On October 30, 2014, CMS issued a final rule for Medicare Home Health Prospective Payment System (HH PPS) rates for CY 2015. The final rule estimates that Medicare payments to home health agencies (HHAs) in CY 2015 will be reduced by 0.30 percent, or $60 million. This decrease reflects the effects of the 2.1 percent home health payment update percentage ($390 million increase) and the second year of the four-year phase-in of the rebasing adjustments to the HH PPS payments rates required by the Affordable Care Act ($450 million decrease). The CY 2015 rebasing adjustments will reduce the national, standardized 60-day episode payment rate by $80.95, decrease the non-routine medical supplies (NRS) conversion factor by 2.82 percent, and increase the national per-visit payment rates. The national, standardized 60-day episode payment rate for CY 2015 will be $2,961.38.

In addition to updating the HH PPS rates, the final rule includes several significant changes that affect HH PPS.

Face-to-face Encounter Requirements

The final rule eliminates the narrative requirement in 42 C.F.R. § 424.22(a)(1)(v), except when the physician is ordering skilled nursing visits for management and evaluation of the patient's care plan. Notwithstanding the elimination of the narrative requirement, the certifying physician is still required to demonstrate that a face-to-face patient encounter occurred. For medical review purposes, only the documentation in the certifying physician's medical records and/or the acute/post-acute care facility's medical records (if the patient was directly admitted to home health) may be used as the basis for certification of patient eligibility.

Physician claims for certification/re-certification of patient eligibility will not be covered if the corresponding HHA claim was denied. This proposal will be implemented through future sub-regulatory guidance.

CMS also clarified that the face-to-face encounter requirements are applicable for certifications (not re-certifications), rather than initial episodes; a certification (versus a re-certification) generally occurs any time that a new state of care assessment is completed to initiate care.

Therapy Reassessment Timeframes

CMS eliminated the requirement for therapy reassessments to be performed on or close to the 13th and 19th therapy visits and at least once every 30 days. For episodes ending on or after January 1, 2015, a qualified therapist, not assistant must provide the needed therapy service and functionally reassess the patient at least every 30 calendar days.

Home Health Quality Reporting Program

The final rule establishes a minimum submission threshold for the number of Outcome and Assessment Information Set (OASIS) assessments that HHAs must submit to meet their quality data reporting requirement. For episodes beginning on or after July 1, 2015 and before June 30, 2016, HHAs must submit admission and discharge OASIS assessments for a at least 70 percent of all patients with episodes of care occurring during that period or be subject to a two percent annual payment reduction. CMS plans to increase the compliance threshold over the next two years to reach a maximum threshold not exceeding 90 percent.

Speech-language Pathologist Personnel Qualifications

Under the final rule, a qualified speech-language pathologist is an individual who meets one of the following requirements: (1) has a masters' or doctoral degree in speech-language pathology and is licensed as a speech-language pathologist by the state where they furnish services; or (2) meets the specific requirements set forth in the Social Security Act.

Home Health Value-Based Purchasing (VBP) Model

CMS is still considering whether to test a HHA VBP model in CY 2016. As envisioned, the model would include a five to eight percent adjustment in payment made after each planned performance period in the projected five to eight states selected to participate in the model. If CMS moves forward with the implementation, it intends to invite additional comments on a more detailed model proposal to be included in future rulemaking.

The final rule is scheduled to be published in the Federal Register on November 6, 2014. The final rule is available here.