On June 17, 2022, the Centers for Medicare & Medicaid Services (CMS) published its Proposed Rule to update the Home Health Prospective Payment System (HHPPS) for CY 2023, in which CMS proposes a permanent 7.69% payment cut to Medicare home health services.
Access to Medicare home health care services is vital to the health, safety, and rehabilitation of America’s seniors and people with disabilities. The cuts proposed in the payment rule include a permanent adjustment of 7.69%, the continuation of a permanent 4.36% behavioral assumption cut, and steep $2 billion “clawback” cuts beginning in 2024, with the potential for additional cuts in years beyond.
This cut equates to a $1.33 billion cut from home healthcare in 2023 alone. Further, Medicare forecasts additional cuts of more than $2 billion in 2024 and the years beyond. In total, these cuts could reach $18.15 billion over the next ten years. Estimates suggest these cuts could put 44% of America’s home health agencies at risk of closure, significantly risking patient access to care.
If implemented, these payment adjustments will jeopardize the stability of this vital sector and risk access to Medicare home health services.
Since CMS implemented the PDGM model, the Partnership has consistently outlined concerns related to CMS’ budget neutrality methodology while also highlighting significant increases in labor and supply costs across the home health community. As the Partnership has noted, the CMS methodology to determine budget neutrality in the home health payment system is flawed.
Fortunately, lawmakers in Congress are taking action to stop these cuts.
U.S. Senators Debbie Stabenow (D-MI) and Susan Collins (R-ME) and and Representatives Terri Sewell (D-AL) and Vern Buchanan (R-FL) have introduced The Preserving Access to Home Health Act of 2022 (S.4605/H.R. 8581), which would delay the 7.69% payment cut proposed for 2023 and block the additional “clawback” cuts that are set to begin as soon as 2024.
Specifically, the Preserving Access to Home Health Act will make the following policy changes:
- Prevent CMS from implementing any permanent or temporary adjustment to home health prospective payment rates prior to 2026. This would delay cuts currently proposed by CMS for 2023 and beyond, allowing more time for CMS to refine its proposed approach to determining budget neutrality in home health.
- Ensure that any adjustments CMS determines to be necessary to offset increases or decreases in estimated aggregate expenditures are made by 2032, such that no cuts would be delayed beyond the end of the budget window.
- The legislation is intended to be self-implementing. It would become effective as of the date of enactment and includes instructions allowing for implementation by program instruction or other means.