What Home Health Providers Can Learn From CMS’ Other Proposed Rules For 2025

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Every year, home health providers await the release of the U.S. Centers for Medicare & Medicaid Services’ (CMS) proposed payment rule. While home health providers are likely months away from seeing a proposal, it’s worth examining if what’s happening in other care settings could offer a clue of what to expect.

CMS released the 2025 proposed payment rules for hospice and skilled nursing facilities (SNFs) in March.

On the hospice side, the proposed rule included a 2.6% increase in the per diem base rate.


Aside from the pay raise for hospices, the proposal also included a market basket index update, and notable changes to some of the geographic areas subject to particular indices.

“There are rural areas that became urban and urban areas that became rural in the new CBSs — core based statistical areas,” William A. Dombi, president of the National Association for Home Care & Hospice (NAHC), told Home Health Care News.

CMS also proposed moving forward with the Hospice Outcomes & Patient Evaluation (HOPE) tool, a patient assessment instrument that has been in the works for years, one that will replace the Hospice Item Set.


Still, Dombi has largely described the hospice proposed payment rule for 2025 as “plain vanilla.”

“In some respects, it’s ho-hum,” he said. “There’s nothing really dramatic or game-changing there. At the same time, as people start filtering through the proposal, and start hitting some of those issues, such as the HOPE instrument and the RFI relative to a new payment model, they get a little more curious about it. There certainly hasn’t been any high-level negatives.”

Though the proposed rule for hospice didn’t inspire extreme positive or negative reactions, Dombi pointed out that he has seen uniform disappointment in reaction to the 2.6% inflation update from providers. Many felt this was too low.

“It’s a disappointment in terms of the number, but it’s a number which can change,” Dombi said. “It’s a number which is pretty much based upon data subject to a forecasting instrument which has perplexed people for decades.”

Dombi also noted that one of the more interesting aspects of the proposal was the request for information regarding system reform on the payment model.

“CMS taking a step into further payment reform for hospice is one thing we’ve all been watching for,” he said.

Notably missing was anything related to program integrity efforts, which Dombi noted was something that providers have expressed a need for.

Dombi believes that there are some connections between the hospice proposed payment rule and the upcoming home health proposal.

“The core based statistical area, and the inflation update, are probably the only clues that we could get out of the hospice rule,” he said. “It might show some sort of understanding of what to expect in the home health rule.”

Another reason home health providers may want to keep their eyes on this proposed rule is that many of these organizations also have hospice service lines. Leaders at these organizations need to factor in the hospice rule to determine what the impact will be on their overall business.

“Those companies that have both home health and hospice can start planning for 2025 — at least preliminary planning,” Dombi said.

SNF proposed rule

The proposed rule for SNF operators includes an increase to payment rates by approximately 4.1%, or $1.3 billion.

Joel VanEaton — executive vice president of PAC regulatory affairs and education at Broad River Rehab — believes that this is a mostly positive update.

“There were comments from people [saying] it’s not enough to cover costs in the world we find ourselves in now, but it is a good thing for skilled nursing facilities that we didn’t have a reduction this year,” he told HHCN. “The last two years, we’ve had a 2.3% parity adjustment to our case mix indexes. We did have payment updates, but that parity adjustment took away some of that.”

The other big change was related to the wage index. For SNFs, wage indexes are essentially based on the geographical location of the facility, and the hospital wage data that’s associated with that geographical location.

Similar to hospice, changes to CBSs meant that some counties went from urban to rural and vice versa.

“There were some wide swings in relation to the impact of the wage index, but fortunately, a couple of years ago CMS put in place a permanent 5% cap on reductions in wage index,” VanEaton said.

Aside from those who believe the 4.1% increase isn’t enough, the reaction to the SNF proposed rule has mostly been positive, according to VanEaton.

“It’s a positive thing that you’re not going to end up worse off than you were the prior year,” he said.

In general, the connections between home health and SNFs may be less obvious than the ones with hospice.

But it is of note that, for now, home health providers seem to be getting the short end of the stick when it comes to annual payment updates.

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