‘Perpetuity Of Uncertainty’: Home Health Providers Await Another Poor Payment Proposal While Left In Limbo On Massive Clawbacks

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The Medicaid Access Rule has been finalized, with six years until the implementation of the 80-20 provision. There’s no time to rest for home-based care providers and advocates on the regulation front, however. Summer is near, and that means so is the home health proposed payment rule from the Centers for Medicare & Medicaid Services (CMS).

In 2022, a significant proposed cut to home health payment mostly took providers by surprise. In 2023, it was expected. And, unfortunately, the home health industry is expecting more of the same in the next proposal.

The counter to CMS’ rate cuts and attempted clawbacks remains the same in 2024, and it is all-encompassing: grassroots action from providers locally; a lawsuit against CMS and the U.S. Department of Health and Human Services (HHS); a push for Congressional support and direct pleas to CMS to rethink its methodologies.


In 2024, there’s already been a few major developments on those fronts.

For one, at the end of April, the National Association for Home Care & Hospice’s (NAHC) lawsuit against CMS – first filed in July of last year – was dismissed by a federal judge. Though an unfortunate update to the situation, NAHC President William A. Dombi proclaimed the legal battle far from over.

“We are disappointed with the court’s ruling,” Dombi said. “However, it is a minor setback that we can readily overcome. Often justice delayed is justice denied. Here, we will have our day in court. This battle is far from over.”


Meanwhile, last week, Sens. Debbie Stabenow (D-Mich.) and Susan Collins (R-Maine) sent a letter to CMS Administrator Chiquita Brooks-LaSure strongly advocating against further cuts to home health payment.

“We appreciate CMS’ commitment to helping people get the care they need, where they need it,” the senators wrote. “This must include home health services for people with Medicare. As CMS proceeds to develop Medicare home health payment rates for 2025, we urge you to consider the value home health care provides to the Medicare program and its beneficiaries.”

There’s a lot going on in Washington, D.C., this year. Providers and advocates will have to find a way to cut through the noise to get the attention of lawmakers with the ability to prevent further cuts.

This week’s members-only, HHCN+ Update focuses on the next five months in home health payment policy, and what the industry expects is ahead of them.

More cuts ahead

There’s not a provider I’ve talked to this year that expects anything but further proposed cuts in June or early July. That’s because CMS made it clear in last year’s final rule that there would be more to come on the cutting front.

Partnership for Quality Home Healthcare (PQHH) CEO Joanne Cunningham forecasted another “doomy, gloomy” home health policy landscape for 2024 in January.

But Cunningham also believes that 2024 being an election year works in the industry’s favor.

“We know that Congress in an election year is very keenly tuned into the needs of their constituents,” she told me. “We are very hopeful. With some of our Congressional advocates, we’re looking for solutions that could make their way into a package that Congress will undoubtedly be moving, dealing with Medicare provisions. Our goal is to make sure that home health is part of that.”

Previously, lawmakers have introduced the Preserving Access to Home Health Act. Similar bills were introduced in 2022 and 2023, both in the Senate and the House. The latest version would have mitigated cuts, and also forced The Medicare Payment Advisory Commission (MedPAC) to take a more holistic view at home health reimbursement by including Medicare Advantage (MA) payments.

After two years of cuts – a 2.890% cut last year, and a 3.925% cut the year before – providers would likely take any respite, but respite is not the goal.

CMS has proposed more severe cuts than it has finalized of late, allowing the overall aggregate payment adjustments to come in as slightly positive. But those positive adjustments are just positive on the surface, which is a story PQHH, NAHC and the provider community are trying to tell.

Source: PQHH, NAHC

Since 2020, CMS has either implemented or announced over $19 billion in cuts through 2029, according to PQHH. As laid out on the chart above, these cuts will have a compounding effect over time.

CMS has dismissed providers’ access-to-care concerns over the last few years, and it has not wavered on its strategy.

“In working with folks from CMS, I find I’m generally very impressed with smart people trying to do good work,” Michael Johnson, the president of home health and hospice at Bayada, told me last year. “I always try to make sure I don’t vilify these folks, because I think they really are trying to do good work. But the primary tool they have is payment. All they have is a hammer. So, if you need a screw adjusted, you’re still using a hammer, and we know what the outcomes of that look like.”


Providers are up against that hammer, and the result of it is the chart shown above.

But CMS is also attempting to claw back “overpayments” it made to providers in 2020-2022: $873 million in 2020, $1.2 billion in 2021 and $1.4 billion in 2022.

At this point, every year that the home health industry does not fully win its fight against CMS, the potential impact of cuts and clawbacks for future years gets worse.

VitalCaring President Luke James and I had a conversation about those clawbacks on stage last month at Home Health Care News’ Capital + Strategy conference.

“I hate to beat a dead horse, but this temporary payment adjustment, the longer it just sits out there and doesn’t get enacted – it’s just growing in terms of size,” James said. “I know we’ve been talking about it for three years. And I think we’ve become maybe somewhat numb to that. But the numbers are very large, and they’re like problems; they only get worse if they fester.”

I then asked if James would rather have those clawback cuts implemented now.

“I’d rather have them not implemented at all,” he continued. “I’d rather them see the failed logic that they’re applying. … But if they’re going to implement them, I think I’d rather take a rip-the-Band-Aid-off approach. Because a lack of certainty is what creates a really hard dealmaking market. Certainty – rather than a perpetuity of uncertainty – is a better place, in my opinion.”

At this point in the game, morale is certainly a part of the equation, almost as much as the nuts and bolts relating to fighting cuts. Providers have fought tooth and nail to both survive and advocate for over two years now.

Stabenow and Collins’ letter to CMS is further evidence of the bipartisan support the industry has in Washington, D.C.

But if 2024 isn’t the year that things turn for the better for home health providers, it will be tough to convince smaller providers that the fight is still worth it – yet again.

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