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CMS Issues Final Rule on Home Health Value-Based Purchasing Expansion

CMS Sets 3.2% increase to home health Medicare rate in CY 2023

Nov 4, 2021 – On November 2, 2021, the Centers for Medicare & Medicaid Services (CMS) issued a final payment rule on the Home Health Value-Based Purchasing (HHVBP) model expansion. Not only does the rule confirm a nationwide expansion of the HHVBP model, but it also sets a 3.2% increase to the home health Medicare rate for the calendar year 2023.

CMS initially proposed a 1.7% increase to the rate in June, but upon reviewing the success of the program, increased the rate to 3.2%. This is expected to equate to a $570 million bump in payments.

The rule and the expansion of the HHVBP model would shift from a fee-for-service (FFS) model that emphasizes the volume of services provided to a system that incentivizes quality of care and value. The shift comes on the heels of the Home Health Value-Based Purchasing Model showing years of promising results.

Home Health Value-Based Purchasing Model Shows Promise

The HHVBP model incentivizes quality of care over volume of care. The model was launched in 2016 through the CMS Innovation Center. Nine states were randomly selected to participate in the Home Health Value-Based Purchasing Model to determine whether the quality and delivery of home health care services could be improved through financial incentives. 

The Home Health Value-Based Purchasing Model showed strong results. The original HHVBP Model resulted in Performance Scores that were 8% higher among HHAs in HHVBP states than HHAs in non-HHVBP states in 2019. It also reduced cumulative Medicare spending by $604.8 million between 2016 and 2019.

Based on these results, on January 8, 2021, CMS announced that the HHVBP model met the statutory requirements for nationwide expansion.

CMS On the Record for HHVBP Model Expansion

“Today, [CMS] acted to improve home health care for older adults and people with disabilities through a final rule that would accelerate the shift from paying for Medicare home health services based on volume to a system that pays for value,” the Centers for Medicare & Medicaid Services wrote in an announcement.

As expected, CMS Administrator Chiquita Brooks-LaSure strongly supports the expansion.

“CMS is committed to helping people get the care they need, where they need it,” said Brooks-LaSure in the agency’s announcement. “This final rule will improve the delivery of home health services for people with Medicare. It will also improve our data collection efforts, helping us to identify health disparities and advance health equity.”

CMS is committed to moving the program forward and continuing its success. Throughout 2022, CMS will provide technical assistance to HHAs to ensure they understand how performance will be assessed and will advance the coordination of care efforts.

More Information on the Rule

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