Medicare Home Health Final Rule Continues CMS Policy of Cuts: Congress Must Act to Enable Access to Meet Patient Demand and Stabilize the Home Health Community

Washington, D.C. – Home health leaders with the Partnership for Quality Home Healthcare (the Partnership) were again disappointed that the Centers for Medicare & Medicaid Services (CMS) continued its policy of cuts by finalizing a -1.975 percent permanent cut to home health in its CY2025 Home Health Prospective Payment System (HH PPS) Final Rule. Today’s cut – the latest in a series of troubling rate reductions – comes despite mounting evidence and clear data that patient access to lifesaving care is declining due to consecutive years of cuts to patient-preferred home health. While the Final HH PPS Rule did mitigate the permanent payment cut proposed by CMS earlier this year, the Partnership warns that any additional cut to home health in 2025 will further restrict beneficiary access.

“The cut that CMS finalized nearly negates the market basket increase that is meant to help providers keep pace with rising costs. The outcome of today’s Final Rule means continued challenges for home health providers as they struggle to keep pace with rising workforce costs. Credible third-party data and evidence we shared with CMS indicate that patient access to home healthcare is declining. Unfortunately, yet another year of cuts will further destabilize home-based care for older Americans,” said Joanne Cunningham, CEO of the Partnership.

“Today’s Final Rule doesn’t change the fact that Congress must intervene to fix this broken payment system that produces year after year of cuts. We are counting on Congress to bring stability to this benefit and preserve access to this lifesaving care,” Cunningham added.

Data show Medicare cuts – which total at least $25 billion over a ten-year period (2020-2029) – are reducing patient access at an alarming rate. Compared to 2019, 500,000 fewer Medicare beneficiaries accessed home health last year, and patient visits per 30 days are down nearly 20 percent. In 2023, more than a third of Medicare patients directed to home health after a hospitalization could not access care due to workforce shortages and capacity limitations at home health agencies. These factors are only worsened by continued destabilizing payment cuts that harm home health agencies’ ability to operate and deliver care.

“The Partnership has been sounding the alarm since these cuts began in 2020,” said Joanne Cunningham, CEO of the Partnership. “We are seeing mounting evidence of the Medicare home health program in steep decline: closures of providers who are the only source of home-based care in their communities, demand for services that is not being met due to the inability of providers to secure the workforce to deliver services, and other signs of distress. We have definitive evidence that Medicare beneficiaries have less access to home health than they did in previous years, despite increased demand by older Americans and their families to receive healthcare in the home setting. It’s time for Congress to step in to protect a critical benefit that an overwhelming number of older and disabled Americans and families support.”

The Partnership and other home health advocates have engaged with Members of Congress to address the immediate impact of Medicare’s home health cuts through bipartisan legislation, the Preserving Access to Home Health Act (S. 2137/H.R. 5159). To stop these looming cuts, Congress must pass relief in 2024 to ensure access to home health is not further compromised for beneficiaries who want to return home after hospitalization and those who want to age safely and comfortably at home.

Data show home health improves patient outcomes and prevents hospitalizations. In 2023, access to home health resulted in 34 percent lower hospital readmission rates. Patients who did not access home health after hospital discharge had a 41 percent higher mortality rate than those who gained access to home health.