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.


CMS plans to implement a completely new payment model for home health services in 2020. That model is 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. CMS has used this authority to institute an adjustment in the first year of PDGM based solely on assumptions of behavior change that might occur. In its HHPPS Proposed Role for 2020, Medicare suggests an 8.01% base rate reduction adjustment – up from the previously proposed 6.42% reduction – that would start before any actual behavioral changes occur. This reduction would translate to a $1.298 billion reduction in home health payments in 2020 alone.

The Partnership strongly supports the Home Health Payment Innovation Act (S. 433 & H.R. 2573), which was introduced with bipartisan support in both the House and Senate. 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.