Policy Analysis: Medicare reduces Base Fee for Home Health Episodes The 2014 prospective payment rule sets payments, adds quality measures and maintains the reassessment schedule for home health agencies. By Mark Kander The 2014 base fee for a 60-day home health episode will decrease by an average of 1 percent from 2013, according to the final rule on Medicare’s ... Policy Analysis
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Policy Analysis  |   January 01, 2014
Policy Analysis: Medicare reduces Base Fee for Home Health Episodes
Author Notes
  • Mark Kander, is ASHA director of health care regulatory analysis. mkander@asha.org
    Mark Kander, is ASHA director of health care regulatory analysis. mkander@asha.org×
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Regulatory, Legislative & Advocacy / Policy Analysis
Policy Analysis   |   January 01, 2014
Policy Analysis: Medicare reduces Base Fee for Home Health Episodes
The ASHA Leader, January 2014, Vol. 19, online only. doi:10.1044/leader.PA3.19012014.np
The ASHA Leader, January 2014, Vol. 19, online only. doi:10.1044/leader.PA3.19012014.np
Medicare Reduces Base Fee for Home Health Episodes
The 2014 prospective payment rule sets payments, adds quality measures and maintains the reassessment schedule for home health agencies.
By Mark Kander
The 2014 base fee for a 60-day home health episode will decrease by an average of 1 percent from 2013, according to the final rule on Medicare’s prospective payment system for home health agencies[www.gpo.gov/fdsys/pkg/FR-2013-12-02/pdf/2013-28457.pdf].
The geographically adjusted base rate for each episode is $2,869, with a 3 percent add-on for rural home health agencies.
The episodic reimbursement rates in the rule, issued in early December by the Centers for Medicare and Medicaid Services, are determined by several factors, including the types and intensity of services a patient receives, the average cost of providing care per episode, and the number of visits. This new formula conforms with provisions of the Affordable Care Act, and is not based on analyses of past home health agency cost and service utilization data, as in previous years.
As in the past, however, payments for each episode expand based on tiered increases in the number of therapy visits. Because the payment rate has dropped, CMS indicated that it will monitor payment claims and other metrics carefully to ensure beneficiary access to services remains strong as it phases in this new payment adjustment.
Home health agency care may include treatment from a speech-language pathologist, occupational therapist, physical therapist, nurse, aide and social worker. In 2012, visits from SLPs totaled 1.34 million, a figure that represents 1.1 percent of all home health agency visits.
Payment reform
The 2014 payment formula is the first step in longer-term adjustments to the national 60-day episode payment rate mandated by the Affordable Care Act. The law also requires CMS to assess the cost of providing access to home health care for patients with severe illness, with low income, and in medically underserved areas. CMS is authorized to establish demonstration projects to test how home health agencies provide access to care and to recommend to Congress by March 1 any legislative or administrative action regarding payment reform.
Paymentsper visit
The rule keeps the per-visit reimbursement system—as opposed to the per-episode prospective payment system—if an episode requires fewer than five total home health visits. The fixed payment per visit is based on historic per-visit costs by discipline. The geographically adjusted 2014 per-visit rates, which are 5.9 percent higher than the 2013 rates, are $143.88 for speech-language pathologists, $132.40 for physical therapists, and $133.30 for occupational therapists.
ICD-9 code refinements
A total of 170 International Classification of Diseases codes representing two entire CMS categories have been removed from the assessment system that helps determine specific episodic rates. The codes represented conditions “too acute” for home care treatment or that don’t require home health agency intervention.
New HHA quality measure
In addition to existing quality measures that assess a variety of items including patient reports of care, communication between providers and patients, and home safety—home health agencies must also report hospital readmissions during the first 30 days of home health care care and preventable emergency room trips.
Therapy reassessment schedule
The home health therapy reassessment schedule continues to require coordination among therapy disciplines. The required “13th visit reassessment” must take place during the 11th, 12th or 13th visit;the required “19th visit reassessment” must take place during the 17th, 18th, or 19th visit.
The 30-day periodic reassessment schedule also stays in effect, independent of the 13th and 19ththerapy visit requirements. CMS allows only one exception to the 30-day reassessment requirement—if therapy is suspended temporarily due to the patient’s hospitalization.
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January 2014
Volume 19, Issue 1