[Federal Register Volume 88, Number 217 (Monday, November 13, 2023)]
[Rules and Regulations]
[Pages 77676-77880]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-24455]
[[Page 77675]]
Vol. 88
Monday,
No. 217
November 13, 2023
Part II
Department of Health and Human Services
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Centers for Medicare & Medicaid Services
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42 CFR Parts 409, 410, 414, et al.
Medicare Program; Calendar Year (CY) 2024 Home Health (HH) Prospective
Payment System Rate Update; HH Quality Reporting Program Requirements;
HH Value-Based Purchasing Expanded Model Requirements; Home Intravenous
Immune Globulin Items and Services; Hospice Informal Dispute Resolution
and Special Focus Program Requirements, Certain Requirements for
Durable Medical Equipment Prosthetics and Orthotics Supplies; and
Provider and Supplier Enrollment Requirements; Final Rule
Federal Register / Vol. 88 , No. 217 / Monday, November 13, 2023 /
Rules and Regulations
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
42 CFR Parts 409, 410, 414, 424, 484, 488, and 489
[CMS-1780-F]
RIN 0938-AV03
Medicare Program; Calendar Year (CY) 2024 Home Health (HH)
Prospective Payment System Rate Update; HH Quality Reporting Program
Requirements; HH Value-Based Purchasing Expanded Model Requirements;
Home Intravenous Immune Globulin Items and Services; Hospice Informal
Dispute Resolution and Special Focus Program Requirements, Certain
Requirements for Durable Medical Equipment Prosthetics and Orthotics
Supplies; and Provider and Supplier Enrollment Requirements
AGENCY: Centers for Medicare & Medicaid Services (CMS), Department of
Health and Human Services (HHS).
ACTION: Final rule.
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SUMMARY: This final rule sets forth routine updates to the Medicare
home health payment rates for calendar year (CY) 2024 in accordance
with existing statutory and regulatory requirements. This rule--
discusses comments received regarding access to home health aide
services; implements home health payment-related changes; rebases and
revises the home health market basket and revises the labor-related
share; codifies statutory requirements for disposable negative pressure
wound therapy (dNPWT); and implements the new items and services
payment for the home intravenous immune globulin (IVIG) benefit. In
addition, it--finalizes changes to the Home Health Quality Reporting
Program (HH QRP) requirements and the expanded Home Health Value-Based
Purchasing (HHVBP) Model; implements the new Part B benefit for
lymphedema compression treatment items, codifies the Medicare
definition of brace, and makes other codification changes based on
recent legislation; adds an informal dispute resolution (IDR) and
special focus program (SFP) for hospice programs; codifies DMEPOS
refill policy; and finalizes proposed revisions for Medicare provider
and supplier enrollment requirements.
DATES: These regulations are effective on January 1, 2024.
FOR FURTHER INFORMATION CONTACT:
Brian Slater, (410) 786-5229, for home health and home IVIG payment
inquiries.
For general information about the Home Health Prospective Payment
System (HH PPS), send your inquiry via email to
[email protected].
For information about the Home Health Quality Reporting Program (HH
QRP), send your inquiry via email to [email protected]
Frank Whelan (410) 786-1302, for Medicare provider and supplier
enrollment inquiries.
For more information about the expanded Home Health Value-Based
Purchasing Model, please visit the Expanded HHVBP Model web page at
https://innovation.cms.gov/innovation-models/expanded-home-health-value-based-purchasing-model.
For more information about the hospice informal dispute resolution
and special focus program, send your inquiry to
[email protected].
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Executive Summary and Issuance of the Proposed Rule
A. Executive Summary
B. Issuance of the Proposed Rule
II. Home Health Prospective Payment System
A. Overview of the Home Health Prospective Payment System
B. Monitoring the Effects of the Implementation of PDGM
C. Provisions for CY 2024 Payment Under the HH PPS
III. Home Health Quality Reporting Program (HH QRP)
A. Background and Statutory Authority
B. General Considerations Used for the Selection of Quality
Measures for the HH QRP
C. Quality Measures Currently Adopted for the CY 2024 HH QRP
D. HH QRP Quality Measure Proposals Beginning With the CY 2025
HH QRP
E. Form, Manner, and Timing of Data Submission Under the HH QRP
F. Policies Regarding Public Display of Measure Data for the HH
QRP
G. Health Equity Update
H. Proposal To Codify HH QRP Data Completion Thresholds
I. Principles for Selecting and Prioritizing HH QRP Quality
Measures and Concepts Under Consideration for Future Years: Request
for Information (RFI)
IV. Changes to the Expanded Home Health Value-Based Purchasing
(HHVBP) Model
A. Background
B. Proposed Changes to the Applicable Measure Set
C. Proposed Changes to the Appeals Process
D. Public Reporting Reminder
E. Health Equity Update
V. Medicare Home Intravenous Immune Globulin (IVIG) Items and
Services
A. General Background
B. Proposed Scope of Expanded IVIG Benefit
C. Proposed IVIG Administration Items and Services Payment
D. Proposed Home IVIG Items and Services Payment Rate
E. Billing Procedures for Home IVIG Items and Services
VI. Hospice Informal Dispute Resolution and Special Focus Program
A. Background and Statutory Authority
B. Proposed Regulatory Provisions
VII. Final Changes Regarding Durable Medical Equipment, Prosthetics,
Orthotics, and Supplies (DMEPOS)
A. Medicare Durable Medical Equipment, Prosthetics, Orthotics,
and Supplies (DMEPOS) Fee Schedule Adjustments
B. Scope of the Benefit and Payment for Lymphedema Compression
Treatment Items
C. Definition of Brace
D. Documentation Requirements for Durable Medical Equipment,
Prosthetics, Orthotics, and Supplies Products Supplied as Refills to
the Original Order
VIII. Changes to the Provider and Supplier Enrollment Requirements
A. Background
B. Proposed Provisions
IX. Collection of Information Requirements
A. Statutory Requirement for Solicitation of Comments
B. Information Collection Requirements (ICRs)
C. Submission of PRA-Related Comments
X. Regulatory Impact Analysis
A. Statement of Need
B. Overall Impact
C. Detailed Economic Analysis
D. Regulatory Review Cost Estimation
E. Alternatives Considered
F. Accounting Statements and Tables
G. Regulatory Flexibility Act (RFA)
H. Unfunded Mandates Reform Act (UMRA)
I. Federalism
J. Conclusion
K. Waiver Fiscal Responsibility Act Requirements Regulations
Text
I. Executive Summary and Issuance of the Proposed Rule
A. Executive Summary
1. Purpose and Legal Authority
a. Home Health Prospective Payment System (HH PPS)
As required under section 1895(b) of the Social Security Act (the
Act), this final rule updates the payment rates for home health
agencies (HHAs) for CY 2024. In this final rule we discuss comments
received on our request for information (RFI) related to access to home
health aide services. This rule finalizes a permanent prospective
adjustment to the CY 2024 home health payment rate to account for the
differences between assumed and actual behavior changes on estimated
aggregate expenditures. It also finalizes the proposal to recalibrate
the PDGM case-
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mix weights and update the LUPA thresholds, functional impairment
levels, and comorbidity adjustment subgroups under section
1895(b)(4)(A)(i) and (b)(4)(B) of the Act for 30-day periods of care
that start in CY 2024. This rule finalizes the proposal to rebase and
revise the home health market basket and finalizes the proposal to
revise the labor-related share. Additionally, this rule finalizes the
proposal to codify statutory requirements for dNPWT and updates the CY
2024 fixed-dollar loss ratio (FDL) for outlier payments (so that
outlier payments as a percentage of estimated total payments are not to
exceed 2.5 percent, as required by section 1895(b)(5)(A) of the Act).
b. Home Health (HH) Quality Reporting Program (QRP)
In accordance with the statutory authority at section
1895(b)(3)(B)(v) of the Act, we are finalizing the addition of two
quality measures to the HH QRP, the removal of two Outcome and
Assessment Information Set (OASIS)-based data elements the codification
of the previously finalized 90 percent OASIS data completion threshold
policy in the Code of Federal Regulations (CFR) and the public
reporting of four measures. We also note that the proposed rule
included a request for information on future HH QRP measure concepts
and an update on health equity in the HH QRP.
c. Expanded Home Health Value-Based Purchasing (HHVBP) Model
In accordance with the statutory authority at section 1115A of the
Act, we are finalizing proposed updated policies, including the
codification of previously finalized measure removal factors, changes
to the applicable measure set, updating the Model baseline year, and an
amendment to the appeals process with conforming regulation text
changes for the expanded HHVBP Model. We are also including an update
on health equity and a reminder about public reporting.
d. Home Intravenous Immune Globulin (IVIG) Items and Services
As required under Division FF, section 4134 of the Consolidated
Appropriations Act, 2023 (CAA, 2023), this final rule will implement
coverage and payment for items and services related to the
administration of IVIG in the home of a patient with a diagnosed
primary immune deficiency disease (PIDD).
e. Hospice Informal Dispute Resolution and Special Focus Program
As required under Division CC, section 407 of the Consolidated
Appropriations Act of 2021 (CAA, 2021), as codified in section 1822(b)
of the Act, this final rule will implement a special focus program
(SFP) for poor performing hospices that includes the SFP algorithm
(including data sources) to identify indicators of hospice poor
performance, the criteria for selection and completion of the SFP,
hospice termination from Medicare, and public reporting of the SFP. We
are also finalizing our proposed regulatory changes to implement an
informal dispute resolution (IDR) process to provide hospice programs
an informal opportunity to resolve disputes related to condition-level
survey findings for those hospice programs that are seeking
recertification for continued participation in Medicare.
f. Durable Medical Equipment, Prosthetics, Orthotics, and Supplies
Products and CAA 2023 Related Changes
Section 3712 of the Coronavirus Aid, Relief, and Economic Security
Act (CARES) Act (Pub. L. 116-136, March 27, 2020) https://www.govinfo.gov/link/plaw/116/public/136 requires that Medicare payment
rates for durable medical equipment (DME) in areas other than rural and
noncontiguous areas during the coronavirus disease 2019 (COVID-19)
public health emergency (PHE) be equal to 75 percent of the adjusted
payment amounts (based on the DME competitive bidding program
information), and 25 percent of the unadjusted fee schedule amounts.
The regulations at Sec. 414.210(g)(9)(v) codified these payment rates
for the duration of the PHE. Section 4139 of the Consolidated
Appropriations Act (CAA), 2023 (Pub. L. 117-328, December 29, 2022)
requires payment based on these rates through the end of the COVID-19
PHE or December 31, 2023, whichever is later. We are finalizing the
proposed changes to the regulations to codify these payment rates
through the end of the COVID-19 PHE or unless otherwise specified by
law.
The scope of the benefit and payment for lymphedema compression
treatment items in section 4133 of the CAA, 2023 adds section
1861(s)(2)(JJ) to the Act, adding the Medicare Part B benefit for
lymphedema compression treatment items effective January 1, 2024. This
rule addresses the scope of the new benefit by defining what
constitutes a standard or custom fitted gradient compression garment
and determining what other compression items may exist that are used
for the treatment of lymphedema and will fall under the new benefit.
This rule also implements section 1834(z) of the Act in
establishing payment amounts for items covered under the new benefit
and frequency limitations for lymphedema compression treatment items.
CMS expects to conduct outreach for individuals with Medicare and issue
provider education regarding this benefit.
The definition of brace in section 1861(s)(9) of the Act provides
coverage under Part B for leg, arm, back, and neck braces. This rule
codifies the existing definition of a brace found in the Medicare
Benefit Policy Manual (CMS Pub. 100-02) and clarifies that this
definition encompasses newer, technology-powered devices.
g. Documentation Requirements for Durable Medical Equipment,
Prosthetics, Orthotics, and Supplies Products Supplied as Refills to
the Original Order
Section 1893(b)(1) of the Act, authorizes ``[r]eview of activities
of providers of services or other individuals and entities furnishing
items and services for which payment may be made under this title . . .
including medical and utilization review . . .''. The requirement for
documentation to support DMEPOS refills originally arose in response to
concerns related to auto-shipments and delivery of DMEPOS products that
may no longer be needed or not needed at the same level of frequency/
volume. This rule will codify our long-standing refill policy, with
some changes. We proposed to require documentation indicating that the
beneficiary has confirmed their need for the refill within the 30-day
period prior to the end of the current supply. We also proposed to
codify our requirement that delivery of DMEPOS items (that is, date of
service) be no sooner than 10 calendar days before the expected end of
the current supply. We sought comments for potential future rulemaking
on ways to balance beneficiary burden with the potential program
integrity risk of not verifying the beneficiary's need for recurring
supplies for certain individuals with permanent conditions and will
consider the commenter submissions.
h. Provider and Supplier Enrollment Requirements
The purpose of our provider enrollment provisions is to strengthen
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and clarify certain aspects of the provider enrollment process. This
includes, but is not limited to: (1) subjecting a greater number of
providers and suppliers, such as hospices, to the highest level of
screening, which includes fingerprinting all 5 percent or greater
owners of these providers and suppliers; (2) applying the change in
majority ownership (CIMO) provisions in 42 CFR 424.550(b) to hospices;
and (3) reducing the period of Medicare non-billing for which a
provider or supplier can be deactivated under Sec. 424.540(a)(1) from
12 months to 6 months. These changes are necessary to help ensure that
payments are made only to qualified providers and suppliers and/or that
owners of these entities are carefully screened. We believe that
fulfilling these objectives will assist in protecting the Trust Funds
and Medicare beneficiaries.
2. Summary of the Provisions of This Final Rule
a. Home Health Prospective Payment System (HH PPS)
In section II.B.2. of this final rule, we discuss comments related
to access to home health aide services. In section II.C.1. of this
rule, we are finalizing a permanent prospective adjustment of -2.890
percent to the CY 2024 home health payment rate.
In section II.C.2. of this rule, we are finalizing the proposal to
recalibrate the PDGM case-mix weights, LUPA thresholds, functional
levels, and comorbidity adjustment subgroups for CY 2024.
In section II.C.3. of this rule, we are finalizing the proposals to
rebase and revise the home health market basket to reflect a 2021 base
year and revise the labor-related share.
In section II.C.4. of this rule, we are finalizing our proposals to
update the home health wage index, the CY 2024 national, standardized
30-day period payment rates, and the CY 2024 national per-visit payment
amounts by the home health payment update percentage. The final home
health payment update percentage for CY 2024 is 3.0 percent.
Additionally, this rule finalizes the CY 2024 FDL ratio to ensure that
aggregate outlier payments do not exceed 2.5 percent of the estimated
total aggregate payments, as required by section 1895(b)(5)(A) of the
Act.
In section II.C.5 of this rule, we finalize our proposal to codify
statutory payment changes for negative pressure wound therapy using a
disposable device (dNPWT).
b. Home Health Quality Reporting Program (HH QRP)
In section III. of this final rule, we will finalize the adoption
of the measure ``COVID-19 Vaccine: Percent of Patients/Residents Who
Are Up to Date'' (Patient/Resident COVID-19 Vaccine) to the HH QRP
beginning with the CY 2025 HH QRP. CMS also finalizes the adoption of
the ``Functional Discharge Score'' (DC Function) measure to the HH QRP
beginning with the CY 2025 HH QRP. With the addition of the Discharge
Function measure, we are finalizing the removal of the ``Application of
Percent of Long-Term Care Hospital (LTCH) Patients with an Admission
and Discharge Functional Assessment and a Care Plan That Addresses
Function'' (Application of Functional Assessment/Care Plan) measure
from the HH QRP beginning with the CY 2025 HH QRP. CMS additionally is
finalizing the removal of two OASIS items no longer necessary for
collection, the M0110--Episode Timing and M2200- Therapy Need items. We
are also finalizing technical changes to Sec. 484.245(b) to codify our
requirement that HHAs must meet or exceed a data submission threshold
set at 90 percent of all required OASIS and submit the data through the
CMS designated data submission systems. Lastly, we summarize input on
CMS's request for information on future HH QRP measure concepts and CMS
updates on HH QRP health equity initiatives.
c. Expanded Home Health Value Based Purchasing (HHVBP) Model
In section IV. of this final rule, we are finalizing codification
of the HHVBP measure removal factors at Sec. 484.380. We will remove
five and add three quality measures to the applicable measure set.
Along with the proposed revisions to the current measure set, we
proposed to revise the weights of the individual measures within the
OASIS-based measure category and within the claims-based measure
category starting in the CY 2025 performance year. We are finalizing to
update the Model baseline year from CY 2022 to CY 2023 starting in the
CY 2025 performance year to enable CMS to measure competing HHAs
performance on benchmarks and achievement thresholds that are more
current for all applicable measures. Additionally, we are finalizing to
amend the appeals process such that reconsideration decisions may be
reviewed by the Administrator. We are also making conforming regulation
text changes at Sec. 484.375(b)(5). We included an update to the RFI,
Future Approaches to Health Equity in the Expanded HHVBP Model, that
was published in the CY 2023 HH PPS rule. We are also including a
reminder that we will begin public reporting HHVBP performance data on
or after December 1, 2024.
d. Home Intravenous Immune Globulin (IVIG) Items and Services
As required under Division FF, section 4134 of the Consolidated
Appropriations Act, 2023 (CAA, 2023), section V. of this rule finalizes
proposed regulations to implement coverage and payment of items and
services related to administration of IVIG in a patient's home for a
patient with PIDD.
e. Hospice Informal Dispute Resolution and Special Focus Program
In section VI. of this final rule, we are finalizing our proposal
for a new hospice informal dispute resolution (IDR) process at Sec.
488.1130 to align with the process that is available for home health
agencies (HHAs). We proposed that the hospice IDR would address
disputes related to condition-level survey findings following a hospice
program's receipt of the official survey statement of deficiencies. The
proposed IDR would provide hospice programs an informal opportunity to
resolve disputes in the survey findings for those hospice programs that
are seeking recertification from the State Survey Agency (SA) or
reaccreditation from an accrediting organization (AO) for continued
participation in Medicare. Additionally, the proposed IDR may be
initiated for those hospice programs that are currently under SA
monitoring (either through a complaint investigation or validation
survey) and those in the finalized SFP. In section VI. of this rule, we
are finalizing our proposal to add the hospice Special Focus Program
(SFP) at Sec. 488.1135. In the final rule, we are finalizing the SFP
algorithm (including data sources) to identify indicators of hospice
poor performance, the criteria for selection and completion of the SFP,
hospice termination from Medicare, and public reporting of the SFP. In
response to previous comments in the CY 2022 HH PPS rule urging CMS to
seek technical expert panel (TEP) recommendations to better inform the
development of the SFP, a TEP was convened to gain input from key
stakeholders on various aspects of the proposed SFP. The finalized
hospice SFP becomes effective beginning the effective date of this
final rule with implementation during CY 2024. We will periodically
review the effectiveness of the finalized methodology and algorithm.
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f. Durable Medical Equipment, Prosthetics, Orthotics, and Supplies
Products and CAA 2023 Related Changes
In section VII.A.3. of this rule, we are finalizing without
modification the conforming changes to Sec. 414.210(g)(9), consistent
with section 4139(a) and 4139(b) of the CAA, 2023. First, section 4139
of the CAA, 2023 does not change the current policy under Sec.
414.210(g)(9)(iii) of paying for DMEPOS items and services furnished in
rural and non-contiguous non-competitive bidding areas (CBAs) based on
a 50/50 blend of adjusted and unadjusted fee schedule amounts through
the duration of the PHE for COVID-19.
As a result, we are finalizing revisions under Sec.
414.210(g)(9)(iii), to state that for items and services furnished in
rural areas and non-contiguous areas (Alaska, Hawaii, and U.S.
territories) with dates of service from June 1, 2018 through the
duration of the emergency period described in section 1135(g)(1)(B) of
the Act (42 U.S.C. 1320b-5(g)(1)(B)) or December 31, 2023, whichever is
later, based on the fee schedule amount for the area is equal to 50
percent of the adjusted payment amount established under this section
and 50 percent of the unadjusted fee schedule amount.
We are finalizing revisions to Sec. 414.210(g)(9)(v) to state that
for items and services furnished in areas other than rural or
noncontiguous areas with dates of service from March 6, 2020 through
December 31, 2023 or through the remainder of the duration of the
emergency period described in section 1135(g)(1)(B) of the Act (42
U.S.C. 1320b-5(g)(1)(B)), whichever is later, the fee schedule amount
for the area is equal to 75 percent of the adjusted payment amount
established under this section and 25 percent of the unadjusted fee
schedule amount.
We are finalizing our proposal to remove outdated text from Sec.
414.210(g)(9)(v) that states ``for items and services furnished in
areas other than rural or noncontiguous areas with dates of service
from the expiration date of the emergency period described in section
1135(g)(1)(B) of the Act (42 U.S.C. 1320b-5(g)(1)(B)), through December
31, 2020, the fee schedule amount for the area is equal to 100 percent
of the adjusted payment amount established under this section.''
We are finalizing our proposal to revise Sec. 414.210(g)(9)(vi) to
state that for items and services furnished in all areas with dates of
service on or after January 1, 2024, or the date immediately following
the duration of the emergency period described in section 1135(g)(1)(B)
of the Act, whichever is later, the fee schedule amount for the area is
equal to the adjusted payment amount established under paragraph (g) of
this section.
We are finalizing the proposal to make conforming changes to Sec.
414.210(g)(2) for the rural and non-contiguous areas in order to
specify the December 31, 2023 date specified in section 4139 of the
CAA, 2023.
In section VII.B.8. of this rule, we discuss the amendment of 42
CFR 410.36(a) to add paragraph (4) and the following new category of
medical supplies, appliances, and devices covered under Medicare Part
B, Lymphedema compression items including: standard and custom fitted
gradient compression garments, gradient compression wraps with
adjustable straps, compression bandaging systems, and other items
determined to be lymphedema compression treatment items under the
process established under Sec. 414.1670. Other covered items will
include accessories such as zippers, liners, and padding or fillers
that are necessary for the effective use of a gradient compression
garment or wrap with adjustable straps.
We are finalizing our proposal to modify and add to the existing
HCPCS Level II codes for lymphedema compression treatment items.
We are finalizing our proposal to add Sec. 414.1670 under new
subpart Q and use the same process described in Sec. 414.240 to obtain
public consultation on preliminary benefit category determinations and
payment determinations for new lymphedema compression treatment items.
We are finalizing our proposal to add a new subpart Q under the
regulations at 42 CFR part 414 titled, ``Payment for Lymphedema
Compression Treatment Items'' to implement the provisions of section
1834(z) of the Act to establish payment amounts for lymphedema
compression treatment items.
We are finalizing our proposal to add Sec. 414.1600 to explain the
purpose and definitions found in subpart Q.
We are finalizing our proposal to add Sec. 414.1660 to address
continuity of pricing when HCPCS codes for lymphedema compression
treatment items are divided or combined.
We are finalizing our proposal to add Sec. 414.1680 with details
regarding frequency limitations for lymphedema compression treatment
items. Medicare will cover and pay for three daytime garments or wraps
every six months and two nighttime garments or wraps every 2 years.
We are finalizing our proposal to revise the regulations for
competitive bidding under at 42 CFR part 414, subpart F to include
lymphedema compression treatment items under the competitive bidding
program as mandated by section 1847(a)(2)(D) of the Act. We are adding
lymphedema compression treatment items to the definition of item at
Sec. 414.402. We are revising Sec. 414.408 to indicate that payment
for these items will be calculated on a lump sum purchase basis and
payment under the program will be made in accordance with any frequency
limitations established under subpart Q in accordance with section
1834(z)(2) of the Act. We are also adding lymphedema compression
treatment items to Sec. 414.412 to address limiting bids submitted
under the program using the payment established under subpart Q.
We are finalizing our proposal to add Sec. 414.1690 indicating
that the payment amounts established under Sec. 414.1650(b) may be
adjusted using information on the payment determined for lymphedema
compression treatment items as part of implementation of the
competitive bidding programs under subpart F using the methodologies
set forth at Sec. 414.210(g).
In section VII.C.3. of this rule, we are finalizing our proposal to
amend the regulations at 42 CFR 410.2 to add the definition of brace
and to add clarification at Sec. 410.36(a)(3)(i) for the purpose of
determining the Medicare Part B benefit and scope for leg, arm, back,
and neck braces and making benefit category determinations regarding
specific items in accordance with the review process for benefit
category and payment determinations under Sec. 414.240.
g. Documentation Requirements for Durable Medical Equipment,
Prosthetics, Orthotics, and Supplies Products Supplied as Refills to
the Original Order
We are finalizing our proposed refill documentation requirements.
We will be updating the refill documentation requirements such that a
beneficiary affirmation will need to be documented by the supplier. We
will require documentation indicating that the beneficiary confirmed
the need for the refill within the 30-day period prior to the end of
the current supply. We will codify our requirement that delivery of
DMEPOS items (that is, date of service) be no sooner than 10 calendar
days before the expected end of the current supply. There is no
associated paperwork burden as the burden is already accounted for and
approved by
[[Page 77680]]
the Office of Management and Budget under OMB control number 0938-0969
(CMS-10417).
h. Provider and Supplier Enrollment Requirements
We proposed several changes to our Medicare provider and supplier
enrollment requirements. These included but were not limited to: (1)
provisions related to hospice enrollment and ownership; and (2)
deactivation of providers and suppliers.
3. Summary of Costs, Transfers, and Benefits
BILLING CODE 4120-01-P
[GRAPHIC] [TIFF OMITTED] TR13NO23.000
[[Page 77681]]
[GRAPHIC] [TIFF OMITTED] TR13NO23.001
BILLING CODE 4120-01-C
B. Issuance of the Proposed Rule
The proposed rule titled ``Medicare Program; Calendar Year (CY)
2024 Home Health (HH) Prospective Payment System Rate Update; HH
Quality Reporting Program Requirements; HH Value-Based Purchasing
Expanded Model Requirements; Home Intravenous Immune Globulin Items and
Services; Hospice Informal Dispute Resolution and Special Focus Program
Requirements, Certain Requirements for Durable Medical Equipment
Prosthetics and Orthotics Supplies; and Provider and Supplier
Enrollment Requirements'' appeared in the Federal Register on July, 10,
2023 (88 FR 43654) hereinafter referred to as the CY 2024 HH PPS
proposed rule or July 2023 proposed rule).
The proposed rule set forth proposed payment and policy changes to
the Medicare Home Health prospective payment system for CY 2024,
proposed changes regarding other programs and policies, as well as
solicited comments.
In the sections of the rule that follow, we will present the
proposed policies
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and summarize and respond to the public comments received.
II. Home Health Prospective Payment System
A. Overview of the Home Health Prospective Payment System
1. Statutory Background
Section 1895(b)(1) of the Act requires the Secretary to establish a
Home Health Prospective Payment System (HH PPS) for all costs of home
health services paid under Medicare. Section 1895(b)(2) of the Act
requires that, in defining a prospective payment amount, the Secretary
will consider an appropriate unit of service and the number, type, and
duration of visits provided within that unit, potential changes in the
mix of services provided within that unit and their cost, and a general
system design that provides for continued access to quality services.
In accordance with the statute, as amended by the Balanced Budget Act
of 1997 (BBA), (Pub. L. 105-33, enacted August 5, 1997) we issued a
final rule which appeared in the July 3, 2000 Federal Register (65 FR
41128) to implement the HH PPS legislation.
Section 5201(c) of the Deficit Reduction Act of 2005 (DRA) (Pub. L.
109-171, enacted February 8, 2006) added new section 1895(b)(3)(B)(v)
to the Act, requiring home health agencies (HHAs) to submit data for
purposes of measuring health care quality, and linking the quality data
submission to the annual applicable home health payment update
percentage increase. This data submission requirement is applicable for
CY 2007 and each subsequent year. If an HHA does not submit quality
data, the home health market basket percentage increase is reduced by 2
percentage points. We issued a final rule which appeared in the
November 9, 2006 Federal Register (71 FR 65935), to implement the pay-
for-reporting requirement of the DRA, which was codified at Sec.
484.225(h) and (i) in accordance with the statute. The pay-for-
reporting requirement was implemented on January 1, 2007.
Section 51001(a)(1)(B) of the Bipartisan Budget Act of 2018 (BBA of
2018) (Pub. L. 115-123) amended section 1895(b) of the Act to require a
change to the home health unit of payment to 30-day periods beginning
January 1, 2020. Section 51001(a)(2)(A) of the BBA of 2018 added a new
subclause (iv) under section 1895(b)(3)(A) of the Act, requiring the
Secretary to calculate a standard prospective payment amount (or
amounts) for 30-day units of service furnished that end during the 12-
month period beginning January 1, 2020, in a budget neutral manner,
such that estimated aggregate expenditures under the HH PPS during CY
2020 are equal to the estimated aggregate expenditures that otherwise
would have been made under the HH PPS during CY 2020 in the absence of
the change to a 30-day unit of service. Section 1895(b)(3)(A)(iv) of
the Act requires that the calculation of the standard prospective
payment amount (or amounts) for CY 2020 be made before the application
of the annual update to the standard prospective payment amount as
required by section 1895(b)(3)(B) of the Act.
Additionally, section 1895(b)(3)(A)(iv) of the Act requires that in
calculating the standard prospective payment amount (or amounts), the
Secretary must make assumptions about behavior changes that could occur
as a result of the implementation of the 30-day unit of service under
section 1895(b)(2)(B) of the Act and case-mix adjustment factors
established under section 1895(b)(4)(B) of the Act. Section
1895(b)(3)(A)(iv) of the Act further requires the Secretary to provide
a description of the behavior assumptions made in notice and comment
rulemaking. CMS finalized these behavior assumptions in the CY 2019 HH
PPS final rule with comment period (83 FR 56461).
Section 51001(a)(2)(B) of the BBA of 2018 also added a new
subparagraph (D) to section 1895(b)(3) of the Act. Section
1895(b)(3)(D)(i) of the Act requires the Secretary annually to
determine the impact of differences between assumed behavior changes,
as described in section 1895(b)(3)(A)(iv) of the Act, and actual
behavior changes on estimated aggregate expenditures under the HH PPS
with respect to years beginning with 2020 and ending with 2026. Section
1895(b)(3)(D)(ii) of the Act requires the Secretary, at a time and in a
manner determined appropriate, through notice and comment rulemaking,
to provide for one or more permanent increases or decreases to the
standard prospective payment amount (or amounts) for applicable years,
on a prospective basis, to offset for such increases or decreases in
estimated aggregate expenditures, as determined under section
1895(b)(3)(D)(i) of the Act. Additionally, section 1895(b)(3)(D)(iii)
of the Act requires the Secretary, at a time and in a manner determined
appropriate, through notice and comment rulemaking, to provide for one
or more temporary increases or decreases to the payment amount for a
unit of home health services for applicable years, on a prospective
basis, to offset for such increases or decreases in estimated aggregate
expenditures, as determined under section 1895(b)(3)(D)(i) of the Act.
Such a temporary increase or decrease shall apply only with respect to
the year for which such temporary increase or decrease is made, and the
Secretary shall not take into account such a temporary increase or
decrease in computing the payment amount for a unit of home health
services for a subsequent year. Finally, section 51001(a)(3) of the BBA
of 2018 amends section 1895(b)(4)(B) of the Act by adding a new clause
(ii) to require the Secretary to eliminate the use of therapy
thresholds in the case-mix system for CY 2020 and subsequent years.
Division FF, section 4136 of the Consolidated Appropriations Act,
2023 (CAA, 2023) amended section 1834(s)(3)(A) of the Act to require
that, beginning with 2024, the separate payment for furnishing negative
pressure wound therapy (NPWT) using a disposable device be for just the
device and not for nursing and therapy services. Payment for nursing
and therapy services are to be included as part of payments under the
HH PPS. The separate payment for 2024 is to be equal to the supply
price used to determine the relative value for the service under the
Medicare Physician Fee Schedule (PFS) (as of January 1, 2022) for the
applicable disposable device, updated by the percentage increase in the
Consumer Price Index for All Urban Consumers (CPI-U). The separate
payment for 2025 and each subsequent year is to be the payment amount
for the previous year updated by the percentage increase in the CPI-U
(United States city average) for the 12-month period ending in June of
the previous year minus the productivity adjustment as described in
section 1886(b)(3)(B)(xi)(II) for such year. The CAA, 2023 also added
section 1834(s)(4) of the Act to require that beginning with 2024, as
part of submitting claims for the separate payment, the Secretary shall
accept and process claims submitted using the type of bill that is most
commonly used by home health agencies to bill services under a home
health plan of care.
2. Current System for Payment of Home Health Services
For home health periods of care beginning on or after January 1,
2020, Medicare makes payment under the HH PPS on the basis of a
national, standardized 30-day period payment rate that is adjusted for
case-mix and area wage differences in accordance with section
51001(a)(1)(B) of the BBA of 2018. The national, standardized 30-
[[Page 77683]]
day period payment rate includes payment for the six home health
disciplines (skilled nursing, home health aide, physical therapy,
speech-language pathology, occupational therapy, and medical social
services). Payment for non-routine supplies (NRS) is also part of the
national, standardized 30-day period rate. Durable medical equipment
(DME) provided as a home health service, as defined in section 1861(m)
of the Act, is paid the fee schedule amount or is paid through the
competitive bidding program and such payment is not included in the
national, standardized 30-day period payment amount. Additionally, the
30-day period payment rate does not include payment for certain
injectable osteoporosis drugs and NPWT using a disposable device
(though this rule is finalizing changes to this provision pursuant to
section 4136 of the CAA, 2023), but such drug and services must be
billed by the HHA while a patient is under a home health plan of care,
as the law requires consolidated billing of osteoporosis drugs and NPWT
using a disposable device.
