The Centers for Medicare & Medicaid Services (CMS) has issued an important update through Change Request (CR) 13241, which becomes effective on January 1, 2023. This update is designed to enhance the accuracy and efficiency of payment processes for Home Health Agencies (HHAs) that do not submit the required quality data. The update fully replaces the previous CR 10874 and introduces several key changes that impact how HHAs receive their payments, particularly focusing on the mandatory submission of quality data such as the Outcome and Assessment Information Set (OASIS) and the Home Health Care Consumer Assessment of Healthcare Providers and Systems (HHCAHPS) data.

Key Changes Introduced by CR 13241:

1. 2% Payment Reduction for Non-Submission of Quality Data

Since the Deficit Reduction Act (DRA) of 2005, CMS has implemented a pay-for-reporting requirement for Medicare home health services. Beginning in calendar year 2007, and continuing each subsequent year, HHAs that fail to submit required quality data are subject to a 2% reduction in their Annual Payment Update (APU). This reduction is a significant penalty, intended to enforce compliance with quality data submission requirements.

The quality data that must be submitted includes:

• OASIS Data: This data must be submitted for all episodes beginning on or after July 1 of the previous year and before July 1 of the current year. OASIS data is crucial for evaluating patient outcomes and ensuring high standards of care.
• HHCAHPS Data: Monthly data collection and submission for HHCAHPS must be completed from April 1 of the prior year through March 31 of the current year. This data reflects patient experiences and satisfaction with the care provided by HHAs.

2. Exemption Criteria for HHCAHPS Data Submission

CMS acknowledges that not all HHAs have a large enough patient base to submit HHCAHPS data. Therefore, HHAs that have served 59 or fewer HHCAHPS-eligible patients in the year immediately prior to the data collection year are exempt from the HHCAHPS submission requirement. These agencies must submit a Participation Exemption Request form to CMS to be granted this exemption. It is important for agencies to accurately count their patients and submit the exemption form if eligible, to avoid the 2% payment reduction.

3. Notification and Reconsideration Process

CMS will issue Technical Direction Letters (TDLs) to Medicare contractors, providing lists of HHAs that have not complied with the quality data submission requirements. Contractors are then responsible for notifying these agencies about the impending 2% reduction. The notification must clearly state whether the non-compliance pertains to OASIS, HHCAHPS, or both, and include the necessary steps to request reconsideration if the HHA believes it has been wrongly identified.

HHAs wishing to dispute the reduction have 30 days from the date of the notification letter to submit a reconsideration request. This request must be accompanied by documentation that supports compliance with the quality data submission requirements. It is crucial that HHAs provide clear and relevant documentation, as CMS will not contact the agency for additional information if the initial submission is incomplete.

4. CMS Review and Final Determination

Once CMS reviews the reconsideration request and supporting documentation, they will issue a final determination. If CMS upholds the 2% reduction, the HHA has the option to appeal the decision through the Provider Reimbursement Review Board (PRRB). If the reduction is reversed, the HHA will receive their full APU for the upcoming year.

Implications for Home Health Agencies

This update reinforces the importance of timely and accurate submission of quality data for HHAs. The 2% payment reduction is a significant financial penalty that can impact the operational sustainability of an agency. Therefore, HHAs must be diligent in their data collection, submission processes, and compliance with CMS requirements to avoid penalties.

For agencies that find themselves subject to the payment reduction, the reconsideration process offers a crucial opportunity to contest the decision. However, this process requires careful preparation and documentation to successfully overturn the penalty.

Conclusion

CMS’s CR 13241 represents a continued effort to enforce quality standards in home health care by linking payment updates to the submission of essential quality data. HHAs must take these requirements seriously and ensure compliance to avoid financial penalties that could adversely affect their operations.

For more information and detailed guidance on compliance, HHAs should consult the official CMS documentation or contact their Medicare Administrative Contractor (MAC).