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Home health care providers may see changes to payment structure

The American population is aging. As the Baby Boomers begin to transition into a new phase of life, there will likely be a greater demand for home health care services. In an effort to help address this need, lawmakers passed the Patient-Driven Groupings Model (PDGM). The Centers for Medicare and Medicaid Services (CMS) touted this new model as a means to improve reimbursement for home health care services.

Will the new model be successful? Unfortunately, due to the model’s current reliance on behavioral assumptions to guide payment decisions critics state the changes would result in unfair and inaccurate payment to providers.

If the law goes into effect as written in 2020, skeptics claim it could translate to over $1 billion lost in reimbursements and lead to the collapse of the home health care industry.

A new proposal may help to adjust this model to provide more accurate payments to home health care service providers.

What is the new proposal? The new piece of legislation requires the use of observed evidence and data to guide Medicare reimbursement rates, as opposed to reliance on assumed changes. Although similar to previous proposals, this piece of legislation is different in that it provides a clearer definition of “observed evidence.”

The new law would also remove the homebound requirement in certain situations. If successful, this would mean more Medicare beneficiaries could receive home health care services.

Will it pass? The bill has a lot of momentum, making passage likely. It is scheduled to be introduced in a few weeks. We will follow this bill’s progression and provide updates in future posts.