Current HH PPS
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Final Rule with Comments
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Home health disciplines included in the National 60-Day Episode rate:
· Skilled nursing, home health aide, physical therapy, speech-language pathology, occupational therapy, and medical social services
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Home health disciplines included in the National 60-Day Episode rate:
· Unchanged
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For eligible beneficiaries under a home health plan of care:
· National 60-day episode prospective payment for covered home health services, adjusted for case mix and wage index
· LUPA, SCIC, PEP, and outlier adjustments allowed
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For eligible beneficiaries under a home health plan of care:
· Unchanged
· LUPA, PEP, and outlier adjustments allowed; SCIC adjustment eliminated
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Average case-mix weights per episode:
· Since the inception of the HH PPS, the increase in the average case mix, nominal case-mix growth (which is the change that is not due to changes in the underlying health status of Medicare home health patient) is 11.75 percent.
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Average case-mix weights per episode:
· To account for the 11.75 percent increase in the nominal case-mix growth, we are finalizing the proposed 2.75 percent reduction of the national standardized 60-day episode payment rate for first 3 years beginning in 2008 and a 2.71 percent reduction in the fourth year, 2011.
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National 60 Day Episode rate
($2,339.00 for CY 2007)
· Includes home health market basket increase (3.3% for CY 2007)
· Adjusted for case-mix and wage-index
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National 60 Day Episode rate ($2,270.32
for CY 2008)
· Includes home health market basket increase (3.0% for CY 2008)
· Adjusted for case-mix and wage-index, and further adjusted for aggregate changes in case mix for the nominal case-mix growth(2.75 percent reduction per year for the first 3 years, 2008, 2009, and 2010, and 2.71 percent reduction for 2011.
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Home health market basket:
· Labor portion = 76.775%
· Non-labor portion = 23.225%
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Home health market basket:
· Labor portion = 77.082%
· Non-labor portion = 22.918%
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Case-mix regression model:
· Single therapy threshold at 10 visits
· Did not account for the timing of episodes
· Single equation model for weight calculation, with a single set of case mix scores and single therapy threshold
· Model r-squared = 0.29, initial episodes, .21 total episodes
· Large increase in payment for delivering at least 10 therapy visits in a 60-day episode
· 80 case-mix groups
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Case-mix regression model:
· Therapy thresholds at 6, 14, and 20 visits
· Accounts for early episodes (the first or second episode in a sequence of adjacent episodes) and later episodes (third or subsequent episodes in a sequence of adjacent episodes), regardless of whether the same home health agency provided care for the entire series of episodes.
· Four-equation model for weight calculation with scores allowed to vary by episode type and with classification of episodes as follows:
1) < 14 therapy visits occurring in
early episode;
2) ≥ 14 therapy visits occurring in
early episode;
3) < 14 therapy visits occurring in
later episode;
4) ≥ 14 therapy visits occurring in
later episode
· Model r-squared = 0.45
· Gradual increase in payment between first and third therapy thresholds
· 153 case-mix groups
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Case-mix model variables:
· M0110 did not exist
· Included M0175 (inpatient facility discharge), M0530 (incontinence) & M0610 (behaviors observed)
· Excluded M0800 (injectible medications)
· Included M0230/240
· Included M0245
· M0825: included (exists as a “yes”/”no” question as to whether or not the projected number of therapy visits for the episode meet the threshold for a Medicare high-therapy case mix group)
· Scores not given for infected surgical wounds, abscesses, chronic ulcers, gangrene, dysphagia, tracheostomy, cystostomy
· Did not include gastrointestinal, pulmonary, cardiac, hypertension, cancer, blood disorders, or affective and other psychoses diagnosis groups
· Points not given for secondary diagnoses
· Points not given for combinations of conditions in the same episode
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Case-mix model variables:
· Creates M0110 for new item to identify early and later episodes
· Excludes M0175, M0530 M0440& M0610
· Adds M0800
· Modifies format of M0230/240 to accommodate changes to payment diagnoses
· M0246 replaces M0245 and now allows for multiple coding for both primary and secondary diagnoses
· Includes M0826 and replaces M0825 (identifies the number of projected therapy visits for the episode, which affects the particular case-mix group for which that episode will be grouped)
· Includes scores for infected surgical wounds, abscesses, chronic ulcers, gangrene, dysphagia, tracheostomy, and cystostomy.
· Adds gastrointestinal, pulmonary, cardiac, hypertension, cancer, blood disorders, and affective and other psychoses diagnosis groups
· Assigns points for some secondary diagnoses
· Assigns points for some combinations of conditions in the same episode
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Wage Index:
· Routine update based on most recently available pre-floor/pre-reclassified hospital wage index
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Wage Index:
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Non-routine supplies (NRS):
· Included in national episode rate as a fixed amount of $49.62, updated annually as part of the national episode rate
· Case-mix adjusted as part of the national 60-day episode rate
· Updated annually, as part of the national episode rate, by the home health market basket factor
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Non-routine supplies (NRS):
· Based on a NRS conversion factor of $52.35. (The original $49.62 from the July 3, 2000 final rule, updated to 2008, adjusted to account for the outlier target of 5%, and adjusted for the nominal change in case-mix)
· Case-mix adjusted separately based on 6 NRS severity groups payments ranges from $14.12 to $551 per episode
· Unchanged
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LUPA Adjustment:
- Calculated if episode has 4 or fewer visits
- No additional payment for LUPA episodes that occur as the first or only episode during a period of home health benefit use
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LUPA Adjustment :
- Additional $87.93 for LUPA episodes that occur as the only episode or the first episode of a sequence of adjacent episodes; to be updated annually by the home health market basket
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PEP adjustment calculation:
- Allowed for partial episodes
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PEP adjustment calculation:
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Outlier adjustment:
- Fixed dollar loss ratio = 0.67
- Loss-sharing ratio = 0.80
- Outlier expenditure target = 5 percent of total home health PPS payments
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Outlier adjustment:
- Fixed dollar loss ratio = 0.89
- Unchanged
- Unchanged
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Quality Data Reporting:
- Report data on 10 quality measures
- HHAs that do not submit quality data subject to 2 percent reduction in home health market basket percentage increase for the next year
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Quality Data Reporting:
- Report data on 12 quality measures
- Unchanged
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Average case-mix under the current case-mix system, based on 20% sample of 2005 data:
- Proprietary agencies: 1.2821
- Voluntary non-profit agencies: 1.1875
- Rural agencies: 1.2047
- Urban agencies: 1.2520
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Average case-mix under the revised case-mix system, based on a 20% sample of 2005 data:
- Proprietary agencies: 1.2620
- Voluntary non-profit agencies: 1.2334
- Rural agencies: 1.1798
- Urban agencies: 1.2616
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