To better align payment with patient care needs and to better
ensure that clinically complex and ill beneficiaries have adequate
access to home health care, in the CY 2019 HH PPS final rule with
comment period (83 FR 56406), we finalized case-mix methodology
refinements through the Patient-Driven Groupings Model (PDGM) for home
health periods of care beginning on or after January 1, 2020. The PDGM
did not change eligibility or coverage criteria for Medicare home
health services, and as long as the individual meets the criteria for
home health services as described at 42 CFR 409.42, the individual can
receive Medicare home health services, including therapy services. For
more information about the role of therapy services under the PDGM, we
refer readers to the Medicare Learning Network (MLN) Matters article
SE20005 available at https://www.cms.gov/regulations-and-guidanceguidancetransmittals2020-transmittals/se20005. To adjust for
case-mix for 30-day periods of care beginning on and after January 1,
2020, the HH PPS uses a 432-category case-mix classification system to
assign patients to a home health resource group (HHRG) using patient
characteristics and other clinical information from Medicare claims and
the Outcome and Assessment Information Set (OASIS) assessment
instrument. These 432 HHRGs represent the different payment groups
based on five main case-mix categories under the PDGM, as shown in
Figure B1. Each HHRG has an associated case-mix weight that is used in
calculating the payment for a 30-day period of care. For periods of
care with visits less than the low-utilization payment adjustment
(LUPA) threshold for the HHRG, Medicare pays national per-visit rates
based on the discipline(s) providing the services. Medicare also
adjusts the national standardized 30-day period payment rate for
certain intervening events that are subject to a partial payment
adjustment. For certain cases that exceed a specific cost threshold, an
outlier adjustment may also be available.
Under this case-mix methodology, case-mix weights are generated for
each of the different PDGM payment groups by regressing resource use
for each of the five categories (admission source, timing, clinical
grouping, functional impairment level, and comorbidity adjustment)
using a fixed effects model. A detailed description of each of the
case-mix variables under the PDGM have been described previously, and
we refer readers to the CY 2021 HH PPS final rule (85 FR 70303 through
70305).
BILLING CODE 4120-01-P
[[Page 77684]]
[GRAPHIC] [TIFF OMITTED] TR13NO23.002
BILLING CODE 4120-01-C
B. Monitoring the Effects of the Implementation of PDGM
1. Routine PDGM Monitoring
In the CY 2024 HH PPS proposed rule (88 FR 43663), CMS provided
data analysis on Medicare home health benefit utilization, including
but not limited to, overall total 30-day periods of care and average
periods of care per HHA user; distribution of the type of visits in a
30-day period of care; the percentage of periods that receive the LUPA;
estimated costs; the percentage of 30-day periods of care by clinical
group, comorbidity adjustment, admission source, timing, and functional
impairment level; and the proportion of 30-day periods of care with and
without any therapy visits, nursing visits, and/or aide/social worker
visits. We received one comment on the analysis presented in the
proposed rule.
Comment: The commenter stated that while the utilization patterns
before and after PDGM implementation show a continuous downward trend,
there is lack of data analysis and explanation by CMS indicating
whether the appropriate level of home health care is being provided to
beneficiaries. They also suggested that CMS should expand the data
collected to include geographic, racial, ethnic, socioeconomic, sexual
orientation and gender identifiers which could highlight whether
disparities in home health usage vary in diverse populations.
Response: We thank the commenter for their feedback on the home
health utilization data presented in the CY 2024 HH PPS proposed rule.
The intent of the monitoring section is to show the trends in the data
presented. We discuss our analysis of these data in the discussion of
our RFI related to home health aides and in the discussion of the PDGM
behavioral assumption adjustments. We will continue to monitor and
analyze home health trends and vulnerabilities within the home health
payment system and will consider the additional monitoring suggested by
the commenter for future rulemaking.
[[Page 77685]]
2. Request for Information (RFI) for Access to Home Health Aide
Services
As we continue to focus on promoting access and value within the
home health benefit, in the CY 2024 HH PPS proposed rule (88 FR 43654),
we solicited comments from the public, including home health providers
as well as patients and advocates, regarding certain trends in the data
that coincide with home health coverage misinformation obtained
anecdotally from beneficiaries; that is, information related to the
provision of home health aide services as needed when a patient is
under the home health benefit. We queried interested parties on the
potential basis for continued decline in utilization of home health
aide services despite persistent need, particularly among higher acuity
beneficiaries. Also, in an effort to better understand the decline in
utilization and improve the provision of the home health aide services
under the home health benefit, we solicited comments specifically on
how home health agencies' recruitment and retention challenges, wage
disparities, aide care impact and wage alignment, Medicare-Medicaid
coordination, physician plans of care, and expected beneficiary
outcomes might be interconnected.
In response to our request for information on access to home health
aide services, we received a total of 85 comments, where commenters
highlighted a multitude of challenges and offered several
recommendations to improve the provision of home health aide services
under Medicare. These comments and our responses are summarized in this
section of the rule.
Comment: Commenters broadly stated that the decline in the
utilization of home health aide services is not indicative of a reduced
need for such services. Commenters also stated that despite Medicare
laws allowing for substantial home health aide hours, the actual
provision is dwindling, especially affecting those with chronic or
long-term conditions, who often require a combination of skilled and
aide services for optimal health and safety at home. A commenter
further stated that both CMS' and home health agencies' policies and
practices have resulted in barriers that devalue and disincentivize the
provision of these essential services. Specifically, the commenter
stated that Medicare's current payment model, PDGM, discourages HHAs
from employing aides and providing necessary aide services. The
commenter stated that this is especially true for patients with high
functional impairments and multiple comorbidities. The commenter stated
``the PDGM base calculation amount favors post-institutional care and
the initial 30 days of services through higher case-mix adjustment for
admission source and timing and there is a low percentage of additional
reimbursement for beneficiaries with high functional impairments and
multiple comorbidities, relative to beneficiaries with low functional
impairments and no co-morbidities.'' The commenter stated that because
these are ostensibly the beneficiaries that would need the most aide
services (and HHAs have surmised that the more aide visits they provide
the lower their overall reimbursement will potentially be in the
future), this has led HHAs tell patients that ``Medicare does not pay
for aides.''
In addition to comments stating that the PDGM discourages the
provision of aide services, commenters also stated that HHAs' engage in
selective practices and strategic preference for serving lower acuity
patients to maximize profits, which they assert has a
disproportionately negative effect on higher acuity patients (that is,
those with multiple comorbidities or high functional impairment) and
often leaves them underserved or completely neglected. Commenters
suggested that CMS has not fulfilled its oversight of HHAs conducting
such discriminatory practices and has failed to enforce the
nondiscrimination conditions of participation for Medicare-certified
HHAs. They stated that CMS should investigate the practices of HHAs
that tend to exclude or underserve beneficiaries with chronic,
disabling conditions and take enforcement action to ensure that
patients with long-term disabilities do not face discrimination in the
provision of aide services.
Commenters identified multiple barriers that they stated affected
HHAs in recruiting and retaining home health aides, including low
compensation, competition for labor in different job markets,
inadequate/limited training opportunities, and demanding work
conditions. Commenters' suggestions to overcome these barriers included
improved compensation, including aide services more directly in care
plans, providing advanced training, and establishing centralized
systems for employee development.
Commenters stated that they had noticed wage disparities between
home health aides and similar positions in other care settings, such as
inpatient hospitals and nursing homes, attributing the disparities to
various factors like the nature of work, working conditions, and level
of institutional support available. They stated that reevaluating
compensation structures is necessary for parity. A commenter stated
that CMS's episodic reimbursement for home health does not support
robust staffing, particularly in rural areas. Commenters stated this
creates a situation where HHAs cannot justify separate visits by a home
health aide when nurses or occupational therapists can perform these
functions within their scope of practice during a skilled or therapy
visit.
Commenters urged both HHAs and CMS to overhaul the current
reimbursement compensation to better incentivize fulfillment of home
health aide services in order to ensure aides receive fair wages
commensurate with the critical nature of their role and their impact on
patient care. A commenter suggested the need for CMS to establish new
payment mechanisms specifically designed to ensure HHAs are compensated
fairly for delivering all necessary services, specifically home health
aide services.
Commenters stated that the effectiveness of coordination between
Medicare and Medicaid varies by state and is generally limited
(especially for dually eligible beneficiaries) and that gaps in
coordination are a systemic issue arising from differences in
eligibility, coverage, and administrative factors. Commenters also
stated that although dually eligible beneficiaries might receive
somewhat better access to aide services through Medicaid, better care
coordination is vital for boosting utilization rates and addressing
disparities in access to services.
Further, commenters stated that they believed a dual issue affected
physicians' care plans for home health aide services. They stated there
is limited availability of aides to provide the aide services included
on care plans due to difficulties in finding qualified staff and
inadequate reimbursements from CMS, as well as the fact that physicians
themselves are increasingly less likely to include home health aide
services in care plans. Commenters stated that this physician hesitance
is fueled by HHAs reporting that aide services are either very limited
or not available at all. Commenters stated that, as a result,
practitioners have substantially reduced or altogether eliminated
requests for aide services. Additionally, commenters stated that HHAs
often refuse to initiate aide services unless family/caregivers commit
to learning how to perform the aide functions themselves (even if those
caregivers are not willing and/or able to continue the care and even if
the patient objects to having a family member
[[Page 77686]]
provide aide care). A few commenters stated that HHAs also have a
practice of either refusing to staff aides adequately or understaffing
them deliberately.
Commenters also stated that there were consequences to
beneficiaries' lack of adequate access to home health aide services,
including outcomes such as unnecessary hospitalizations, nursing
facility admissions, potentiated health complications, family/caregiver
burnout, and even forced institutionalizations that lead to a
significant loss of independence and quality of life.
Response: CMS appreciates the comments and suggestions received
regarding home health aide service utilization (especially among higher
acuity Medicare beneficiaries), the status of Medicare and Medicaid
home health aide coordination, physician care plans, HHA recruitment
and retention challenges, as well as wage disparities in other care
settings, in influencing both the availability and quality of home
health aide services for Medicare beneficiaries. We thank commenters
for their feedback suggesting various changes for the equitable and
adequate provision of home health aide services, as well as for payment
reform, recruitment, and retention strategies, improved inter-program
coordination between Medicare and Medicaid, and an overall shift in how
the value of home health aide services is recognized, how home health
aides are compensated, and how home health aide services are
effectively integrated into plans of care. We do note that the current
HH PPS, which generally bundles payment for all goods and services
furnished in a 30-day period, including home health aide services, is
set forth by statute. As such, suggestions related to the payment
structure of the HH PPS, including regarding how aides are paid, are
more appropriately addressed to Congress for consideration.
We would like to thank commenters for their responses regarding
payment rates for home health aide services. In response to the
comments detailing concern that HHAs may be influencing practitioners
to curtail or omit aide services, or are refusing to initiate such
services as ordered, we would like to direct readers' attention to the
home health Conditions of Participation (CoPs) at 42 CFR 484.60. As a
reminder, per the regulations, each patient is required to receive home
health services as delineated in an individualized plan of care. Such
plan of care must specify the care and services necessary to meet the
patient-specific needs as identified in the comprehensive assessment,
including identification of the responsible discipline(s), and the
measurable outcomes that the HHA anticipates will occur as a result of
implementing and coordinating the plan of care. It is improper for an
HHA to unduly influence a practitioner based on the HHA's own service
constraints.
Overall, the feedback provided by respondents will help guide our
policy formulation processes. One of CMS' objectives is to continually
enhance home health policies to optimize both access and quality of
care for Medicare beneficiaries. Likewise, in keeping with the
President's Executive Order (E.O.) on Increasing Access to High-Quality
Care and Supporting Caregivers,\1\ we find the comments and suggestions
received relevant to identifying ``gaps in knowledge about the home-
and community-based workforce serving people with disabilities and
older adults.'' As such, all comments and suggestions will be
considered alongside the goals of this E.O., including identifying
opportunities to expand analyses, supplementing data, or launching new
efforts to provide important data on the home- and community-based
workforce, such as home health aides, as appropriate. This information
may assist in policy development, addressing barriers, and fostering
coordination under the home health benefit for future regulatory
updates.
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\1\ Exec. Order No. 14,095, 3 CFR 24669-24676. (April 18, 2023).
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C. Provisions for CY 2024 Payment Under the HH PPS
1. CY 2024 Final Behavior Assumption Adjustments Under the HH PPS
(a) Background
As discussed in section II.A.1. of this rule, starting in CY 2020,
the Secretary was statutorily required by Section 1895(b)(2)(B) of the
Act, to change the unit of payment under the HH PPS from a 60-day
episode of care to a 30-day period of care. CMS was also required to
make assumptions about behavior changes that could occur as a result of
the implementation of the 30-day unit of payment and the case-mix
adjustment factors that eliminated the use of therapy thresholds. In
the CY 2019 HH PPS final rule with comment period (83 FR 56455), we
finalized three behavior change assumptions as to documentation,
coding, and the LUPA thresholds, which were also described in the CY
2022 and 2023 HH PPS rules (86 FR 35890, 87 FR 37614, and 87 FR 66795
through 66796). In the CY 2020 HH PPS final rule with comment period
(84 FR 60519), we included the effects of these behavior change
assumptions in the calculation of the 30-day budget neutral payment
amount for CY 2020, finalizing a negative 4.36 percent behavior change
assumption adjustment (``assumed behaviors''). We did not propose any
changes in CYs 2021 and 2022 relating to the behavior assumptions that
were finalized in the CY 2019 HH PPS final rule with comment period, or
to the negative 4.36 percent behavior change assumption adjustment,
that was finalized in the CY 2020 HH PPS final rule with comment
period.
In the CY 2023 HH PPS final rule (87 FR 66796), we concluded that
the three assumed behavior changes had in fact occurred. Additionally,
this monitoring showed that other behavioral changes, such as changes
in the provision of therapy and functional impairment levels, also
resulted from implementing the PDGM. We also restated, as we originally
noted in the CY 2020 HH PPS final rule with comment period (84 FR
60513), that we interpret actual behavior changes to encompass both
behavior changes that were previously outlined and assumed by CMS, as
well as other behavior changes that were not identified at the time the
budget-neutral 30-day payment rate for CY 2020 was established. In the
CY 2023 HH PPS final rule (87 FR 66796), we provided supporting
evidence that other behavior changes occurred, including that the
number of therapy visits declined in CYs 2020 and 2021, as well as a
slight decline in therapy visits beginning in CY 2019 after the
finalization of the removal of therapy thresholds, but prior to
implementation of the PDGM. In section II.B.1. of the CY 2024 HH PPS
proposed rule (88 FR 43663 through 43671), we stated that our analysis
continues to show that the actual 30-day periods are similar to the
simulated 30-day periods, overall. The number of therapy visits (total
and average) continue to decline, indicating that HHAs changed their
behavior to reduce therapy visits. The analysis continues to support
the presence of the original three assumed behavior changes (for
example, in the volume of visits for LUPAs), as well as other
individual behavior changes (for example, therapy visits). To capture
all such behavior changes, we use the entirety of all behaviors to
calculate estimated aggregate expenditures. The law instructs CMS to
ensure that estimated aggregate expenditures under the PDGM are equal
to the estimated aggregate expenditures that otherwise would have been
made under the prior system, as required by section 1895(b)(3)(A)(iv)
[[Page 77687]]
and 1895(b)(3)(D) of the Act. We accordingly use the aggregate data.
Section 4142(a) of the CAA, 2023, requires CMS to present, to the
extent practicable, a description of the actual behavior changes
occurring under the HH PPS from CYs 2020-2026. This subsection of the
CAA, 2023, also required CMS to provide datasets underlying the
simulated 60-day episodes and discuss and provide time for stakeholders
to provide input and ask questions on the payment rate development for
CY 2023. CMS complied with these requirements by posting online both
the supplemental LDS and descriptive files and the description of
actual behavior changes that affected CY 2023 payment rate development.
Additionally, on March 29, 2023, CMS conducted a webinar entitled
Medicare Home Health Prospective Payment System (HH PPS) Calendar Year
(CY) 2023 Behavior Change Recap, 60-Day Episode Construction Overview,
and Payment Rate Development. The webinar was open to the public and
discussed the actual behavior changes that occurred upon implementation
of the PDGM, our approach used to construct simulated 60-day episodes
using 30-day periods, payment rate development for CY 2023, and
information on the supplemental data files containing information on
the simulated 60-day episodes and actual 30-day periods used in
calculating the permanent adjustment to the payment rate. Materials
from the webinar, including the presentation and the CY 2023
descriptive statistics from the supplemental LDS files, containing
information on the number of simulated 60-day episodes and actual 30-
day periods in CY 2021 that were used to construct the permanent
adjustment to the payment rate, as well as information such as the
number of episodes and periods by case-mix group, case-mix weights, and
simulated payments, can be found on the Home Health Patient-Driven
Groupings Model web page at https://www.cms.gov/medicare/medicare-fee-for-service-payment/homehealthpps/hh-pdgm. In the CY 2024 HH PPS
proposed rule, we continued to describe actual behavior changes (88 FR
43663 through 43672) identified through our analysis of CYs 2020-2022
claims data. We posted a descriptive statistics file with the release
of the CY 2024 HH PPS proposed rule. Additionally, the LDS file
available for purchase contained the simulated 60-day episodes and
actual 30-day periods. Furthermore, to promote data transparency, we
will continue to describe the behavior changes analyzed through CY 2026
claims and we will continue to post the descriptive statistics file and
the LDS file with the simulated 60-day episodes and actual 30-day
periods in annual rulemaking.
(b) Method To Annually Determine the Impact of Differences Between
Assumed Behavior Changes and Actual Behavior Changes on Estimated
Aggregate Expenditures
In the CY 2022 HH PPS proposed rule (86 FR 35889 through 35892) we
solicited comments on our methodology to annually determine the impact
of differences between assumed and actual behavior changes on estimated
aggregate expenditures. We received feedback from this comment
solicitation, as well as commenter's feedback when this methodology was
proposed in the CY 2023 HH PPS proposed rule. We finalized this
methodology in the CY 2023 HH PPS final rule (87 FR 66804) stating that
this methodology aligns with the statutory requirements as required by
1895(b)(3)(D) of the Act. Under that methodology, for CYs 2020 through
2026, we will evaluate whether the 30-day budget neutral payment rate
and resulting aggregate expenditures are equal under the PDGM to what
they would have been under the 153-group case-mix system and 60-day
unit of payment. An overview of the methodology is listed in this
section, followed by detailed instructions on each step.
Create simulated 60-day episodes from actual 30-day
periods.
Price out the simulated 60-day episodes and determine
aggregate expenditures.
Price out only the actual 30-day periods which were used
to create the simulated 60-day episodes and determine aggregate
expenditures.
Compare aggregate expenditures between the simulated 60-
day episodes and actual 30-day periods.
Determine what the 30-day payment rate should have been to
equal the simulated 60-day episodes aggregate expenditures using the
153-group case-mix system and 60-day unit of payment.
(1) Create Simulated 60-Day Episodes From 30-Day Periods
The first step in our methodology is to determine which PDGM 30-day
periods of care could be grouped together to form simulated 60-day
episodes of care. To facilitate grouping, we made some exclusions and
assumptions as described later in this section prior to pricing out the
simulated 60-day episodes of care. We note in the early months of CY
2020, there were 60-day episodes which started in 2019 and ended in
2020 and therefore, some of these exclusions and assumptions may be
specific to the first year of the PDGM. We identify, through footnotes,
if an exclusion or assumption is specific to CY 2020 only.
(a) Exclusions
Claims where the claim occurrence code 50 date (OASIS
assessment date) occurred on or after October 31 of that year. This
exclusion was applied to ensure the simulated 60-day episodes contained
both 30-day periods from the same year and would not overlap into the
following year (for example, 2021, 2022, 2023). This is done because
any 30-day periods with an OASIS assessment date in November or
December might be part of a simulated 60-day episode that would
continue into the following year and where payment would have been made
based on the ``through'' date. For CYs 2021 through 2026, we also
excluded claims with an OASIS assessment date before January 1 of that
year.\2\ Again, this is to ensure a simulated 60-day episode (simulated
from two 30-day periods) does not overlap years.
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\2\ There are no 30-day PDGM claims which started in CY 2019 and
ended in CY 2020, and therefore this exclusion would not apply to
the CY 2020 dataset.
---------------------------------------------------------------------------
Beneficiaries and all of their claims if they have
overlapping claims from the same provider (as identified by CCN).\3\
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\3\ Claims are dropped from the same provider that extend into
the following calendar year to ensure episode timing is accurate for
simulated 60-day episodes. All of a beneficiary's claims are
dropped, rather than only a subset, so as not to create a conflict
in assigning episode timing.
---------------------------------------------------------------------------
Beneficiaries and all of their claims if three or more
claims from the same provider are linked to the same occurrence code 50
date.\4\
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\4\ This is done because if three or more claims link to the
same OASIS it would not be clear which claims should be joined to
simulate a 60-day episode.
---------------------------------------------------------------------------
(b) Assumptions
If two 30-day periods of care from the same provider
reference the same OASIS assessment date (using occurrence code 50),
then we assume those two 30-day periods of care would have been billed
as a 60-day episode of care under the 153-group system.
If two 30 day-periods of care reference different OASIS
assessment dates and each of those assessment dates is referenced by a
single 30-day period of care, and those two 30-day periods of care
occur together close in time (that is, the ``from'' date of the later
30-day period of care is between 0 to 14 days after the ``through''
date of the
[[Page 77688]]
earlier 30-day period of care), then we assume those two 30-day periods
of care also would have been billed as a 60-day episode of care under
the 153-group system.
For all other 30-day periods of care, we assume that they
would not be combined with another 30-day period of care and would have
been billed as a single 30-day period.
(2) Price Out the Simulated 60-Day Episodes and Determine Aggregate
Expenditures
After application of the exclusions and assumptions described
previously, we have the simulated 60-day episodes dataset for each
year. We assign each simulated 60-day episode of care as a normal
episode, PEP, LUPA, or outlier based on the payment parameters
established in the CY 2020 HH PPS final rule with comment period (84 FR
60478) for 60-day episodes of care. Next, using the October 2019 3M
Home Health Grouper (v8219) \5\ we assign a HIPPS code to each
simulated 60-day episode of care using the 153-group methodology.
Finally, we price the simulated 60-day episodes of care using the
payment parameters described in the CY 2020 final rule with comment
period (84 FR 60537) for 60-day episodes of care.
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\5\ https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HomeHealthPPS/CaseMixGrouperSoftware.
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For CYs 2021 through 2026, we adjust the simulated 60-day base
payment rate to align with current payments for the analysis year (that
is, wage index budget neutrality factor and home health payment
update). For example, to calculate the CY 2021 simulated 60-day episode
base payment rate, we started with the final CY 2020 60-day base
payment rate ($3,220.79) and multiplied by the final CY 2021 wage index
budget neutrality factor (0.9999) and the CY 2021 home health payment
update (1.020) to get an adjusted 60-day base payment rate ($3,284.88)
for CY 2021. We used that adjusted 60-day base payment rate ($3,284.88)
to price out the CY 2021 simulated 60-day claims. Once each claim is
priced under the pre-PDGM HH PPS, that is each claim is adjusted from
the base payment rate by case-mix, wage index, etc., we calculate the
estimated aggregate expenditures for all simulated 60-day episodes in
CY 2021. This method is then replicated to price out the simulated 60-
day episodes for each year of claims data through CY 2026.
(3) Price Out the 30-Day Periods and Determine Aggregate Expenditures
Next, we calculated the PDGM aggregate expenditures for the
specific year (for example, CY 2020) using those specific 30-day
periods that were used to create the simulated 60-day episodes.
Therefore, both the actual PDGM expenditures and the simulated pre-PDGM
aggregate expenditures are based on the exact same claims for the
permanent adjustment calculation.
(4) Compare Aggregate Expenditures Between the Simulated 60-Day
Episodes and Actual 30-Day Periods
We determine if the total aggregate expenditures under the PDGM
were higher or lower than under the 153-case mix group system in each
year beginning with CY 2020 through CY 2026. If expenditures were
higher under the PDGM (that is, we paid more than we would have if the
153-group payment system was in place), then the actual base payment
rate we implemented was too high. If the expenditures were lower under
the PDGM (that is, we paid less than we would have if the 153-group
payment system was in place), then the actual base payment rate we
implemented was too low.
(5) Determine What the 30-Day Payment Rate Should Have Been
Using an iterative process, we determine what the 30-day base
payment rate should have been, in order to achieve the same estimated
aggregate expenditures as obtained from the simulated 60-day episodes.
This is our recalculated (``repriced'') base payment rate.
(c) Calculating Permanent and Temporary Payment Adjustments
To offset prospectively for such increases or decreases in
estimated aggregate expenditures as a result of the impact of
differences between assumed behavior changes and actual behavior
changes, in any given year, we calculate a permanent prospective
adjustment by calculating the percent change between the actual 30-day
base payment rate and the recalculated 30-day base payment rate. This
percent change is converted into a behavior adjustment factor and
applied in the annual rate update process.
To offset retrospectively for such increases or decreases in
estimated aggregate expenditures as a result of the impact of
differences between assumed behavior changes and actual behavior
changes in any given year, we calculate a temporary prospective
adjustment by calculating the dollar amount difference between the
estimated aggregate expenditures from all 30-day periods using the
recalculated 30-day base payment rate, and the aggregate expenditures
for all 30-day periods using the actual 30-day base payment rate for
the same year. In other words, when determining the temporary
retrospective dollar amount, we use the full dataset of actual 30-day
periods using both the actual and recalculated 30-day base payment
rates to ensure that the utilization and distribution of claims are the
same. In accordance with section 1895(b)(3)(D)(iii) of the Act, the
temporary adjustment is to be applied on a prospective basis and shall
apply only with respect to the year for which such temporary increase
or decrease is made. Therefore, after we determine the dollar amount to
be reconciled in any given year, we calculate a temporary adjustment
factor to be applied to the base payment rate for that year. The
temporary adjustment factor is based on an estimated number of 30-day
periods in the next year using historical data trends, and as
applicable, we control for a permanent adjustment factor, case-mix
weight recalibration neutrality factor, wage index budget neutrality
factor, and the home health payment update. The temporary adjustment
factor is applied last. While we did not propose any changes to the
methodology finalized in the CY 2023 HH PPS final rule (87 FR 66804),
we did receive comments on the CY 2024 HH PPS proposed rule which are
summarized in this section.
Comment: Many commenters opposed the behavioral adjustment
methodology finalized in the CY 2023 HH PPS final rule based on legal
and technical concerns that mostly repeated objections raised in the
last rulemaking cycle. The legal arguments mostly restated we are
violating the Medicare statute. These commenters repeated technical
concerns including the use of therapy visits, accepted diagnosis codes,
timing assignment, and missing OASIS items. Commenters stated ``home
health agencies have predictably provided fewer therapy sessions,'' and
the methodology's reliance on this change in therapy utilization is not
appropriate to use in determining behavior changes since the law
required the elimination of the therapy thresholds. Commenters again
stated the methodology is unreasonable because ``claims billed under
one case-mix system, with different incentives, coding and billing
rules, and unit of payment'' cannot be compared. They requested that
CMS reverse the permanent payment adjustment taken in CY 2023, withdraw
the proposal of a permanent payment
[[Page 77689]]
adjustment for CY 2024, and develop and propose a new methodology after
input from a technical expert panel. Similarly, a few commenters stated
again that the methodology performs an unauthorized rebasing of the 30-
day payment rate. Lastly, several commenters stated beneficiaries using
home health are becoming more complex and have higher acuity needs, for
which reimbursement does not match. We received a new comment on the
methodology requesting CMS to consider how to further integrate the
acuity of patients into the behavioral assumption methodology and how
to better account for acuity overall in the PDGM.
Response: We appreciate the comments and recommendations we
received regarding the behavior adjustment methodology. We did not
propose any changes to the behavior adjustment methodology in this
year's proposed rule and will not be finalizing any changes. As noted,
most of these comments were similar to comments we received on the CY
2023 HH PPS proposed rule, so we refer readers to our responses to
these concerns in the CY 2023 HH PPS final rule (87 FR 66797 through
66804). In that rule, for example, we responded to commenters'
assertions that we violated the Medicare statute, as well as
commenters' disagreement with technical concerns, including the
inclusion of therapy provision, with our methodology.
One such argument to which we responded in the CY 2023 HH PPS final
rule (87 FR 66802) was a theory that we implemented an unauthorized
rebasing of the payment rates. The law requires us to determine the
difference between assumed versus actual behaviors on estimated
aggregate expenditures. Therefore, we continue to believe that the best
reading of the law requires us to retrospectively determine if the 30-
day payment amount in CYs 2020 through 2022 resulted in the same
estimated aggregate expenditures if the 60-day unit of payment and the
PDGM case-mix adjustment had not been implemented. As stated
previously, the finalized methodology compares the payment rate and
aggregate expenditures based on assumed behaviors to what the payment
rate and estimated aggregate expenditures would have been using actual
behaviors, which we believe is what the law requires.
We thank the commenters for their suggestion that they should be
paid more because patient acuity has increased. We finalized a policy
in the CY 2019 HH PPS final rule with comment period (83 FR 56515) to
annually recalibrate the PDGM case-mix weights using a fixed effects
model, with the most recent and complete utilization data available at
the time of annual rulemaking. Annual recalibration of the PDGM case-
mix weights ensures that the case-mix weights reflect, as accurately as
possible, current home health resource use and changes in utilization
patterns. It also allows us to be as accurate and up to date as
possible when measuring relationships between resource use and
functional points, functional threshold levels, comorbidities, LUPA
thresholds, and case-mix weights. These aspects of the PDGM capture
patient acuity. Further, because our finalized methodology utilizes the
most recent claims data (which includes case-mix), patient acuity is
reflected in the data.
(d) CY 2020 Results
This section discusses the final results that CMS determined from
CY 2020 claims data that was previously published in the CY 2023 HH PPS
final rule (87 FR 66804 through 66805). CMS did not do any
recalculations for CY 2020 data and this section simply reiterates what
was done previously for informative purposes only. Using the
methodology described previously, we simulated 60-day episodes using
actual CY 2020 30-day periods to determine what the CY 2020 permanent
and temporary payment adjustments should be to offset for such
increases or decreases in estimated aggregate expenditures. For CY
2020, we began with 8,423,688 30-day periods and dropped 603,157 30-day
periods that had a claim occurrence code 50 date after October 31,
2020. We also eliminated 79,328 30-day periods that did not appear to
group with another 30-day period to form a 60-day episode if the 30-day
period had a ``from date'' before January 15, 2020 or a ``through
date'' after November 30, 2020. This was done to ensure a 30-day period
would not have been part of a 60-day episode that would have overlapped
into CY 2021. Applying the additional exclusions and assumptions as
described previously, an additional 14,062 30-day periods were excluded
from this analysis. Additionally, we excluded 66,469 simulated 60-day
episodes of care where no OASIS information was available in the CCW
VRDC or could not be grouped to a HIPPS due to a missing primary
diagnosis or other reason. Our simulated 60-day episodes of care
produced a distribution of two 30-day periods of care (70.6 percent)
and single 30-day periods of care (29.4 percent). This distribution is
similar to what we found when we simulated 30-day periods of care for
implementation of the PDGM. After all exclusions and assumptions were
applied, the final dataset included 7,618,061 actual 30-day periods of
care and 4,463,549 simulated 60-day episodes of care for CY 2020.
Using the final dataset for CY 2020 (7,618,061 actual 30-day
periods which made up the 4,463,549 simulated 60-day episodes) we
determined the estimated aggregate expenditures under the pre-PDGM HH
PPS were lower than the actual estimated aggregate expenditures under
the PDGM HH PPS. This indicates that aggregate expenditures under the
PDGM were higher than if the 153-group payment system was still in
place in CY 2020. As described previously in the methodology, we needed
to calculate what the actual CY 2020 30-day base payment rate
($1,864.03) should have been to equal the aggregate expenditures that
we calculated using the simulated CY 2020 60-day episodes. We
determined the CY 2020 30-day base payment rate should have been
$1,742.52 based on actual behavior rather than the $1,864.03 based on
assumed behaviors. The percent change between the two payment rates
(actual and recalculated) would be the permanent adjustment. Next, we
calculated the difference in aggregate expenditures for all CY 2020
PDGM 30-day claims using the actual and recalculated payment rates.
This difference is the retrospective dollar amount needed to offset
payment. Our results are shown in Table B1.
[[Page 77690]]
[GRAPHIC] [TIFF OMITTED] TR13NO23.003
As shown in Table B1 and in the CY 2023 HH PPS final rule (87 FR
66805), a permanent prospective adjustment of -6.52 percent to the CY
2023 30-day payment rate would be required to offset for such increases
in estimated aggregate expenditures in future years. Additionally, we
determined that our initial estimate of base payment rates required to
achieve budget neutrality resulted in excess expenditures of HHAs of
approximately $873 million in CY 2020. This would require a temporary
adjustment to offset for such increase in estimated aggregate
expenditures for CY 2020.
