Comprehensive Summary of CMS Final Rule

Transcription

1 Comprehensive Summary of CMS Final Rule On Tuesday, November 2, 2010, the Centers for Medicare and Medicaid Services (CMS) issued a final rule to update the Home Health Prospective Payment System (HHPPS) rates for Calendar Year (CY) The rule also implements the home health and hospice face-to-face visit requirements contained in the Affordable Care Act (ACA), as well as a wide variety of home health related policy changes. The 550 page rule can currently be viewed at The effective date is January 1, 2011, unless otherwise indicated. CMS made little change from their proposed rule with regard to payment cuts, but based on VNAA s and other comments, CMS made significant changes to most of the non-payment issues in the proposed rule that mitigate some of the negative impacts. Such changes, of course, were constrained by requirements of the ACA that cannot be superseded by regulation. While this analysis is intended to be a comprehensive summary, VNAA recommends that members read the full text to be sure that new requirements are fully understood. This is particularly true in the detailed sections on therapy, face-to-face visit requirements and CAHPS. Home Health Payment Changes in CY 2011 CMS refused to give any significant ground on the 2011 case-mix creep adjustment and will be imposing the 3.79% cut as proposed. However, CMS did agree to postpone any decision on a 2012 creep cut and thus deferred its proposed cut of an additional 3.79% for nominal case-mix change in 2012 for further study. CMS did concede that the 2011 creep cut should not apply to non-routine supply payments but indicated further study will be done to determine the appropriateness of supply payment cuts in the future. As mandated by the ACA, the existing home health agency outlier cap becomes permanent reducing HHPPS rates by an additional 2.5%. CMS applied the ACA mandated 1% reduction to the CY 2011 home health market basket amount resulting in a 1.1% market basket update for home health agencies (HHAs) in CY This is based on a final home health market basket of 2.1% versus the 2.4% estimated in the proposed rule.

2 The 2011 Standardized HHPPS Rate in non rural areas falls from $2, to $2, or by 5.23%. This amount, of course, is adjusted in episode by the area wage index and supplemental payments for non-routine medical supplies. As with all payment changes in home health, the amount becomes effective for all episodes ending on and after January 1, The Non-Routine Supply base rate decreases from $53.34 to $ This results in the following supply add-on rates by level: o 1 = $14.18 o 2 = $51.18 o 3 = $ o 4 = $ o 5 = $ o 6 = $ LUPA rates decrease from: o Aide - $51.18 to $50.42 o MSS - $ to $ o OT - $ to $ o PT - $ to $ o SN - $ to $ o SLP - $ to $ The LUPA Episode rate decreases from $94.72 to $ HHPPS rates for services furnished to patients in rural areas will continue to benefit from a 3% increase above those for non-rural areas. CMS Comments on Payment Update CMS rejected VNAA s suggestion to phase-in the creep cuts indicating that splitting the cut between 2011 and 2012 already addresses this issue. CMS notes that many of the issues raised in the public comments will ultimately be addressed in the 2014 rebasing of the PPS system. CMS indicates that it considers the impact of payment reductions on access to be satisfactory if almost all counties have at least one home health agency with a positive Medicare margin. CMS states that its impact analysis indicates that each county would continue to have at least one home health agency after the rule takes effect. CMS indicates that impacts of HHPPS changes at the state level were not provided because they are not required by law or regulation. With regard to VNAA s comment to apply case-mix creep cuts on a providerspecific basis, CMS responds that it is not feasible on an individual basis and not

