Since the Centers for Medicare & Medicaid Services (CMS) announced its proposal to phase out Requests for Anticipated Payments (RAPs) last month, home health providers have voiced their concerns about what the change will mean for them.
Industry-wide, the consensus isn’t good. Many providers worry the removal of RAPs, in addition to the other regulatory changes, will create insurmountable cash flow issues and force them to close up shop.
But not everyone is taking such a fatalistic view.
“To me, that is not a sky-is-falling issue,” Mark Sharp, partner at national accounting and advisory firm BKD, said. “You need to plan for cash flow purposes, … [but] it will be okay in my mind, as long as you can get past that dip and make sure you’re effective in your day-to-day cash flows.”
Sharp’s comments came during the National Association for Home Care & Hospice (NAHC) Financial Management Conference last month in Chicago.
His rationale: The elimination of RAPs will only mean a one-time hit for agencies. So as long as providers have credit lined up ahead of the implementation, they should survive and fall into the new groove relatively easily.
Currently, home health agencies can receive about 60% of their anticipated payment for a care episode at the beginning of that episode through a RAP. However, CMS wants to cut that to 20% in 2020, then eliminate the practice altogether in 2021.
CMS cited fraudsters as the inspiration for the change, which is why Melinda Gaboury, co-founder and CEO of Healthcare Provider Solutions Inc., said she wasn’t surprised when the proposal was announced.
“The reality is there’s a lot of abuse going on out there,” Gaboury told conference attendees. “I’ve had conversations numerous times with the Medicare [auditors] about RAPs going on and on and on with no final claims. And I get that’s not the majority, but that’s the reality and part of the reason they justified this.”
While Gaboury believes the phase out of RAPs will be difficult for agencies to navigate, she says the industry has bigger fish to fry — like the new notice of admission requirement CMS is proposing in place of RAPs.
“It’s going to be very unnerving, very scary, very frustrating from the beginning,” Gaboury said.
Under CMS’s proposal, beginning in 2021, home health agencies would be required to submit an electronic notice of admission within five days of receiving a new patient starting. Agencies that fail to meet the submission deadlines would see payment penalties.
On top of that, both Gaboury and Sharp testified to the urgency of addressing the 8.01% rate reduction set to come with the Patient-Driven Grouping Model’s (PDGM) behavioral adjustment.
“The sky-is-falling [issue] is the 8% behavior adjustment,” Sharp told attendees. “That’s the sky is falling. If I were going to throw all my weight into really combatting something, it would be that.”