An Analysis and Commentary on Federal Health Care Issues by Larry Goldberg

CMS Finalizes Calendar Year 2022 Home Health Prospective Payment System Update

The Centers for Medicare and Medicaid Services (CMS) have issued a final calendar year (CY) 2022 update to the home health prospective payment system (HH PPS). 

The 528-page rule is currently on display at the Federal Register. A copy is available at: https://public-inspection.federalregister.gov/2021-23993.pdf. Publication is slated for November 9. This link will change upon publication. The rule and its changes are effective January 1, 2022. 

The rule updates the payment rates for home health agencies (HHAs), finalizes the recalibration of the case-mix weights for 30-day periods of care while maintaining the CY 2021 low utilization payment adjustment (LUPA) thresholds, updates the CY 2022 fixed-dollar loss ratio (FDL), uses the physical therapy (PT) add-on factor to establish the occupational therapy (OT) LUPA, and updates the home infusion therapy services payment rates. 

Additionally, the rule expands the Home Health Value-Based Purchasing (HHVBP) Model to all Medicare-certified HHAs in the 50 States, Territories, and the District of Columbia beginning January 1, 2022 with CY 2022 as a pre-implementation year, and ending the original HHVBP Model one year early for the HHAs in the nine original Model States, such that CY 2020 performance data would not be used to calculate a payment adjustment for CY 2022. 

Further, the rule finalizes proposals under the HH Quality Reporting Program (QRP), including removal of an Outcome and Assessment Information Set (OASIS)-based measure, the Drug Education on All Medications Provided to Patient/Caregiver During All Episodes of Care measure, replaces the Acute Care Hospitalization During the First 60 Days of Home Health (NQF #0171) measure and Emergency Department Use Without Hospitalization During the First 60 Days of Home Health (NQF #0173) measure with the Home Health Within Stay Potentially Preventable measure, and will begin public reporting of the Percent of Residents Experiencing One or More Major Falls with Injury measure and Application of Percent of Long-Term Care Hospital Patients with an Admission and Discharge Functional Assessment and a Care Plan that Addresses Function (NQF #2631) measure beginning in April 2022. 

The rule also makes permanent the changes to the home health Conditions of Participation (CoP) that were implemented during the COVID-19 public health emergency (PHE) and finalizes changes to the CoPs to implement a provision of the Consolidated Appropriations Act, 2021.

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Addendum to Final Calendar Year 2022 Home Health PPS 

Patient-Driven Grouping Model (PDGM) and Behavioral Assumptions, and Recalibration of the PDGM Case-Mix Weights

Beginning on January 1, 2020, Medicare implemented the PDGM and a 30-day unit of payment. Each of the 432 payment groups has an associated case-mix weight and low utilization payment adjustment (LUPA) threshold. CMS’ policy is to annually recalibrate the case mix weights using the most complete utilization data available at the time of the rulemaking.
CMS says it is finalizing the recalibration of the HH PPS case-mix weights as “proposed” for CY 2022.

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