(e) CY 2021 Results
This section discusses the final results CMS determined from CY
2021 claims data that was previously published in the CY 2023 HH PPS
final rule (87 FR 66805 through 66806). CMS did not do any
recalculations for CY 2021 data and this section simply reiterates what
was done previously for informative purposes only. Using the
methodology described previously, we simulated 60-day episodes using
actual CY 2021 30-day periods to determine what the permanent and
temporary payment adjustments should be to offset for such increases or
decreases in estimated aggregate expenditures as a result of the impact
of differences between assumed behavior changes and actual behavior
changes. For CY 2021, we began with 9,269,971 30-day periods of care
and dropped 570,882 30-day periods of care that had claim occurrence
code 50 date after October 31, 2021. We also excluded 968,434 30-day
periods of care that had claim occurrence code 50 date before January
1, 2021 to ensure the 30-day period would not be part of a simulated
60-day episode that began in CY 2020. Applying the additional
exclusions and assumptions as described previously, an additional 5,868
30-day periods were excluded.
Additionally, we excluded 14,302 simulated 60-day episodes of care
where no OASIS information was available in the CCW VRDC or could not
be grouped to a HIPPS due to a missing primary diagnosis or other
reason. Our simulated 60-day episodes of care produced a distribution
of two 30-day periods of care (70.0 percent) and single 30-day periods
of care (30.0 percent) that was similar to what we found when we
simulated two 30-day periods of care for implementation of the PDGM.
After all exclusions and assumptions were applied, the final dataset
included 7,703,261 actual 30-day periods of care and 4,529,498
simulated 60-day episodes of care for CY 2021.
Using the final dataset for CY 2021 (7,703,261 actual 30-day
periods which made up the 4,529,498 simulated 60-day episodes) we
determined the estimated aggregate expenditures under the pre-PDGM HH
PPS were lower than the actual estimated aggregate expenditures under
the PDGM HH PPS. This indicates that aggregate expenditures under the
PDGM were higher than if the 153-group payment system was still in
place in CY 2021. As described previously in the methodology, we needed
to calculate what the actual CY 2021 30-day base payment rate
($1,901.12) should have been to equal aggregate expenditures that we
calculated using the simulated CY 2021 60-day episodes. We determined
the CY 2021 30-day base payment rate should have been $1,751.90 based
on actual behavior rather than the $1,901.12 based on assumed
behaviors. The actual CY 2021 base payment rate of $1,901.12 does not
account for any behavior adjustments needed for CY 2020, and therefore
to evaluate changes for only CY 2021 we would need to control for the -
6.52 percent prospective adjustment that we determined for CY 2020.
Therefore, using the recalculated CY 2020 base payment rate of
$1,742.52, multiplied by the CY 2021 wage index budget neutrality
factor (0.9999) and the CY 2021 home health payment update (1.020), the
CY 2021 base payment rate for assumed behaviors would have been
$1,777.19. The percent change between the two payment rates would be
the annual permanent adjustment for CY 2021 (assuming the -6.52 percent
adjustment was already taken). Next, we calculated the difference in
aggregate expenditures for all CY 2021 PDGM 30-day claims using the
actual ($1,901.12, as this was what CMS actually paid in CY 2021) and
recalculated ($1,751.90) payment rates. This difference is the
retrospective dollar amount needed to offset payment. Our results are
shown in Table B2.
[[Page 77691]]
[GRAPHIC] [TIFF OMITTED] TR13NO23.004
As shown in Table B2 and in the CY 2023 HH PPS final rule (87 FR
66806), a permanent prospective adjustment of -1.42 percent (assuming
the -6.52 percent adjustment was already taken) would be required to
offset for such increases in estimated aggregate expenditures in future
years. Additionally, we determined that our initial estimate of base
payment rates required to achieve budget neutrality resulted in excess
expenditures of approximately $1.2 billion in CY 2021. This would
require a one-time temporary adjustment factor to offset for such
increases in estimated aggregate expenditures for CY 2021.
(f) CY 2022 Final Results
We will continue the practice of using the most recent complete
home health claims data at the time of rulemaking. The CY 2022 analysis
presented in the CY 2024 HH PPS proposed rule was considered
``preliminary'' and as more data became available from the latter half
of CY 2022, we updated our results. As we did with the CY 2024 HH PPS
proposed rule, the HH PPS limited data set (LDS) file released with
this final rule includes two files: the actual CY 2022 30-day periods
and the CY 2022 simulated 60-day episodes. We remind readers a data use
agreement (DUA) is required to purchase the CY 2024 final HH PPS LDS
file. Access will be granted for both the 30-day periods and the
simulated 60-day episodes under one DUA. Visit the HH PPS LDS web page
for more information.\6\ In addition, the final CY 2024 Home Health
Descriptive Statistics from the LDS Files spreadsheet is available on
the Home Health Prospective Payment System Regulations and Notices web
page,\7\ does not require a DUA, and is available at no cost to
interested parties. The spreadsheet contains information on the number
of simulated 60-day episodes and actual 30-day periods in CY 2022 that
were used to determine the behavior adjustments. The spreadsheet also
provides information such as the number of episodes and periods by
case-mix group, case-mix weights, and simulated payments. The CY 2024
final rule utilizes the CY 2022 finalized data for determining the
behavior adjustment needed to calculate the CY 2024 payment rate.
However, while the claims data and the permanent and temporary behavior
adjustment results will be considered complete, any adjustments to
future payment rates may be subject to additional considerations such
as permanent adjustments taken in previous years.
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\6\ https://www.cms.gov/research-statistics-data-and-systems/files-for-order/limiteddatasets/home_health_pps_lds.
\7\ https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HomeHealthPPS/Home-Health-Prospective-Payment-System-Regulations-and-Notices.
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Using the methodology described previously, we simulated 60-day
episodes using actual CY 2022 30-day periods to determine what the
permanent and temporary payment adjustments should be to offset for
such increases or decreases in estimated aggregate expenditures as a
result of the impact of differences between assumed behavior changes
and actual behavior changes. For CY 2022, we began with 8,593,266 30-
day periods of care and dropped 539,048 30-day periods of care that had
claim occurrence code 50 date after October 31, 2022. We also excluded
894,333 30-day periods of care that had claim occurrence code 50 date
before January 1, 2022 to ensure the 30-day period would not be part of
a simulated 60-day episode that began in CY 2021. Applying the
additional exclusions and assumptions as described previously, an
additional 6,105 30-day periods were excluded.
Additionally, we excluded 18,296 simulated 60-day episodes of care
where no OASIS information was available in the CCW VRDC or could not
be grouped to a HIPPS due to a missing primary diagnosis or other
reason. Our simulated 60-day episodes of care produced a distribution
of two 30-day periods of care (69.6 percent) and single 30-day periods
of care (30.4 percent) that was similar to what we found when we
simulated two 30-day periods of care for implementation of the PDGM.
After all exclusions and assumptions were applied, the final dataset
included 7,124,359 actual 30-day periods of care and 4,199,746
simulated 60-day episodes of care for CY 2022.
Using the final dataset for CY 2022 (7,124,359 actual 30-day
periods which made up the 4,199,746 simulated 60-day episodes) we
determined the estimated aggregate expenditures under the pre-PDGM HH
PPS were lower than the actual estimated aggregate expenditures under
the PDGM HH PPS as shown in Table B3. This indicates that aggregate
expenditures under the PDGM were higher than if the 153-group payment
system was still in place in CY 2022. As described previously in the
methodology, we needed to calculate what the actual CY 2022 30-day base
payment rate should have been to equal aggregate expenditures that we
calculated using the simulated CY 2022 60-day episodes. We determined
the CY
[[Page 77692]]
2022 30-day base payment rate should have been $1,839.10 based on
actual behavior rather than the $2,031.64 based on assumed behaviors.
We note, the actual CY 2022 base payment rate of $2,031.64 does not
account for any behavior adjustments needed for CYs 2020 and 2021, and
therefore to evaluate changes for only CY 2022 we need to account for
the -7.85 percent prospective adjustment that we determined for CYs
2020 and 2021. Therefore, using the recalculated CY 2021 base payment
rate of $1,751.90 (shown in Table B2), multiplied by the CY 2022 case-
mix weights recalibration neutrality factor (1.0396), the CY 2022 wage
index budget neutrality factor (1.0019) and the CY 2022 home health
payment update (1.026), the CY 2022 base payment rate for assumed
behavior would have been $1,872.18. The percent change between the two
payment rates would be the additional permanent adjustment (assuming
the -7.85 percent adjustment was already taken). Next, we calculated
the difference in aggregate expenditures for all CY 2022 PDGM 30-day
claims using the actual ($2,031.64) and recalculated ($1,839.10)
payment rates. This difference is the retrospective dollar amount
needed to offset payment. Our results are shown in Table B3.
[GRAPHIC] [TIFF OMITTED] TR13NO23.005
As shown in Table B3, a permanent prospective adjustment of -1.767
percent to the CY 2024 30-day payment rate (assuming the -7.85 percent
adjustment was already taken) would be required to offset for such
increases in estimated aggregate expenditures in future years.
Additionally, we determined that our initial estimate of base payment
rates required to achieve budget neutrality resulted in excess
expenditures of approximately $1.4 billion in CY 2022. This would
require a one-time temporary adjustment factor to offset for such
increases in estimated aggregate expenditures for CY 2022.
(g) CY 2024 Final Permanent Adjustment and Temporary Adjustment
Calculations
As discussed in the CY 2023 HH PPS final rule (87 FR 66808), to
offset fully the increase in estimated aggregate expenditures for CYs
2020 and 2021 based on the impact of the differences between assumed
and actual behavior changes, in CY 2023, CMS would have needed to apply
a -7.85 percent permanent adjustment to the CY 2023 base payment rate,
as well as implement a temporary adjustment of approximately $2.1
billion to reconcile retrospective overpayments in CYs 2020 and 2021.
We recognized that applying the full permanent and temporary adjustment
immediately would have resulted in a significant negative adjustment in
a single year. However, as we noted at the time, and as still is
applicable, if the PDGM 30-day base payment rate remained higher than
it should be, there will be a compounding effect, potentially creating
the need for an even larger reduction to adjust for behavioral changes
in future years. After considering all options, CMS proposed and
finalized the application of only a permanent adjustment to the CY 2023
base payment rate. We believed, and continue to believe, this mitigates
the need for a larger permanent adjustment and reduces the amount of
any additional temporary adjustments in future years.
We also recognized the potential hardship to some providers of
implementing the full -7.85 percent permanent adjustment in a single
year. We exercised our discretion to implement adjustments in a time
and manner determined appropriate, under section 1895(b)(3)(D) of the
Act, to finalize a -3.925 percent (half of the -7.85 \8\ percent)
permanent adjustment to the CY 2023 30-day payment rate. However, we
emphasized that the permanent adjustment needed in CY 2023 to account
fully for actual behavior changes in CYs 2020 and 2021 was -7.85
percent and applying a -3.925 percent permanent adjustment to the CY
2023 30-day payment rate would not fully account for differences in
behavior changes on estimated aggregate expenditures during those
years, as well as CYs 2022 and 2023. We stated we would need to account
for that difference (that is, the remaining half not applied to the CY
2023 payment rate) in future rulemaking, and any additional adjustments
(for example, CY 2022) needed to the base payment rate, to account for
behavior change based on more recent data analysis. We note that the
total permanent adjustment based on CY 2022 data did not have any
previous behavior adjustments applied.
[[Page 77693]]
However, as described later in this section, we recognize for CY 2024
we must account for adjustments made in CY 2023.
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\8\ We initially proposed a -7.69 percent permanent adjustment
in the CY 2023 HH PPS proposed rule (87 FR 37620). As more data
became available from the latter half of CY 2021, we updated our
results.
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The percent change between the actual CY 2022 base payment rate of
$2,031.64 (based on assumed behaviors) and the CY 2022 recalculated
base payment rate of $1,839.10 (based on actual behaviors) (shown in
Table B3) is the total (cumulative) permanent adjustment for CY 2022.
The summation of the dollar amount for CYs 2020, 2021, and 2022 is the
amount that represents the temporary payment adjustment to offset for
increased aggregate expenditures in CYs 2020, 2021, and 2022. Our
results are shown in Table B4 and B5.
[GRAPHIC] [TIFF OMITTED] TR13NO23.006
[GRAPHIC] [TIFF OMITTED] TR13NO23.007
We remind readers when we update the national, standardized 30-day
period payment amount (section II.C.4.2) that adjustment factors are
multiplied in this payment system and therefore, individual numbers
(that is, percentages) do not sum precisely to the permanent adjustment
needed to account for the total permanent adjustment in that year.
Additionally, as we stated in the CY 2023 HH PPS final rule (87 FR
66808), applying a -3.925 percent permanent adjustment to the CY 2023
30-day payment rate would not adjust the rate fully to account for
differences in behavior changes on estimated aggregate expenditures in
CYs 2020 and 2021. Therefore, we cannot determine the CY 2024 final
permanent adjustment by simply subtracting -3.925 percent from the
total permanent adjustment of -9.477 percent (updated from -9.356
percent in the proposed rule as more data became available), as
described further below.
Instead, we look at the total permanent adjustment needed for the
current year of data and account for any prior permanent adjustments
through multiplication and division of factors. In other words, we
determined the total permanent adjustment based on CY 2022 data (which
had no prior adjustments) is -9.477 percent, which is converted to a
0.90523 factor. We recognize that in CY 2023 we implemented a -3.925
percent permanent behavior adjustment, converted to a 0.96075 factor,
and we must account for it in the proposed CY 2024 permanent
adjustment. Next, we calculated the CY 2024 permanent adjustment factor
by solving (1-x) = 0.90523 (9.477 percent) divided by 0.96075 (3.925
percent). The resulting factor (1-x) is 0.94221, which is converted to
a 5.779 percent (updated from 5.653 percent in the CY 2024 HH PPS
proposed rule (88 FR 43678) as more data became available) reduction to
the CY 2024 national, standardized base payment rate. In other words, 1
minus the factor 0.94221 equals 0.05779 which is equal to a 5.779
percent reduction. Therefore, to offset the increase in estimated
aggregate expenditures for CY 2022 based on the impact of the
differences between assumed and actual behavior changes, and to account
for the permanent adjustment of -3.925 percent taken in CY 2023
rulemaking, CMS would need to apply a -5.779 percent permanent
adjustment to the CY 2024 base payment rate.
To calculate the temporary adjustment, we would add the CY 2022
temporary adjustment dollar amount of $1,405,447,290 to the previously
finalized CYs 2020 and 2021 dollar amounts for a total of
$3,489,523,364. We stated in the CY 2023 HH PPS final rule (87 FR
66804) and the CY 2024 HH PPS proposed rule (88 FR 43678), after we
determine the dollar amount to be reconciled, we will calculate a
temporary adjustment factor to be applied to the base payment rate for
that year. That is, the dollar amount will be converted to a factor.
However, in the CY 2023 HH PPS proposed rule (87 FR 37682), we opted to
implement only the permanent adjustment and solicit
[[Page 77694]]
comments on the implementation of a temporary adjustment, as we
believed for that year applying both would result in too significant of
a reduction in the payment rate in one year. Given that the magnitude
of implementing both the temporary and permanent adjustments for CY
2024 rate setting may also result in a significant reduction of the
payment rate, we similarly did not propose to take the temporary
adjustment in CY 2024. As we are required by Section 1895(b)(3)(D)(iii)
of the Act, we will propose a temporary adjustment factor to the
national, standardized 30-day base payment rate when we propose this
temporary payment adjustment in future rulemaking.
We received 343 comments on the permanent prospective behavior
change adjustment on the CY 2024 home health payment rate which are
summarized in this section. Similar to comments received on the CY 2023
permanent adjustment, the majority of commenters disagreed with the
proposed permanent adjustment to the CY 2024 payment rate.
Comment: Overall, commenters raised concerns that the proposed rate
cut would be a threat to home health access. Further, industry
advocates submitted data from hospitals and health systems to support
their assertion that HHA referrals for Medicare beneficiaries are
increasingly being rejected, and the number of patients referred to
home health and subsequently admitted is dropping.
These commenters interpret these trends to be indicative of
declining access to home health services and state that CMS's
implementation of the PDGM and behavior adjustment resulting in rate
cuts are major contributors. Commenters stated that a rate cut will
affect beneficiary access by forcing HHAs to close, sell, reduce
service areas, reduce admissions, and struggle to retain staff, while
many others are operating with, or will operate with, negative margins
if the CY 2024 permanent rate adjustment is finalized. These commenters
contend that CMS does not have an accurate financial picture of
industry stability, as we do not account for overall margins (for
example, Medicare Advantage), rather just Medicare Fee-For-Service
(FFS) margins when considering margin analyses. A commenter stated that
``the economic model of HHAs necessitates a view consistent with the
HHAs' evaluation of its overall financial condition,'' suggesting that
it is common for Medicare's FFS payment to subsidize shortfalls from
other payers.
Response: We appreciate industry advocates' dedication to ensuring
continued access to home health services. We recognize there is always
a level of concern that accompanies a payment rate decrease and we
remind readers that, by law, as described in section 1895(b)(3)(D) of
the Act, we are required to ensure that estimated aggregate
expenditures under the HH PPS are equal to our determination of
estimated aggregate expenditures that otherwise would have been made
under the HH PPS in the absence of the change to a 30-day unit of
payment and changes in case-mix adjustment factors. We appreciate
providers', beneficiaries', and other stakeholders' commitment to the
sustainability of the home health benefit.
As we noted above, we reprice the base payment rate based on actual
behavior changes by HHAs, not on how the behavior changes impact HHA
margins. In any event, CMS looked closely at our data to ensure the
payment rate adequately covers the costs reported by HHAs, without
creating unnecessary hardship to providers and maintaining access to
quality services for all beneficiaries. Maintaining access is one of
CMS's priorities when making policy decisions. We do not intend to
obstruct the provision of home health services to any beneficiary who
qualifies for this benefit.
Overall, CMS's data on the cost of providing care (as reported by
HHAs on the Home Health Medicare Cost Reports (CMS Form 1728-20, OMB
No. 0938-0022)) and the margin analysis, along with data reported by
MedPAC in their annual Medicare payment policy reports to the Congress,
indicate that the cost of providing home health care remains, on
average, below the base payment rate and that HHAs in general continue
to experience high profit margins. CMS's analysis, shown in Table B4 of
the CY 2024 HH PPS proposed rule, indicates that the CY 2022 national,
standardized 30-day period payment rate was approximately 45 percent
more than the CY 2022 estimated 30-day period cost (88 FR 43665).
MedPAC's 2023 March Report to the Congress \9\ found that in 2021, home
health agencies' average cost per 30-day period decreased by 2.9
percent and that Medicare's payment per in-person visit increased by
17.7 percent. Medicare margins for freestanding agencies averaged 24.9
percent in 2021, up from 20.2 percent in 2020 and 15.4 percent in 2019.
These high margins indicate that the increase in payments in 2021 far
exceeded the increase in costs, which undermines commenters' assertion
that CMS's modest (by comparison) cuts to the base rate in 2023 would
exacerbate any problems with access to care. Further, MedPAC's
projected Medicare margin for HHAs for 2023 is 17.0 percent, which
includes the statutory adjustment to the base payment rate in
accordance with the statutory requirement to determine the impact of
differences between assumed behavior changes and actual behavior
changes on estimated aggregate expenditures in response to the change
in case-mix adjustment and the 30-day period payment.
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\9\ Report to Congress, Medicare Payment Policy. Home Health
Care Services, Chapter 8. MedPAC. March 2023 https://www.medpac.gov/wp-content/uploads/2023/03/Ch8_Mar23_MedPAC_Report_To_Congress_SEC.pdf.
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Some commenters pointed to the number of HHAs with negative
margins. Using Medicare cost reports with a year end of December 31,
2022, approximately 21 percent of HHAs have margins below zero percent.
We are aware that some HHAs face financial difficulties, but the
behavior adjustment is an aggregate adjustment that impacts the base
payment rates of all HHAs equally. Our analysis, shown in Table B6,
indicates that even prior to the PDGM, approximately 20 to 23 percent
of freestanding HHAs had margins below zero percent, indicating that
this phenomenon pre-dated the PDGM, and are not the result of the rate
adjustments related to the initial behavior assumptions applied in CY
2020.
[[Page 77695]]
[GRAPHIC] [TIFF OMITTED] TR13NO23.008
With respect to the comment that CMS must look at the HHAs' overall
financial condition (that is, overall margins), we have never endorsed
the view that Medicare funds should be used to subsidize reimbursement
rates from other payers--a policy that would be inconsistent with our
obligation to be responsible stewards of the Medicare Trust Funds and
would ultimately increase costs to Medicare beneficiaries, taxpayers,
or both. As we noted in the CY 2023 HH PPS final rule we responded to
this assertion stating: ``Medicare has never set payments to cross-
subsidize other payers. Section 1861(v)(1)(A) of the Act states that
under the methods of determining costs, the necessary costs of
efficiently delivering covered services to individuals covered by the
insurance programs established by this title will not be borne by
individuals not so covered, and the costs with respect to individuals
not so covered will not be borne by such insurance programs'' (87 FR
66807).
While CMS monitors the payment rate to ensure it is adequate for
providing care, MedPAC further assesses access to care by reviewing
several indicators to determine the level at which payments will be
adequate to cover the costs of providing care of a provider in any
given year. Specifically, they examine the supply of home health
providers, annual changes in the volume of services, quality of care,
and access to capital, in addition to the relationship between
Medicare's payments and providers' costs. Their annual reports indicate
that prior to and following the implementation of the PDGM, the payment
adequacy indicators for home health care have been positive.
Finally, we observed many methodological weaknesses in the analyses
submitted by commenters. It is unclear whether the proprietary data on
which commenters base their analyses includes referrals from only
Medicare FFS beneficiaries or also includes referrals from patients
covered by other payers, which means the entire analysis may be inapt
for Medicare FFS policy. In addition, the proportion of hospital
referrals rejected by HHAs does not equate to the proportion of
qualifying beneficiaries who are denied care. The data fails to capture
why the beneficiary was rejected--for example, because the analysis
focuses on numbers of referrals denied rather than numbers of
beneficiaries denied care, the rejection referral proportion could be
inflated by a small number of beneficiaries rejected from multiple
HHAs, or by beneficiaries rejected from one HHA but who ultimately
received care from another HHA. It also fails to indicate that the HHA
did in fact reject the referral and why it was rejected (for example,
payment or staff related), or whether there was another reason the
patient did not receive home health services, such as patient refusal
or readmission to an inpatient facility.
Further, the data submitted by the commenters is deficient in
analyzing the characteristics of the beneficiaries who are receiving
home health services versus those that do not. The usefulness of such
analysis would be to potentially show whether HHAs are strategic in
accepting certain types of patients over others. In response to a
similar home health rate decrease (CY 2011 HH PPS final rule), in which
CMS finalized a 3.79 percent rate reduction, a commenter stated that
``HHAs may become more selective in their acceptance of medically
difficult patients who are likely to utilize more services'' (75 FR
70375). Additionally, in the CY 2023 HH PPS final rule we quoted an
article published in February 2020, in which the National Association
for Home Care and Hospice (NAHC) stated ``categorically, across the
board, we're going to reduce our therapy services'' because of the PDGM
(87 FR 66798). A comment letter received by NAHC on the CY 2023
proposed rule also attempted to outline, how historically, rate cuts to
Medicare home health services alter how HHAs provide care.
Compellingly, we also received a significant number of comments in
response to the CY 2024 HH PPS proposed rule supporting this concept.
These comments are discussed below.
Comment: Commenters indicated that HHAs may also choose which
patients to accept on service to maximize payment. For example, a
patient advocate group noted that ``HHAs self-select the Medicare
patients they will serve (or not serve), and then HHAs determine the
services they provide, based on their hiring choices and OASIS
assessments.'' This commenter stated that home health care has become
``big business,'' and stated that ``HHAs focus
[[Page 77696]]
more on profits for shareholders and less on critically needed services
for patients.'' Another commenter stated, ``the venture capital backed
agencies are using data-mining solutions to ensure a profit is made.
This includes everything from the heavily scrutinized referral
acceptance procedure to ensure `profitable' patients are chosen over
`non-profitable' patients and the rationing of care based on what the
data shows to create profit from decreasing direct care costs.''
Response: Our previous response related to margins suggests that,
as some commenters have claimed, HHAs may be strategically admitting or
denying beneficiaries based to maximize their margins. We are concerned
by suggestions that the ``referral rejections'' and perceived access to
care issue that industry advocates have cited to us are in fact being
caused by strategic behavior. We would be interested to receive data
and analysis comparing beneficiaries who are receiving home health
services versus those who are not, which could help inform future
policy proposals. The data we received does not address that issue, and
CMS's review of utilization software websites designed to guide HHAs to
the most profitable referrals and to identify ways to decrease costs
supports these commenters assertions. For these reasons, we cannot
credit home health agencies' conclusion that either behavioral
adjustments or the PDGM are the root cause of the access issues
reported by beneficiaries.
We will continue to monitor home health utilization, claims data,
and home health cost reports to identify trends that may indicate
vulnerabilities and deficiencies in the home health prospective payment
system and potentially affect access to care. Given this monitoring and
analyses showing that the home health payment exceeds the cost of
providing care, we would expect that providers would not have to reject
referrals because of inadequate payment. In fact, due to the newly
implemented case-mix system designed to encourage a varied distribution
of services, we would not only expect that agencies would not have to
reject referrals but be well-positioned to accept a wide range of
referrals regardless of the services needed.
We are aware of the changes in the home health industry, including
buyouts and increased interest of private equity groups. These shifts
will undoubtedly change the landscape of home health; however, we
remind stakeholders that Medicare FFS sets rates to cover costs that
align with Medicare's principles of reasonable cost determination as
set out at 42 CFR 413.9, not to ensure high profit margins. The home
health benefit uses a prospective payment system that is inclusive of
all care required in a 30-day period of care. This method of payment is
made based on a predetermined, base payment amount. The home health
case-mix system, the PDGM, was created to align the payment system more
closely with patient characteristics and ensure that payment accurately
meets the resource needs of various types of patients. This helps HHAs
to be paid appropriately for a wide range of patients with varying care
needs and improves the likelihood that clinically complex and ill
beneficiaries and patients coming from the hospital will have adequate
access to home health care. In the CY 2019 HH PPS final rule with
comment period (83 FR 56448), where we finalized the implementation of
the PDGM, there was some commenter concern that the PDGM may introduce
``inappropriate practice patterns,'' suggesting again that HHAs may
change how they operate in accordance with payment. However, our
objective then, as well as now, remains to pay for the care provided as
required by the statute. As evidenced by the behavior changes described
in the CY 2023 HH PPS final rule, we understand that providers do
continue to adjust practice patterns in response to payment and case-
mix changes. We also understand that venture capital and private equity
groups are buying HHAs. This, however, does not mean that overall
access to the benefit has been compromised and the analyses presented
by commenters fails to show evidence that this is the case. Further,
were the data to show definitively that overall access has been
affected, there remains no direct link to inadequate payment. It is
also important to note that while the commenters' data purports to show
an increase in ``referral rejections'' beginning with the
implementation of the PDGM and through the beginning of CY 2023, in CY
2020 (beginning of PDGM) and each subsequent year through CY 2023, CMS
has instituted a positive rate update for HHAs. It is unclear why HHAs
would reject referrals when payment rates have increased each year
since the implementation of the PDGM, and as established earlier, have
continually exceeded the cost of providing care. Additionally, CMS is
statutorily required, under Section 1895(b)(3)(D)(i), to ensure that
estimated aggregate expenditures under the PDGM are equal to the
estimated aggregate expenditures that otherwise would have been made
under the prior system, by accounting for the impact of the differences
between assumed behavior changes and actual behavior changes on
estimated aggregate expenditures. This requirement under section
1895(b)(3)(D)(i) resulted in the proposed -5.653 percent adjustment for
CY 2024.
We do not believe that the percentage of ``referral rejections''
attributable to staffing issues requires a different policy. Commenters
did not submit any evidence that staffing shortages are due to changes
in the payment rate or case-mix adjustment rather than the widespread
staffing shortages that exist across the spectrum of healthcare, and in
the general labor market. While we recognize the staffing challenges
faced by HHAs and other healthcare providers, we are accounting for
those staffing challenges in other ways, such as the market basket
increase (which includes labor costs), as explained in section II.C.3
of this final rule.
In conclusion, we appreciate the concerns that a rate decrease may
affect access to home health services; however, CMS's analysis of HHA
cost reports and margin analysis, as well as MedPAC's analysis of
profit margins, the supply of home health providers, annual changes in
the volume of services, quality of care, and access to capital shows
that access should remain adequate. Our discussion above indicates that
any effect on access would not be a result of CMS paying more
accurately for the care provided. In addition, the law requires us to
evaluate the difference between assumed and actual behavior changes on
estimated aggregate expenditures independently for CYs 2020 through
2026. The payment adjustment does not include extenuating factors such
as margins. Further, while the analyses submitted by the commenters
allegedly show that access to home health services has been
compromised, CMS does not have access to the proprietary data used to
create the analysis to confirm the validity of the results.
Final Decision: We continue to adhere to the methodology finalized
in the CY 2023 HH PPS final rule (87 FR 66804). However, as in previous
years, we acknowledge that taking a large permanent adjustment in a
single year, to comply with the statutory requirement that CMS ensure
the estimated aggregate expenditures under the PDGM are equal to the
estimated aggregate expenditures that would have been made under the
prior system, may be burdensome for some providers. As we have the
discretion to implement any behavior adjustment in a time and manner
determined appropriate, we are
[[Page 77697]]
finalizing only a -2.890 percent (half of the -5.779 \10\ percent)
permanent adjustment for CY 2024. This approach of applying half of the
permanent adjustment is aligned with the approach finalized in the CY
2023 HH PPS final rule (87 FR 66808) where CMS finalized half of the
permanent adjustment to the CY 2023 30-day payment rate.
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\10\ We initially proposed a -5.653 percent permanent adjustment
in the CY 2024 HH PPS proposed rule (88 FR 43679). As more data
became available from the latter half of CY 2022, we updated our
results.
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However, we note the permanent adjustment to account for actual
behavior changes in CYs 2020, 2021, and 2022, should be -5.779 percent,
which includes the remaining ``half'' from the CY 2023 HH PPS final
rule and the additional adjustment based on CY 2022 data. Therefore,
applying a -2.890 percent permanent adjustment to the CY 2024 30-day
payment rate would not adjust the rate fully to account for differences
in behavior changes on estimated aggregate expenditures during those
years. We will have to account for that difference, and any other
potential adjustments needed to the base payment rate, to account for
behavior change based on data analysis in future rulemaking.
CMS did not propose to adjust the CY 2024 base payment rate using
our temporary adjustment authority, as section 1895(b)(3)(D)(iii)
allows any adjustment to be made in a time and manner deemed
appropriate by the Secretary. However, we remind readers that without
the full permanent adjustment (-5.779 percent) in effect, the total
temporary dollar amount will likely continue to increase until the
permanent adjustment is fully implemented.
2. CY 2024 PDGM LUPA Thresholds and PDGM Case-Mix Weights
(a) CY 2024 PDGM LUPA Thresholds
Under the HH PPS, LUPAs are paid when a certain visit threshold for
a payment group during a 30-day period of care is not met. In the CY
2019 HH PPS final rule with comment period (83 FR 56492), we finalized
a policy to set the LUPA thresholds at the 10th percentile of visits or
2 visits, whichever is higher, for each payment group. This means the
LUPA threshold for each 30-day period of care may vary depending on the
PDGM payment group to which it is assigned. If the LUPA threshold for
the payment group is met under the PDGM, the 30-day period of care will
be paid the full 30-day period case-mix adjusted payment amount
(subject to any partial payment adjustment or outlier adjustments). If
a 30-day period of care does not meet the PDGM LUPA visit threshold,
then payment will be made using the CY 2024 per-visit payment amounts
as described in section II.C.4.e.3. of this final rule. For example, if
the LUPA visit threshold is four, and a 30-day period of care has four
or more visits, it is paid the full 30-day period payment amount; if
the period of care has three or less visits, payment is made using the
per-visit payment amounts.
In the CY 2019 HH PPS final rule with comment period (83 FR 56492),
we finalized a policy to reevaluate the LUPA thresholds for each PDGM
payment group every year based on the most current utilization data
available at the time of rulemaking. However, as CY 2020 was the first
year of the new case-mix adjustment methodology, we stated in the CY
2021 HH PPS final rule (85 FR 70305, 70306) that we would maintain the
LUPA thresholds that were finalized and shown in Table 17 of the CY
2020 HH PPS final rule with comment period (84 FR 60522) for CY 2021
payment purposes. We stated that at that time, we did not have
sufficient CY 2020 data to reevaluate the LUPA thresholds for CY 2021.
