assessment Submission and Processing System for OASIS Submission Agencies must convert to the national Assessment Submission and Processing System (ASAP) effective January 1, 2015. Because of the implementation of the new national submission system, agencies will no longer submit to CMS by individual state databases. In order to transition data from the state databases to ASAP, the OASIS submission system will be shut down permanently, per CMS, at 6:00 pm Eastern Time on December 26, 2014. The OASIS ASAP system will be available at 12:00 am Eastern time on January 1, 2015.CMS states:
  • From 6:00 PM (ET) on December 26, 2014 through 11:59 pm on December 31, 2014, no OASIS assessments will be accepted.
  • The OASIS ASAP system will become available at 12:00 am (ET) on January 1, 2015.
NOTE:  “OASIS assessment data files submitted on or after January 1, 2015 using the ASAP system must follow version 2.10 (which supports OASIS C) and version 2.11 (which supports OASIS C1) of the OASIS data submission specifications.” (2014, CMS.gov/Medicare/OASISC1). Errors and warnings are to be available within 24 hours in final validation reports in the CASPER reporting application. To learn about log in and use of CASPER, go to http://tinyurl.com/pht9m4g The OASIS submission user guide can be located at https://qtso.com/hhatrain.html. Leaders should appoint an individual to track submissions and fatal errors such as misspelled names and monitor the number of errors over the months to come. Be certain that documentation of transmission errors also occurs, if caused by CMS. Have logs of proof with dates and times of submission and error when discussing with CMS. 2015 PPS Rule The 2015 PPS Rule brings many changes including the elimination of case-mix points for nearly 200 codes from pulmonary, psych 1 and 2, as well as blindness/low vision diagnoses categories. OASIS items such as M1200 (Vision) and M2030 (Injectable drug use) will lose case-mix value. The recalibration of home health case-mix adjuster can have significant impact on individual agencies. From 2000-2014, the 124 variables remained relatively the same, but in 2015 there has been significant change. The new 124 variable model saw 63 prior variables dropped with 21 new variables added. Collectively, this new model impacts all 153 case-mix categories. (Dombi, 11/19/2014 NAHC Seminar) What are the Differences between ICD-9-CM and ICD-10-CM and should I prepare NOW? The answer is a resounding “YES”. There are many differences between ICD-9 and ICD-10. ICD-9-CM: 17 chapters and V and E code chapters 13,000 disease codes plus V and E codes 3,000 procedure codes in Volume 3 3-5 digits in disease codes Essentially numeric system Codes usually do not indicate timing encounter No differentiation between left/right laterality ICD-10-CM: 21 chapters- V and E codes in disease chapters 68,000 disease codes, including V and E codes 87,000 procedures codes in ICD-10-PCS 3-7 digits in disease codes Alphanumeric system Codes specify initial and subsequent encounters Differentiates between the right and left laterality Expertise in anatomy, physiology, and diagnostics will be a must Third Party Coding experts should already be actively into their plan for additional education of their coding teams. Some, like Select Data, have been stepping up training sessions and will be offering ongoing Anatomy, Physiology, and Diagnostic seminars for 2 years to refresh and maintain currency among their credentialed experts. It may look like ICD-10 is far away (11 months) but, an additional 55,000 diagnostic codes, combination codes, and increased coding specificity to the 7th digit means increased risk for payment and more importantly, increased risk for payment retention. Your clinicians need documentation education so your diagnoses are well supported. If your payment retention has been or becomes in question, can the MACs, RACs, or Z-PICs be far behind? Could you survive what is coming with the coding process you have in place right now? As you can see, 2015 will be a year of tremendous change. Are you ready? Let Select Data assist to make 2015 memorable, in a positive way.  

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