Home Health Associations Say Groupings Model is ‘Fraught with Risks’

When the Centers for Medicare & Medicaid Services (CMS) proposed a new payment model for home health care agencies in late July, industry associations decried the significant changes, and public companies took a major hit.

With a potential cut of $950 billion to home health reimbursements in 2019 alone included in the model, associations are still asking for answers from CMS several weeks later, and hammering the emphasis that the untested model is risky. The payment system update also included an $80 million reduction in payments to home health agencies in 2018.

Seeking Answers

The rule proposed many changes to the way agencies would be reimbursed for home health care, such as the home health groupings model, which categorizes patients into six patient groups based on diagnosis.

The rule also proposes switching from the current 60-day episode of care to a 30-day period, resulting in a $950 million cut in payments to the sector. The switch may be based on an estimation by CMS that a significant number of home health cases could be completed in one 30-day episode.

“CMS estimates that 25% [of home health cases] could be wrapped up in a 30-day episode, that it doesn’t need to go into a 60-day episode,” Joy Cameron, vice president of policy and innovation of ElevatingHome, told Home Health Care News.

However, ElevatingHome is doing its own research on that figure. Others have also questioned CMS’ impetus for the proposal.

“We keep getting conflicting intelligence regarding that,” Bill Dombi, interim president of the National Association for Home Care & Hospice (NAHC) told HHCN of CMS’ reasoning.

There are some suspicions that CMS is masking an enormous payment cut to home health within the payment system overhaul, according to Dombi, who calls the untested system “fraught with risks.”

Nonetheless, the full extent of the impact of the 30-day model is not yet fully known, Dombi said.

“The confusion expressed earlier… has now grown,” Dombi said of the current state of the industry’s response. “A number of companies are trying to do an in-depth, deep-dive analysis, and the conclusion is that they can’t do the analysis.”

ElevatingHome is also concerned that CMS has not worked with the industry enough before proposing the new model.

“There is concern that it has not been met with industry interaction,” Cameron told HHCN. “There hasn’t been dialogue back and forth and collaboration. We wish [CMS] had done that to allow us to offer feedback.”

Overstepping Authority?

Above all the questions and concerns, there also remains a potential trump card that stakeholders are holding close to their chests—if CMS has the authority to actually implement such sweeping changes without Congressional approval.

Several executives of public home health care companies have questioned CMS’ ability to go forth with the rule under the authority granted to it by Congress.

Almost Family (Nasdaq: AFAM) President Steve Guenther argued that CMS has an obligation to implement the rule in a “budget neutral manner” in accordance with its authority from Congress.

Guenther also stated that the rule would likely put patients at risk of losing access to care, though he does support modernizing the payment system.

“To do otherwise may put vulnerable patient populations at risk and most certainly will drive unnecessary opposition to what is otherwise directionally a positive policy development,” Guenther said in a statement on the company’s second quarter earnings results.

Others have echoed this risk.

“It’s disadvantaging providers with certain patients, not patient categories,” Dombi said. “If it’s disadvantaging certain patients, you can anticipate, for survival purposes, providers would change behaviors, [such as] how they care for patients and if they care for them at all.”

Amedisys (Nasdaq: AMED) CEO Paul Kusserow also voiced fighting words during the company’s most recent earnings call, saying of the newly proposed model, “It ain’t over until it’s over.”

NAHC plans to challenge CMS on its authority to overhaul the payment system in such a significant way, Dombi told HHCN. The association is likely to present its challenge by the end of August, according to Dombi, who feels “very confident” CMS does not have the authority. The association is also prepared to execute other options, including filing suit in court and asking for Congressional intervention.

“We do not have enough information about this model, and we don’t have enough capability on our own to fully analyze its impact,” Dombi said. “We’re not in the dark, but we’re in no position to say the concerns are overblown. If there is a huge cut hidden in there, the risk is real.”

Written by Amy Baxter