In the CY 2022 HH PPS final rule (86 FR 62249), we discussed the
influence of the COVID-19 PHE on home health utilization and finalized
a proposal to recalibrate the PDGM case-mix weights, functional
impairment levels, and comorbidity subgroups while maintaining the LUPA
thresholds for CY 2022. We stated that, because there are several
factors that contribute to how the case-mix weight is set for a
particular case-mix group (such as the number of visits, length of
visits, types of disciplines providing visits, and non-routine
supplies) and the case-mix weight is derived by comparing the average
resource use for the case-mix group relative to the average resource
use across all groups, we believed the COVID-19 PHE would have impacted
utilization within all case-mix groups similarly. Therefore, the impact
of any reduction in resource use caused by the COVID-19 PHE on the
calculation of the case-mix weight would be minimal since the impact
would be accounted for both in the numerator and denominator of the
formula used to calculate the case-mix weight. However, in contrast,
the LUPA thresholds are based on the number of overall visits in a
particular case-mix group (the threshold is the 10th percentile of
visits or 2 visits, whichever is greater) instead of a relative value
(like what is used to generate the case-mix weight) that would control
for the impacts of the COVID-19 PHE. We noted that visit patterns and
some of the decrease in overall visits in CY 2020 may not be
representative of visit patterns in CY 2022. Therefore, to mitigate any
potential future and significant short-term variability in the LUPA
thresholds due to the COVID-19 PHE, we finalized the proposal to
maintain the LUPA thresholds finalized and displayed in Table 17 in the
CY 2020 HH PPS final rule with comment period (84 FR 60522) for CY 2022
payment purposes.
For CY 2023, we proposed to update the LUPA thresholds using CY
2021 Medicare home health claims (as of March 21, 2022) linked to OASIS
assessment data. After reviewing the CY 2022 home health claims
utilization data we determined that visit patterns have stabilized. Our
data analysis indicated that visits in 2022 were similar to visits in
2020. We believed that CY 2021 data would be more indicative of visit
patterns in CY 2023 rather than continuing to use the LUPA thresholds
derived from the CY 2018 pre-PDGM data. Therefore, in the CY 2023 HH
PPS final rule we finalized a policy to update the LUPA thresholds for
CY 2023 using data from CY 2021.
In accordance with our policy, for CY 2024, in the CY 2024 HH PPS
proposed rule, we proposed to update the LUPA thresholds using CY 2022
home health claims utilization data (as of March 17, 2023). We
solicited public comments on the proposed updates to the LUPA
thresholds for CY 2024. These comments and our responses are summarized
in this section of the rule.
Comment: A few commenters expressed support for the proposed LUPA
thresholds.
Response: We thank the commenters for their support.
Comment: Some commenters continued to disagree with the policy to
reevaluate and update the LUPA thresholds annually. A commenter
recommended that CMS reduce the LUPA threshold for all case-mix groups
to two visits. Another commenter recommended CMS not update the LUPA
thresholds for CY 2024 and reassess the impact of using CY 2023 data
before making any adjustments. This commenter stated that the change in
LUPA visit thresholds from two and three visits to the current four and
five visit thresholds narrows the gap between the LUPA visit threshold
and the average visits per home health period, and that as the gap
narrows, LUPA payments will no longer represent outliers. Lastly, a
commenter questioned the methodology used to calculate the LUPA
thresholds.
[[Page 77698]]
Response: We thank the commenters for their recommendations;
however, in the CY 2019 HH PPS final rule with comment period (83 FR
56492), we finalized the policies to set LUPA thresholds at the 10th
percentile of visits or 2 visits, whichever is higher, for each payment
group, and reevaluate the LUPA thresholds for each PDGM payment group
every year based on the most current utilization data available at the
time of rulemaking. We did not propose any changes to our finalized
LUPA threshold policy in the CY 2024 HH PPS proposed rule. Further, our
policy to reevaluate the LUPA thresholds ensures that they reflect, as
accurately as possible, current home health resource use and changes in
utilization patterns. As such, we believe that we should update the
LUPA thresholds using CY 2022 home health claims utilization data (as
of July 15, 2023), to ensure they are representative of the most recent
visit patterns.
Final Decision: We are finalizing the proposal to update the LUPA
thresholds for CY 2024, using CY 2022 claims data (as of July 15,
2023). The final LUPA thresholds for the CY 2024 PDGM payment groups
with the corresponding Health Insurance Prospective Payment System
(HIPPS) codes and the case-mix weights are listed in Table B12 and is
also available on the HHA Center web page.\11\
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\11\ https://www.cms.gov/medicare/enrollment-renewal/providers-suppliers/home-health-agency-center.
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(b) CY 2024 Functional Impairment Levels
Under the PDGM, the functional impairment level is determined by
responses to certain OASIS items associated with activities of daily
living (ADLs) and risk of hospitalization; that is, responses to OASIS
items M1800-M1860 and M1033. A home health period of care receives
points based on each of the responses associated with these functional
OASIS items, which are then converted into a table of points
corresponding to increased resource use. The sum of these points
results in a functional score which is used to group home health
periods into a functional level with similar resource use. That is, the
higher the points, the higher the response is associated with increased
resource use. The sum of these points results in a functional
impairment score which is used to group home health periods into one of
three functional impairment levels with similar resource use. The three
functional impairment levels of low, medium, and high were designed so
that approximately one-third of home health periods from each of the
clinical groups fall within each level. This means home health periods
in the low impairment level have responses for the functional OASIS
items that are associated with the lowest resource use, on average.
Home health periods in the high impairment level have responses for the
functional OASIS items that are associated with the highest resource
use on average.
For CY 2024, we proposed to use CY 2022 claims data to update the
functional points and functional impairment levels by clinical group.
The CY 2018 HH PPS proposed rule (82 FR 35320) and the technical report
from December 2016, posted on the Home Health PPS Archive web page
located at: https://www.cms.gov/medicare/home-health-pps/home-health-pps-archive, provides a more detailed explanation as to the
construction of these functional impairment levels using the OASIS
items. We proposed to use the same methodology previously finalized to
update the functional impairment levels for CY 2024.
We solicited public comments on the updates to functional points
and the functional impairment levels by clinical group. A summary of
these comments and our responses are as follows:
Comment: Several commenters opposed the proposed, updated CY 2024
functional impairment points and levels. A commenter recommended
delaying this update until the effect of the CY 2023 functional
impairment levels has been assessed. This commenter also suggested that
if future updates are warranted that it should occur in CY 2025 using
post pandemic CY 2023 claims data.
Response: We thank the commenters for their recommendations;
however, performing a yearly recalibration allows us to be as accurate
and up to date as possible when measuring the relationship between
resource use and functional points, functional threshold levels,
comorbidities, LUPA thresholds and case-mix weights. Therefore, we do
not believe it would be appropriate to delay updates to the functional
impairment points and levels for CY 2024. We continue to believe that
updating the functional impairment levels using current data ensures
that all variables used as part of the overall case-mix adjustment
appropriately align home health payment with the actual cost of
providing home health care services.
Comment: A commenter disagreed with the method used for assigning
the functional impairment levels, stating that the update in point
values appears to be more aimed at achieving an arbitrarily set target
of one-third in each level rather than a true categorization of the
patients' clinical presentation.
Response: We remind commenters that the functional levels are set
so that roughly a third of periods within each clinical group are
assigned to low, medium, and high to ensure that the case-mix system
pays appropriately for differences in functional impairment level. The
structure of categorizing functional impairment into low, medium, and
high levels has been part of the home health payment structure since
the implementation of the HH PPS. The previous HH PPS grouped home
health episodes using functional scores based on functional OASIS items
with similar average resource use within the same functional level,
with approximately a third of episodes classified as low functional
score, a third of episodes classified as medium functional score, and a
third of episodes classified as high functional score. Likewise, the
PDGM groups home health periods of care using functional impairment
scores based on functional OASIS items with similar resource use and
has three levels of functional impairment severity: low, medium, and
high. However, the PDGM differs from the previous HH PPS functional
variable, in that the three functional impairment level thresholds in
the PDGM vary between the clinical groups. The PDGM functional
impairment level structure accounts for the patient characteristics
within that clinical group associated with increased resource costs
affected by functional impairment. This is to further ensure that
payment is more accurately aligned with actual patient characteristics
and resource needs.
Comment: Some commenters were concerned that the proposed
functional impairment levels do not accurately reflect the actual
functional impairment levels of home health patients or the cost to
provide care for higher acuity patients, specifically those in the
musculoskeletal rehabilitation, neuro rehabilitation, surgical
aftercare, and wounds groups, as these individuals often have intense
needs for assistance with daily living. A few commenters questioned why
it appears there would be a reduction in reimbursement for the highest
acuity patients and suggested that this will limit an agency's ability
to care for these types of patients. Some commenters indicated that
they would see fewer patients with high functional impairment, as
several groups changed from high functional impairment to medium
functional impairment, while others stated this change will
[[Page 77699]]
incentivize for-profit agencies to hand-pick patients based on their
predicted case mix grouping. A commenter suggested that the shift of
patients from high functional impairment to medium functional
impairment indicates by CMS through the HIPPS code that these patients
are not as clinically complex and therefore would not require as many
resources.
Response: We have noted in past rules that we use the functional
impairment level case-mix adjustment, developed as part of the PDGM
case-mix, to provide the necessary payment adjustments to ensure that
functional care needs are met based on actual patient characteristics.
As in any case-mix system, there will be certain case-mix groups where
a patient's costs exceed the average as well as where their costs are
below the average. However, we do not believe that a patient assignment
to a HIPPS category should dictate what care the patient needs. We
expect the provision of services to be made to best meet the patient's
care needs and in accordance with the home health CoPs at Sec. 484.60
which sets forth the requirements for the content of the individualized
home health plan of care which includes the types of services,
supplies, and equipment required; the frequency and duration of visits
to be made; as well as patient and caregiver education and training to
facilitate timely discharge. Therefore, we do not expect HHAs to under-
supply care or services; reduce the number of visits in response to
payment; or inappropriately discharge a patient receiving Medicare home
health services as these would be violations of the CoPs and could also
subject HHAs to program integrity measures.
Final Decision: We are finalizing the functional points and
functional impairment levels updates for CY 2024 as proposed, using CY
2022 claims data (as of July 15, 2023). The updated OASIS functional
points table and the table of functional impairment levels by clinical
group for CY 2024 are listed in Tables B7 and B8, respectively.
BILLING CODE 4120-01-P
[[Page 77700]]
[GRAPHIC] [TIFF OMITTED] TR13NO23.009
[[Page 77701]]
[GRAPHIC] [TIFF OMITTED] TR13NO23.010
BILLING CODE 4120-01-C
(c) CY 2024 Comorbidity Subgroups
Thirty-day periods of care receive a comorbidity adjustment
category based on the presence of certain secondary diagnoses reported
on home health claims. These diagnoses are based on a home-health
specific list of clinically and statistically significant secondary
diagnosis subgroups with similar resource use, meaning the diagnoses
have at least as high as the median resource use and are reported in
more than 0.1 percent of 30-day periods of care. Home health 30-day
periods of care can receive a comorbidity adjustment under the
following circumstances:
Low comorbidity adjustment: There is a reported secondary
diagnosis on the home health-specific comorbidity subgroup list that is
associated with higher resource use.
[[Page 77702]]
High comorbidity adjustment: There are two or more
secondary diagnoses on the home health-specific comorbidity subgroup
interaction list that are associated with higher resource use when both
are reported together compared to when they are reported separately.
That is, the two diagnoses may interact with one another, resulting in
higher resource use.
No comorbidity adjustment: A 30-day period of care
receives no comorbidity adjustment if no secondary diagnoses exist or
do not meet the criteria for a low or high comorbidity adjustment.
In the CY 2019 HH PPS final rule with comment period (83 FR 56406),
we stated that we would continue to examine the relationship of
reported comorbidities on resource utilization and make the appropriate
payment refinements to help ensure that payment is in alignment with
the actual costs of providing care. For CY 2024, we proposed to use the
same methodology used to establish the comorbidity subgroups to update
the comorbidity subgroups using CY 2022 home health data.
For CY 2024, we proposed to update the comorbidity subgroups to
include 22 low comorbidity adjustment subgroups as identified in Table
B19 and 101 high comorbidity adjustment interaction subgroups as
identified in Table B20 in the CY 2024 HH PPS proposed rule.
We invited comments on the proposed updates to the low comorbidity
adjustment subgroups and the high comorbidity adjustment interactions
for CY 2024. These comments and our responses are summarized as
follows.
Comment: A commenter supported the proposed low comorbidity
subgroups and the high comorbidity interactions. This commenter stated
that the proposed low comorbidity subgroups achieve the goal of
ensuring that payment is in alignment with the actual costs of
providing care and the high comorbidity adjustment interaction
subgroups acknowledge the impact of multiple diagnoses on care delivery
complexity and cost.
Response: We thank the commenter for their support.
Comment: A commenter requested clarification on the number of
proposed low comorbidity subgroups for CY 2024. This commenter noted
that Table B19 included 22 subgroups, but the preamble language listed
the number of subgroups as 21.
Response: We thank the commenter for bringing this to our
attention. The preamble language inadvertently stated that there were
21 low comorbidity subgroups; however, the 22 subgroups listed in Table
B19 are accurate. Furthermore, the number of low comorbidity subgroups
remains 22 for this final rule.
Comment: A commenter requested that CMS reassign diseases and
disorders, as well as specific ICD-10 CM diagnosis codes, to different
comorbidity subgroups and create new high comorbidity interactions. The
commenter requested the following reassignments:
Include the Diabetes with mononeuropathy, E.41 codes in
the Neurological 10 grouping.
Include rheumatic mitral valve diseases I05. codes and
aortic rheumatic valve diseases I06 codes in the Heart 9 grouping.
Add a high comorbidity interaction for Circulatory 1 and
Skin 4.
Add a high comorbidity interaction between Neurological 11
and Skin 4.
Add a high comorbidity interaction between Skin 1, abscess
and Skin 4.
Response: We appreciate the commenter's review of these codes and
suggested reassignments and may consider these changes in future
rulemaking. As we stated in the CY 2020 final rule with comment period
(84 FR 60510), and as described in the technical report ``Overview of
the Home Health Groupings Model,'' the home health-specific comorbidity
list is based on the principles of patient assessment by body systems
and their associated diseases, conditions, and injuries. We used this
process to develop categories of conditions that identify clinically
relevant relationships associated with increased resource use. We
understand the magnitude of clinical conditions and comorbidities, and
the interactions that exist between them, in the Medicare home health
population; however, we remind commenters that only those subgroups of
diagnoses that represent more than 0.1 percent of periods of care and
that have at least as high as the median resource use will receive a
low comorbidity adjustment. We describe this method for determining
statistical significance in the CY 2020 final rule with comment period
(84 FR 60510). This is based on the knowledge that the average number
of comorbidities in the aggregate becomes the standard within that
population for the purpose of payment. However, because we still expect
HHAs to report all secondary diagnoses that affect care planning, there
will be comorbidity subgroups included in the home health-specific list
that do not meet the criteria to receive an adjustment.
Final Decision: We are finalizing the proposal to update the
comorbidity adjustment subgroups and the high comorbidity adjustment
interactions using CY 2022 home health data. For CY 2024, the final
update to the comorbidity adjustment subgroups includes 22 low
comorbidity adjustment subgroups as identified in Table B9 and 102 high
comorbidity adjustment interaction subgroups as identified in Table
B10. The final CY 2024 low comorbidity adjustment subgroups and the
high comorbidity adjustment interaction subgroups including those
diagnoses within each of these comorbidity adjustments will also be
posted on the HHA Center web page at https://www.cms.gov/Center/Provider-Type/Home-Health-Agency-HHA-Center.
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(d) CY 2024 PDGM Case-Mix Weights
As finalized in the CY 2019 HH PPS final rule with comment period
(83 FR 56502), the PDGM places patients into meaningful payment
categories based on patient and other characteristics, such as timing,
admission source, clinical grouping using the reported principal
diagnosis, functional impairment level, and comorbid conditions. The
PDGM case-mix methodology results in 432 unique case-mix groups called
home health resource groups (HHRGs). We also finalized a policy in the
CY 2019 HH PPS final rule with comment period (83 FR 56515) to
recalibrate annually the PDGM case-mix weights using a fixed effects
model with the most recent and complete utilization data available at
the time of annual rulemaking. Annual recalibration of the PDGM case-
mix weights ensures that the case-mix weights reflect, as accurately as
possible, current home health resource use and changes in utilization
patterns. To generate the proposed recalibrated CY 2024 case-mix
weights for the CY 2024 HH PPS proposed rule, we used CY 2022 home
health claims data with linked OASIS data (as of March 17, 2023). These
data were the most current and complete data available at the time of
rulemaking. We stated that we believe that recalibrating the case-mix
weights using data from CY 2022 would be reflective of PDGM utilization
and patient resource use for CY 2024 and indicated that the proposed
recalibrated case-mix weights would be updated based on more complete
CY 2022 claims data for the final rule.
The claims data provide visit-level data and data on whether non-
routine supplies (NRS) were provided during the period and the total
charges of NRS. We determine the case-mix weight for each of the 432
different PDGM payment groups by regressing resource use on a series of
indicator variables for each of the categories using a fixed effects
model as described in the following steps:
Step 1: Estimate a regression model to assign a functional
impairment level to each 30-day period. The regression model estimates
the relationship between a 30-day period's resource use and the
functional status and risk of hospitalization items included in the
PDGM, which are obtained from certain OASIS items. We refer readers to
Table B7 for further information on the OASIS items used for the
functional impairment level under the PDGM. We measure resource use
with the cost-per-minute + NRS approach that uses information from 2021
home health cost reports. We use 2021 home health cost report data
because it is the most complete cost report data available at the time
of rulemaking. Other variables in the regression model include the 30-
day period's admission source, clinical group, and 30-day period
timing. We also include home health agency level fixed effects in the
regression model. After estimating the regression model using 30-day
periods, we divide the coefficients that correspond to the functional
status and risk of hospitalization items by 10 and round to the nearest
whole number. Those rounded numbers are used to compute a functional
score for each 30-day period by summing together the rounded numbers
for the functional status and risk of hospitalization items that are
applicable to each 30-day period. Next, each 30-day period is assigned
to a functional impairment level (low, medium, or high) depending on
the 30-day period's total functional score. Each clinical group has a
separate set of functional thresholds used to assign 30-day periods
into a low, medium, or high functional impairment level. We set those
thresholds so that we assign roughly a third of 30-day periods within
each clinical group to each functional impairment level (low, medium,
or high).
Step 2: A second regression model estimates the relationship
between a 30-day period's resource use and indicator variables for the
presence of any of the comorbidities and comorbidity interactions that
were originally examined for inclusion in the PDGM. Like the first
regression model, this model also includes home health agency level
fixed effects and includes control variables for each 30-day period's
admission source, clinical group, timing, and functional impairment
level. After we estimate the model, we assign comorbidities to the low
comorbidity adjustment if any comorbidities have a coefficient that is
statistically significant (p-value of 0.05 or less) and which have a
coefficient that is larger than the 50th percentile of positive and
statistically significant comorbidity coefficients. If two
comorbidities in the model and their interaction term have coefficients
that sum together to exceed $150 and the interaction term is
statistically significant (p-value of 0.05 or less), we assign the two
comorbidities together to the high comorbidity adjustment.
Step 3: After Step 2, each 30-day period is assigned to a clinical
group, admission source category, episode timing category, functional
impairment level, and comorbidity adjustment category. For each
combination of those variables (which represent the 432 different
payment groups that comprise the PDGM), we then calculate the 10th
percentile of visits across all 30-day periods within a particular
payment group. If a 30-day period's number of visits is less than the
10th percentile for their payment group, the 30-day period is
classified as a Low Utilization Payment Adjustment (LUPA). If a payment
group has a 10th percentile of visits that is less than two, we set the
LUPA threshold for that payment group to be equal to two. That means if
a 30-day period has one visit, it is classified as a LUPA and if it has
two or more visits, it is not classified as a LUPA.
Step 4: Take all non-LUPA 30-day periods and regress resource use
on the 30-day period's clinical group, admission source category,
episode timing category, functional impairment level, and comorbidity
adjustment category. The regression includes fixed effects at the level
of the home health agency. After we estimate the model, the model
coefficients are used to predict each 30-day period's resource use. To
create the case-mix weight for each 30- day period, the predicted
resource use is divided by the overall resource use of the 30-day
periods used to estimate the regression.
The case-mix weight is then used to adjust the base payment rate to
determine each 30-day period's payment. Table B11 shows the
coefficients of the payment regression used to generate the weights,
and the coefficients divided by average resource use.
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The final case-mix weights for CY 2024 are listed in Table B12 and
will also be posted on the HHA Center web page \12\ upon display of
this final rule.
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Changes to the PDGM case-mix weights are implemented in a budget
neutral manner by multiplying the CY 2024 national standardized 30-day
period payment rate by a case-mix budget neutrality factor. Typically,
the case-mix weight budget neutrality factor is also calculated using
the most recent, complete home health claims data available. For CY
2024, we will continue the practice of using the most recent complete
home health claims
[[Page 77726]]
data at the time of rulemaking, which is CY 2022 data (as of July 15,
2023). The case-mix budget neutrality factor is calculated as the ratio
of 30-day base payment rates such that total payments when the CY 2024
PDGM case-mix weights (developed using CY 2022 home health claims data)
are applied to CY 2022 utilization (claims) data are equal to total
payments when CY 2023 PDGM case-mix weights (developed using CY 2021
home health claims data) are applied to CY 2022 utilization data. This
produces a case-mix budget neutrality factor for CY 2024 of 1.0124.
We invited comments on the proposed CY 2024 case-mix weights, case-
mix weight budget neutrality factor and these are summarized as
follows.
Comment: A commenter expressed support for the annual recalibration
of the case-mix weights using CY 2022 utilization data.
Response: We thank the commenter for their support.
Comment: Several commenters opposed recalibrating the PDGM case-mix
weights for CY 2024. Some commenters expressed concern with the
frequency of recalibration stating that annual updates create
instability for home health agencies. Other commenters stated that CMS
should delay recalibrating the case-mix weights until the impact of
previous recalibrations on access and care has been reviewed. A
commenter suggested that an independent analysis should be conducted to
verify the reliability of the regression model used to set case-mix
weights during a period of budget neutrality measurement. Lastly, a
commenter requested transparency as to why and how CMS makes changes to
the PDGM case-mix weights.
Response: We recognize that commenters have had concerns regarding
annual recalibration since we finalized this policy previously;
however, we continue to believe that annual recalibration of the PDGM
case-mix weights ensures that the case-mix weights reflect, as
accurately as possible, current home health resource use, changes in
utilization patterns, and reflects the types of patients currently
receiving home health services. We believe that prolonging
recalibration, rather than recalibrating annually, could lead to more
significant variation in the case-mix weights than what is observed
using the most recent utilization data. Therefore, we believe that
utilizing CY 2022 data to recalibrate the CY 2024 case-mix weights is
appropriate and do not agree that an independent analysis is necessary.
Regarding the comment requesting transparency, we direct commenters to
review the CY 2019 HH PPS final rule with comment period (83 FR 56502)
for the finalized case-mix adjustment methodology, as well as the
previously discussed steps we take to determine the case-mix weight for
each of the 432 different PDGM payment groups which are outlined in
this final rule.
Comment: A few commenters requested that CMS analyze the cumulative
impact of the proposed recalibration of the PDGM case-mix weights, as
well as the updates to the wage index prior to finalizing any changes.
Response: It is important to note that both the recalibration of
the PDGM case-mix weights and updates to the HH PPS are implemented in
a budget neutral manner so that changes to the case-mix weights,
functional impairment levels, comorbidity adjustments, as well as
updated wage data do not impact payments in the aggregate.
Comment: A commenter had general concerns regarding the diagnosis
codes included in the clinical grouping case-mix variable. This
commenter stated that there continues to be no assignment of many
diagnoses that drive home health need, citing non-specific diagnosis
codes such as debility and weakness. The commenter stated that while
there may be no specific medical diagnoses causing these conditions,
the patient would still greatly benefit from home health care. The
commenter recommended that CMS allow codes such as R29.6 Repeated
falls, R54 Age related physical debility, R26.89 Abnormalities of gait,
M62.81 Muscle weakness, and generalized R41.82 Altered Mental Status
for home health services.
Response: As we stated in the CY 2019 HH PPS final rule with
comment period (83 FR 56473), we believe that the majority of the R-
codes (codes that describe signs and symptoms, as opposed to diagnoses)
are not appropriate as principal diagnosis codes for grouping home
health periods into clinical groups. We believe that the use of
symptoms, signs, and abnormal clinical and laboratory findings would
make it difficult to meet the requirements of an individualized plan of
care as required at 42 CFR 484.60. Likewise, we believe that clinically
it is important for home health providers to have a clear understanding
of the patients' diagnoses in order to safely and effectively furnish
home health services. Interventions and treatment aimed at mitigating
signs and symptoms of a condition may vary depending on the cause.
Anecdotally, we have heard that a home health referral may be
nonspecific or that a physician or allowed practitioner may be in the
process of determining a more definitive diagnosis. However, with
respect to patient safety and quality of care, we believe it is
important for a clinician to investigate the cause of the signs and/or
symptoms for which the referral was made. This may involve calling the
referring physician or allowed practitioner to gather more information.
We note that HHAs are required under the home health CoPs at Sec.
484.60 to participate in care coordination to assure the identification
of patient needs and factors that could affect patient safety and
treatment efficacy. ICD-10-CM coding guidelines are clear that R-codes
are to be used when no more specific diagnosis can be made even after
all the facts bearing on the case have been investigated. Therefore,
while these codes should not be used as a principal diagnosis for the
provision of home health services, they can be reported as secondary
diagnoses to provide a more complete clinical picture of the patient.
By the time the patient is referred to home health and meets the
qualifications of eligibility, we would expect that a more definitive
code would substantiate the need for services.
Final Decision: We are finalizing the proposal to recalibrate the
HH PPS case-mix weights for CY 2024. The proposed recalibrated case-mix
weights were updated based on more complete CY 2022 claims data (as of
July 15, 2023) for this final rule. We did not receive any comments on
the proposed case-mix weight budget neutrality factor. Therefore, we
are finalizing the proposal to implement the changes to the PDGM case-
mix weights in a budget neutral manner by applying a case-mix budget
neutrality factor to the CY 2024 national, standardized 30-day period
payment rate. As stated previously, the final case-mix budget
neutrality factor for CY 2024 will be 1.0124.
3. Rebase and Revise the Home Health Market Basket and Revise the
Labor-Related Share
(a) Background
Section 1895(b)(3)(B) of the Act requires that the standard
prospective payment amounts for CY 2024 be increased by a factor equal
to the applicable home health market basket update for those HHAs that
submit quality data as required by the Secretary. Effective for cost
reporting periods beginning on or after July 1, 1980, we developed and
adopted an HHA input price index (that is, the home health ``market
basket''). Although ``market basket'' technically describes
[[Page 77727]]
the mix of goods and services used to produce home health care, this
term is also commonly used to denote the input price index derived from
that market basket. Accordingly, the term ``home health market basket''
used in this document refers to the HHA input price index.
The percentage change in the home health market basket reflects the
average change in the price of goods and services purchased by HHAs in
providing an efficient level of home health care services. We first
used the home health market basket to adjust HHA cost limits by an
amount that reflected the average increase in the prices of the goods
and services used to furnish reasonable cost home health care. This
approach linked the increase in the cost limits to the efficient
utilization of resources. For a greater discussion on the home health
market basket, see the notice with comment period published in the
February 15, 1980 Federal Register (45 FR 10450, 10451), the notice
with comment period published in the February 14, 1995 Federal Register
(60 FR 8389, 8392), and the notice with comment period published in the
July 1, 1996 Federal Register (61 FR 34344, 34347). Beginning with the
FY 2002 HH PPS payments, we have used the growth in a home health
market basket to update payments under the HH PPS.
We have rebased and revised the home health market basket
periodically through the years since FY 2002. We rebased the home
health market basket effective with the FY 2005 update (69 FR 31251-
31255), with the CY 2008 update (72 FR 25435-25442), and with the CY
2013 update (77 FR 67081). We last rebased and revised the home health
market basket effective with the CY 2019 update (83 FR 56425 through
56435) reflecting a 2016 base year. Beginning with CY 2024, we proposed
to rebase and revise the home health market basket to reflect a 2021
base year. In the following discussion, we provide an overview of the
proposed home health market basket and describe the methodologies used
to determine the 2021-based home health market basket.
The home health market basket is a fixed-weight, Laspeyres-type
price index. A Laspeyres-type price index measures the change in price,
over time, of the same mix of goods and services purchased in the base
period. Any changes in the quantity or mix of goods and services (that
is, intensity) purchased over time relative to the base period are not
measured.
The index itself is constructed in three steps. First, a base
period is selected (for the proposed home health market basket, we
proposed to use 2021 as the base period) and total base period costs
are estimated for a set of mutually exclusive and exhaustive cost
categories. Each category is calculated as a proportion of total costs.
These proportions are called cost weights. Second, each expenditure
category is matched to an appropriate price or wage variable, referred
to as a price proxy. In almost every instance, these price proxies are
derived from publicly available statistical series that are published
on a consistent schedule (preferably at least on a quarterly basis).
Finally, the cost weight for each cost category is multiplied by the
level of its respective price proxy. The sum of these products (that
is, the cost weights multiplied by their price index levels) for all
cost categories yields the composite index level of the market basket
in a given period. Repeating this step for other periods produces a
series of market basket levels over time. Dividing an index level for a
given period by an index level for an earlier period produces a rate of
growth in the input price index over that timeframe.
As noted previously, the market basket is described as a fixed-
weight index because it represents the change in price over time of a
constant mix (quantity and intensity) of goods and services needed to
provide HHA services. The effects on total costs resulting from changes
in the mix of goods and services purchased subsequent to the base
period are not measured. For example, an HHA hiring more nurses after
the base period to accommodate the needs of patients would increase the
volume of goods and services purchased by the HHA but would not be
factored into the price change measured by a fixed-weight home health
market basket. Only when the index is rebased would changes in the
quantity and intensity be captured, with those changes being reflected
in the cost weights. Therefore, we rebase the home health market basket
periodically so that the cost weights reflect recent changes in the mix
of goods and services that HHAs purchase to furnish inpatient care
between base periods.
(b) Rebasing and Revising of the Home Health Market Basket
We believe that it is technically appropriate to rebase the home
health market basket periodically so that the cost category weights
reflect changes in the mix of goods and services that HHAs purchase in
furnishing home health care. For the CY 2024 HH PPS proposed rule, we
proposed to rebase and revise the home health market basket to reflect
a 2021 base year using 2021 Medicare cost report data for Medicare-
participating freestanding HHAs, the latest available and most complete
data on the actual structure of HHA costs at the time of this
rulemaking. In prior rulemaking, commenters have expressed concern that
recent cost pressures and the impact of the COVID-19 PHE have impacted
input price inflation in providing home health services. We proposed to
use 2021 as the base year because we believe that the Medicare cost
reports for this year represent the most recent, complete set of
Medicare cost report data available for developing the home health
market basket that captures recent cost trends. Given the potential
impact of the COVID-19 PHE on the Medicare cost report data, we will
continue to monitor these data going forward and any changes to the
home health market basket will be proposed in future rulemaking.
The terms ``rebasing'' and ``revising,'' while often used
interchangeably, denote different activities. The term ``rebasing''
means moving the base year for the structure of costs of an input price
index (that is, in this exercise, we proposed to move the base year
cost structure from 2016 to 2021) without making any other major
changes to the methodology. The term ``revising'' means changing data
sources, cost categories, and price proxies used in the input price
index. For the CY 2024 HH PPS proposed rule, we proposed to rebase and
revise the home health market basket to reflect a 2021 base year.
(c) Derivation of the 2021-Based Home Health Market Basket Major Cost
Weights
We proposed to derive the major cost weights for the revised and
rebased home health market basket from the Medicare cost reports (CMS
Form 1728-20, OMB No. 0938-0022) for freestanding HHAs whose cost
reporting period began on or after October 1, 2020 and before October
1, 2021. Of the 2021 Medicare cost reports for freestanding HHAs,
approximately 84 percent of the reports had a begin date on January 1,
2021, approximately 5 percent had a begin date on July 1, 2021, and
approximately 3 percent had a begin date on October 1, 2020. The
remaining 8 percent had a begin date within the specified range. Using
this methodology allowed our sample to include HHAs with varying cost
report years including, but not limited to, the Federal fiscal or
calendar year.
We proposed to maintain our policy of using data from freestanding
HHAs,
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which account for about 93 percent of HHAs (87 FR 66882), as our
analysis has determined that they better reflect HHAs' actual cost
structure. Cost data for hospital-based HHAs can be affected by the
allocation of overhead costs over the entire institution.
