The Centers for Medicare and Medicaid Services (CMS) has posted its Calendar Year (CY) 2024 proposed Home Health Prospective Payment System (HHPPS) rule for Medicare home health services. CMS’s press release on the rule is available here.

CMS’s 2024 proposed payment rule changes and various adjustments to the base home health episodic rate will decrease aggregate Medicare home health expenditures by 2.2 percent, or $375 million, nationally ($460 million inflation update – $870 million rate adjustment + $35 million outlier Fixed Dollar Loss ratio change).

The payment rule proposes a rate reduction of 5.1 percent based on behavioral assumption adjustments. This cut is the remainder of the original 7.85 percent rate reduction that CMS calculated and partially imposed under its previous payment rule.

CMS has estimated a Medicare home health overpayment of $3,439,729 billion between CY 2020 and 2022, but it proposes to continue to hold on the collection of this alleged overpayment. It also refuses to recognize its unprecedented forecasting error in CY 2022 and 2023 rates where the inflation update fell short of reality by a cumulative 5.2 percent. That error will impact base rates permanently if not corrected. 

Other components of the proposed rule include:

• A market-basket increase of 2.70 percent.
• A decrease in the 30-day payment rate from $2,010.69 to $1,974.38 after application of the Patient-Driven Groupings Model (PDGM) budget neutrality adjustment, market-basket update, a wage index budget neutrality factor, and case-mix recalibration neutrality factor adjustments. Agencies that do not submit required quality data will have that rate reduced by 2 percent.
• Low Utilization Payment Adjustment (LUPA) rates set at:
  • Skilled Nursing: $167.93;
  • Physical Therapy: $183.55;
  • Speech Language Pathology (SLP): $199.52;
  • Occupational Therapy (OT): $184.81;
  • Medical Social Work: $269.16; and
  • Home Health Aide: $76.03.
• CMS is proposing to remove five measures from the current Home Health Value-Based Purchasing (HHVBP) applicable measure set and add three measures starting in CY 2025. Due to the net change in the number of measures proposed, CMS is proposing to adjust the weights for the measures in the Outcome and Assessment Information Set (OASIS)-based and claims-based measure categories starting in CY 2025. Lastly, CMS is proposing to update the Model baseline year to CY 2023 for all measures starting in CY 2025.
• CMS is proposing to adopt two new Home Health Quality Reporting Program (HHQRP) measures and remove one existing measure, along with the removal of two OASIS items. Additionally, CMS is proposing to begin public reporting of additional measures in the HHQRP.

An article on the rule from LeadingAge National is available here. LeadingAge NY will continue to review the rule, and members are encouraged to communicate their concerns to inform public comment.

Contact: Meg Everett, meverett@leadingageny.org, 518-867-8871