Amedisys CEO: New Senate Bill Aims to Take the Teeth Out of PDGM

The home health industry — with the help of at least two members of Congress — has fired a salvo against the proposed Patient-Driven Groupings Model (PDGM) through a new federal bill introduced earlier this week.

The legislation takes aim at the aspect of PDGM known as behavioral adjustments, which have been fervently opposed by many home health stakeholders, including Paul Kusserow, president and CEO of Amedisys (Nasdaq: AMED).

Kusserow described pushback on PDGM’s behavioral adjustments Thursday at the 2018 Home Health Care News Summit in Chicago.


Floated by the Centers for Medicare & Medicaid Services (CMS) in early July, PDGM overhauls the home health prospective payment system by removing perceived incentives to over-provide therapy services and halving the standard 60-day unit of payment. Besides those two major changes, however, PDGM also includes the so-called “behavioral adjustments,” or measures CMS assumes agencies will take in light of the new framework.

Behavioral adjustments, for example, assume that agencies will change documentation and coding practices to get the most in reimbursement under PDGM. They also include CMS’ prediction — not based on any real-world observations or pilot programs — that agencies will actively look to avoid Low Utilization Payment Adjustment (LUPA) claims by adding any necessary visits.

“I think behavioral adjustments are something that this industry really shouldn’t tolerate,” Kusserow said. “The idea that [CMS] knows what we’re going to do, particularly if it’s bad, even before we do it is just wrong.”


Backed by Amedisys, the National Association for Home Care & Hospice (NAHC) and other industry players, Republican Sen. John Kennedy of Louisiana introduced a new bill Tuesday — S. 3458 — seeking to remove the controversial behavioral adjustments. The bill is co-sponsored by Sen. Bill Cassidy, also a republican from Louisiana.

“We are really excited about this bill,” Kusserow said. “We think it will take a lot of the teeth out of PDGM — we can live with the rest.”

Among its provisions, S. 3458 seeks to prohibit CMS from making rate adjustments based on behavioral assumptions.

The measure likewise seeks to require CMS to institute rate adjustments only after home health agency behavioral changes have actually occurred, basing those adjustments on observed evidence instead of speculation.

To ensure budget neutrality, the bill also requires that the phase-in of any necessary rate increases or decreases be no greater than 2% per year to limit potential disruption in patient care.

“This legislation, if enacted, would help ensure greater financial stability for Medicare home health providers during the most dramatic payment change they have experienced since the inception of the prospective payment system,” NAHC President William W. Dombi told HHCN via email. “Attempts to predict home health provider response to payment changes in the past proved faulty, and preemptively penalizing providers in the absence of clear evidence guarantees harmful consequences.”

In addition to Baton Rouge, Louisiana-based Amedisys and NAHC, the Partnership for Quality Home Healthcare has also been working with lawmakers on legislative solutions to the behavioral change issue.

Under PDGM, the 30-day payment amount needed to maintain budget neutrality would be about $1,754, assuming providers make adjustments. If agencies do not make any of adjustments, the 30-day payment amount would have to be 6.42% greater.

To some extent, CMS’ push for assumed behavioral adjustments in the PDGM proposal contradicts steps that the agency has taken in other care settings and with the skilled nursing facility (SNF) industry.

For proof, see the rule-making process for SNFs’ new Patient-Driven Payment Model (PDPM), home health experts argue.

“We do not make any attempt to anticipate or predict provider reactions to the implementation of the proposed PDPM,” CMS officials wrote in the SNF final rule. “That being said, we acknowledge the possibility that implementing the proposed PDPM could substantially affect resident care and coding behaviors.  … As a result, lacking an appropriate basis to forecast behavioral responses, we do not adjust our analyses of resident and provider impacts discussed in this section for projected changes in provider behavior. We do intend to monitor behavior which may occur in response to the implementation of PDPM, if finalized, and may consider proposing policies to address such behaviors to the extent determined appropriate.”

S. 3458 was read twice and referred to the Senate Committee on Finance.

“If you don’t want to live with this cut, then call your congressmen, call your senators, and say you support this bill,” Kusserow said to summit attendees. “This is really important because what it says is, ‘Don’t [dock] us 6.4% in 2020.’ Don’t do that to us.”

Written by Robert Holly

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