Lawmakers to Verma: Time to Ditch PDGM’s Behavioral Assumptions

The flood of home health support from Congress on the Patient-Driven Groupings Model (PDGM) front continues.

On July 2, a bipartisan, bicameral group of lawmakers sent a letter to Centers for Medicare & Medicaid Services (CMS) Administrator Seema Verma, urging the agency’s leader to revisit certain widely opposed provisions of PDGM during CMS’s annual rulemaking cycle. The group of lawmakers was made up of Sens. Susan Collins (R-Maine) and Debbie Stabenow (D-Mich.), in addition to Reps. Vern Buchanan (R-Fla.) and Terri Sewell (D-Ala.).

The four members of Congress were instrumental in introducing S. 433 in February and H.R. 2573 in May, respectively.


Both bills are known as the Home Health Payment Innovation Act of 2019.

“We recently introduced bipartisan legislation in the House and Senate … that would require CMS to rely on actual claims data before imposing cuts and create guardrails to ensure that even as CMS maintains budget neutrality over multiple years, no single year behavioral adjustment will be more or less than two percentage points,” the lawmakers wrote. “At the same time, we believe the annual rulemaking cycle offers an opportunity to revise the adjustments and avoid unnecessary disruption to care at a time when providers are already implementing a new payment model.”

Broadly, the standing version of PDGM includes certain provisions — or assumptions — that would eventually lead to a projected 6.42% rate cut to home health payments in 2020, based on agencies’ internal analysis and modeling.


Those assumptions, for example, include CMS’s belief that home health agencies would do everything possible to avoid being hit with a Low Utilization Payment Adjustment (LUPA) claim under PDGM’s more complex framework.

Currently, home health providers receive a LUPA claim if they provide four or fewer visits during a 60-day care episode to any type of patient. Once PDGM goes into effect, providers will have to navigate a complex web of 216 different LUPA scenarios.

CMS expects LUPA rates to drop from 8% to 7.1% once PDGM kicks in, but some industry experts believe they’ll actually increase.

PDGM was mandated to be budget neutral by the Bipartisan Budget Act (BBA) of 2018.

“The changes to home health payment required by BBA of 2018 were not intended to create significant cuts in 2020,” the lawmakers wrote. “CMS has wide discretion in making assumptions, but we are concerned that CMS has not taken into account what may happen to Medicare beneficiaries and their access to home health services as a result of this substantial cut.”

After being introduced roughly five months ago, S. 433 was read twice and referred to the Senate Committee on Finance, where it currently remains. Meanwhile, H.R. 2573 currently resides in committee as well.

In general, industry policy experts expect a PDGM refinement legislation to, perhaps, be wrapped into a broader Medicare bill this fall.

Sen. Collins — who has openly discussed her personal connection to home health care — has been a particularly strong ally to industry stakeholders.

“What CMS is doing is making an assumption that is very unfair,” Collins previously told Home Health Care News. “It’s making an assumption that most home health care providers are being overpaid. I just don’t believe that is the case.”

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