We proposed to derive seven major cost categories (Wages and
Salaries, Benefits, Transportation, Professional Liability Insurance
(PLI), Fixed Capital, Movable Capital, and Medical Supplies) from the
2021 HHA Medicare cost reports. The residual cost category, ``All
Other'', reflects all remaining costs not captured in the seven major
cost categories. Each of the major cost categories and the residual are
based on those cost centers that are reimbursable under the HH PPS,
specifically cost centers 16 through 25 (Skilled Nursing Care--RN,
Skilled Nursing Care--LPN, Physical Therapy, Physical Therapy
Assistant, Occupational Therapy, Certified Occupational Therapy
Assistant, Speech-Language Pathology, Medical Social Services, Home
Health Aide, and Medical Supplies Charged to Patients). While the cost
centers have changed in CMS Form 1728-20, these generally coincide with
those cost centers from CMS Form 1728-94 that were used to derive the
2016-based home health market basket (83 FR 56425). The cost centers
used from CMS Form 1728-94 were cost centers 6 through 12 (Skilled
Nursing Care, Physical Therapy, Occupational Therapy, Speech Pathology,
Medical Social Services, Home Health Aide, and Supplies). Total costs
for the HH PPS reimbursable services reflect overhead allocation. We
note that Medical Supplies was not considered to be a major cost
category in the 2016-based home health market basket because it was not
derived directly from Medicare cost report data and was instead derived
from the residual ``All Other'' category using Benchmark Input-Output
(I-O) data published by the Bureau of Economic Analysis (BEA). Next, we
provide details on the proposed calculations for the total Medicare
allowable costs and each of the seven major cost categories derived
from the Medicare cost report data. Unless otherwise specified,
calculations are consistent with 2016 methodology.
(1) Total Medicare Allowable Costs
We proposed that total Medicare allowable costs for HHAs would be
equal to the sum of total costs for the Medicare allowable cost centers
as reported on Worksheet B, column 10, lines 16 through 25. We proposed
that these total Medicare allowable costs for the HHA will be the
denominator for the cost weight calculations for the Wages and
Salaries, Benefits, Transportation, Professional Liability Insurance,
Fixed Capital, Movable Capital, and Medical Supplies cost weights. With
this work complete, we then set about deriving cost levels for the
seven major cost categories.
(2) Costs for the Seven Major Cost Categories Derived From the Medicare
Cost Report Data
(a) Wages and Salaries
We proposed that wages and salaries costs reflect direct patient
care wage and salary costs, overhead wage and salary costs (associated
with the following overhead cost centers: Plant Operations and
Maintenance, Transportation, Telecommunications Technology,
Administrative and General, Nursing Administration, Medical Records,
and Other General Service cost centers), and a portion of direct
patient care contract labor costs. The estimation of the wage and
salary costs is derived using a similar methodology to that which was
implemented for the 2016-based home health market basket, with the
primary difference being the specific cost report line items now
available on the HHA cost report form.
(i) Direct Patient Care
We proposed to calculate direct patient care wages and salaries by
summing costs from Worksheet A, column 1, lines 16 through 25.
(ii) Overhead
We proposed to calculate overhead wages and salaries by summing
costs from Worksheet B, columns 3 through 9, lines 16 through 25
multiplied by the percentage of costs in the overhead cost centers that
were reported as salaries. This ratio is calculated as the sum of costs
on Worksheet A, column 1, lines 3 through 9, divided by the sum of
costs on Worksheet A, columns 1 through 5, lines 3 through 9.
(iii) Wages and Salaries Portion of Direct Patient Care Contract Labor
Contract labor costs allocated to wages and salaries costs reflect
a portion of the direct patient care contract labor costs.
Specifically, we proposed to calculate direct patient care contract
labor costs by first summing costs from Worksheet A, column 4, lines 16
through 25. These contract labor costs are then multiplied by each
provider's ratio of direct patient care wages and salaries costs to
total direct patient care wages and salaries and benefits costs. This
ratio is calculated as the sum of costs on Worksheet A, column 1, lines
16 through 25, divided by the sum of costs on Worksheet A, columns 1
and 2, lines 16 through 25. Similarly, the 2016 method for deriving the
wages and salaries costs multiplied the combined salaries and benefits
(both Direct Patient Care (DPC) and non-DPC) and DPC contract labor, by
the ratio of combined DPC and non-DPC salaries to total DPC and non-DPC
salaries and benefits.
(b) Benefits
Benefits costs reflect direct patient care benefit costs, overhead
benefit costs (associated with the following overhead cost centers:
Plant Operations and Maintenance, Transportation, Telecommunications
Technology, Administrative and General, Nursing Administration, Medical
Records, and Other General Service) and a portion of direct patient
care contract labor costs. Similarly, the 2016 method for deriving the
benefits costs multiplied the combined salaries and benefits (both DPC
and non-DPC) and DPC contract labor, by the ratio of combined DPC and
non-DPC benefits to total DPC and non-DPC salaries and benefits.
(i) Direct Patient Care
We proposed to calculate the cost of the direct patient care
benefit costs by summing costs from Worksheet A, column 2, lines 16
through 25.
(ii) Overhead
We proposed to calculate overhead benefit costs by summing costs
from Worksheet B, columns 3 through 9, lines 16 through 25 multiplied
by the percentage of costs in the overhead cost centers that were
reported as benefits. This percentage is calculated as the sum of costs
on Worksheet A, column 2, lines 3 through 9, divided by the sum of
costs on Worksheet A, columns 1 through 5, lines 3 through 9.
(iii) Benefits Portion of Direct Patient Care Contract Labor
Contract labor costs allocated to Benefits costs reflect a portion
of the direct patient care contract labor costs. Specifically, we
proposed to first calculate direct patient care contract labor costs by
summing costs from Worksheet A, column 4, lines 16 through 25. These
contract labor costs are then multiplied by each provider's ratio of
direct patient care benefits costs to total direct patient care wages
and salaries and benefits costs. This ratio is calculated as the sum of
costs on Worksheet A, column 2, lines 16 through 25, divided by the sum
of costs on Worksheet A, columns 1 and 2, lines 16 through 25.
[[Page 77729]]
(c) Transportation
Transportation costs reflect direct patient care costs as well as
transportation costs associated with Capital Expenses, Plant Operations
and Maintenance, and Administrative and General cost centers.
Specifically, we proposed to calculate transportation costs by summing
costs from Worksheet A, column 3, lines 16 through 25; Worksheet A,
column 3, lines 1 through 3; and costs on Worksheet B, column 4, lines
16 through 25 multiplied by a ratio that reflects the non-salary and
benefits portion of these costs. Specifically, this ratio was
calculated as 1 minus the sum of costs on Worksheet A, columns 1 and 2,
line 4, divided by the sum of costs on Worksheet A, columns 1 through
5, line 4.
(d) Professional Liability Insurance
Professional Liability Insurance reflects premiums, paid losses,
and self-insurance costs. Specifically, we proposed to calculate
Professional Liability Insurance by summing costs from Worksheet S-2
Part I, line 14, columns 1 through 3.
(e) Fixed Capital
Fixed Capital-related costs reflect the portion of Medicare-
allowable costs reported in Capital Related Buildings and Fixtures
(Worksheet A, column 5, line 1). We proposed to calculate this Medicare
allowable portion by first calculating a ratio for each provider that
reflects fixed capital costs as a percentage of HHA reimbursable
services. Specifically, this ratio was calculated as the sum of costs
from Worksheet B, column 1, lines 16 through 25 divided by the sum of
costs from Worksheet B, column 1, line 1 minus lines 3 through 9. This
percentage is then applied to the costs from Worksheet A, column 5,
line 1.
(f) Movable Capital
Movable Capital-related costs reflect the portion of Medicare
allowable costs reported in Capital Related Movable Equipment
(Worksheet A, column 5, line 2). We proposed to calculate this Medicare
allowable portion by first calculating a ratio for each provider that
reflects movable capital costs as a percentage of HHA reimbursable
services. Specifically, this ratio was calculated as the sum of costs
from Worksheet B, column 2, lines 16 through 25 divided by the sum of
costs from Worksheet B, column 2, line 2 minus lines 3 through 9. This
percentage is then applied to the costs from Worksheet A, column 5,
line 2.
(g) Medical Supplies
Medical Supplies costs reflect the cost of supplies furnished to
individual patients and for which a separate charge is made, as well as
minor medical and surgical supplies not expected to be specifically
identified in the plan of treatment or for which a separate charge is
not made. Specifically, we proposed to calculate Medical Supplies as
the sum of Worksheet A, column 5, line 25; and Worksheet B, column 6,
line 25 multiplied by a ratio that reflects the non-salary and benefits
portion of these costs. Specifically, this ratio was calculated as 1
minus the sum of costs on Worksheet A, columns 1 and 2, line 6, divided
by the sum of costs on Worksheet A, columns 1 through 5, line 6. We
note that in the 2016-based home health market basket, the Medical
Supplies cost weight was derived from the ``All Other'' residual cost
weight.
(3) Derivation of the Major Cost Weights
After we derive costs for each of the seven major cost categories
and total Medicare allowable costs for each provider using the Medicare
cost report data, we proposed to address data outliers using the
following steps. First, for each of the seven major cost categories, we
divide the costs in that category by total Medicare allowable costs
calculated for the provider to obtain cost weights for the universe of
HHA providers. We proposed to trim the data to remove outliers (a
standard statistical process) by: (1) requiring that major costs (such
as wages and salaries costs) and total Medicare allowable costs be
greater than zero and requiring that category costs are less than the
total Medicare allowable costs; and (2) excluding the top and bottom
five percent of the major cost weight (for example, wages and salaries
costs as a percent of total Medicare allowable costs). We note that
missing values are assumed to be zero consistent with the methodology
for how missing values were treated in the 2016-based home health
market basket. After these outliers have been excluded, we sum the
costs for each category across all remaining providers. We then divide
this by the sum of total Medicare allowable costs across all remaining
providers to obtain a cost weight for the 2021-based home health market
basket for the given category.
Finally, we proposed to calculate the residual ``All Other'' cost
weight that reflects all remaining costs that are not captured in the
other categories listed by subtracting the major cost weight
percentages (Wages and Salaries, Benefits, Transportation, Professional
Liability Insurance, Fixed Capital, Movable Capital, and Medical
Supplies) from 1. We note that non-direct patient care contract labor
costs (such as contract labor costs reported in the Administrative and
General cost center of the Medicare cost report) are captured in the
``All Other'' residual cost weight and later disaggregated into more
detail as described later in this section.
Table B13 shows the major cost categories and their respective cost
weights as derived from the Medicare cost reports.
[[Page 77730]]
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The decrease in the wages and salaries cost weight of 0.9
percentage point and the decrease in the benefits cost weight of 0.2
percentage point is primarily attributable to direct patient care
contract labor costs as reported on the Medicare cost report data, as
shown in Table B14. Our analysis of the Medicare cost report data shows
that a decrease in the compensation cost weight from 2016 to 2021
occurred, in aggregate, among for-profit, nonprofit, and government
providers and among providers serving only rural beneficiaries, only
urban beneficiaries, or both rural and urban beneficiaries.
[GRAPHIC] [TIFF OMITTED] TR13NO23.034
Additionally, the Medicare cost report data shows that decreased
contract labor utilization has occurred over most occupational
categories, including higher-paid specialties, and that utilization of
direct patient care contract labor has been trending downward since
2010. We also note that over the 2016 to 2021 time period, the average
number of full-time equivalents per provider decreased considerably.
(4) Derivation of the Detailed Cost Weights
We proposed to divide the ``All Other'' residual cost weight
estimated from the 2021 Medicare cost report data into more detailed
cost categories. To divide this cost weight, we proposed to use the
2012 Benchmark I-O ``Use Tables/Before Redefinitions/Purchaser Value''
for North American Industrial Classification System (NAICS) 621600,
Home Health Agencies, published by the BEA. These data are publicly
available at http://www.bea.gov/industry/io_annual.htm. For the 2016-
based home health market basket, we used the 2007 Benchmark I-O data,
the most recent data available at the time (83 FR 56427).
The BEA Benchmark I-O data are generally scheduled for publication
every five years with the most recent data available for 2012. The 2012
Benchmark I-O data are derived from the 2012 Economic Census and are
the building blocks for BEA's economic accounts. Therefore, they
represent the most comprehensive and complete set of data on the
economic processes or mechanisms by which output is produced and
distributed.\13\ Besides Benchmark I-O estimates, BEA also produces
Annual I-O estimates. While based on a similar methodology, the Annual
I-O estimates reflect less comprehensive and less detailed data sources
and are subject to revision when benchmark data become available.
Instead of using the less detailed Annual I-O data, we proposed to
inflate the detailed 2012 Benchmark I-O data forward to 2021 by
applying the annual price changes for each year from the respective
price proxies to the appropriate market basket cost categories that are
obtained from the 2012 Benchmark I-O data. Then, we calculated the cost
shares that each cost category represents of the 2012 I-O data inflated
to 2021. These resulting 2021 cost shares were applied to the ``All
Other'' residual cost weight to obtain the detailed cost weights for
the 2021-based home health market basket. For example, the cost for
Utilities represents 11.0 percent of the sum of the ``All Other'' 2012
Benchmark I-O HHA costs inflated to 2021. Therefore, the Utilities cost
weight represents 11.0 percent of the 2021-based home health market
basket's ``All Other'' cost category (18.6 percent), yielding a
Utilities cost weight
[[Page 77731]]
of 2.0 percent in the 2021-based home health market basket (0.110 x
18.6 percent = 2.0 percent). For the 2016-based home health market
basket, we used the same methodology while basing it on the 2007
Benchmark I-O data (aged to 2016).
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\13\ http://www.bea.gov/papers/pdf/IOmanual_092906.pdf.
---------------------------------------------------------------------------
Using this methodology, we proposed to derive eight detailed cost
categories from the 2021-based home health market basket ``All Other''
residual cost weight (18.6 percent). These categories are: (1)
Utilities; (2) Administrative Support; (3) Financial Services; (4)
Rubber and Plastics; (5) Telephone; (6) Professional Fees; (7) Other
Products; and (8) Other Services. We note that the Utilities cost
category is currently referred to as Operations & Maintenance in the
2016-based home health market basket; however, the methodology and data
sources underlying this cost category remain the same.
Table B15 compares the cost categories and weights for the 2021-
based home health market basket compared to the 2016-based home health
market basket. In cases where a cost category has been recategorized in
the 2021-based home health market basket, we have entered ``n/a'' to
maintain correct totals as they appear in the CY 2019 HH PPS final rule
with comment period (83 FR 56428).
[GRAPHIC] [TIFF OMITTED] TR13NO23.035
(d) Selection of Price Proxies
After developing the cost weights for the 2021-based home health
market basket, we select the most appropriate wage and price proxies
currently available to represent the rate of price change for each cost
category. With the exception of the price index for Professional
Liability Insurance costs, the proposed price proxies are based on
Bureau of Labor Statistics (BLS) data and are grouped into one of the
following BLS categories:
Employment Cost Indexes. Employment Cost Indexes (ECIs)
measure the rate of change in employment wage rates and employer costs
for employee benefits per hour worked. These indexes are fixed-weight
indexes and strictly measure the change in wage rates and employee
benefits per hour. ECIs are superior to Average Hourly Earnings (AHE)
as price proxies for input price indexes because they are not affected
by shifts in occupation or industry mix, and because they measure pure
price change and are available by both occupational group and by
industry. The industry ECIs are based on the NAICS and the occupational
ECIs
[[Page 77732]]
are based on the Standard Occupational Classification System (SOC).
Producer Price Indexes. Producer Price Indexes (PPIs)
measure the average change over time in the selling prices received by
domestic producers for their output. The prices included in the PPI are
from the first commercial transaction for many products and some
services (https://www.bls.gov/ppi/).
Consumer Price Indexes. Consumer Price Indexes (CPIs)
measure the average change over time in the prices paid by urban
consumers for a market basket of consumer goods and services (https://www.bls.gov/cpi/). CPIs are only used when the purchases are similar to
those of retail consumers rather than purchases at the producer level,
or if no appropriate PPIs are available.
We evaluate the price proxies using the criteria of reliability,
timeliness, availability, and relevance:
Reliability. Reliability indicates that the index is based
on valid statistical methods and has low sampling variability. Widely
accepted statistical methods ensure that the data were collected and
aggregated in a way that can be replicated. Low sampling variability is
desirable because it indicates that the sample reflects the typical
members of the population. (Sampling variability is variation that
occurs by chance because only a sample was surveyed rather than the
entire population.)
Timeliness. Timeliness implies that the proxy is published
regularly, preferably at least once a quarter. The market baskets are
updated quarterly, and therefore, it is important for the underlying
price proxies to be up-to-date, reflecting the most recent data
available. We believe that using proxies that are published regularly
(at least quarterly, whenever possible) helps to ensure that we are
using the most recent data available to update the market basket. We
strive to use publications that are disseminated frequently, because we
believe that this is an optimal way to stay abreast of the most current
data available.
Availability. Availability means that the proxy is
publicly available. We prefer that our proxies are publicly available
because this will help ensure that our market basket updates are as
transparent to the public as possible. In addition, this enables the
public to be able to obtain the price proxy data on a regular basis.
Relevance. Relevance means that the proxy is applicable
and representative of the cost category weight to which it is applied.
The CPIs, PPIs, and ECIs that we have selected meet these criteria.
Therefore, we believe that they continue to be the best measure of
price changes for the cost categories to which they would be applied.
The following is a detailed explanation of the price proxies we
proposed for each cost category weight.
(e) 2021-Based Home Health Market Basket Price Proxies
As part of the revising and rebasing of the home health market
basket, we proposed to rebase and revise the home health blended Wages
and Salaries index and the home health blended Benefits index. We
proposed to use these blended indexes as price proxies for the Wages
and Salaries and the Benefits categories of the 2021-based home health
market basket, as we did in the 2016-based home health market basket.
The following is a more detailed discussion.
(1) Wages and Salaries
For measuring price growth in the 2021-based home health market
basket, we proposed to apply six price proxies to six occupational
subcategories within the Wages and Salaries cost weight, which would
reflect the 2021 occupational mix in HHAs. This is a similar approach
that was used for the 2016-based market basket. We proposed to use a
blended wage proxy because there is not a published wage proxy specific
to the home health industry.
We proposed to continue to use the National Industry-Specific
Occupational Employment and Wage estimates for NAICS 621600, Home
Health Care Services, published by the BLS Office of Occupational
Employment and Wage Statistics (OEWS) as the data source for the cost
shares of the home health blended wage and benefits proxy. We note that
in the spring of 2021, the Occupational Employment Statistics (OES)
program began using the name Occupational Employment and Wage
Statistics (OEWS) to better reflect the range of data available from
the program. Data released on or after March 31, 2021 reflect the new
program name. This is the same data source that was used for the 2016-
based HHA blended wage and benefit proxies; however, we proposed to use
the May 2021 estimates in place of the May 2016 estimates. Detailed
information on the methodology for the national industry-specific
occupational employment and wage estimates survey can be found at
http://www.bls.gov/oes/current/oes_tec.htm.
The six occupational subcategories (Health-Related Professional and
Technical, Non- Health-Related Professional and Technical, Management,
Administrative, Health and Social Assistance Service, and Other Service
Occupations) for the Wages and Salaries cost weight were tabulated from
the May 2021 OEWS data for NAICS 621600, Home Health Care Services.
Table B16 compares the 2021 occupational assignments to the 2016
occupational assignments of the six CMS designated subcategories. Data
that are unavailable in the OEWS occupational classification for 2016
or 2021 are shown in Table B16 as ``n/a.''
[[Page 77733]]
[GRAPHIC] [TIFF OMITTED] TR13NO23.036
We proposed to calculate total costs by occupation by taking the
OEWS number of employees multiplied by the OEWS annual average salary
for each subcategory, and then calculating the proportion of total wage
costs that each subcategory represents of the total industry wage
costs. The proportions listed in Table B17 represent the wages and
salaries blend weights for 2021, and the ECIs for each occupational
category within the Wages and Salaries price proxy blend, as well as
the 2016 weights. We note that the current ECI series also reflect the
2021 occupational mix of workers. We also note that 2018 updates to the
Standard Occupational Classification (SOC) system included a
reclassification of Personal Care Aides from SOC code 39-9021 to 31-
1122, which is reflected in the updated weights and represents the
major reason for the higher weight for health care and
[[Page 77734]]
social assistance services and lower weight for other service
occupations.\14\
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\14\ https://www.bls.gov/soc/2018/soc_2018_whats_new.pdf.
[GRAPHIC] [TIFF OMITTED] TR13NO23.037
[GRAPHIC] [TIFF OMITTED] TR13NO23.038
A comparison of the yearly changes from CY 2021 to CY 2024 for the
2016-based home health Wages and Salaries proxy blend and the 2021-
based home health Wages and Salaries proxy blend is shown in Table B18.
The annual increases in the wages and salaries price proxy is 0.3
percentage point lower in 2021 and 2022 relative to the 2016-based
price proxy, and the increases are equal in 2023 and 2024. The
differences are primarily driven by the aforementioned reclassification
of Personal Care Aides, which caused a shift in the relative share from
the Other Service Occupations to Health and Social Assistance Services
as illustrated previously in Table B17.
[[Page 77735]]
[GRAPHIC] [TIFF OMITTED] TR13NO23.039
(2) Benefits
For measuring Benefits price growth in the 2021-based home health
market basket, we proposed to apply applicable price proxies to the six
occupational subcategories that are used for the Wages and Salaries
price proxy blend. The six categories in Table B19 are the same as
those in the 2016-based home health market basket and include the same
occupational mix as listed in Table B17.
[GRAPHIC] [TIFF OMITTED] TR13NO23.040
There is no available data source that exists for benefit costs by
occupation for the home health industry. Thus, to construct weights for
the home health benefits blend we calculated the ratio of benefits to
wages and salaries for 2021 for the six ECI series we proposed to use
in the blended `wages and salaries' and `benefits' indexes. To derive
the relevant benefits weight, we applied the benefit-to-wage ratios to
the 2021 OEWS wage and salary weights for each of the six occupational
subcategories and normalized. For example, the 2021 ECI data shows a
ratio of benefits to wages for the health-related professional &
technical category of 1.010. We applied this ratio to the 2021 OEWS
weight for wages and salaries for health-related professional &
technical (29.7 percent) to get an unnormalized weight of 30.0 (29.7
times 1.010), and then normalized those weights relative to the other
five benefit occupational categories to obtain a final benefit weight
for health-related professional & technical (30.1 percent).
A comparison of the yearly changes from CY 2021 to CY 2024 for the
2016-based home health Benefits proxy blend and the 2021-based home
health Benefits proxy blend is shown in Table B20. With the exception
of a 0.2 percentage point difference in 2022, the annual increases in
the two price proxies are the same when rounded to one decimal place.
[GRAPHIC] [TIFF OMITTED] TR13NO23.041
[[Page 77736]]
(3) Medical Supplies
We proposed to use a 75/25 blend of the PPI Commodity data for
Surgical and Medical Instruments (BLS series code #WPU1562) and the PPI
Commodity data for Personal Safety Equipment and Clothing (BLS series
code #WPU1571), which would replace the current price proxy of the PPI
for Medical, Surgical, and Personal Aid Devices (BLS series code
#WPU156). The PPI Commodity data for Personal Safety Equipment and
Clothing would reflect personal protective equipment (PPE) including
but not limited to face shields and protective clothing. The 2012
Benchmark I-O data does not provide specific costs for the two
categories we proposed to blend. In absence of such data, we have based
the weights of this blend on the change in the medical supplies weight
as reported in the Medicare cost reports in the years prior to and
after the COVID-19 PHE. Specifically, analysis of Medicare cost report
data found that the average weight for medical supplies for the 2016-
2019 period (stable around 1.5 percent) was about 75 percent of the
weight observed for the 2020-2021 period (roughly 2.0 percent). Thus,
we believe that it was likely that the increase in the cost weight was
mainly attributable to costs such as those associated with personal
safety equipment and clothing, and we based the 75/25 blend on that
analysis. We believe this change will more closely proxy the rate of
change of the underlying costs, including increased utilization of
personal protective equipment.
(4) Professional Liability Insurance
We proposed to use the CMS Physician Professional Liability
Insurance price index to measure price growth of this cost category. To
generate this index, we collect commercial insurance premiums for a
fixed level of coverage while holding non-price factors constant (such
as a change in the level of coverage). The same proxy was used for the
2016-based home health market basket.
(5) Transportation
We proposed to use the CPI U.S. city average for Transportation
(BLS series code #CUUR0000SAT) to measure price growth of this
category. The same proxy was used for the 2016-based home health market
basket.
(6) Administrative and Support
We proposed to use the ECI for Total compensation for Private
industry workers in Office and administrative support (BLS series code
#CIU2010000220000I) to measure price growth of this cost category. The
same proxy was used for the 2016-based home health market basket.
(7) Financial Services
We proposed to use the ECI for Total compensation for Private
industry workers in financial activities (BLS series code
#CIU201520A000000I) to measure price growth of this cost category. The
same proxy was used for the 2016-based home health market basket.
(8) Rubber and Plastics
We proposed to use the PPI Commodity data for Rubber and plastic
products (BLS series code #WPU07) to measure price growth of this cost
category. The same proxy was used for the 2016-based home health market
basket.
(9) Telephone
We proposed to use CPI U.S. city average for Telephone services
(BLS series code #CUUR0000SEED) to measure price growth of this cost
category. The same proxy was used for the 2016-based home health market
basket.
(10) Professional Fees
We proposed to use the ECI for Total compensation for Private
industry workers in Professional and related (BLS series code
#CIS2010000120000I) to measure price growth of this category. The same
proxy was used for the 2016-based home health market basket.
(11) Utilities
We proposed to use CPI-U U.S. city average for Fuel and utilities
(BLS series code #CUUR0000SAH2) to measure price growth of this cost
category. The same proxy was used for the 2016-based home health market
basket.
(12) Other Products
We proposed to use the PPI Commodity data for Final Demand-Finished
goods less foods and energy (BLS series code #WPUFD4131) to measure
price growth of this category. The same proxy was used for the 2016-
based home health market basket.
(13) Other Services
We proposed to use the ECI for Total compensation for Private
industry workers in Service occupations (BLS series code
#CIU2010000300000I) to measure price growth of this category. The same
proxy was used for the 2016-based home health market basket.
(14) Fixed Capital
We proposed to use the CPI U.S. city average for Owners' equivalent
rent of residences (BLS series code #CUUS0000SEHC) to measure price
growth of this cost category. The same proxy was used for the 2016-
based home health market basket.
(15) Movable Capital
We proposed to use the PPI Commodity data for Machinery and
equipment (BLS series code #WPU11) to measure price growth of this cost
category. The same proxy was used for the 2016-based home health market
basket.
(f) Summary of Price Proxies of the 2021-Based Home Health Market
Basket
Table B21 shows the price proxies for the 2021-based home health
market basket.
[[Page 77737]]
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We invited public comment on our proposal to rebase and revise the
home health market basket to reflect a 2021 base year. The following is
a summary of the public comments received and our responses.
[[Page 77738]]
Comment: Several commenters supported the rebasing and revising of
the home health market basket from a 2016 base year to a 2021 base
year. Some commenters, while supporting moving forward with a rebasing,
asked CMS to consider rebasing the home health market basket to a later
base year, such as 2022 or 2023, when the data become available, to
more fully incorporate changes to HHA cost structures. They stated that
there is a significant gap between 2021 and what home health providers
are experiencing now, and that data from 2021 cost reports neglects to
capture the rapid rise in labor costs starting in 2022, and, therefore,
using CY 2023 in future rulemaking would better align permanent changes
that have occurred in more recent years. A commenter recommended that
CMS delay rebasing and revising until this data is further explored,
perhaps using a technical expert panel.
Response: We appreciate the commenters' support to rebase and
revise the home health market basket. As discussed in section II.C.3 of
this final rule, the market basket used to update HH PPS payments has
been periodically rebased and revised over the history of the HH PPS to
reflect more recent data on HHA cost structures. We proposed to rebase
and revise the home health market basket using 2021 Medicare cost
reports, the most recent year of complete data available at the time of
CY 2024 rulemaking, which showed a decrease in the compensation cost
weight between 2016 and 2021. While Medicare cost report data for 2022
and 2023 are incomplete at this time, we note that preliminary 2022
data suggest that a decline in the compensation weight may have
continued. Accordingly, we believe it is more appropriate to update the
base year cost weights to 2021 to reflect changes since 2016 rather
than to delay the rebasing. It has been our longstanding practice to
rebase the market basket on a regular basis to ensure it reflects the
input cost structure of HHAs. As stated in the CY 2024 HH PPS proposed
rule (88 FR 43703), given the potential impact of the COVID-19 PHE on
the Medicare cost report data, we will continue to monitor the Medicare
cost report data as they become available and, if appropriate, propose
any changes to the home health market basket in future rulemaking.
CMS appreciates hearing from stakeholders, through rulemaking or by
sending an email to [email protected], about any data or analyses
available to achieve the shared goal of ensuring that the home health
market basket and its underlying data are technically appropriate. As
required by statute, any proposed changes to improve and/or update the
home health market basket occur through the rulemaking process and
stakeholders have an opportunity to publicly comment and make
recommendations regarding the appropriateness of proposed changes.
Comment: A few commenters noted that the rebasing and revising of
the home health market basket utilizes Medicare cost report data from
freestanding HHAs, and questioned whether providers that are part of
health systems are being fairly compensated as a result. A commenter
noted that if CMS did include data for hospital-based HHAs, their
analysis of Medicare cost report data indicates that the labor-related
share would be approximately 76 percent.
Response: CMS has discussed the CY 2019 HH PPS final rule with
comment period (83 FR 56425) and explained in the CY 2024 HH PPS
proposed rule (88 FR 43704), that we believe data from freestanding
HHAs, which account for over 90 percent of HHAs, better reflect HHAs'
actual cost structure, as expense data for hospital-based HHAs can be
affected by the allocation of overhead costs over the entire
institution. This is a result of freestanding HHAs using an HHA-
specific cost report while HHAs that are hospital-based use the HHA
component of the hospital cost report. Therefore, we believe that the
2021-based home health market basket reflects the most current and
accurate mix of goods and services for the majority of home health
providers.
Final Decision: After consideration of public comments, we are
finalizing the 2021-based home health market basket as proposed without
modification.
4. CY 2024 Home Health Payment Rate Updates
(a) CY 2024 Home Health Market Basket Percentage Increase
Based on IHS Global Inc.'s (IGI's) first quarter 2023 forecast, the
proposed CY 2024 home health market basket percentage increase was 3.0
percent based on the 2021-based home health market basket. IGI is a
nationally recognized economic and financial forecasting firm with
which CMS contracts to forecast the components of the market baskets.
We proposed that if more recent data subsequently became available (for
example, a more recent estimate of the market basket), we would use
such data, if appropriate, to determine the market basket percentage
increase in the final rule.
Based on IGI's third quarter 2023 forecast with historical data
through the second quarter of 2023, the 2021-based home health market
basket percentage increase for CY 2024 is 3.3 percent. Table B22
provides a comparison of the yearly percent changes from CY 2019 to CY
2026 for the 2016-based home health market basket and the 2021-based
home health market basket based on IGI's third quarter 2023 forecast.
[[Page 77739]]
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Table B22 shows that the forecasted percentage increase for CY 2024
of the 2021-based home health market basket is 3.3 percent, or 0.1
percentage point lower than growth estimated using the 2016-based home
health market basket. The average historical estimates of the growth in
the 2021-based and 2016-based home health market baskets over CY 2019
through CY 2022 differ by an average of 0.1 percentage point. As
discussed previously, this is primarily driven by a reclassification of
Personal Care Aides, which caused a shift in the relative weight of the
Wages and Salaries and Benefits blended price proxies from Other
Service Occupations to Health and Social Assistance Services, which
over this period grew relatively slower. On average, the two indexes
produce similar updates to one another over the forecasted period. We
invited public comment on our proposals for the CY 2024 home health
market basket update. The following is a summary of the public comments
received on the proposed CY 2024 home health market basket update.
Comment: Several commenters supported the proposed payment update
for CY 2024 and the use of the latest available data but expressed
concern that the CY 2024 payment update does not adequately factor in
the effects of many challenges faced by HHAs. These challenges included
the impact of the COVID-19 PHE, increased costs of labor due to
workforce-shortages, and other increased costs associated with
infection control, medical supplies, and transportation. Multiple
commenters reported offering bonuses to attract and retain staff, and
that it is increasingly difficult to compete with other medical
providers in their market, such as hospitals and SNFs. A commenter
stated that they believe the home health market basket update should
roughly coincide with the CPI and if it does not coincide, CMS should
explain why it is different.
A few commenters expressed concern over the accuracy of the
forecast underlying the proposed market basket update for CY 2024. They
requested that CMS reexamine the forecasting approach or consider other
methods and data sources to calculate a final rule market basket update
that better reflects the rapidly increasing input prices and costs
facing HHAs.
Response: We are required to update HH PPS payments by the market
basket update adjusted for productivity, as directed by section
1895(b)(3)(B) of the Act. Specifically, section 1895(b)(3)(B)(iii)
states that the increase factor shall be based on an appropriate
percentage increase in a market basket of goods and services included
in home health services in the same manner as the market basket
percentage increase under section 1886(b)(3)(B)(iii) is determined and
applied to the mix of goods and services comprising inpatient hospital
services for the fiscal year or year. As the law specifies which
specific update factors to use, comparisons to general inflation are
not relevant to the determination of the home health market basket
update.
