PDGM, Bankruptcies and Medicare Advantage: Top Home Health Stories of 2019

No shockers here: The Patient-Driven Groupings Model (PDGM) was the big story in 2019.

The most widely read Home Health Care News story from the past year was a PDGM-focused conversation between the leaders of Amedisys Inc. (Nasdaq: AMED), LHC Group Inc. (Nasdaq: LHCG) and Encompass Health’s (NYSE: EHC) home health division. Now just days away, PDGM has a great chance of shaping 2020’s top stories as well.

While at least six of HHCN’s most popular stories this year had to do with PDGM, there were many other topics that caught readers’ attention in 2019. For example, the ongoing struggle of providers working to attract and retain caregivers remains a powerful issue, as did new Medicare Advantage (MA) opportunities, unexpected cross-industry partnerships and the somewhat controversial hospice carve-in.

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Revisit 2019 — and get a sense of what ongoing trends and regulations will shape 2020 — by browsing through our 10 most-read stories from the past year.

Perfect Storm: Amedisys, Encompass Health and LHC Group CEOs Brace for PDGM

The No. 1 story from 2019 came out of September’s HHCN Summit in Chicago, when Amedisys’s Paul Kusserow, LHC Group’s Keith Myers and Encompass Health’s April Anothy highlighted the “perfect storm” looming over the home health landscape. In addition to PDGM, that storm includes the Review Choice Demonstration (RCD) and the phasing out of Requests for Anticipated Payment (RAPs).

To weather the storm, agencies will have to expertly manage their cash flow and make sure staff are operating at the tops of their licenses.

How Home Health Agencies Can Prepare for, Fight PDGM

PDGM is the most significant overhaul to home health reimbursement in 20 years, but it’s not an insurmountable change. That was the key message from National Association for Home Care & Hospice (NAHC) President William A. Dombi in this story, which highlighted various steps agencies can take to mitigate PDGM’s impact.

[Updated] CMS Proposes Elimination of RAPs, $250 Million Medicare Payment Increase

The Centers for Medicare & Medicaid Services (CMS) rolled out its proposal payment rule in July. As expected, the proposal tweaked certain provisions of PDGM. Seemingly out of nowhere, however, the proposal also called for the elimination of RAPs, a tool that many small and mid-sized agencies use to manage cash flow and make payroll.

Understandably, the relative surprise and projected impact helped this story make HHCN’s most-popular stories list. Ultimately, CMS’s RAP proposal was finalized in October.

PDPM Aftermath Offers Glimpse of Home Health Therapy Changes to Come

Among its changes, PDGM will move therapy utilization away from volume, instead tying reimbursement to patient characteristics. The Patient-Driven Payment Model (PDPM) does something similar for skilled nursing facility (SNF) operators. The therapy ramifications from that model — launched Oct. 1 — are already occurring.

Home Care Industry Turnover Reaches All-Time High of 82%

Routinely labeled as the toughest challenge facing home care agencies, the median caregiver turnover rate skyrocketed to 82% in 2018, according to this year’s Home Care Benchmarking Study by market research and education firm Home Care Pulse. The all-time high was a 15% increase compared to the prior year.

This story looked at private-duty home care, but skyrocketing turnover is a persistent challenge in home health care, too.

[Updated] Walmart Health, Amedisys Partner to Expand Home Health Access Nationwide

Multinational retail giant Walmart took a major leap toward expanding into health care in 2019 with the launch of Walmart Health, a project that included the opening of a 10,000-square-foot health center in Dallas, Georgia. In a deal that embodies the cross-industry appeal of home health care, Amedisys was quick to get in on the action.

CMS Proposal Takes Home Health Agency Closure Estimates and ‘Lights Them on Fire’

Once implemented, PDPM has the potential to put 30% of home health providers out of business, mostly small and mid-sized agencies. CMS’s RAP phaseout will likely pour gasoline on that 30% fire, some industry insiders predict.

The situation may not end up that dire, but stakeholders should still expect at least a slight uptick in home health bankruptcies next year.

Home Care Providers Look Ahead as Medicare Advantage Evolution Continues

CMS opened up Medicare Advantage to non-medical in-home care in 2018. The agency did so even further in 2019, announcing in April that plans next year can cover any benefits that “have a reasonable expectation of improving or maintaining the health or overall function” of beneficiaries with chronic conditions.

The expansion has been profound. At least 148 plans will cover in-home support services in 2020, according to a study conducted by actuarial consulting firm Milliman.

Primary Diagnosis Changes Among PDGM’s Most Overlooked Aspects

About 40% of the diagnoses allowed for under the current Prospective Payment System (PPS) will not be accepted as a primary diagnosis under PDGM — a change some industry leaders have called potentially disastrous.

[Updated] CMS to Test Hospice Carve-In Under Medicare Advantage

CMS announced in March that it planned to test drive a hospice carve-in under Medicare Advantage in 2021, though some say the hospice-MA connection may form sooner rather than later. While many support the idea, others are more skeptical. Home health agencies haven’t had a great experience in the MA world, so hospice providers may not strike gold either.

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