3 appropriate based on types of providers since the differences in creep between types of providers (e.g. for-profit, nonprofit, are trivial). (A chart is provided that shows total case mix change from for nonprofits to be 16.6% and for profits to be 19.0%). CMS further indicates that it has no data that would allow it to identify so called safety net agencies or full access agencies to apply the creep cuts differently. However, CMS notes that this issue will be more completely examined in the study mandated by section 3131 of the Affordable Care Act. CMS indicates that it expects agencies will absorb these cuts as they have with all prior cuts with no impact on access as they did in Studies presented in comments by others showing impact of the creep cuts based on vendor data sets were dismissed by CMS because they are not a representative sample of agencies. CMS contends that there is no data that supports higher costs of home healthcare due to the quicker and sicker discharges from hospitals. On average, home health visits per episode have gone down over time, the number of patients admitted from hospitals vs. community have gone down and the percentage of patients having institutional post-acute care prior to home health admission have gone up. CMS states that there is no data to support the need to fund high technology homecare since the percentage of total home health patients receiving such care has gone down over time. CMS also contends that there is no data that supports that the total costs to Medicare have been reduced by home health diversions from hospital care. CMS will recalibrate case-mix weights again for the 2012 HHPPS update. CMS indicates it is not feasible to police creep up-coding through the medical review process because of the high volume of claims. CMS pledges to work with the home health community this year to consider more accurate measures of case-mix creep but indicates the suggestion to base the analysis on individual clinical medical record review is not feasible. CMS also notes that industry arguments that home health spending remains below Congressional Budget Office expenditures is irrelevant to the issue of controlling case-mix creep. CMS dismisses the comment that Congress did not intend there to be a creep cut on top of other cuts legislated in the Affordable Care Act. Had that been Congressional intent, CMS states that Congress would have eliminated the

4 statutory authority of the Secretary of Health and Human Services (HHS) to make such cuts. Pre-floor, Pre-reclassification Wage Index CMS once again rejected all comments submitted by VNAA and others requesting modifications to the use of the pre-floor, pre-reclassified hospital wage index by using the same arguments it has made in the past and deferred action until such time as the overall problems with the hospital wage index is resolved. CMS does acknowledge that there is an issue related to dropping the critical access hospitals from the wage index calculation several years ago, but indicates that it is outside of the scope of this rule so CMS need not address it. CMS acknowledges that there have been some significant wage index changes between 2010 and 2011 and urges agencies to consider wage index changes when estimating the impact of this rule on their agency. Home Health Face-to-Face Encounter Based on comments from VNAA and others, CMS agreed to extend the time for face-to-face encounters to 90 days, rather than 30 days, prior to admission for home healthcare as long as the encounter was related to the reason why the patient needs home health services. If the reason for the face-to-face encounter was different, the face-to-face encounter must occur within 30 days, rather than 15 days after admission. CMS clarifies that it will be flexible in determining when an admission is unrelated to the face-to-face encounter and will not require there to be a direct cause and effect relationship between the findings of the visit and the subsequent admission. For the admission to be considered unrelated to the physician visit, it would have to reflect a significant change in patient condition from the visit to the admission. CMS continues to apply the very narrow definition of telehealth that could be used to satisfy the face-to-face requirement. This definition is only applicable to telehealth delivered from specific, designated originating sites and as such does not really relate to most homecare. CMS also will consider a hospital-based face-to-face encounter with a physician that does not practice in the community to count as the needed encounter if that physician certifies the need for home healthcare, documents the face-to-face encounter and the transfer of the patient for plan of care certification and follow up to a community physician who will actually follow the patient and update the plan of care. CMS agreed with VNAA s comment that there should be no difference between physician financial conflict rules and those applied to nurses conducting face-toface visits to support home health certification and will make the rules the same.

5 Physician documentation requirements for the face-to-face encounter will be changed to make clear that the HHA will not be responsible for or otherwise penalized for inadequate physician record keeping related to the face-to-face encounter. This does not suggest that the physician is in any way relieved from responsibility to fully document the encounter in medical records. CMS also indicates that standardized language cannot be provided to physicians to satisfy encounter documentation requirements. It does pledge to provide information and education to physicians on this requirement. CMS clarified that the face-to-face requirement is only applicable to initial certifications and does not apply to recertifications. Quality Improvement Home Health Compare will be updated in July 2011 to include the category increase in the number of pressure ulcers. At the same time, discharge to community, improvement in urinary incontinence and emergent care for wound infection - deteriorating wound status will be eliminated from public reporting. Home Health Compare items will be modified consistent with OASIS changes such that improvement in bed transfer will replace the existing item on positioning and the item on emergency department use without hospitalization will replace emergent care. The 13 OASIS Process Measures will also be added to Home Health Compare. In response to comments, CMS declined to exempt Medicare Advantage Plans from completing OASIS and indicated it was premature to address the request to eliminate New York State s long term home health programs from measurements to be used in pay for performance. Hospice Face-to-face Encounter CMS, based on comments from VNAA and others, agreed to extend the time period for hospice face-to-face encounters from 15 days before the 180 th day recertification to 30 days before the third and subsequent recertification period(s). The change from 180 days to the third recertification period was made to simplify and standardize counting. CMS also indicated that the hospice could bill for the additional services of the hospice physician or nurse practitioner (NP) if during the course of the required face-to-face visit s/he performed medically necessary services in addition to the purely administrative services of patient assessment and documentation of continued hospice eligibility.

