Home Health Industry Pushes Back on CMS Budget-Neutrality Methodology for PDGM

Home Health Care News

Since the release of the U.S. Centers for Medicare & Medicaid Services’ (CMS) proposed payment rule, home health stakeholders have been sitting in their respective “war rooms” trying to navigate the proposal.

As providers geared up for the unveiling of the proposal, many knew that CMS’ analysis of whether the Patient-Driven Groupings Model (PDGM) led to higher, lower or equal spending compared to the old payment model would be a major factor, according to William A. Dombi, the president of the National Association for Home Care & Hospice (NAHC).

Many are pushing back against CMS’ methodology for assessing budget neutrality, with organizations such as NAHC expressing their concerns even prior to the release of the proposed rule.

“When we found out on Friday that CMS chose to use the same methodology which had been roundly condemned by anybody who had evaluated it, we had to conclude the CMS had effectively declared war against home health,” Dombi said. “I don’t mean that in an emotional sense, but in a practical sense, where the outcome of this proposal could be extraordinarily — not just disruptive — but devastating to the home health care community.”

He made these comments during NAHC’s latest webinar on Thursday.

Overall, the proposed rule comes with a decrease to payment rates by 4.2%, or $810 million less compared to 2022 rates.

“CMS only gets to that [$810 million] by adding in the inflation update, so the inflation update for 2023 is a meager 2.9%,” Dombi said.

The proposed rule also includes a 7.69% PDGM budget-neutrality adjustment.

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