While evidence already confirms that home healthcare is a cost effective care setting with positive clinical outcomes for patients, the Partnership is working to further improve quality and access for the patients we serve.


In the Home Health Prospective Payment System (HHPPS) Final Rule for FY2020, the Centers for Medicare & Medicaid Services (CMS) finalized plans to implement a new payment model for home health services in 2020, known as the Patient-Driven Groupings Model or PDGM. The Bipartisan Budget Act (BBA) of 2018 requires the new model to be budget neutral while changing from a 60-day payment unit to a 30-day payment unit. In addition, the new model under BBA must not use the volume of therapy visits as a payment level determinant in contrast to the Home Health Perspective Payment System (HHPPS) model in effect since October 2000.

In devising a model that is budget neutral, BBA mandates Medicare to apply “behavioral adjustments” to account for changes in provider behavior unrelated to changes in patients served or services delivered that increase payments.

In the HHPPS Final Rule for 2020, CMS used this authority to institute an adjustment in the first year of PDGM based solely on assumptions of behavior change that might occur in 50 percent of the episodes of care. Therefore, CMS will use behavioral assumptions in adjusting the payment rate for half the 30-day episodes of care, opposed to all 30-day episodes of care in 2020, which reduces the first year payment cut to 4.36 percent from a previously planned 8.01 percent.

The Partnership appreciates that CMS leaders responded to the home health community’s comments and feedback and also greatly appreciates Congressional leadership by the sponsors of the Home Health Payment Innovation Act (S. 433 & H.R. 2573), which was introduced with bipartisan support in both the House and Senate. The strong bipartisan support for this legislation and the momentum created by the groundswell of Congressional support is tremendously appreciated. This important legislation would:

  1. Achieve full budget neutrality over the period of 2020-2029.
  2. Prohibit any pre-change rate reductions based on assumptions.
  3. Require behavioral adjustments based on real, actual changes in provider behavior in response to the new payment model.
  4. Permit a phase-in of rate adjustments (up or down) when an annual adjustment would be greater than 2 percent. However, the phase-in would operate to ensure full budget neutrality by 2029.
  5. Permit MA Plans and CMMI innovations to waive the “confined to the home” requirement under the Medicare home health services benefit when in the best interest of the Medicare beneficiary.