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HAP Comment Letter to CMS on CY 2016 Home Health Prospective Payment System Proposed Rule

September 4, 2015

Andrew M. Slavitt
Acting Administrator
Centers for Medicare & Medicaid Services
U.S. Department of Health and Human Services
Attention: CMS-1625-P
P.O. Box 8016
Baltimore, MD 21244-1850

Re: CMS-1625-P Medicare and Medicaid Programs; Calendar Year 2016 Home Health Prospective Payment System Rate Update; Home Health Value-Based Purchasing Model; and Home Health Quality Reporting Requirements

Dear Mr. Slavitt:

On behalf of The Hospital & Healthsystem Association of Pennsylvania (HAP), which represents approximately 240 member hospitals and health systems, we appreciate this opportunity to comment about the Centers for Medicare & Medicaid Services’ (CMS) calendar year (CY) 2016 Home Health Prospective Payment System (PPS) proposed rule.   

Proposed Payment Rates

The overall payment reduction rate would be 0.78 percent, which results in a reduction of $350 million nationally, and nearly $2.1 million in Pennsylvania.

For CY 2016, CMS is proposing a total nominal case-mix growth reduction of 3.41 percent, implemented and distributed evenly over a two-year period. According to CMS, this reduction accounts for estimated case-mix growth unrelated to patient acuity.

CMS also is proposing a two-year extension to the three percent add-on rate in rural areas to be in place until the end of CY 2018.

HAP is concerned with the proposal to cut home health national payment rates by an additional 3.41 percent.

This proposed case-mix reduction is of concern because it appears to be based on a 2000–2009 case-mix weight change analysis, rather than changes in the condition of beneficiaries during the CY 2012 to 2014 period that Medicare proposes to address.

HAP commends CMS for extending the three percent add-on rate for two additional years; however, we urge CMS to make changes based on recent information, as patients are entering into the home health system at a much higher acuity level than is reflected in the years that the changes are based upon.

Home Health Value-Based Purchasing (VBP) Demonstration Project

To begin on January 1, 2016, CMS proposes to launch an initiative designed to support greater quality and efficiency of care among Medicare-certified home health agencies.

The home health value-based purchasing (VBP) model supports efforts to build a health care system that delivers better care, spends health dollars more wisely, and results in healthier communities. CMS has chosen nine states to participate in the project.

Public quality reporting and pay for performance can improve alignment in the health care delivery system, including home health. HAP supports CMS for seeking to pilot a home health VBP program in advance of formal implementation.

CMS is proposing to apply a reduction or increase of up to eight percent to current Medicare payments to Medicare-certified home health agencies.

HAP believes a possible reduction of this magnitude is too great, considering the significant Medicare payment reductions that home health agencies have endured in recent years.

HAP encourages CMS to lower the percentage of penalty to mirror other health care industries––one to two percent reduction/increase. This impacts home health agencies negatively because of their smaller operating margins.

HAP also recommends changing participation in the program from mandatory to voluntary, open to all home health providers nationally.

The CMS proposal has 29 quality measures spanning areas of process, outcome, and costs.

While HAP supports measures that improve quality outcomes, lower cost, and reduce readmissions, CMS should limit the number of measures to no more than ten measures identified as highest priority for improving care outcomes for home health agency patients.

HAP also recommends that CMS thoroughly evaluate each measure to ensure the measures truly add to the overall quality of care, while not causing burden on home health agencies.

HAP encourages the continued use of National Quality Forum-endorsed measures. Measures chosen should be risk-adjusted, tested, and evaluated, prior to use.

Quality Reporting Program

CMS solicits comments on new measures for implementation in future years. The home health VBP program allows for CMS to study new quality measures.

Four of the measures would meet requirements of the Improving Medicare Post-Acute Care Transformation (IMPACT) Act.

Two of the proposed measures involve vaccinations. HAP understands the importance of the influenza and herpes zoster vaccinations; however, variables such as medication shortages and patient choice, may impact the reportable data negatively.

HAP commends CMS for following the eight outcome and process measurement domains from the IMPACT Act as the minimum data reporting requirements, and adding four measures also required by the IMPACT Act.

There are currently 79 home health quality measures, 12 adverse event measures, 38 outcome measures, and 29 process measures.

HAP member hospitals have expressed concern around the time burden for data collection for quality measures. HAP recommends that CMS consider consolidating or removing measures prior to expanding the current set of measures any further.

Some of the measures could prove to be redundant or unnecessary when the IMPACT Act measures are operational.

Thank you for consideration of HAP’s comments about the Home Health Prospective Payment System proposed rule.

If you have any questions, please feel free to contact me at (717) 561-5344, or Brian Smith, director of compliance, at (717) 561-5356.

Sincerely,

Jeff Bechtel
Senior Vice President, Health Economics and Policy                                     

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