CMS unveils Key Updates for Home health agencies in 2025
The Centers for Medicare & Medicaid Services (CMS) recently released its final rule outlining crucial changes to the Home Health Agencies (HHA) payment structure and policies starting January 1, 2025.
Payment Adjustments: A Balanced Approach
While CMS initially projected a 2.7% increase in home health payments, the final rule reflects a more modest 0.5% increase, translating to roughly $85 million compared to 2024. This adjustment incorporates a behavioral offset and other payment modifications designed to ensure stability within the industry.
The final rule incorporates a 2.2% market basket update, partially offset by a 0.5% productivity adjustment. Additionally, it includes a 1.8% national, standardized 30-day payment rate decrease, reflecting a long-term adjustment related to the Patient-Driven Groupings Model (PDGM).
Key Updates for 2025:
Case-Mix Adjustments: The CY 2025 case-mix budget neutrality factor is set at 1.0039.
Outlier Payments: A fixed-dollar loss ratio of 0.35 will determine outlier payments for CY 2025.
Occupational Therapy: A dedicated LUPA add-on factor of 1.7238 will now be used for occupational therapy, replacing the previous practice of utilizing the physical therapy LUPA add-on factor.
Specialized Treatments: Separate payment for disposable negative pressure wound therapy is set at $276.57, while Intravenous immune Globulin items and services will be reimbursed at $430.99.
- Wage Index Revamp: Adoption of the Office of Management & Budget’s updated core-based statistical area (CBSA) delineations will influence area wage indexes. This will result in shifts between urban and rural classifications for certain counties, with CMS utilizing its existing 5% cap on annual wage-index changes to manage any significant fluctuations.
Strengthening Quality Care:
CMS is committed to prioritizing social determinants of health within the HHQRP. Starting in 2027, four new measures addressing living situations, food security, and utility access will be incorporated. an existing measure relating to transportation is also being modified to align with existing inpatient programs, and data collection methodologies are being updated.
Looking Ahead: the HHVBP Model’s Evolution
CMS is actively exploring new performance measure concepts for the HHVBP model beyond 2025, with a specific focus on family caregiver support, falls with injury, Medicare spending per beneficiary, and functional independence measures. Health equity remains a priority, with CMS considering the inclusion of a Health Equity Adjustment similar to the SNF Value-Based Purchasing programme.
Supporting Informed Decision-making:
Changes to the Home Health Conditions of Participation (CoP) now require agencies to carefully consider their caseload, staffing capacity, and the complexity of patient needs before accepting new patients. This aims to ensure a high standard of care across the board.
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Staying Ahead of the Curve:
The transition from COVID-19 reporting standards to a more complete system tracking acute respiratory illnesses is also underway, with mandatory weekly reporting commencing on January 1, 2025. This shift reflects a focus on a broader perspective on infectious disease surveillance.
Home health agencies need to stay abreast of these evolving regulations and policies to ensure operational compliance and deliver high-quality care.
How will the transition to value-based care impact smaller home health agencies compared to larger ones?
Interview between Time.news Editor and Home Health Policy Expert
Time.news Editor: Welcome to Time.news! Today, we have the pleasure of speaking with Dr. Emily Turner, a renowned expert in healthcare policy, particularly regarding home health agencies. dr. Turner, thank you for joining us.
Dr. Emily turner: Thank you for having me! I’m excited to discuss the recent developments from the Centers for Medicare & Medicaid Services, or CMS, regarding home health agencies.
Editor: Absolutely! The CMS recently released their final rule that will bring significant changes to HHA payment structures and policies starting January 1, 2025. Can you give us an overview of what these updates entail?
dr. Turner: Certainly! The new rule from CMS is designed to modernize the payment system for home health agencies. Some key updates include a shift toward value-based care, emphasizing quality of patient outcomes rather than just service delivery. This means that agencies will need to demonstrate effective patient management and health improvement to receive full reimbursement.
Editor: That’s a considerable change. How do you think this shift toward value-based care will affect the overall quality of care provided by home health agencies?
Dr. Turner: I believe it will considerably enhance the quality of care. By incentivizing agencies to focus on patient outcomes, we encourage them to implement more complete care plans. This could lead to better patient engagement, improved health literacy, and ultimately, higher satisfaction rates.
editor: Are there any specific metrics or standards that agencies will need to focus on to align with this new reimbursement model?
Dr. Turner: Yes, CMS has specified several metrics, including patient satisfaction scores, readmission rates, and health improvement benchmarks. Agencies will need to track these metrics closely and implement strategies for improvement if they’re to succeed financially under the new structure.
Editor: That sounds like quite the challenge. What implications do you think this will have for smaller home health agencies that may lack resources compared to larger competitors?
Dr. Turner: That’s a valid concern. Smaller agencies might struggle with the administrative burden of tracking and reporting these metrics effectively. However, I foresee potential support structures emerging, like partnerships or coalitions among smaller agencies to share resources, best practices, and technologies that can help level the playing field.
Editor: Engaging! it seems collaboration could be key. On a policy level, what can be done to assist smaller agencies during this transition?
Dr. Turner: Policymakers need to be aware of these challenges and could potentially offer technical assistance programs, grants, or low-interest loans to help small agencies upgrade their IT systems and training programs.Moreover, ongoing education on these new standards will be crucial for everyone involved in home health care.
Editor: That brings us to an crucial point about training and education. How can home health care workers adapt to these new expectations and standards?
Dr. Turner: Continuous education and training will be vital. Agencies should invest in training their staff not only on clinical skills but also on data collection and patient engagement strategies. CMS has also indicated a commitment to providing resources to aid the transition, which should be embraced by all home health agencies.
Editor: As we look towards 2025, what do you envision as the biggest opportunity and challenge for home health agencies in light of these updates?
Dr. Turner: The biggest opportunity lies in redefining the role of home health agencies in the larger healthcare ecosystem. As healthcare continues to move towards patient-centered care, HHAs can position themselves as integral parts of that model. The challenge, however, will be adapting to these rapid changes while maintaining financial viability and ensuring staff are equipped to meet new demands.
Editor: Great insights, Dr. Turner! Thank you for shedding light on these crucial updates and how they could reshape home health care in the coming years.
Dr. Turner: Thank you for having me! It’s an exciting time for home health agencies, and I look forward to seeing how they adapt and thrive in this new landscape.
Editor: And to our readers, stay tuned for more updates on health policy changes that affect you and your loved ones!