Home health providers’ fight against cuts in Medicare fees has become a year-to-year battle. But the annual cuts are getting worse, and that’s exactly what industry advocates are trying to make clear to Congress ahead of the next payment rule proposal.
Since implementing the Patient-Driven Groupings Model (PDGM) in 2020, the Centers for Medicare & Medicaid Services (CMS) has increased home health care payments by $19 billion by 2029, according to a new analysis from the Partnership for Quality Home Healthcare abbreviated (PQHH) and the National Association for Home Care & Hospice (NAHC).
Many of the cuts made by CMS are permanent, and multiple additional cuts in the future – plus unsatisfactory adjustments for inflation – are putting significant pressure on providers.
For example, last fall CMS decided to increase total payments for 2024 by 0.8%. However, the agency actually made another permanent prospective adjustment of -2.890%. The year before, a cut of -3.925% was made.
Future cuts paint a bleak outlook for providers, something NAHC and PQHH are trying to educate lawmakers about.
“One of the things we wanted to make sure we could show our allies in Congress was how much home health insurance has actually been cut,” Joanne Cunningham, CEO of PQHH, told Home Health Care News. “Providers are experiencing great stress and are struggling to maintain their status to provide care and fulfill their roles. We started PDGM with a significant cut. The cuts made since then are permanent, they are not going away. The diagram illustrates the stacking effect of these cuts. Then we projected what we know future cuts will entail.”
Although this year will be a hectic one in Washington, DC as it is an election year, Cunningham believes this will actually have a positive impact on vendors.
This will mean lawmakers have a listening ear on the most pressing issues facing their constituents, she said.
“That’s the cause,” Cunningham said. “And why we see the health care access issues that patients face.”
As Cunningham noted, CMS has said it will continue to make gradual cuts going forward.
In the future, providers will receive significantly less compensation for their services.
At the same time, more of their patients than ever are benefiting from Medicare Advantage (MA) plans. MA already tends to pay far less for home health services than Medicare, which charges a fee.
“It’s concerning,” Cunningham said. “And it goes against what most policymakers want, what most Americans want, what most Medicare recipients and families want.” It’s a disconnect. But the good news is that lawmakers seem to understand that.”
In addition, CMS has also touted future reimbursements for alleged overpayments to providers in the past.
Specifically, CMS estimates that the company overpaid $873 million in 2020, $1.2 billion in 2021 and $1.4 billion in 2022.
These clawbacks would add gas to a fire that is already uncontrollable for providers.
“The clawbacks are unconscionable,” Cunningham said. “These are essentially recoveries for payments that providers received for services provided to patients in previous years. It is unthinkable that any policymaker would want to destabilize the Medicare home health program by implementing these reimbursement cuts.”