6 CMS modified the location of the attestation so it is now above rather than below the physician signature. CMS Comments on Hospice Face-to-Face Encounter CMS reiterates that the new requirements are in addition to the existing requirement for the hospice recertification narrative: the person is terminally ill with a prognosis of 6 months or less if the illness runs its normal course, that the physician composed the narrative based on review of the medical record or examination, includes clinical information and documentation to support the certification. CMS makes clear that the attestation of the face-to-face encounter is separate and distinct from the recertification, signed by the physician or NP and dated. If the visit and attestation are completed on different days, both dates must be included. The encounter need not be in the patient s home but if transportation is required to reach physician or NP, the hospice must provide it. The hospice physician must be employed or under arrangements. Required faceto-face encounters cannot be made by an attending physician. The NP cannot be employed only for the purpose of face-to-face recertification visits. The face-to-face encounter can be a contract employee only if approved by CMS as being an extraordinary circumstance. The hospice physician or NP doing the face-to-face recertication could be under arrangements with another hospice or be volunteer employees of the hospice. If a patient is transferred from another hospice, the receiving hospice has the responsibility to accurately determine the benefit period status by query to the Common Working File and interviewing the patient and/or family. A patient that refuses the required face-to-face encounter may be discharged from hospice for cause. The hospice NP must be the designated hospice attending for the patient for the hospice to bill for any non-administrative, medically necessary services that may happen during the face-to-face encounter that are furnished by the NP. Evidence for the recertification should come from three categories: decline in clinical status guidelines (e.g. decline in systolic blood pressure), non-disease specific guidelines (e.g. decline in functional status) and co-morbidities. Hospice patients must be discharged if they cannot be legitimately recertified due to improvement or continued stability. If the patient appeals, the hospice must abide by the QIO decision. Hypertension Codes

7 CMS accepted VNAA and other comments that, based on current coding rules, its proposed elimination of hypertension codes and from the PPS payment weights would unfairly eliminate weight for some patients whose resource use was legitimately impacted by hypertension. CMS withdrew its proposed elimination of these codes from the payment weights pending further study. Therapy Coverage and Assessment Visits CMS upheld its position on the need for functional assessment visits by a qualified therapist at the 13 th and 19 th visits in an episode but provided some latitude in rural areas and in exceptional circumstances beyond the control of the therapist. In such cases, a range will be allowed of the 10 th to 13 th visit and the 16 th to 19 th visit. Additional flexibility is added when more than one therapy discipline is being provided to the patient by allowing the therapist from each discipline to complete their functional assessment close to but not after the 13 th and 19 th visit. CMS reaffirmed the need for such visits by qualified therapists, and clarified that the appropriate use of maintenance therapy was consistent with existing manual policy and thus not a change in reduction of coverage. CMS changed the regulatory language to indicate that in maintenance situations the therapist evaluates response to therapy versus progress. CMS dropped its new definition of rehabilitative therapy as unclear, deletes confusing scenarios that appeared in the proposed rule, clarifies that maintenance therapy need not be restorative but asserts that coverage depends on the continued effectiveness of therapy. CMS also clarified that the coverage of therapy hinges on the need for skilled therapy versus restorative potential which may or may not be helpful since CMS adjudicates when skilled therapy is medically necessary. Similarly policy is clarified that in order to be covered, maintenance therapy must require skilled therapy services. Based on comments by VNAA and others, the implementation date for the therapy changes has been extended until April 30, 2011 vs. January 1, CMS made numerous editorial changes to the regulatory text to improve its clarity and assure consistency with existing manual policy on therapy coverage and documentation. CMS addresses comments about the proposed rule s elimination of coverage for cases in which spontaneous improvement can be expected by asserting that this is consistent with existing policy but that therapists must judge whether spontaneous improvement can be expected on a case-by-case basis.

