‘No Other Option Left’: NAHC Sues CMS, HHS Over Home Health Payment Cuts

The National Association for Home Care & Hospice (NAHC) is suing the Centers for Medicare & Medicaid Services (CMS) after the agency proposed further home health payment rate cuts last week.

The organization announced that it filed a lawsuit against CMS and the U.S. Department of Health and Human Services (HHS) Thursday.

CMS’ latest proposal includes a 2.2% reduction in Medicare fee-for-services payments for next year. It also includes a 5.653% permanent rate cut.


NAHC’s lawsuit alleges CMS and HHS have applied an “invalid” methodology to determine payment. It also argues that the proposal “unlawfully” cuts the payments provided for home health services.

The organization believes that, if these actions go unaddressed, cuts will significantly reduce access to home health care.

“We continued our conversations, discussions and advocacy with CMS in hopes of seeing something happening in the proposed rule that was issued last week,” NAHC President William A. Dombi told Home Health Care News. “When that rule came out, CMS absolutely stuck to its position on the budget neutrality calculation methodology. It was decided that we really had no other option left to try to deal with that other than to go to court.”


The lawsuit follows the introduction of the Preserving Access to Home Health Act of 2023 in the U.S. Senate last month. The legislation, among other things, aims to prevent further cuts to home health payments.

NAHC’s lawsuit mirrors a similar and recent lawsuit from another advocacy organization.

The American Hospital Association filed a lawsuit over the 340B drug discount program in 2022.

Dombi doesn’t believe that the lawsuit will sour the industry’s relationship with CMS, however.

“We have not had a single lawsuit that has in any negative way affected our relationship with the Medicare program,” he said. “We had a conversation with the American Hospital Association recently about that 340B case, and they had the same experience. This is a professional matter, and people act in a professional way, it’s not personalized, we’re not blaming any individuals within CMS. This is just part of a relationship between providers and payers.”

With the lawsuit having been filed, the government now has 60 days to respond. It is likely that they will file a motion for extension of time to respond, according to Dombi.

“An alternative might be trying to dismiss the case on the grounds that the court doesn’t have the power to hear it, that’s a fairly normal approach,” he said.

In Dombi’s view, a successful lawsuit would result in CMS being required to come up with a compliant methodology.

“We would be looking to the court to provide some guidance on what that compliant methodology would be,” he said. “In our own analysis, we believe that providers of home health have been underpaid as it relates to budget neutrality. At minimum, we would expect to see the rate cuts from 2023, that were permanent readjustments to the base rate, and the one proposed for 2024, along with the temporary adjustments … to go away. The end product of that is that we would have a stable system to deliver home health services to Medicare beneficiaries.”

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