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Volume 22.06

On October 31, 2022, the Centers for Medicare & Medicaid Services (“CMS”) issued the calendar year (“CY”) 2023 Home Health Prospective Payment System (“HH PPS”) Rate Update final rule, which updates Medicare payment policies and rates for home health agencies (“HHAs”). This rule includes routine updates to the Medicare Home Health PPS and the home infusion therapy services’ payment rates for CY 2023, in accordance with existing statutory and regulatory requirements.

Final rates will increase by .7% compared to 2022 rates.  The increase is the result of a 4% home health payment update plus a .2% increase reflecting the impact of an update relating to outlier payments.  This 4.2% is reduced by 50% of the permanent behavioral assumption adjustment, or 3.5%.

The remaining portion of the permanent behavioral assumption adjustment has been deferred for future rulemaking.

The rule also finalizes recalibration of the PDGM case-mix weights and updates the low utilization payment adjustment (“LUPA”) thresholds, functional impairment levels, comorbidity adjustment subgroups for CY 2023, and the FDL used for outlier payments. Additionally, the rule finalizes the reassignment of certain diagnosis codes under the PDGM case-mix groups.

To achieve the policy goal of increased predictability in home health payments, while aligning with the FY 2023 Inpatient Prospective Payment System final rule and other rules, this rule finalizes a permanent, budget neutral 5% cap on negative wage index changes (regardless of the underlying reason for the decrease) for home health agencies to smooth year-to-year changes in the pre-floor/pre-reclassified hospital wage index.

Comments on Telecommunication Technology Solicited – CMS finalized policy changes regarding the use of services furnished via telecommunications systems in the CY 2021 HH PPS final rule. However, the collection of data on the use of telecommunications technology under the home health benefit is limited to a broad category of telecommunications technology costs under administrative costs on the HHA cost report (reported at the agency level). In the CY 2023 HH PPS proposed rule, CMS solicited comments on the collection of data on the use of such services furnished using telecommunications technology on the home health claims (at the individual beneficiary level). Collecting data on the use of telecommunications technology on home health claims would allow CMS to analyze the characteristics of the beneficiaries utilizing services furnished remotely and could give us a broader understanding of the social determinants that affect who benefits most from these services, including what barriers may potentially exist for certain subsets of beneficiaries. CMS plans to begin collecting this data on home health claims on a voluntary basis beginning on January 1, 2023, and on a mandatory basis beginning on July 1, 2023. Further program instruction for reporting this information on home health claims will be issued in January 2023.

The final rules are available here.  The National Association for Home Care & Hospice (“NAHC”) is offering a web event today at 1:00 p.m.  You can register at Online Store (avectra.com).