Govt Relaxes Home Health Medicare Rules for New ACOs

The federal government has taken steps to expand Medicare reimbursements for home health and telehealth services through a new type of accountable care organization (ACO) that was officially announced Tuesday.

The newly unveiled Next Generation ACO Model eases certain rules that restrict home care,  telehealth and post-acute care in traditional, fee-for-service Medicare. For example, certain participating Next Generation providers could waive the requirement that beneficiaries need to be located in a rural area to receive coverage for telehealth.

Next Generation ACOs also could receive waivers that would allow claims for certain home visits after a patient is discharged from an inpatient facility, such as a hospital. These visits would have to be made by licensed clinicians under the general supervision of Next Generation Providers/Suppliers, or organizations that are not part of the ACO proper but have “preferred provider” status.


“Licensed clinicians may be any employees, leased employees, or independent contractors who are licensed under applicable state law to perform the ordered services under physician (or other practitioner) supervision,” the Next Generation ACO Model Request for Applications states.

Providers in Next Generation ACOs also could potentially provide skilled nursing services to patients who have not spent any time in the hospital. Under standard Medicare rules, a beneficiary must spend three midnights as a hospital inpatient to qualify for subsequent skilled nursing, including rehabilitation services.

Like existing ACO models — the Pioneer model and the Medicare Shared Savings Program — the Next Generation program calls for different types of health care providers to partner up with the goal of improving patient outcomes and lowering costs through coordinated care. They can share in savings they achieve, if they meet quality benchmarks.


The Next Generation model is designed for providers that already are experienced in this type of population health management, the Centers for Medicare & Medicaid Services (CMS) specified. It offers greater rewards than the MSSP model — which currently has the most participation — but also poses greater financial risk to participants.

CMS anticipates that 15 to 20 ACOs will participate in the Next Generation model across the country, with various types of provider organizations involved. Organizations interested in the first round of participation must submit a letter of intent by May 1, 2015.

Written by Tim Mullaney

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