In the CY 2024 HH PPS proposed rule, we proposed to rebase and
revise the current 2016-based home health market basket to reflect a
2021 base year. See section II.C.3 of this final rule for a description
of this proposal, the comments received, and the final 2021-based home
health market basket. The home health market basket is a fixed-weight,
Laspeyres-type index that measures price changes over time and would
not reflect increases in costs associated with changes in the volume or
intensity of input goods and services. As such, the home health market
basket update would reflect the prospective price pressures described
by the commenters (such as wage growth or higher energy prices) but
would inherently not reflect other factors that might increase the
level of costs, such as the quantity of labor used or any shifts
between contract and staff nurses. We note that cost changes (that is,
the product of price and quantities) would only be reflected when a
market basket is rebased and the base year weights are updated to a
more recent time period. We believe the increase in the 2021-based home
health market basket adequately reflects the average change in the
price of goods and services HHAs purchase in order to provide home
health services and is technically appropriate to use as the home
health payment update factor. As stated previously, we are finalizing a
home health market basket that reflects a 2021
[[Page 77740]]
base year and, therefore, any change in the cost structure for HHAs
that occurred between 2016 and 2021 is now reflected in the cost
weights for this rebased market basket.
In response to the commenters' request that we reexamine the
current forecasting approach for determining the HH PPS market basket
update, IHS Global Inc. is a nationally recognized economic and
financial forecasting firm with which CMS contracts to forecast the
components of the market baskets. We believe that basing the
prospective update on these forecasts is an appropriate method, while
also acknowledging that these are expectations of expected trends and
may differ from actual experience. Thus, we do acknowledge that CY 2022
compensation price growth for the 2016-based home health market basket
was higher (5.8 percent) than was forecasted at the time of the CY 2022
HH PPS final rule (3.3 percent). We note that the lower projected CY
2024 home health market basket percent increase relative to the CY 2022
historical increase and the CY 2023 projected increase reflects the
expectation that wage, and price pressures will lessen in CY 2024
relative to recent history.
Comment: A commenter stated the proposed market basket update does
not reflect the increased cost of giving care and suggested that CMS
give home health providers a full market basket adjustment that
recognizes the dramatic increases in the cost of care. The commenter
referenced a high inflation period prior to the implementation of the
PPS and noted that cost limits were updated by higher amounts than what
CMS had proposed for the CY 2024 update.
Response: As stated previously, the home health market basket
measures price changes (like other CMS market baskets) over time and
appropriately would not reflect increases in costs associated with
changes in the volume or intensity of input goods and services. In FY
2002, CMS began using the growth in a home health market basket to
update payments under the HH PPS as stated in section 1895(b)(4)(B) of
the Act, and effective beginning with 2015, reduced by the productivity
adjustment described in section 1886(b)(3)(B)(xi)(II) of the Act.
Comment: Several commenters requested that CMS deviate from its
usual update and consider making a one-time adjustment to the market
basket update or apply a forecast error adjustment to account for
underpayments in CY 2021 through CY 2023.
Response: As most recently discussed in the CY 2023 HH PPS final
rule (87 FR 66848), the HH PPS market basket updates are set
prospectively, which means that the market basket update relies on a
mix of both historical data for part of the period for which the update
is calculated and forecasted data for the remainder. For instance, the
CY 2024 market basket update in this final rule reflects historical
data through the second quarter of CY 2023 and forecasted data through
the fourth quarter of CY 2024. The forecast error for a market basket
update is calculated as the actual market basket increase for a given
year less the forecasted market basket increase. Due to the uncertainty
regarding future price trends, forecast errors can be both positive and
negative. In evaluating the difference between the forecasted increase
and later acquired actual data for the period from CY 2012 through CY
2020 (excluding CYs 2018 and CY 2020, which were set by statute), we
found the forecasted market basket updates for each payment year for
HHAs were higher than the actual market basket updates. For this final
rule, we have incorporated more recent historical data and forecasts to
capture the price and wage pressures facing HHAs and believe it is the
best available projection of inflation to determine the applicable
percentage increase for the HHA payments in CY 2024.
Final Decision: In accordance with section 1895(b)(3)(B)(iii) of
the Act, we are finalizing our policy to use the most recent data to
determine the home health market basket update for CY 2024 in this
final rule. The final CY 2024 home health market basket percentage
increase is 3.3 percent.
(b) CY 2024 Productivity Adjustment
In the CY 2015 HH PPS final rule (79 FR 38384), we finalized our
methodology for calculating and applying the multifactor productivity
adjustment. As we explained in that rule, section 1895(b)(3)(B)(vi) of
the Act, requires that, in CY 2015 (and in subsequent calendar years,
except CY 2018 (under section 411(c) of the Medicare Access and CHIP
Reauthorization Act of 2015 (MACRA) (Pub. L. 114-10, enacted April 16,
2015)), the market basket percentage under the HH PPS as described in
section 1895(b)(3)(B) of the Act be annually adjusted by changes in
economy-wide productivity. Section 1886(b)(3)(B)(xi)(II) of the Act
defines the productivity adjustment to be equal to the 10-year moving
average of change in annual economy-wide private nonfarm business
multifactor productivity (as projected by the Secretary for the 10-year
period ending with the applicable fiscal year, calendar year, cost
reporting period, or other annual period). The BLS publishes the
official measures of productivity for the United States economy. We
note that previously the productivity measure referenced in section
1886(b)(3)(B)(xi)(II) of the Act was published by BLS as private
nonfarm business multifactor productivity. Beginning with the November
18, 2021 release of productivity data, BLS replaced the term
``multifactor productivity'' with ``total factor productivity'' (TFP).
BLS noted that this is a change in terminology only and will not affect
the data or methodology. As a result of the BLS name change, the
productivity measure referenced in section 1886(b)(3)(B)(xi)(II) of the
Act is now published by BLS as ``private nonfarm business total factor
productivity''. We refer readers to https://www.bls.gov for the BLS
historical published TFP data. A complete description of IGI's TFP
projection methodology is available on the CMS website at https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/MedicareProgramRatesStats/MarketBasketResearch. Based on IGI's
first quarter 2023 forecast, the proposed productivity adjustment (the
10-year moving average of TFP for the period ending December 31, 2024)
for CY 2024 was 0.3 percent. We also proposed that if more recent data
subsequently became available (for example, a more recent estimate of
the productivity adjustment), we would use such data, if appropriate,
to determine the productivity adjustment in the CY 2024 HH PPS final
rule. Using IGI's third quarter 2023 forecast, the 10-year moving
average growth of TFP for CY 2024 is projected to be 0.3 percent.
The following is a summary of the public comments received on the
proposed CY 2024 productivity adjustment:
Comment: Several commenters expressed concern about the continued
application of the productivity adjustment to HHAs. They stated that
services provided through the home health benefit are hands-on, labor-
intensive services and do not lend themselves to the productivity gains
realized in other sectors. A commenter noted that CMS has acknowledged
that health providers, due to the nature of their service, lack the
ability to add efficiencies in the way other sectors do.\15\ They asked
CMS to use its
[[Page 77741]]
authority to account for the lack of parity in this adjustment when
considering its overall payment adjustment to home health providers. A
commenter recognized that the productivity adjustment is required by
statute and urged CMS to work with Congress to eliminate it
permanently. In absence of that elimination, they believe that the home
health rate increase should include an additional amount equal to the
productivity adjustment to offset it.
---------------------------------------------------------------------------
\15\ https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/ReportsTrustFunds/Downloads/ProductivityMemo2016.pdf.
---------------------------------------------------------------------------
Response: Section 1895(b)(3)(B) of the Act requires the market
basket percentage under the HHA prospective payment system, as
described in section 1895(b)(3)(B) of the Act, be annually adjusted by
changes in economy-wide productivity. Section 1886(b)(3)(B)(xi)(II) of
the Act defines the productivity adjustment to be equal to the 10-year
moving average of changes in annual economy-wide private nonfarm
business multifactor productivity (as projected by the Secretary for
the 10-year period ending with the applicable fiscal year, year, cost
reporting period, or other annual period). We acknowledge the concerns
of the commenters regarding the appropriateness of the productivity
adjustment; however, we are required pursuant to Section 1895(b)(3)(B)
of the Act to apply the specific productivity adjustment described
here. In addition, with respect to providing feedback to Congress, we
note that MedPAC monitors various factors for Medicare providers in
terms of profitability and beneficiary access to care and reports the
findings to Congress on an annual basis. MedPAC did a full analysis of
payment adequacy for home health care providers in its March 2023
Report to Congress (https://www.medpac.gov/document/march-2023-report-to-the-congress-medicare-payment-policy/). MedPAC stated that given the
positive payment adequacy indicators for HHAs, they recommended that
the home health base payment rate be reduced by 7 percent for CY 2024.
Final Decision: We are finalizing the CY 2024 productivity
adjustment of 0.3 percent. Therefore, the final CY 2024 home health
payment update percentage is 3.0 percent (3.3 percent home health
market basket percentage increase, reduced by 0.3 percentage point
productivity adjustment). Section 1895(b)(3)(B)(v) of the Act requires
that the home health percentage update be decreased by 2 percentage
points for those HHAs that do not submit quality data as required by
the Secretary. For HHAs that do not submit the required quality data,
the CY 2024 final home health payment update percentage is 1.0 percent
(3.0 percent minus 2 percentage points).
(c) Labor-Related Share
In the CY 2024 HH PPS proposed rule (88 FR 43715), we proposed to
update the labor-related share to reflect the 2021-based home health
market basket Compensation (Wages and Salaries plus Benefits, which
include direct patient care contract labor costs) cost weight. The
current labor-related share is based on the Compensation cost weight of
the 2016-based home health market basket. Based on the 2021-based home
health market basket, the proposed labor-related share was 74.9
percent, and the proposed non-labor-related share was 25.1 percent. The
labor-related share for the 2016-based home health market basket was
76.1 percent and the non-labor-related share was 23.9 percent. As
explained earlier, the decrease in the compensation cost weight of 1.2
percentage points is primarily attributable to a lower cost weight of
direct patient care contract labor costs as reported in the Medicare
cost report data. Table B23 details the components of the labor-related
share for the 2016-based and 2021-based home health market baskets.
[GRAPHIC] [TIFF OMITTED] TR13NO23.044
The revised labor-related share will be implemented in a budget
neutral manner through the use of labor-related share budget neutrality
factor (as described in section II.C.4.e.(2)) so that the aggregate
payments do not increase or decrease due to changes in the labor-
related share values.
We invited public comments on the proposed labor-related share. The
following is a summary of the public comments received and our
responses.
Comment: A few commenters opposed the proposal to decrease the
labor-related share based on the updated cost weights from the 2021
Medicare cost report data. The commenters state that a drop in the
compensation cost weight for HHAs is in direct contradiction to their
real-time experience that labor and associated costs continue to
increase. A commenter indicated that they believe the decrease in the
labor-related share is a direct result of factors related to COVID-19,
and they are concerned a shortage of staff may be artificially
decreasing the labor-related share based on the 2021 Medicare cost
report data. They believe that contract labor utilization by HHAs has
normalized and increased relative to the period CMS proposed to use to
establish the labor-related share due to increased availability of
contract staff.
A commenter stated they are concerned that the 2021 data precedes
the time period when much of the dramatic growth in labor costs
occurred, or that the result may have been influenced by inaccuracies
in the underlying reported costs, including how providers reported
contract labor costs (for example, in the Administrative and General
cost center, which would not be captured in the compensation costs
weight or in direct salaries which would). They suggested that CMS
ensure the accuracy of the
[[Page 77742]]
compensation weight and underlying 2021 cost report data, including
ensuring that it is consistent with available 2022 data.
Response: The labor-related share is composed of the Wages &
Salaries and Benefits cost weights (which include direct patient care
contract labor) from the 2021-based home health market basket. These
cost weights were calculated using the 2021 Medicare cost report data
(form CMS-1728-20), which is submitted by both rural and urban
freestanding home health agencies and was the most comprehensive data
source available for determining the CY 2024 labor-related share at the
time of rulemaking. We note that the labor-related share has been
trending downward since 2010, and preliminary Medicare cost report data
from 2022 (which reflects approximately 80 percent of home health
agencies) suggest that this trend may continue despite recent increases
in utilization of contract labor. We understand that these findings may
appear to conflict with the firsthand experiences of many providers who
are experiencing increased costs of labor, but the labor-related share
is intended to reflect the national average and a decrease in the
labor-related share does not suggest that the cost of labor is
decreasing, but rather that aggregate labor-related costs have
increased at a slower rate than aggregate non-labor-related costs since
2016.
While we will continue to analyze the home health Medicare cost
report data on a regular basis to ensure it accurately reflects the
costs structures facing home health providers, we believe the proposed
74.9 percent labor-related share reflects the most recent and
comprehensive data source available and, therefore, is a technical
improvement to the 2016-based labor-related share, which was based on
CY 2016 Medicare cost report data.
Final Decision: After consideration of public comments, we are
finalizing the labor related share of 74.9 percent and the non-labor-
related share of 25.1 percent, as proposed. We did not receive any
comments on our proposal to implement the revised labor-related share
in a budget neutral manner. Therefore, we are finalizing our proposal
to implement the revised labor-related share in a budget neutral manner
using a labor-related share budget neutrality factor. The labor-related
share budget neutrality factor for CY 2024 is 0.9998.
(d) CY 2024 Home Health Wage Index
Sections 1895(b)(4)(A)(ii) and (b)(4)(C) of the Act require the
Secretary to provide appropriate adjustments to the proportion of the
payment amount under the HH PPS that account for area wage differences,
using adjustment factors that reflect the relative level of wages and
wage-related costs applicable to the furnishing of home health
services. Since the inception of the HH PPS, we have used inpatient
hospital wage data in developing a wage index to be applied to home
health payments. We proposed to continue this practice for CY 2024, as
it is our belief that in the absence of home health-specific wage data
accounting for area differences, using inpatient hospital wage data is
appropriate and reasonable for the HH PPS.
In the CY 2021 HH PPS final rule (85 FR 70298), we finalized our
proposal to adopt the revised OMB delineations with a 5-percent cap on
wage index decreases, where the estimated reduction in a geographic
area's wage index would be capped at 5-percent in CY 2021 only, meaning
no cap would be applied to wage index decreases for the second year (CY
2022). Therefore, we finalized the use of the FY 2022 pre-floor, pre-
reclassified hospital wage index with no 5-percent cap on decreases as
the CY 2022 wage adjustment to the labor portion of the HH PPS rates
(86 FR 62285). However, as described in the CY 2023 HH PPS final rule
(87 FR 66851 through 66853), for CY 2023 and each subsequent year, we
finalized a policy that the CY HH PPS wage index would include a 5-
percent cap on wage index decreases. Specifically, we finalized for CY
2023 and subsequent years, the application of a permanent 5-percent cap
on any decrease to a geographic area's wage index from its wage index
in the prior year, regardless of the circumstances causing the decline.
That is, we finalized that a geographic area's wage index for CY 2023
would not be less than 95 percent of its final wage index for CY 2022,
regardless of whether the geographic area is part of an updated CBSA,
and that for subsequent years, a geographic area's wage index would not
be less than 95 percent of its wage index calculated in the prior
calendar year. For CY 2024, we proposed to base the HH PPS wage index
on the FY 2024 hospital pre-floor, pre-reclassified wage index for
hospital cost reporting periods beginning on or after October 1, 2019
and before October 1, 2020 (FY 2020 cost report data). The proposed CY
2024 HH PPS wage index would not take into account any geographic
reclassification of hospitals, including those in accordance with
section 1886(d)(8)(B) or 1886(d)(10) of the Act, but would include the
5-percent cap on wage index decreases. We would apply the appropriate
wage index value to the revised labor portion of the HH PPS rates based
on the site of service for the beneficiary (defined by section 1861(m)
of the Act as the beneficiary's place of residence).
To address those geographic areas in which there are no inpatient
hospitals, and thus, no hospital wage data on which to base the
calculation of the CY 2024 HH PPS wage index, we proposed to continue
to use the same methodology discussed in the CY 2007 HH PPS final rule
(71 FR 65884) to address those geographic areas in which there are no
inpatient hospitals. For rural areas that do not have inpatient
hospitals, we proposed to use the average wage index from all
contiguous Core Based Statistical Areas (CBSAs) as a reasonable proxy.
Currently, the only rural area without a hospital from which hospital
wage data could be derived is Puerto Rico. However, for rural Puerto
Rico, we do not apply this methodology due to the distinct economic
circumstances that exist there (for example, due to the close proximity
of almost all of Puerto Rico's various urban and non-urban areas to one
another, this methodology would produce a wage index for rural Puerto
Rico that is higher than half of its urban areas). Instead, we proposed
to continue to use the most recent wage index previously available for
that area. The most recent wage index previously available for rural
Puerto Rico is 0.4047. For urban areas without inpatient hospitals, we
use the average wage index of all urban areas within the State as a
reasonable proxy for the wage index for that CBSA. For CY 2024, the
only urban area without inpatient hospital wage data is Hinesville, GA
(CBSA 25980). Using the average wage index of all urban areas in
Georgia as proxy, the final CY 2024 wage index value for Hinesville, GA
will be 0.8622.
On February 28, 2013, OMB issued Bulletin No. 13-01, announcing
revisions to the delineations of MSAs, Micropolitan Statistical Areas,
and CBSAs, and guidance on uses of the delineation of these areas. In
the CY 2015 HH PPS final rule (79 FR 66085 through 66087), we adopted
OMB's area delineations using a 1-year transition.
On August 15, 2017, OMB issued Bulletin No. 17-01 in which it
announced that one Micropolitan Statistical Area, Twin Falls, Idaho,
now qualifies as a Metropolitan Statistical Area. The new CBSA (46300)
comprises the principal city of Twin Falls, Idaho in Jerome County,
Idaho and Twin Falls County, Idaho. The CY 2022 HH PPS wage index value
for CBSA 46300, Twin
[[Page 77743]]
Falls, Idaho is 0.8707. Bulletin No. 17-01 is available at https://www.whitehouse.gov/wp-content/uploads/legacy_drupal_files/omb/bulletins/2017/b-17-01.pdf.
On April 10, 2018 OMB issued OMB Bulletin No. 18-03, which
superseded the August 15, 2017 OMB Bulletin No. 17-01. On September 14,
2018, OMB issued OMB Bulletin No. 18-04 which superseded the April 10,
2018 OMB Bulletin No. 18-03. These bulletins established revised
delineations for Metropolitan Statistical Areas, Micropolitan
Statistical Areas, and Combined Statistical Areas, and provided
guidance on the use of the delineations of these statistical areas. A
copy of OMB Bulletin No. 18-04 may be obtained at: https://www.bls.gov/bls/omb-bulletin-18-04-revised-delineations-of-metropolitan-statistical-areas.pdf.
On March 6, 2020, OMB issued Bulletin No. 20-01, which provided
updates to and superseded OMB Bulletin No. 18-04 that was issued on
September 14, 2018. The attachments to OMB Bulletin No. 20-01 provided
detailed information on the update to statistical areas since September
14, 2018, and were based on the application of the 2010 Standards for
Delineating Metropolitan and Micropolitan Statistical Areas to Census
Bureau population estimates for July 1, 2017 and July 1, 2018. (For a
copy of this bulletin, we refer readers to https://www.whitehouse.gov/wp-content/uploads/2020/03/Bulletin-20-01.pdf). In OMB Bulletin No. 20-
01, OMB announced one new Micropolitan Statistical Area, one new
component of an existing Combined Statistical Area and changes to New
England City and Town Area (NECTA) delineations. In the CY 2021 HH PPS
final rule (85 FR 70298), we stated that if appropriate, we would
propose any updates from OMB Bulletin No. 20-01 in future rulemaking.
After reviewing OMB Bulletin No. 20-01, we have determined that the
changes in Bulletin 20-01 encompassed delineation changes that would
not affect the Medicare home health wage index for CY 2022.
Specifically, the updates consisted of changes to NECTA delineations
and the re-designation of a single rural county into a newly created
Micropolitan Statistical Area. The Medicare home health wage index does
not utilize NECTA definitions, and, as most recently discussed in the
CY 2021 HH PPS final rule (85 FR 70298) we include hospitals located in
Micropolitan Statistical areas in each State's rural wage index. In
other words, these OMB updates did not affect any geographic areas for
purposes of the HH PPS wage index calculation for CY 2024.
The following is a summary of the comments received on the CY 2024
wage index and our responses:
Comment: A few commenters recommended more far-reaching revisions
and reforms to the wage index methodology used under Medicare fee-for-
service. Some commenters recommended that CMS create a home health
specific wage index. These commenters stated that it is no longer
reasonable to believe that the cost of labor is comparable between
hospitals and home health agencies, and therefore, the IPPS wage index
is no longer a sufficient proxy for the home health wage index. MedPAC
recommended that Congress repeal the existing Medicare wage index
statutes, including current exceptions, and require the Secretary to
phase in new Medicare wage index systems for hospitals and other types
of providers that use all-employer, occupation-level wage data with
different occupation weights for the wage index of each provider type;
reflect local-area-level differences in wages between and within
metropolitan statistical areas and statewide rural areas; and smooth
wage index differences across adjacent local areas.
Response: We appreciate the commenters' recommendations; however,
these comments are outside the scope of the proposed rule. Any changes
regarding the adjustment of home health payments to account for
geographic wage differences, beyond the wage index proposals discussed
in the CY 2024 HH PPS proposed rule, would have to go through notice
and comment rulemaking. While CMS and other interested parties, such as
MedPAC, have explored potential alternatives to the current home health
wage index, no consensus has been achieved regarding a replacement
system. Further, it seems some of these recommendations are more
appropriate for Congress to consider. Therefore, we believe that in the
absence of home health specific wage data, using the pre-floor, pre-
reclassified hospital wage data is appropriate and reasonable for home
health payments. This position is longstanding and consistent with
other Medicare payment systems (for example, SNF PPS, IRF PPS, and
Hospice).
Comment: Several commenters recommended that CMS adopt wage index
policies for home health that are allowed under other Medicare payment
areas such as IPPS and hospice. A few commenters recommended that CMS
allow home health providers to utilize geographic reclassification and
the rural floor. Another commenter recommended that CMS create a home
health specific floor like the hospice floor. Other commenters
recommended that CMS adopt, for home health, the low wage index policy
finalized in the CY 2020 IPPS final rule. Finally, a commenter
requested that CMS calculate non-hospital wage indexes using the post-
floor, post-reclassified hospital wage index.
Response: We thank the commenters for their recommendations.
However, we do not believe that any of these policies are applicable to
the home health wage index. The reclassification provision at section
1886(d)(10)(C)(i) of the Act states that the Board shall consider the
application of any subsection (d) hospital requesting the Secretary
change the hospital's geographic classification. The reclassification
provision found in section 1886(d)(10) of the Act is specific to IPPS
hospitals only. Section 4410(a) of the Balanced Budget Act of 1997
(Pub. L. 105-33) provides that the area wage index applicable to any
hospital that is located in an urban area of a state may not be less
than the area wage index applicable to hospitals located in rural areas
in that state. This is the rural floor provision and it is also
specific only to IPPS hospitals. Additionally, the low wage index
hospital policy increases the wage index for hospitals with a wage
index value below the 25th percentile wage index value for a fiscal
year by half the difference between the otherwise applicable final wage
index value for a year for that hospital and the 25th percentile wage
index value for that year across all hospitals. This policy is specific
to IPPS hospitals and does not apply to home health agencies. Finally,
the application of the hospice floor is specific to hospices and does
not apply to HHAs. The hospice floor was developed through a negotiated
rulemaking advisory committee, under the process established by the
Negotiated Rulemaking Act of 1990 (Pub. L. 101- 648). Committee members
included representatives of national hospice associations; rural,
urban, large, and small hospices; multi-site hospices; consumer groups;
and a government representative. The Committee reached consensus on a
methodology that resulted in the hospice wage index. Because the
reclassification provision, the hospital rural floor, and the hospital
low wage policy each apply only to hospitals, and the hospice floor
applies only to hospices, we continue to believe the use of the pre-
floor and pre-reclassified hospital wage index results
[[Page 77744]]
in the most appropriate adjustment to the labor portion of the home
health payment rates.
Comment: A commenter suggested that the HH PPS wage index should be
based on the hospital wage index adjusted for population density. This
commenter believes that in areas with lower population densities such
as rural areas, travel costs are increased because of the time and
mileage involved for home health personnel to travel between patients
to provide services and that the current method of adjusting labor
costs does not accurately account for the increased travel costs and
lost productivity when serving lower population density areas. Another
commenter recommended that CMS implement an out-migration adjustment
for non-hospital providers. This commenter stated that due to the
nature of their work, home health workers not only travel extensively
to visit patients in their homes, but they also tend to live and work
across a broad geographic area. The commenter believes this causes
disparities between provider types because acute care hospitals have
the option to increase their wage index if at least 10% of a county's
hospital-employed residents commute to work in higher wage index areas
and home health providers do not have this option.
Response: We thank the commenters for their recommendations.
However, currently there are no mechanisms in place that would allow
population density or out migration adjustments in the home health wage
index and we did not propose such changes in the CY 2024 HH PPS
proposed rule.
Comment: A few commenters recommended refinements to the 5-percent
cap policy on wage index decreases finalized in the CY 2023 HH PPS
final rule (87 FR 66853). A commenter recommended that CMS lower the
cap threshold to 3 percent. This commenter believes that a 3-percent
cap on wage index decreases would protect HHAs who are still
experiencing negative consequences due to the COVID-19 pandemic, such
as increased costs and loss of staff. Another commenter recommended
that in addition to the 5-percent cap on wage index decreases, CMS
should implement a 10-percent cap (2x the decrease cap) on the amount
any geographic area's wage index can increase from one year to the
next.
Response: We thank the commenters for their recommendations;
however, we did not propose changes to the 5-percent cap policy in the
CY 2024 HH PPS proposed rule. We remind commenters that we stated in
the CY 2023 HH PP final rule (87 FR 66852) that we believe that the 5-
percent cap on wage index decreases is an adequate safeguard against
any significant payment reductions and that the 5-percent threshold
effectively mitigates any significant decreases in an HHA's wage index
for future calendar years, while still balancing the importance of
ensuring that area wage index values accurately reflect relative
differences in area wage levels. Additionally, we stated that the
purpose of the wage index cap on wage index decreases is to support
increased predictability about home health payments for providers,
enabling them to more effectively budget and plan their operations.
That is, we believe that a provider will be able to more effectively
budget and plan when there is awareness regarding expected minimum
level of home health payments in the upcoming calendar year. We did not
propose to limit wage index increases because we do not believe such a
policy would enable HHAs to more effectively budget and plan their
operations.
Comment: A commenter questioned whether the 2020 cost report data
collected during the first year of the COVID-19 pandemic is accurate
and if it adequately reflects current relative labor costs given the
unique nature of that period. This commenter suggested that CMS
validate the 2020 cost report wage data collected during the COVID-19
pandemic to ensure it does not reflect aberrant trends.
Response: The FY 2020 cost report data was reviewed and audited by
the MACs and CMS did not identify any significant issues with the FY
2020 wage data itself in terms of our audits of this data. Therefore,
we continue to believe the FY 2020 wage data is the best available wage
data to use for FY 2024. A full discussion on this process can be found
in section III.C ``Verification of Worksheet S-3 Wage Data'' located in
the FY 2024 IPPS final rule (87 FR 58961-58965).
Comment: A few commenters expressed concern that the proposed
revised labor-related shares would negatively impact the home health
wage index and in turn home health payments. A commenter stated that
the proposed wage index changes from CY 2023 to CY 2024, combined with
the decrease in the labor-related share, results in substantial payment
variances and a greater impact on home health providers than in past
years.
Response: As noted in the proposed rule, the decrease in the
compensation cost weight of 1.2 percentage points is primarily
attributable to a lower cost weight of direct patient care contract
labor costs as reported in the Medicare cost report data. The decreased
labor-related share is implemented in a budget neutral manner, which is
consistent with the policies for implementing the annual recalibration
of the case-mix weights and update of the home health wage index in a
budget neutral manner.
Final Decision: After considering the comments received in response
to the proposed rule, and for the reasons discussed previously, we are
finalizing as proposed our proposal to use the FY 2024 pre-floor, pre-
reclassified hospital wage index data as the basis for the CY 2024 HH
PPS wage index. The final CY 2024 wage index is available on the CMS
website at: https://www.cms.gov/Center/Provider-Type/Home-Health-Agency-HHA-Center.
(e) CY 2024 Home Health Payment Update
(1) Background
The HH PPS has been in effect since October 1, 2000. As set forth
in the July 3, 2000 final rule (65 FR 41128), the base unit of payment
under the HH PPS was a national, standardized 60-day episode payment
rate. As finalized in the CY 2019 HH PPS final rule with comment period
(83 FR 56406), and as described in the CY 2020 HH PPS final rule with
comment period (84 FR 60478), the unit of home health payment changed
from a 60-day episode to a 30-day period effective for those 30-day
periods beginning on or after January 1, 2020.
As set forth in Sec. 484.220, we adjust the national, standardized
prospective payment rates by a case-mix relative weight and a wage
index value based on the site of service for the beneficiary. To
provide appropriate adjustments to the proportion of the payment amount
under the HH PPS to account for area wage differences, we apply the
appropriate wage index value to the labor portion of the HH PPS rates.
In the CY 2019 HH PPS final rule with comment period (83 FR 56435), we
finalized rebasing the home health market basket to reflect 2016
Medicare cost report data. We also finalized a revision to the labor-
related share to reflect the 2016-based home health market basket
Compensation (Wages and Salaries plus Benefits) cost weight. We
finalized that for CY 2019 and subsequent years, the labor-related
share would be 76.1 percent and the non-labor related share would be
23.9 percent. As discussed in section II.C.3 of this final rule, for CY
2024, we are finalizing the proposal to rebase the home health market
basket using 2021 Medicare cost
[[Page 77745]]
report data. We are also finalizing that the labor-related share based
on the 2021-based home health market basket will be 74.9 percent and
the non-labor-related share will be 25.1 percent. The following are the
steps we take to compute the case-mix and wage-adjusted 30-day period
payment amount for CY 2024:
Multiply the national, standardized 30-day period rate by
the patient's applicable case-mix weight.
Divide the case-mix adjusted amount into a labor (74.9
percent) and a non-labor portion (25.1 percent).
Multiply the labor portion by the applicable wage index
based on the site of service of the beneficiary.
Add the wage-adjusted portion to the non-labor portion,
yielding the case-mix and wage adjusted 30-day period payment amount,
subject to any additional applicable adjustments.
We provide annual updates of the HH PPS rate in accordance with
section 1895(b)(3)(B) of the Act. Section 484.225 sets forth the
specific annual percentage update methodology. In accordance with
section 1895(b)(3)(B)(v) of the Act and Sec. 484.225(i), for an HHA
that does not submit home health quality data, as specified by the
Secretary, the unadjusted national prospective 30-day period rate is
equal to the rate for the previous calendar year increased by the
applicable home health payment update percentage, minus 2 percentage
points. Any reduction of the percentage change would apply only to the
calendar year involved and would not be considered in computing the
prospective payment amount for a subsequent calendar year.
The final claim that the HHA submits for payment determines the
total payment amount for the period and whether we make an applicable
adjustment to the 30-day case-mix and wage-adjusted payment amount. The
end date of the 30-day period, as reported on the claim, determines
which calendar year rates Medicare will use to pay the claim.
We may adjust a 30-day case-mix and wage-adjusted payment based on
the information submitted on the claim to reflect the following:
A LUPA is provided on a per-visit basis as set forth in
Sec. Sec. 484.205(d)(1) and 484.230.
A partial payment adjustment as set forth in Sec. Sec.
484.205(d)(2) and 484.235.
An outlier payment as set forth in Sec. Sec.
484.205(d)(3) and 484.240.
(2) CY 2024 National, Standardized 30-Day Period Payment Amount
Section 1895(b)(3)(A)(i) of the Act requires that the standard
prospective payment rate and other applicable amounts be standardized
in a manner that eliminates the effects of variations in relative case-
mix and area wage adjustments among different home health agencies in a
budget-neutral manner. To determine the CY 2024 national, standardized
30-day period payment rate, we will continue our practice of using the
most recent, complete utilization data at the time of rulemaking; that
is, we are using CY 2022 claims data for CY 2024 payment rate updates.
We apply a permanent behavioral adjustment factor, a case-mix weights
recalibration budget neutrality factor, a wage index budget neutrality
factor, a labor-related share budget neutrality factor and the home
health payment update percentage to update the CY 2024 payment rate. As
discussed in section II.C.1 of this final rule, we finalized a
permanent behavior adjustment of -2.890 percent to ensure that payments
under the PDGM do not exceed what payments would have been under the
153-group payment system as required by law. The final permanent
behavior adjustment factor is 0. 97110. As discussed previously, to
ensure the changes to the PDGM case-mix weights are implemented in a
budget neutral manner, we apply a case-mix weight budget neutrality
factor to the CY 2024 national, standardized 30-day period payment
rate. The final case-mix weight budget neutrality factor for CY 2024 is
1.0124.
