MedPAC Targets Home Health Readmissions, Recommends Penalties

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Karen Utterback By Karen Utterback 
Former Vice President, Product Marketing and Strategy, McKesson (Retired)
Medical professionals working in the ER

The movement toward increased regulation of home health agencies continues. In mid-January, Medicaid issued a rule requiring all home- and community-based providers to take a person-centered approach to qualify for reimbursement. A few days later, the Medicare Payment Advisory Commission (MedPAC) voted to recommend that home health providers should be subject to Medicare reimbursement penalties based on hospital readmission rates.

The recommendation will be included in MedPAC’s March report to Congress. Of course, lawmakers are not required to follow the recommendations. For example, the commission called for a 4% reduction in skilled nursing facility payments in January 2013, but Congress ignored the suggestion after significant outcry from providers.

According to McKnight’s News, an analyst told the panel that about one-third of patients who go from a hospital to a home health stay are subsequently readmitted to the hospital. Under MedPAC’s proposal, the penalties would be structured similarly to those now levied against hospitals and proposed for skilled nursing facilities, with the exact rate triggering the penalties being set by the Secretary of Health and Human Services.

In the same meeting, the commissioners recommended adding a hospice benefit to Medicaid Advantage plans. Although some Medicare Advantage patients can currently select a palliative care benefit, it’s paid through Medicare’s fee-for-service program. The change recommended by MedPAC would allow Medicaid Advantage plans to enact cost-sharing for the benefit.

Home health executives concerned over increased regulations should watch this space for updates and continue preparing for the uptick in data reporting to satisfy the new requirements.

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