8 CMS pledges to reassess the effectiveness of therapy coverage and documentation requirements as part of the study mandated by Section 3131 of the ACA. This further signals that the 3131 study will be the vehicle for examining a wide range of PPS issues and suggests that CMS may change therapy payment under PPS in some significant way. Coding Changes CMS accepted the comment that there should be separate codes for nursing visits for management and evaluation versus observation and assessment. Outlier Payments CMS did not change its proposed position on outlier payment for 2011 and will maintain a.67 fixed dollar loss ratio and a 10% cap on outlier episodes to achieve the new statutory set aside of 2.5% of total payments for outlier payments. CMS expressed interest in VNAA s comment to investigate the payment of outliers based on agency-specific costs versus LUPA rates as a means to counter abuse. CMS also may consider visit intensity in calculating costs for outlier payments. Home Health CAHPS CMS did not change its proposed positions on the implementation of CAHPS but did extend the time for filing for exception requests and submitting dry-run data until January 21, Home Health Compare will be updated with HHCAHPS data by the spring or summer of 2011 but data that has been voluntarily submitted to the HHCAHPS system can be suppressed at the request of the agency. HHPPS payment will be impacted for non-submission of HHCAHPS data in 2012 if providers do not submit the dry run data in for the 3 rd quarter of 2010 by January 21, 2011, the 4 th quarter of 2010 by April 21, 2011 and the 1 st, quarter of 2011 by July 21, Exception applications will be accepted from agencies that have less than 60 HHCAHPS-eligible patients from July 1, 2009 through March 31, Both vendors and agencies are required to participate in the quality assurance program for HHCAHPS upon request. CMS clarifies that it will accept agency submission of less than the 300 cases required if that is the best the agency can achieve. CMS acknowledges the wide range of prices for HHCAHPS vendor services and suggests that agencies that are unhappy with the pricing they have seen should shop around. CMS maintains that HHCAHPS vendors can offer consulting services to improve scores without creating a conflict of interest but vendors cannot provide home health services.

9 CMS Grouping of HHPPS Claims Based on the positive comments received, CMS will consider adopting this procedure but will wait until a future regulation to announce it. CMS assured agencies that it will continue to provide full grouper software even after it implements CMS-based grouping of claims. CMS responds to concerns about inaccuracies that have been found by agencies in past groupers by indicating that it will soon put in place provider-based testing of groupers by agencies before future groupers are released. Re-enrollment of Providers with Ownership Transferred Within 36 Months CMS affirmed the need for this control on flipping provider ownership but provided a new exception for agencies that submit two full years of completed cost reports (excluding low utilization cost reports). CMS eliminated the exception based on being a publicly held corporation. CMS made technical clarifications to definitions of ownership change for purposes of this rule. Clarifications include excluding indirect changes in ownership and changes that are merely a difference in ownership structure under the same owners. CMS also clarifies that it will not provide a blanket exception for changes in ownership created as a result of bankruptcy, but will abide by directions from the individual bankruptcy court. Impacts of the Final Rule CMS provides extensive impact tables on the final rule. These include a projected negative impact of -4.99% for freestanding, nonprofits and -4.85% among freestanding for-profits with most of the difference driven by wage index changes. The impact on urban, freestanding nonprofits was estimated at -5.03% and rural -4.70%. For freestanding, for profits the urban impact was estimated at -4.89% and rural -4.61%. CMS reports that most counties will still be served by at least one home health agency with a positive margin and that there are currently 10,400 agencies and growing. The total estimated savings for these changes in 2011 are calculated as $960 million.