Additionally, we apply a wage index budget neutrality factor to
ensure that wage index updates and revisions are implemented in a
budget neutral manner. To calculate the wage index budget neutrality
factor, we first determine the payment rate needed for non-LUPA 30-day
periods using the CY 2024 wage index, so those total payments are
equivalent to the total payments for non-LUPA 30-day periods using the
CY 2023 wage index and the CY 2023 national standardized 30-day period
payment rate adjusted by the case-mix weights recalibration neutrality
factor. Then, by dividing the payment rate for non-LUPA 30-day periods
using the CY 2024 wage index with a 5-percent cap on wage index
decreases by the payment rate for non-LUPA 30-day periods using the CY
2023 wage index with a 5-percent cap on wage index decreases, we obtain
a wage index budget neutrality factor of 1.0012. We then apply the wage
index budget neutrality factor of 1.0012 to the 30-day period payment
rate. After we apply the wage index budget neutrality factor, we also
apply a labor-related share budget neutrality factor so that aggregate
payments do not increase or decrease due to changes in the labor-
related share values. In order to calculate the labor-related share
budget neutrality factor, we simulate total payments using CY 2022 home
health utilization claims data with the CY 2024 HH PPS wage index and
the CY 2024 labor-related share (labor-related share of 74.9 percent
and non-labor-related share of 25.1 percent) and compare it to our
simulation of total payments using the CY 2024 HH PPS wage index with
the CY 2023 labor-related share (labor-related share of 76.1 percent
and non-labor-related share of 23.9 percent). By dividing the base
payment amount using the finalized labor-related share and CY 2024 wage
index and payment rate by the base payment amount using the CY 2023
labor-related share and CY 2024 wage index and payment rate, we obtain
a labor-related share budget neutrality factor of 0.9998.
Next, we update the 30-day period payment rate by the final CY 2024
home health payment update percentage of 3.0 percent. The CY 2024
national, standardized 30-day period payment rate is calculated in
Table B24.
[[Page 77746]]
[GRAPHIC] [TIFF OMITTED] TR13NO23.045
The CY 2024 national, standardized 30-day period payment rate for
an HHA that does not submit the required quality data is updated by the
final CY 2024 home health payment update percentage of 1.0 percent (3.0
percent minus 2 percentage points) and is shown in Table B25.
[GRAPHIC] [TIFF OMITTED] TR13NO23.046
(3) CY 2024 National Per-Visit Rates for 30-Day Periods of Care
The national per-visit rates are used to pay LUPAs and are also
used to compute imputed costs in outlier calculations. The per-visit
rates are paid by type of visit or home health discipline. The six home
health disciplines are as follows:
Home health aide (HH aide).
Medical Social Services (MSS).
Occupational therapy (OT).
Physical therapy (PT).
Skilled nursing (SN).
Speech-language pathology (SLP).
To calculate the final CY 2024 national per-visit rates, we started
with the CY 2023 national per-visit rates. Then we applied a wage index
budget neutrality factor to ensure budget neutrality for LUPA per-visit
payments. We calculated the wage index budget neutrality factor by
simulating total payments for LUPA 30-day periods of care using the CY
2024 wage index with a 5-percent cap on wage index decreases and
comparing it to simulated total payments for LUPA 30-day periods of
care using the CY 2023 wage index with 5-percent cap. By dividing the
total payments for LUPA 30-day periods of care using the CY 2024 wage
index by the total payments for LUPA 30-day periods of care using the
CY 2023 wage index, we obtained a wage index budget neutrality factor
of 1.0012. We apply the wage index budget neutrality factor to
calculate the CY 2024 national per-visit rates. In order to calculate
the labor-related share budget neutrality factor for the national per
visit amounts, we simulate total payments for LUPA 30-day periods using
CY 2022 home health utilization claims data with the CY 2024 HH PPS
wage index and the CY 2024 labor-related share (labor-related share of
74.9 percent and non-labor-related share of 25.1 percent) and compare
it to our simulation of total payments for LUPA 30-day periods using
the CY 2024 HH PPS wage index with the CY 2023 labor-related share
(labor-related share of 76.1 percent and non-labor-related share of
23.9 percent). By dividing the payment amounts for LUPA 30-day periods
using the CY 2024 labor-related share and CY 2024 wage index and
payment rate by the payment amounts for LUPA 30-day periods using the
CY 2023 labor-related share and CY 2024 wage index and payment rate, we
obtain a labor-related share budget neutrality factor of 0.9999.
The LUPA per-visit rates are not calculated using case-mix weights.
Therefore, no case-mix weight budget neutrality factor is needed to
ensure budget neutrality for LUPA payments. Additionally, we are not
applying the permanent adjustment to the per visit payment rates but
only to the case-mix adjusted 30-day payment rate. Lastly, the per-
visit rates for each discipline are updated by the final CY 2024 home
health payment update percentage of 3.0 percent. The national per-visit
rates are adjusted by the wage index based on the site of service of
the beneficiary. The per-visit payments for LUPAs are separate from the
LUPA add-on payment amount, which is paid for episodes that occur as
the only episode or initial episode in a sequence of adjacent episodes.
The CY 2024 national per-visit rates for HHAs that submit the required
quality data are updated by the finalized CY 2024 home health payment
update percentage of 3.0 percent and are shown in Table B26.
[[Page 77747]]
[GRAPHIC] [TIFF OMITTED] TR13NO23.047
The CY 2024 per-visit payment rates for HHAs that do not submit the
required quality data are updated by the CY 2024 home health payment
update percentage of 3.0 percent minus 2 percentage points and are
shown in Table B27.
[GRAPHIC] [TIFF OMITTED] TR13NO23.048
We did not receive any comments on the CY 2024 30-day home health
payment rates or the per-visit payment rates.
Final Decision: We are finalizing the updates to the CY 2024
national, standardized 30-day period payment rates and the CY 2024
national per-visit payment amounts as proposed.
(4) LUPA Add-On Factors
Prior to the implementation of the 30-day unit of payment, LUPA
episodes were eligible for a LUPA add-on payment if the episode of care
was the first or only episode in a sequence of adjacent episodes. As
stated in the CY 2008 HH PPS final rule, the average visit lengths in
these initial LUPAs are 16 to 18 percent higher than the average visit
lengths in initial non-LUPA episodes (72 FR 49848). LUPA episodes that
occur as the only episode or as an initial episode in a sequence of
adjacent episodes are adjusted by applying an additional amount to the
LUPA payment before adjusting for area wage differences. In the CY 2014
HH PPS final rule (78 FR 72305), we changed the methodology for
calculating the LUPA add-on amount by finalizing the use of three LUPA
add-on factors: 1.8451 for SN; 1.6700 for PT; and 1.6266 for SLP. We
multiply the per-visit payment amount for the first SN, PT, or SLP
visit in LUPA episodes that occur as the only episode or an initial
episode in a sequence of adjacent episodes by the appropriate factor to
determine the LUPA add-on payment amount.
In the CY 2019 HH PPS final rule with comment period (83 FR 56440),
in addition to finalizing a 30-day unit of payment, we finalized our
policy of continuing to multiply the per-visit payment amount for the
first skilled nursing, physical therapy, or speech-language pathology
visit in LUPA periods that occur as the only period of
[[Page 77748]]
care or the initial 30-day period of care in a sequence of adjacent 30-
day periods of care by the appropriate add-on factor (1.8451 for SN,
1.6700 for PT, and 1.6266 for SLP) to determine the LUPA add-on payment
amount for 30-day periods of care under the PDGM. For example, using
the final CY 2024 per-visit payment rates for HHAs that submit the
required quality data, for LUPA periods that occur as the only period
or an initial period in a sequence of adjacent periods, if the first
skilled visit is SN, the payment for that visit would be $310.66
(1.8451 multiplied by $168.37), subject to area wage adjustment.
(5) Occupational Therapy LUPA Add-On Factor
In order to implement Division CC, section 115, of CAA, 2021, in
the CY 2022 HH PPS final rule (86 FR 62289) CMS finalized changes to
regulations at Sec. 484.55(a)(2) and (b)(3) that allowed occupational
therapists to conduct initial and comprehensive assessments for all
Medicare beneficiaries under the home health benefit when the plan of
care does not initially include skilled nursing care, but either PT or
SLP (86 FR 62351). This change, led to us establishing a LUPA add-on
factor for calculating the LUPA add-on payment amount for the first
skilled occupational therapy (OT) visit in LUPA periods that occurs as
the only period of care or the initial 30-day period of care in a
sequence of adjacent 30-day periods of care.
As stated in the CY 2022 HH PPS final rule with comment period (86
FR 62289) since there was not sufficient data regarding the average
excess of minutes for the first visit in LUPA periods when the initial
and comprehensive assessments are conducted by occupational therapists,
we finalized the use of the PT LUPA add-on factor of 1.6700 as a proxy.
We also stated that we would use the PT LUPA add-on factor as a proxy
until we have CY 2022 data to establish a more accurate OT add-on
factor for the LUPA add-on payment amounts (86 FR 62289). At this time,
we are analyzing the CY 2022 data and will continue to use the PT LUPA
add-on factor for OT LUPAs and plan to propose a LUPA add-on factor
specific to OT in future rulemaking.
(6) Payments for High-Cost Outliers Under the HH PPS
(a) Background
Section 1895(b)(5) of the Act allows for the provision of an
addition or adjustment to the home health payment amount otherwise made
in the case of outliers because of unusual variations in the type or
amount of medically necessary care. Under the HH PPS and the previous
unit of payment (that is, 60-day episodes), outlier payments were made
for 60-day episodes whose estimated costs exceed a threshold amount for
each HHRG. The episode's estimated cost was established as the sum of
the national wage-adjusted per visit payment amounts delivered during
the episode. The outlier threshold for each case-mix group or partial
payment adjustment defined as the 30-day day period payment or partial
payment adjustment for that group plus a fixed-dollar loss (FDL)
amount. For the purposes of the HH PPS, the FDL amount is calculated by
multiplying the home health FDL ratio by a case's wage-adjusted
national, standardized 60-day episode payment rate, which yields an FDL
dollar amount for the case. The outlier threshold amount is the sum of
the wage and case-mix adjusted PPS episode amount and wage-adjusted FDL
amount. The outlier payment is defined to be a proportion of the wage-
adjusted estimated cost that surpasses the wage-adjusted threshold. The
proportion of additional costs over the outlier threshold amount paid
as outlier payments is referred to as the loss-sharing ratio.
As we noted in the CY 2011 HH PPS final rule (75 FR 70397 through
70399), section 3131(b)(1) of the Affordable Care Act amended section
1895(b)(3)(C) of the Act to require that the Secretary reduce the HH
PPS payment rates such that aggregate HH PPS payments were reduced by 5
percent. In addition, section 3131(b)(2) of the Affordable Care Act
amended section 1895(b)(5) of the Act by redesignating the existing
language as section 1895(b)(5)(A) of the Act and revised the language
to state that the total amount of the additional payments or payment
adjustments for outlier episodes could not exceed 2.5 percent of the
estimated total HH PPS payments for that year. Section 3131(b)(2)(C) of
the Affordable Care Act also added section 1895(b)(5)(B) of the Act,
which capped outlier payments as a percent of total payments for each
HHA for each year at 10 percent.
As such, beginning in CY 2011, we reduced payment rates by 5
percent and targeted up to 2.5 percent of total estimated HH PPS
payments to be paid as outliers. To do so, we first returned the 2.5
percent held for the target CY 2010 outlier pool to the national,
standardized 60-day episode rates, the national per visit rates, the
LUPA add-on payment amount, and the NRS conversion factor for CY 2010.
We then reduced the rates by 5 percent as required by section
1895(b)(3)(C) of the Act, as amended by section 3131(b)(1) of the
Affordable Care Act. For CY 2011 and subsequent calendar years we
targeted up to 2.5 percent of estimated total payments to be paid as
outlier payments, and apply a 10-percent agency-level outlier cap.
In the CY 2017 HH PPS proposed and final rules (81 FR 43737 through
43742 and 81 FR 76702), we described our concerns regarding patterns
observed in home health outlier episodes. Specifically, we noted the
methodology for calculating home health outlier payments may have
created a financial incentive for providers to increase the number of
visits during an episode of care in order to surpass the outlier
threshold; and simultaneously created a disincentive for providers to
treat medically complex beneficiaries who require fewer but longer
visits. Given these concerns, in the CY 2017 HH PPS final rule (81 FR
76702), we finalized changes to the methodology used to calculate
outlier payments, using a cost-per-unit approach rather than a cost-
per-visit approach. This change in methodology allows for more accurate
payment for outlier episodes, accounting for both the number of visits
during an episode of care and the length of the visits provided. Using
this approach, we now convert the national per-visit rates into per 15-
minute unit rates. These per 15-minute unit rates are used to calculate
the estimated cost of an episode to determine whether the claim will
receive an outlier payment and the amount of payment for an episode of
care. In conjunction with our finalized policy to change to a cost-per-
unit approach to estimate episode costs and determine whether an
outlier episode should receive outlier payments, in the CY 2017 HH PPS
final rule we also finalized the implementation of a cap on the amount
of time per day that would be counted toward the estimation of an
episode's costs for outlier calculation purposes (81 FR 76725).
Specifically, we limit the amount of time per day (summed across the
six disciplines of care) to 8 hours (32 units) per day when estimating
the cost of an episode for outlier calculation purposes.
In the CY 2017 HH PPS final rule (81 FR 76724), we stated that we
did not plan to re-estimate the average minutes per visit by discipline
every year. Additionally, the per unit rates used to estimate an
episode's cost were updated by the home health update percentage each
year, meaning we would start with the national per visit amounts for
the same calendar year when calculating the
[[Page 77749]]
cost-per-unit used to determine the cost of an episode of care (81 FR
76727). We will continue to monitor the visit length by discipline as
more recent data becomes available and may propose to update the rates
as needed in the future.
In the CY 2019 HH PPS final rule with comment period (83 FR 56521),
we finalized a policy to maintain the current methodology for payment
of high-cost outliers upon implementation of PDGM beginning in CY 2020
and calculated payment for high-cost outliers based upon 30-day period
of care. Upon implementation of the PDGM and 30-day unit of payment, we
finalized the FDL ratio of 0.56 for 30-day periods of care in CY 2020.
Given that CY 2020 was the first year of the PDGM and the change to a
30-day unit of payment, we finalized maintaining the same FDL ratio of
0.56 in CY 2021 as we did not have sufficient CY 2020 data at the time
of CY 2021 rulemaking to propose a change to the FDL ratio for CY 2021.
In the CY 2022 HH PPS final rule with comment period (86 FR 62292), we
estimated that outlier payments would be approximately 1.8 percent of
total HH PPS final rule payments if we maintained an FDL of 0.56 in CY
2022. Therefore, in order to pay up to, but no more than, 2.5 percent
of total payments as outlier payments we finalized an FDL of 0.40 for
CY 2022. In the CY 2023 HH PPS final rule (87 FR 66875), using CY 2021
claims utilization data, we finalized an FDL of 0.35 in order to pay up
to, but no more than, 2.5 percent of the total payment as outlier
payments in CY 2023.
(b) Fixed-Dollar Loss (FDL) Ratio for CY 2024
For a given level of outlier payments, there is a trade-off between
the values selected for the FDL ratio and the loss-sharing ratio. A
high FDL ratio reduces the number of periods that can receive outlier
payments but makes it possible to select a higher loss-sharing ratio,
and therefore, increase outlier payments for qualifying outlier
periods. Alternatively, a lower FDL ratio means that more periods can
qualify for outlier payments, but outlier payments per period must be
lower.
The FDL ratio and the loss-sharing ratio are selected so that the
estimated total outlier payments do not exceed the 2.5 percent
aggregate level (as required by section 1895(b)(5)(A) of the Act).
Historically, we have used a value of 0.80 for the loss-sharing ratio,
which, we believe, preserves incentives for agencies to attempt to
provide care efficiently for outlier cases. With a loss-sharing ratio
of 0.80, Medicare pays 80 percent of the additional estimated costs
that exceed the outlier threshold amount. Using more complete CY 2022
claims data (as of July 15, 2023) and given the statutory requirement
that total outlier payments do not exceed 2.5 percent of the total
payments estimated to be made under the HH PPS, we are finalizing an
FDL ratio of 0.27 percent for CY 2024.
5. Disposable Negative Pressure Wound Therapy
(1) Background
Negative pressure wound therapy (NPWT) is a medical procedure in
which a vacuum dressing is used to enhance and promote healing in
acute, chronic, and burn wounds. The therapy involves using a sealed
wound dressing attached to a pump to create a negative pressure
environment in the wound. Applying continued or intermittent vacuum
pressure helps to increase blood flow to the area and draw out excess
fluid from the wound. This promotes wound healing by preparing the
wound bed for closure, reducing edema, promoting granulation tissue
formation and perfusion, and removing exudate and infectious material.
The wound type and the location of the wound determine whether the
vacuum can either be applied continuously or intermittently. NPWT can
be utilized for varying lengths of time, as indicated by the severity
of the wound, from a few days, up to a span of several months.
The therapy can be administered using the conventional NPWT system,
classified as durable medical equipment (DME), or can be administered
using a disposable device. A disposable NPWT (dNPWT) device is a
single-use integrated system that consists of a non-manual vacuum pump,
a receptacle for collecting exudate, and wound dressings. Unlike
conventional NPWT systems classified as DME, dNPWT devices have preset
continuous negative pressure, no intermittent setting, are pocket-sized
and easily transportable, and are generally battery-operated with
disposable batteries.
In order for a beneficiary to receive dNPWT under the home health
benefit, the beneficiary must qualify for the home health benefit in
accordance with existing eligibility requirements. To be eligible for
Medicare home health services, as set out in sections 1814(a) and
1835(a) of the Act, a physician, nurse practitioner (NP), clinical
nurse specialist (CNS), or physician assistant (PA) (that is, allowed
practitioner) must certify that the Medicare beneficiary (patient)
meets the following criteria:
Is confined to the home.
Needs skilled nursing care on an intermittent basis or
physical therapy or speech-language pathology; or have a continuing
need for occupational therapy.
Is under the care of a physician or allowed practitioner.
Receive services under a plan of care established and
reviewed by a physician or allowed practitioner.
Has had a face-to-face encounter related to the primary
reason for home health care with a physician or allowed provider type
within a required timeframe.
Coverage for dNPWT is determined based upon a physician or allowed
practitioner's order as well as patient preference. Treatment decisions
as to whether to use a dNPWT system versus a conventional NPWT DME
system are determined by the characteristics of the wound, as well as
patient goals and preferences discussed with the ordering physician or
allowed practitioner to best achieve wound healing.
(2) Current Payment for Negative Pressure Wound Therapy Using a
Disposable Device
Prior to CY 2017, a dNPWT system was considered a non-routine
supply and thus payment for the disposable device was included in the
episode payment amount under the previous home health payment system.
However, section 504 of the CAA, 2016 (Pub. L. 114-113) amended both
section 1834 of the Act (42 U.S.C. 1395m) and section 1861(m)(5) of the
Act (42 U.S.C. 1395x(m)(5)), and required a separate payment for an
applicable disposable device when furnished on or after January 1,
2017, to an individual who receives home health services for which
payment is made under the Medicare home health benefit. Therefore, in
the CY 2017 HH PPS final rule (81 FR 76736), we finalized the
implementation of several changes in payment for furnishing dNPWT for a
patient under a home health plan of care beginning in CY 2017, and each
subsequent year. These payment changes included the implementation of a
separate payment amount for dNPWT that was set equal to the amount of
the payment that would be made under the Medicare Hospital Outpatient
Prospective Payment System (OPPS) using the CPT codes 97607 and 97608.
This separate payment amount included furnishing the service as well as
the dNPWT device. As a reminder, codes 97607 and 97608 are defined as
follows:
HCPCS 97607--Negative pressure wound therapy, (for
example, vacuum assisted drainage collection), utilizing disposable,
non-durable medical
[[Page 77750]]
equipment including provision of exudate management collection system,
topical application(s), wound assessment, and instructions for ongoing
care, per session; total wound(s) surface area less than or equal to 50
square centimeters.
HCPCS 97608--Negative pressure wound therapy, (for
example, vacuum assisted drainage collection), utilizing disposable,
non-durable medical equipment including provision of exudate management
collection system, topical application(s), wound assessment, and
instructions for ongoing care, per session; total wound(s) surface area
greater than 50 square centimeters.
We also finalized that for instances where the sole purpose of a
home health visit is to furnish dNPWT, Medicare would not consider this
a visit for purposes of determining full episode payments, LUPAs or
other adjustments, under the HH PPS. Visits performed solely for the
purposes of furnishing a new dNPWT device are not reported on the HH
PPS claim (TOB 32x). Where a home health visit is exclusively for the
purpose of furnishing dNPWT, the HHA submits only a TOB 34x. However,
if the home health visit includes the provision of other home health
services in addition to, and separate from, furnishing dNPWT, the HHA
submits both a TOB 32x and TOB 34x--the TOB 32x for other home health
services and the TOB 34x for furnishing NPWT using a disposable device.
Payment for home health visits related to wound care, but not requiring
the furnishing of an entirely new dNPWT device, are covered by the HH
PPS 30-day period payment and must be billed using the home health
claim.
(3) CAA, 2023
Division FF, section 4136 of the CAA, 2023 (Pub. L. 117-328) amends
section 1834 of the Act (42 U.S.C. 1395m) and mandates several
amendments to the Medicare separate payment for dNPWT devices beginning
in CY 2024. Section 4136(a) of the CAA, 2023 amends 1834(s)(3) of the
Act by adding subparagraph (A) which outlines the calculation of the
payment amounts for (i) years prior to CY 2024, (ii) CY 2024, (iii) CY
2025; and each subsequent year. As discussed previously, for a year
prior to CY 2024, the amount of the separate payment was set equal to
the amount of the payment that would be made under the Medicare
Hospital OPPS using the CPT codes 97607 and 97608 and included the
professional service as well as the furnishing of the device. For CY
2024, the CAA, 2023 requires that the separate payment amount for an
applicable dNPWT device would be set equal to the supply price used to
determine the relative value for the service under the Physician Fee
Schedule (PFS) under section 1848 as of January 1, 2022 (CY 2022)
updated by the specified adjustment described in subparagraph (B) for
such year. For 2025 and each subsequent year, the CAA, 2023 requires
that the separate payment amount will be set equal to the payment
amount established for the device in the previous year, updated by the
specified adjustment described in subparagraph (B) for such year.
Division FF section 4136 of the CAA, 2023 adds a new subparagraph
1834(s)(3)(B), which requires that the separate payment amount to be
adjusted by the percent increase in the CPI-U for the 12-month period
ending with June of the preceding year minus the productivity
adjustment described in section 1886(b)(3)(B)(xi)(II) for such year.
Accordingly, this may result in a percentage being less than 0.0 for a
year and may result in payment being less than such payment rates for
the preceding year.
Section 1834(s)(3)(C) of the Act, as added by Division FF, section
4136 of the CAA, 2023, specifies that the separate payment amount for
applicable devices furnished on or after January 1, 2024, would no
longer include payment for nursing or therapy services described in
section 1861(m) of the Act. Payment for such nursing or therapy
services would now be made under the prospective payment system
established under section 1895 of the Act, the HH PPS, and is no longer
separately billable.
Division FF, section 4136 of the CAA, 2023 also added a new
paragraph 1834(s)(4) of the Act that mandates a change in claims
processing for the separate payment amount for an applicable disposable
device. Beginning in CY 2024 and each subsequent year, claims for the
separate payment amount of an applicable dNPWT device would now be
accepted and processed on claims submitted using the type of bill that
is most commonly used by home health agencies to bill services under a
home health plan of care (TOB 32X). That is, claims with a date of
service on or after January 1, 2024 for an applicable dNPWT device will
no longer be submitted on TOB 34X.
(4) Payment Policies for dNPWT Devices for CY 2024 and Subsequent Years
For the purposes of paying for a dNPWT device for a patient under a
Medicare home health plan of care, CMS proposed that the payment amount
for CY 2024 would be equal to the supply price of the applicable
disposable device under the Medicare PFS (as of January 1, 2022)
updated by the specified adjustment as mandated by the CAA, 2023. The
supply price of an applicable disposable device under the Medicare PFS
for January 1, 2022 listed in the supporting documentation files for
the CY 2022 PFS final rule (86 FR 64966) is $263.25. Therefore, the
payment amount for CY 2024 will be set equal to the amount of $263.25
updated by the percent increase in the CPI-U for the 12-month period
ending in June of 2023 minus the productivity adjustment. The CPI-U for
the 12-month period ending in June of 2023 is 3.0 percent and the
corresponding productivity adjustment is 0.4 percent based on IHS
Global Inc.'s third-quarter 2023 forecast of the CY 2024 productivity
adjustment (which reflects the 10-year moving average of changes in
annual economy-wide private nonfarm business TFP for the period ending
June 30, 2023).\16\ Therefore, the final update percentage will be 2.6
percent.
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\16\ Note: This productivity adjustment is different from home
health as the timeframe for the home health productivity adjustment
is calculated using the 10-year moving average of changes in annual
economy-wide private nonfarm business TFP for the period ending
December 31, 2024.
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[[Page 77751]]
[GRAPHIC] [TIFF OMITTED] TR13NO23.049
We also proposed that the separate payment for CY 2025 and each
subsequent year would be based on the established payment amount for
the previous calendar year updated by the percentage increase in the
CPI-U minus the productivity adjustment for the 12-month period ending
in June of the previous year. The application of productivity
adjustment may result in a net update that may be less than 0.0 for a
year and may result in the separate payment amount under this
subsection for an applicable device for a year being less than such
separate payment amount for such device for the preceding year.
In accordance with the changes made by the CAA, 2023, we proposed
that claims reported for a dNPWT device would no longer be reported on
TOB 34X. Instead, for dates of service beginning on or after January 1,
2024, the HHA would report the Healthcare Common Procedure Coding
System (HCPCS) code A9272 (for the device only) on the home health TOB
32X. The code HCPCS A9272 is defined as a wound suction, disposable,
includes dressing, all accessories and components, any type, each. We
will provide education and develop materials outlining the new billing
procedures for dNPWT under the home health benefit including MLN
Matters[supreg] articles and manual guidance after publication of the
CY 2024 HH PPS final rule.
Finally, we proposed that the services related to the application
of the device would be included in the HH PPS and would be excluded
from the separate payment amount for the device. Only the home health
services for the administration of the device would be geographically
adjusted and the payment amount for HCPCS A9272 would not be subject to
geographic adjustment.
We solicited public comment on all aspects of the proposed payment
policies for furnishing a dNPWT device as articulated in this section,
as well as the corresponding proposed regulations text changes at Sec.
409.50 and Sec. 484.202.
The following is a summary of the public comments received
regarding the new payment policies for dNPWT.
Comment: Commenters were generally supportive of the proposals to
codify the statutorily mandated changes to dNPWT for beneficiaries
under a home health plan of care, stating that the new policies will
promote clarity regarding these services and facilitate collaboration
between providers. A few commenters also requested guidance materials
as soon as possible to ensure that HHAs and vendors have ample time to
make the necessary adjustments in their claim reporting processes.
Response: We thank the commenters for their support. We will issue
a Change Request (CR) outlining the new billing procedures for dNPWT
under the home health benefit and provide educational materials,
including MLN Matters[supreg] articles and manual guidance after
publication of this final rule.
Comment: A commenter requested clarification regarding which
practitioners are authorized to order dNPWT. This commenter noted that
in the preamble language CMS references the pre-CARES Act requirements
that these functions are limited to a physician and wanted to ensure
that nurse practitioners (NPs), clinical nurse specialists (CNSs) and
physician assistants (PAs) are authorized to establish, review, and
certify home health plans of care that include dNPWT, and that home
health beneficiaries receiving dNPWT are authorized to be under the
care of an NP, CNS, or PA.
Response: We thank the commenter for their comment. The term
``allowed practitioner'' was inadvertently omitted from the dNPWT
preamble language. However, the regulations at parts 409, 424, and 484
were amended to implement section 3708 of the CARES Act, which included
defining a nurse practitioner (NP), a clinical nurse specialist (CNS),
and a physician's assistant (PA) (as such qualifications are defined at
Sec. Sec. 410.74 through 410.76) as ``allowed practitioners'' (85 FR
27572). Allowed practitioners in addition to physicians, can certify
and recertify beneficiaries for eligibility, order home health services
(including dNPWT), and establish and review the plan of care.
Comment: A commenter requested further clarification regarding the
billing process for dNPWT. This commenter submitted several questions
regarding how claims should be billed beginning in CY 2024 including,
whether payment for the device would still occur under OPPS and
continue to be captured on TOB 34X; whether CPT codes 97607 and 97608
would continue to be utilized; whether the co-payment would still apply
to the device; how visits would be captured on TOB 32X; if visits
related to the application of the device are required to be identified
as dNPWT visits; and whether wound care centers would be able to
initially apply the dNPWT device.
Response: In the CY 2024 HH PPS proposed rule, we clarified that
HHAs will no longer submit claims on TOB 34X or utilize CPT codes 97607
and 97608 for home health beneficiaries receiving dNPWT. Instead, when
a home health beneficiary receives dNPWT, for dates of service
beginning on or after January 1, 2024, the HHA will report the HCPCS
code A9272 on TOB 32X for the device only. The deductible and
coinsurance will still apply when the dNPWT device is billed using
HCPCS code A9272. Claims for dNPWT sent on TOB 34X with HCPCS codes
97607 or 97608 and claim through dates on or after January 1, 2024 will
be returned to the provider. In addition, services related to the
application of the device will be reported on TOB 32X and are included
in the home health bundled payment. That is, visits for home health
services, including visits for the application for dNPWT, would be
reported as they currently are based on the discipline providing the
service. Therefore, visits for services related to the application of
the dNPWT device are excluded from the separate payment amount for the
device. In situations where wound care centers initially apply the
dNPWT device to beneficiaries who are then referred to
[[Page 77752]]
home health for the continuation of the treatment with dNPWT, the wound
care center would apply the device and bill the appropriate CPT code
(as the patient is not yet under a HH plan of care). However, if the
patient is already under a home health plan of care and goes to the
wound care center for application of the device, then the device should
be billed by the HHA on the TOB 32X and the services would be
considered home health services under the HH PPS.
Final Decision: We are finalizing our proposal to codify the
statutory requirements for dNPWT as proposed. Beginning January 1,
2024, a separate payment for the disposable device will be made to an
HHA for an individual who is under a home health plan of care using
HCPCS code A9272. The CY 2024 payment amount for the device under a
home health plan of care will be $270.09, which is equal to the supply
price of an applicable disposable device under the Medicare PFS for
January 1, 2022, which is $263.25 updated by the final update of 2.6
percent. For 2025 and each subsequent year, the separate payment amount
will be set equal to the payment amount established for the device in
the previous year, updated by the percentage increase in the CPI-U
minus the productivity adjustment for the 12-month period ending in
June of the previous year. Claims reported for a dNPWT device will no
longer be reported on TOB 34X. Instead, for dates of service beginning
on or after January 1, 2024, the HHA would report the HCPCS code A9272
(for the device only) on the home health TOB 32X. The services related
to the application of the device will be included in the home health
payment and will be excluded from the separate payment amount for the
device. We note that only the home health services for the
administration of the device will be geographically adjusted and the
payment amount for HCPCS A9272 (for the device only) will not be
subject to geographic adjustment. We will issue a CR and provide
educational materials outlining the new billing procedures for dNPWT
under the home health benefit including MLN Matters[supreg] articles
and manual guidance after publication of the CY 2024 HH PPS final rule.
III. Home Health Quality Reporting Program (HH QRP)
A. Background and Statutory Authority
The HH QRP is authorized by section 1895(b)(3)(B)(v) of the Act.
Section 1895(b)(3)(B)(v)(II) of the Act requires that, for 2007 and
subsequent years, each home health agency (HHA) submit to the Secretary
in a form and manner, and at a time, specified by the Secretary, such
data that the Secretary determines are appropriate for the measurement
of health care quality. To the extent that an HHA does not submit data
in accordance with this clause, the Secretary shall reduce the home
health market basket percentage increase applicable to the HHA for such
year by 2 percentage points. As provided at section 1895(b)(3)(B)(vi)
of the Act, depending on the home health market basket percentage
increase applicable for a particular year, as further reduced by the
productivity adjustment (except in 2018 and 2020) described in section
1886(b)(3)(B)(xi)(II) of the Act, the reduction of that increase by 2
percentage points for failure to comply with the requirements of the HH
QRP may result in the home health market basket percentage increase
being less than 0.0 percent for a year, and may result in payment rates
under the Home Health PPS for a year being less than payment rates for
the preceding year. Section 1890A of the Act requires that the
Secretary establish and follow a pre-rulemaking process, in
coordination with the consensus-based entity (CBE) with a contract
under section 1890 of the Act, to solicit input from certain groups
regarding the selection of quality and efficiency measures for the HH
QRP. The HH QRP regulations can be found at 42 CFR 484.245 and 484.250.
In this final rule, we are adopting two new measures and removing
one existing measure. Second, we are finalizing the removal of two
OASIS items. Third, we are finalizing a requirement for public
reporting of four measures in the HH QRP. Fourth, we are providing an
update on our efforts to close the health equity gap. Fifth, we are
codifying our 90 percent data submission threshold policy in the Code
of Federal Regulations. Lastly, we discuss responses to our request for
information on principles we could use to select and prioritize HH QRP
quality measures in future years. These proposals are further discussed
as follows.
B. General Considerations Used for the Selection of Quality Measures
for the HH QRP
For a detailed discussion of the considerations we historically use
for measure selection for the HH QRP quality, resource use, and other
measures, we refer readers to the CY 2016 HH PPS final rule (80 FR
68695 through 68696). In the CY 2019 HH PPS final rule with comment
period (83 FR 56548 through 56550), we finalized the factors we
consider for removing previously adopted HH QRP measures.
C. Quality Measures Currently Adopted for the CY 2024 HH QRP
The HH QRP currently includes 20 measures for the CY 2024 program
year, as described in Table C1.
[[Page 77753]]
[GRAPHIC] [TIFF OMITTED] TR13NO23.050
[[Page 77754]]
D. HH QRP Quality Measure Proposals Beginning With the CY 2025 HH QRP
1. Discharge Function Score Measure Beginning With the CY 2025 HH QRP
a. Background
Eligibility for Medicare's home health benefit stipulates that
beneficiaries must need part-time (fewer than eight hours per day) or
intermittent skilled care for their medical conditions and be unable to
leave their homes without considerable effort. Unlike skilled nursing
facilities, a proceeding hospital stay is not required for
beneficiaries to access the Medicare home health benefit.\17\ HH
patients frequently have complex medical issues, including cardiac,
circulatory and respiratory conditions, and between 30-40 percent of HH
patients begin their episode of care with a high level of functional
debility.\18\ Measuring functional status of HH patients can provide
valuable information about an HHA's quality of care. A patient's
functional status is associated with institutionalization,\19\ higher
risk of falls and falls-related hip fracture and death,20 21
greater risk of undernutrition,\22\ higher emergency department
admissions,\23\ higher risk of readmissions following home
care,24 25 and higher prevalence of hypertension and
diabetes.\26\ Predictors of poorer recovery in function include greater
age, complications after hospital discharge, and residence in a nursing
home.\27\ Understanding factors associated with poorer functional
recovery facilitates the ability to estimate expected functional
outcome recovery for patients, based on their personal characteristics.
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\17\ Medicare Payment Advisory Commission. (2022). March 2022
report to the congress: Medicare payment policy. Washington, DC:
Medicare Payment Advisory Commission.
\18\ Medicare Payment Advisory Commission. (2022). March 2022
report to the congress: Medicare payment policy. Washington, DC:
Medicare Payment Advisory Commission.
\19\ Hajek, A., Brettschneider, C., Lange, C., Posselt, T.,
Wiese, B., Steinmann, S., Weyerer, S., Werle, J., Pentzek, M.,
Fuchs, A., Stein, J., Luck, T., Bickel, H., M[ouml]sch, E., Wagner,
M., Jessen, F., Maier, W., Scherer, M., Riedel-Heller, S.G.,
K[ouml]nig, H.H., & AgeCoDe Study Group. (2015). Longitudinal
Predictors of Institutionalization in Old Age. PLoS One,
10(12):e0144203.
\20\ Akahane, M., Maeyashiki, A., Yoshihara, S., Tanaka, Y., &
Imamura, T. (2016). Relationship between difficulties in daily
activities and falling: loco-check as a self-assessment of fall
risk. Interactive Journal of Medical Research, 5(2), e20.
\21\ Zaslavsky, O., Zelber-Sagi, S., Gray, S.L., LaCroix, A.Z.,
Brunner, R.L., Wallace, R.B., . . . Woods, N.F. (2016). Comparison
of Frailty Phenotypes for Prediction of Mortality, Incident Falls,
and Hip Fracture in Older Women. Journal of the American Geriatrics
Society, 64(9), 1858-1862.
\22\ van der Pols-Vijlbrief, R., Wijnhoven, H.A.H., Bosmans,
J.E., Twisk, J.W.R., & Visser, M. (2016). Targeting the underlying
causes of undernutrition. Cost-effectiveness of a multifactorial
personalized intervention in community-dwelling older adults: A
randomized controlled trial. Clinical Nutrition (Edinburgh,
Scotland).
\23\ Hominick, K., McLeod, V., & Rockwood, K. (2016).
Characteristics of older adults admitted to hospital versus those
discharged home, in emergency department patients referred to
internal medicine. Canadian Geriatrics Journal: CGJ, 19(1), 9-14.
\24\ Knox, S., Downer, B., Haas, A., Middleton, A., &
Ottenbacher, K.J. (2020). Function and caregiver support associated
with readmissions during home health for individuals with dementia.
Archives of Physical Medicine and Rehabilitation, 101(6), 1009-1016.
\25\ Middleton, A. Downer, B., Haas, A., Knox, S., &
Ottenbacher, K.J. (2019) Functional status ss associated with 30-day
potentially preventable readmissions following home health care.
Medical Care, 57(2):145-151.
\26\ Halaweh, H., Willen, C., Grimby-Ekman, A., & Svantesson, U.
(2015). Physical activity and health-related quality of life among
community dwelling elderly. J Clin Med Res, 7(11), 845-52.
\27\ C[oacute]rcoles-Jim[eacute]nez, M.P., Villada-Munera, A.,
Del Egido-Fernandez, M.A., Candel-Parra, E., Moreno-Moreno, M.,
Jimenez-Sanchez, M.D., & Pina-Martinez, A. (2015). Recovery of
activities of daily living among older people one year after hip
fracture. Clinical Nursing Research, 24(6), 604-623.
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Home health care can positively impact functional outcomes. There
is evidence the provision of home care services can lead to
statistically significant improvements in function and successful
discharge into the community.\28\ In stroke patients, home-based
rehabilitation programs administered by home health clinicians
significantly improved function.\29\ Home health services, delivered by
a registered nurse positively impacted patient Quality of Life (QOL)
and clinical outcomes, including significant improvement in dressing
lower body and bathing activities of daily living, meal preparation,
shopping, and housekeeping instrumental activities of daily living.\30\
In addition, a retrospective study, using data abstracted from the
Minimum Data Set and OASIS, reported that nursing home admissions were
delayed in the study population receiving home health services by an
average of eight months \31\ and for a similar population, community
dwelling adults receiving community-based services supporting aging in
place, health and functional outcomes were enhanced, and improved
cognition and lower rates of depression, function assistance, and
incontinence were noted.\32\
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\28\ Bowles, K.H., McDonald, M., Barron, Y., Kennedy, E.,
O'Connor, M., & Mikkelsen, M. (2021). Surviving COVID-19 after
hospital discharge: symptom, functional, and adverse outcomes of
home health recipients. Annals of Internal Medicine, 174(3), 316-
325.
\29\ Asiri, F.Y., Marchetti, G.F., Ellis, J.L., Otis, L.,
Sparto, P.J., Watzlaf, V., & Whitney, S.L. (2014). Predictors of
functional and gait outcomes for persons poststroke undergoing home-
based rehabilitation. Journal of Stroke and Cerebrovascular
Diseases: The Official Journal of National Stroke Association,
23(7), 1856-1864.
\30\ C[oacute]rcoles-Jim[eacute]nez, M.P., Villada-Munera, A.,
Del Egido-Fernandez, M.A., Candel-Parra, E., Moreno-Moreno, M.,
Jimenez-Sanchez, M.D., & Pina-Martinez, A. (2015). Recovery of
activities of daily living among older people one year after hip
fracture. Clinical Nursing Research, 24(6), 604-623.
\31\ Asiri, F.Y., Marchetti, G.F., Ellis, J.L., Otis, L.,
Sparto, P.J., Watzlaf, V., & Whitney, S.L. (2014). Predictors of
functional and gait outcomes for persons poststroke undergoing home-
based rehabilitation. Journal of Stroke and Cerebrovascular
Diseases: The Official Journal of National Stroke Association,
23(7), 1856-1864.
\32\ Han, S.J., Kim, H.K., Storfjell, J., & Kim, M.J. (2013).
Clinical outcomes and quality of life of home health care patients.
Asian Nursing Research, 7(2), 53-60.
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To satisfy the requirement of the Improving Medicare Post-Acute
Care Transformation (IMPACT) Act of 2014 (Pub. L. 113-185) to develop
and implement standardized quality measures from five quality measure
domains, including the domain of functional status, cognitive function,
and changes in function and cognitive function, across the post-acute
care (PAC) settings, CMS adopted the ``Application of Percent of Long-
Term Care Hospital Patients with an Admission and Discharge Functional
Assessment and a Care Plan That Addresses Function'' (Application of
Functional Assessment/Care Plan) measure in the CY 2018 HH PPS final
rule (82 FR 51722 through 51727). This cross-setting process measure
allowed for the standardization of functional assessments across
assessment instruments and facilitated cross-setting data collection,
quality measurement, and interoperable data exchange.
However, performance on this measure across the PAC settings,
including the range of HHAs, is so high and unvarying across most HH
providers that the measure no longer offers meaningful distinctions in
performance. Several measures addressing functional status are
currently part of the PAC QRPs. None of the existing functional outcome
measures are cross-setting in nature, in that they are either: (a) not
implemented in all four settings (for instance, the ``Discharge
Mobility and Self-Care Score'' measures are reported for SNFs and IRFs
but not for LTCHs and HHAs); or (b) rely on functional status items not
collected in all settings (for instance, the ``Discharge Mobility and
Self-Care Score'' measures rely on items not collected in LTCHs). In
contrast, a cross-setting functional outcome measure will include the
HH setting. Moreover, the measure specifications will be aligned across
settings, including the use of a common set of standardized functional
assessment data elements, thereby
[[Page 77755]]
satisfying the requirements of the IMPACT Act.
Measure Importance
Maintenance or improvement of physical function among older adults
is increasingly an important focus of healthcare. Worldwide, close to
20 percent of older adults living at home report needing some form of
assistance with their ADLs, and in the US 29 percent of older adults
report difficulties completing their activities of daily living
(ADLs).\33\ Adults aged 65 years and older constitute the most rapidly
growing population in the United States, and functional capacity in
physical (non-psychological) domains has been shown to decline with
age.\34\ Moreover, impaired functional capacity is associated with
poorer quality of life and an increased risk of all-cause mortality,
postoperative complications, and cognition, the latter of which can
complicate the return of a patient to the community from post-acute
care if the patient exhibits cognitive deficits.35 36 37
Nonetheless, evidence suggests that physical functional abilities,
including mobility and self-care, are modifiable predictors of patient
outcomes across PAC settings, including functional recovery or decline
after post-acute care,\38\ \39\ 40 41 42 rehospitalization
rates,43 44 45 discharge to community,46 47 and
falls.\48\
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\33\ Chen, S., Jones, L.A., Jiang, S., Jin, H., Dong, D., Chen,
X., . . . Zhu, A. (2022). Difficulty and help with activities of
daily living among older adults living alone during the COVID-19
pandemic: a multi-country population-based study. BMC geriatrics,
22(1), 1-14.
\34\ High KP, Zieman S, Gurwitz J, Hill C, Lai J, Robinson T,
Schonberg M, Whitson H. Use of Functional Assessment to Define
Therapeutic Goals and Treatment. J Am Geriatr Soc. 2019
Sep;67(9):1782-1790. doi: 10.1111/jgs.15975. Epub 2019 May 13. PMID:
31081938; PMCID: PMC6955596.
\35\ Clouston SA, Brewster P, Kuh D, Richards M, Cooper R, Hardy
R, Rubin MS, Hofer SM. The dynamic relationship between physical
function and cognition in longitudinal aging cohorts. Epidemiol Rev.
2013;35(1):33-50. doi: 10.1093/epirev/mxs004. Epub 2013 Jan 24.
PMID: 23349427; PMCID: PMC3578448.
\36\ Michael YL, Colditz GA, Coakley E, Kawachi I. Health
Behaviors, Social Networks, and Healthy Aging: Cross- Sectional
Evidence from the Nurses' Health Study. Qual Life Res. 1999
Dec;8(8):711-22. doi: 10.1023/a:1008949428041. PMID: 10855345.
\37\ High KP, Zieman S, Gurwitz J, Hill C, Lai J, Robinson T,
Schonberg M, Whitson H. Use of Functional Assessment to Define
Therapeutic Goals and Treatment. J Am Geriatr Soc. 2019
Sep;67(9):1782-1790. doi: 10.1111/jgs.15975. Epub 2019 May 13. PMID:
31081938; PMCID: PMC6955596.
\38\ Deutsch A, Palmer L, Vaughan M, Schwartz C, McMullen T.
Inpatient Rehabilitation Facility Patients' Functional Abilities and
Validity Evaluation of the Standardized Self-Care and Mobility Data
Elements. Arch Phys Med Rehabil. 2022 Feb 11:S0003-9993(22)00205-2.
doi: 10.1016/j.apmr.2022.01.147. Epub ahead of print. PMID:
35157893.
\39\ Hong I, Goodwin JS, Reistetter TA, Kuo YF, Mallinson T,
Karmarkar A, Lin YL, Ottenbacher KJ. Comparison of Functional Status
Improvements Among Patients With Stroke Receiving Postacute Care in
Inpatient Rehabilitation vs Skilled Nursing Facilities. JAMA Netw
Open. 2019 Dec 2;2(12):e1916646. doi: 10.1001/
jamanetworkopen.2019.16646. PMID: 31800069; PMCID: PMC6902754.
\40\ Alcusky M, Ulbricht CM, Lapane KL. Postacute Care Setting,
Facility Characteristics, and Poststroke Outcomes: A Systematic
Review. Arch Phys Med Rehabil. 2018;99(6):1124-1140.e9. doi:
10.1016/j.apmr.2017.09.005. PMID: 28965738; PMCID: PMC5874162.
\41\ Chu CH, Quan AML, McGilton KS. Depression and Functional
Mobility Decline in Long Term Care Home Residents with Dementia: a
Prospective Cohort Study. Can Geriatr J. 2021;24(4):325-331.
doi:10.5770/cgj.24.511. PMID: 34912487; PMCID: PMC8629506.
\42\ Lane NE, Stukel TA, Boyd CM, Wodchis WP. Long-Term Care
Residents' Geriatric Syndromes at Admission and Disablement Over
Time: An Observational Cohort Study. J Gerontol A Biol Sci Med Sci.
2019;74(6):917-923. doi: 10.1093/gerona/gly151. PMID: 29955879;
PMCID: PMC6521919.
\43\ Li CY, Haas A, Pritchard KT, Karmarkar A, Kuo YF, Hreha K,
Ottenbacher KJ. Functional Status Across Post-Acute Settings is
Associated With 30-Day and 90-Day Hospital Readmissions. J Am Med
Dir Assoc. 2021 Dec;22(12):2447-2453.e5. doi: 10.1016/
j.jamda.2021.07.039. Epub 2021 Aug 30. PMID: 34473961; PMCID:
PMC8627458.
\44\ Middleton A, Graham JE, Lin YL, Goodwin JS, Bettger JP,
Deutsch A, Ottenbacher KJ. Motor and Cognitive Functional Status Are
Associated with 30-day Unplanned Rehospitalization Following Post-
Acute Care in Medicare Fee-for-Service Beneficiaries. J Gen Intern
Med. 2016 Dec;31(12):1427-1434. doi: 10.1007/s11606-016-3704-4. Epub
2016 Jul 20. PMID: 27439979; PMCID: PMC5130938.
\45\ Gustavson AM, Malone DJ, Boxer RS, Forster JE, Stevens-
Lapsley JE. Application of High-Intensity Functional Resistance
Training in a Skilled Nursing Facility: An Implementation Study.
Phys Ther. 2020;100(10):1746-1758. doi: 10.1093/ptj/pzaa126. PMID:
32750132; PMCID: PMC7530575.
\46\ Minor M, Jaywant A, Toglia J, Campo M, O'Dell MW. Discharge
Rehabilitation Measures Predict Activity Limitations in Patients
with Stroke Six Months after Inpatient Rehabilitation. Am J Phys Med
Rehabil. 2021 Oct 20. doi: 10.1097/PHM.0000000000001908. Epub ahead
of print. PMID: 34686630.
\47\ Dubin R, Veith JM, Grippi MA, McPeake J, Harhay MO,
Mikkelsen ME. Functional Outcomes, Goals, and Goal Attainment among
Chronically Critically Ill Long-Term Acute Care Hospital Patients.
Ann Am Thorac Soc. 2021;18(12):2041-2048. doi: 10.1513/
AnnalsATS.202011-1412OC. PMID: 33984248; PMCID: PMC8641806.
\48\ Hoffman GJ, Liu H, Alexander NB, Tinetti M, Braun TM, Min
LC. Posthospital Fall Injuries and 30-Day Readmissions in Adults 65
Years and Older. JAMA Netw Open. 2019 May 3;2(5):e194276. doi:
10.1001/jamanetworkopen.2019.4276. PMID: 31125100; PMCID:
PMC6632136.
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The implementation of interventions that improve patients'
functional outcomes and reduce the risks of associated undesirable
outcomes as a part of a patient-centered care plan is essential to
maximizing functional improvement. For many people, the overall goals
of HH care may include optimizing functional improvement, returning to
a previous level of independence, maintaining functional abilities, or
avoiding institutionalization. Studies have suggested that HH care has
the potential to improve patients' functional abilities including the
performance of ADLs at discharge through the provision of physical and
occupational therapy services for community dwelling older adult
patients with various diagnoses, including
dementia.49 50 51 52 53 54 Assessing functional status as a
health outcome in HH can thus provide valuable information in
determining treatment decisions throughout the care continuum, the need
for therapy service, and discharge planning,55 56 57 as well
as
[[Page 77756]]
provide information to consumers about the effectiveness of the care
delivered. Because evidence shows that older adults experience aging
heterogeneously and require individualized and comprehensive health
care, functional status can serve as a vital component in informing the
provision of health care and thus indicate HH quality of
care.58 59 60 61
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\49\ Knox, S., Downer, B., Haas, A., & Ottenbacher, K.J. (2022).
Home health utilization association with discharge to community for
people with dementia. Alzheimer's & Dementia: Translational Research
& Clinical Interventions, 8(1), e12341.
\50\ Prvu Bettger, J., McCoy, L., Smith, E.E., Fonarow, G. C.,
Schwamm, L.H., & Peterson, E.D. (2015). Contemporary trends and
predictors of postacute service use and routine discharge home after
stroke. Journal of the American Heart Association, 4(2), e001038.
\51\ Golding-Day M, Whitehead P, Radford K, Walker M.
Interventions to reduce dependency in bathing in community dwelling
older adults: a systematic review. Syst Rev. 2017 Oct 11;6(1):198.
doi: 10.1186/s13643-017-0586-4. PMID: 29020974; PMCID: PMC5637353.
\52\ Foster, E.R., Carson, L.G., Archer, J., & Hunter, E.G.
(2021). Occupational therapy interventions for instrumental
activities of daily living for adults with Parkinson's disease: A
systematic review. The American Journal of Occupational Therapy,
75(3).
\53\ Anderson, W.L., & Wiener, J.M. (2015). The impact of
assistive technologies on formal and informal home care. The
Gerontologist, 55(3), 422-433.
\54\ Knox, S., Downer, B., Haas, A., Middleton, A., &
Ottenbacher, K.J. (2020). Function and caregiver support associated
with readmissions during home health for individuals with dementia.
Archives of physical medicine and rehabilitation, 101(6), 1009-1016.
\55\ Dubin R, Veith JM, Grippi MA, McPeake J, Harhay MO,
Mikkelsen ME. Functional Outcomes, Goals, and Goal Attainment among
Chronically Critically Ill Long-Term Acute Care Hospital Patients.
Ann Am Thorac Soc. 2021;18(12):2041-2048. doi:10.1513/
AnnalsATS.202011-1412OC. PMID: 33984248; PMCID: PMC8641806.
\56\ Warren M, Knecht J, Verheijde J, Tompkins J. Association of
AM-PAC ``6-Clicks'' Basic Mobility and Daily Activity Scores With
Discharge Destination. Phys Ther. 2021 Apr 4;101(4): pzab043. doi:
10.1093/ptj/pzab043. PMID: 33517463.
\57\ Cogan AM, Weaver JA, McHarg M, Leland NE, Davidson L,
Mallinson T. Association of Length of Stay, Recovery Rate, and
Therapy Time per Day With Functional Outcomes After Hip Fracture
Surgery. JAMA Netw Open. 2020 Jan 3;3(1):e1919672. doi: 10.1001/
jamanetworkopen.2019.19672. PMID: 31977059; PMCID: PMC6991278.
\58\ Chase, J.-A.D., Huang, L., Russell, D., Hanlon, A.,
O'Connor, M., Robinson, K.M., & Bowles, K.H. (2018). Racial/ethnic
disparities in disability outcomes among post-acute home care
patients. Journal of aging and health, 30(9), 1406-1426.
\59\ Fashaw-Walters, S.A., Rahman, M., Gee, G., Mor, V., White,
M., & Thomas, K.S. (2022). Out Of Reach: Inequities In The Use Of
High-Quality Home Health Agencies: Study examines inequities in the
use of high-quality home health agencies. Health Affairs, 41(2),
247-255.
\60\ Criss MG, Wingood M, Staples WH, Southard V, Miller KL,
Norris TL, Avers D, Ciolek CH, Lewis CB, Strunk ER. APTA Geriatrics'
Guiding Principles for Best Practices in Geriatric Physical Therapy:
An Executive Summary. J Geriatr Phys Ther. 2022 Apr-June;45(2):70-
75. doi: 10.1519/JPT.0000000000000342. PMID: 35384940.
\61\ Cogan AM, Weaver JA, McHarg M, Leland NE, Davidson L,
Mallinson T. Association of Length of Stay, Recovery Rate, and
Therapy Time per Day With Functional Outcomes After Hip Fracture
Surgery. JAMA Netw Open. 2020 Jan 3;3(1):e1919672. doi: 10.1001/
jamanetworkopen.2019.19672. PMID: 31977059; PMCID: PMC6991278.
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We are finalizing the adoption of the Discharge Function Score (DC
Function) measure \62\ in the HH QRP beginning with the CY 2025 HHQRP.
This assessment-based outcome measure evaluates functional status by
calculating the percentage of HH patients' quality episodes who meet or
exceed an expected discharge function score. We are finalizing that
this measure will replace the topped-out, cross-setting Application of
Functional Assessment/Care Plan process measure. Like the cross-setting
process measure it is replacing, the final measure is calculated using
standardized patient assessment data from the current HH assessment
tool.
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\62\ Discharge Function Score for Home Health Agencies (HHAs)
Technical Report, which is available at https://www.cms.gov/files/document/hh-discharge-function-score-measure-technical-report.pdf.
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In addition to meeting the requirements of the Act, the DC Function
measure supports current CMS priorities. Specifically, the measure
aligns with the Streamline Quality Measurement domain in CMS's
Meaningful Measures 2.0 framework \63\ in two ways. First, the final
outcome measure will further CMS's objective to increase the proportion
of outcome measures in the HH QRP by replacing the Application of
Functional Assessment/Care Plan cross-setting process measure with an
outcome measure (see Section III.2 of this final rule). Second, this
measure adds no additional provider burden since it will be calculated
using data from the OASIS that are already reported to the Medicare
program for quality reporting purposes.
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\63\ https://www.cms.gov/medicare/meaningful-measures-framework/meaningful-measures-20-moving-measure-reduction-modernization,
accessed February 1, 2023.
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The final DC Function measure will also follow a calculation
approach similar to the existing functional outcome measures.
Specifically, the measure (1) considers two dimensions of function
(that is, self-care and mobility activities) and (2) accounts for
missing data by using statistical imputation to improve the validity of
measure performance. The statistical imputation recodes missing
functional status data to a likely value had the status been assessed,
whereas the current imputation approach implemented in existing
function outcome measures recodes missing data to the lowest functional
status.
b. Measure Testing
Measure testing was conducted on the DC Function measure to assess
validity, reliability, and reportability, all of which informed
stakeholder feedback and Technical Expert Panel (TEP) input (See the
Stakeholder and Technical Expert Panel (TEP) Input section of this
final rule). Validity was assessed for the measure performance, the
risk adjustment model, face validity, and statistical imputation
models. Validity testing of measure performance entailed determining
Spearman's rank correlations between the final measure's performance
and the performance of other publicly reported HH quality measures.
Results indicated that the measure captures the most probable
determination of actual outcomes based on the directionalities and
strengths of correlation coefficients and are further detailed in Table
C2.
[GRAPHIC] [TIFF OMITTED] TR13NO23.051
Validity testing of the risk adjustment model showed good model
discrimination, as the measure model has the predictive ability to
distinguish patients with low expected functional capabilities from
those with high expected functional capabilities.\64\ The ratios of
observed-to-predicted discharge function score across eligible
episodes, by deciles of expected functional capabilities, ranged from
0.98 to 1.01. Both the Cross-Setting Discharge Function TEPs and
patient-family feedback showed strong support for the face validity and
importance of the final measure as an indicator of quality of care.
Lastly, validity testing of the measure's statistical imputation models
indicated that the models demonstrate good discrimination and produce
more precise and accurate estimates of function scores for items with
missing scores when compared to adopting the current imputation
approach implemented in the SNF QRP functional outcome measures,
specifically Change in Self-Care Score measure, Change in Mobility
Score measure, Application of IRF Functional Outcome Measure: Discharge
Self-Care Score for Medical Rehabilitation Patients (CBE ID #2635)
(Discharge Self-Care Score) measure, and Application of IRF Functional
Outcome Measure: Discharge Mobility Score for Medical Rehabilitation
Patients (CBE ID #2636) (Discharge
[[Page 77757]]
Mobility Score) measure. The current imputation approach involves
recoding ``Activity Not Attempted'' (ANA) codes to ``1'' or ``most
dependent.''
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\64\ ``Expected functional capabilities'' is defined as the
predicted discharge function score.
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Reliability and reportability testing also yielded results that
support the measure's scientific acceptability. Split-half testing
revealed the final measure's excellent reliability, indicating an
intraclass correlation coefficient value of 0.94. Reportability testing
indicated good reportability (79 percent) of providers meeting the
public reporting threshold of 20 eligible episodes. For additional
measure testing details, we refer readers to the document titled
Discharge Function Score for Home Health Agencies (HHAs) Technical
Report, which is available at https://www.cms.gov/files/document/hh-discharge-function-score-measure-technical-report.pdf.
c. Competing and Related Measures
Section 1899B(e)(2)(A) of the Act requires that, absent an
exception under section 1899B(e)(2)(B) of the Act, measures specified
under section 1899B of the Act be endorsed by the entity with a
contract under section 1890(a). In the case of a specified area or
medical topic determined appropriate by the Secretary for which a
feasible and practical measure has not been endorsed, section
1899B(e)(2)(B) permits the Secretary to specify a measure that is not
so endorsed, as long as due consideration is given to measures that
have been endorsed or adopted by a consensus organization identified by
the Secretary.
The final DC Function measure is not CBE-endorsed, so we considered
whether there are other available measures that (1) assess both
functional domains of self-care and mobility in HHAs and (2) satisfy
the requirement of the Act to develop and implement standardized
quality measures from the quality measure domain of functional status,
cognitive function, and changes in function and cognitive function
across the PAC settings. While the Application of Functional
Assessment/Care Plan measure assesses both functional domains and
satisfies the Act's requirement, this cross-setting process measure is
not CBE-endorsed and the performance on this measure among HHAs is so
high and unvarying across most providers that the measure does not
offer meaningful distinctions in performance. Additionally, after
review of the CBE's consensus-endorsed measures, we were unable to
identify any CBE-endorsed measures for HHAs that meet the
aforementioned requirements.
Therefore, after consideration of other available measures, we find
that the exception under section 1899B(e)(2)(B) of the Act applies and
propose to adopt the DC Function measure beginning with the CY 2025 HH
QRP. We intend to submit the final measure to the CBE for consideration
of endorsement when feasible.
d. Interested Parties and Technical Expert Panel (TEP) Input
In our development and specification of this measure, we employed a
transparent process in which we sought input from stakeholders and
national experts and engaged in a process that allowed for pre-
rulemaking input, in accordance with section 1890A of the Act. To meet
this requirement, we provided the following opportunities for
stakeholder input: a Patient and Family Engagement Listening Session,
two TEPs, and public comments through a request for information (RFI).
First, the measure development contractor convened a Patient and
Family Engagement Listening Session, during which patients and
caregivers provided views on the measure concept. Participants
expressed support and emphasized the importance of measuring functional
outcomes and found self-care and mobility to be critical aspects of
care. Additionally, they expressed a strong interest in metrics
assessing the number of patients discharged from particular agencies or
facilities with improvements in self-care and mobility, and their views
of self-care and mobility aligned with the functional domains captured
by the final measure. All feedback was used to inform measure
development efforts.
The measure development contractor subsequently convened TEPs on
July 14-15, 2021, and January 26-27, 2022, to obtain expert input on
the development of DC Function measure for use in the HH QRP. The TEPs
consisted of stakeholders with a diverse range of expertise, including
HH and PAC subject matter knowledge, clinical expertise, patient and
family perspectives, and measure development experience. The TEPs
supported the final measure concept and provided substantive feedback
regarding the measure's specifications and measure testing data. First,
the TEP was asked whether they prefer a cross-setting measure that is
modeled after the Inpatient Rehabilitation Facility (IRF) Functional
Outcome Measure: Discharge Mobility Score for Medical Rehabilitation
Patients (CBE ID #2636) (Discharge Mobility Score) and IRF Functional
Outcome Measure: Discharge Self-Care Score for Medical Rehabilitation
Patients (CBE ID #2635) (Discharge Self-Care Score) measures, or one
that is modeled after the IRF Functional Outcome Measure: Change in
Mobility for Medical Rehabilitation Patients (CBE ID #2634) (Change in
Mobility Score) and IRF Functional Outcome Measure: Change in Self-Care
Score for Medical Rehabilitation Patients (CBE ID #2633) (Change in
Self-Care Score). With the Discharge Mobility Score and Change in
Mobility Score measures and the Discharge Self-Care Score and Change in
Self-Care Score measures being both highly correlated and not appearing
to measure unique concepts, the TEP favored the Discharge Mobility
Score and Discharge Self-Care Score measures over the Change in
Mobility Score and Change in Self-Care Score measures and recommended
moving forward with the Discharge Mobility Score and Discharge Self-
Care Score measures for the cross-setting measure. Second, in deciding
on the standardized functional assessment data elements to include in
the cross-setting measure, the TEP recommended removing redundant data
elements. Strong correlations between scores of functional items within
the same functional domain suggested that certain items may be
redundant in eliciting information about patient function and inclusion
of these items could lead to overrepresentation of a particular
functional area. Subsequently, our measure development contractor
focused on the Discharge Mobility Score measure as a starting point for
cross-setting development due to the greater number of cross-setting
standardized functional assessment data elements for mobility while
also identifying redundant functional items that could be removed from
a cross-setting functional measure.
Additionally, the TEP supported including the cross-setting self-
care items such that the cross-setting function measure captures both
self-care and mobility. Panelists agreed that self-care items added
value to the measure and are clinically important to function. Lastly,
the TEP provided refinements to imputation strategies to more
accurately represent function performance across all PAC settings,
including the support of using statistical imputation over the current
imputation approach implemented in existing functional outcome measures
in the PAC QRPs. We considered all the TEP's recommendations for
developing a cross-setting function measure and applied those
recommendations where technically feasible and appropriate. Summaries
of the TEP proceedings
[[Page 77758]]
titled Technical Expert Panel (TEP) for the Refinement of Long-Term
Care Hospital (LTCH), Inpatient Rehabilitation Facility (IRF), Skilled
Nursing Facility (SNF)/Nursing Facility (NF), and Home Health (HH)
Function Measures Summary Report (July 2021 TEP) available at https://mms-test.battelle.org/sites/default/files/TEP-Summary-Report-PAC-Function.pdf and Technical Expert Panel (TEP) for Cross-Setting
Function Measure Development Summary Report (January 2022 TEP)
available at https://mms-test.battelle.org/sites/default/files/PAC-Function-TEP-Summary-Report-Jan2022-508.pdf.
e. Measure Application Partnership (MAP) Review
Our pre-rulemaking process includes making publicly available a
list of quality and efficiency measures, called the MUC List, that the
Secretary is considering adopting through the Federal rulemaking
process for use in Medicare programs. This allows multi-stakeholder
groups to provide recommendations to the Secretary on the measures
included on the list.
We included the DC Function measure under the HH QRP in the
publicly available MUC List for December 1, 2022,\65\ and the CBE
received five comments from industry-connected interested parties on
the 2022 MUC List. Three commenters were supportive of the measure and
two were not. Among the commenters in support of the measure, one
commenter stated that function scores are the most meaningful outcome
measure in the HH setting, as they not only assess patient outcomes but
also can be used for clinical improvement processes. Additionally, the
commenter noted the measure's good reliability and validity and that
the measure is feasible to implement. The second commenter supported
the measure; however, the comments did not appear to be directly
related to any aspect of the measure itself. The third commenter
supported the measure without providing additional detailed comments.
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\65\ Centers for Medicare & Medicaid Services. Overview of the
List of Measures Under Consideration for December 1, 2022. https://mmshub.cms.gov/sites/default/files/2022-MUC-List-Overview.pdf.
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Among the two commenters who did not support the DC Function
measure, a commenter raised the following concerns: the ``gameability''
of the expected discharge score, the measure's complexity, and the
difficulty of implementing a composite functional score. CMS was able
to address these concerns during the MAP PAC/LTC Workgroup Meeting held
on December 12, 2022. Specifically, CMS clarified that the expected
discharge scores are not calculated using self-reported functional
goals and are simply calculated by risk-adjusting the observed
discharge scores (see the Quality Measure Calculation section III.C.1.e
of this final rule). Therefore, CMS believes that these scores cannot
be ``gamed'' by reporting less-ambitious functional goals. CMS also
pointed out that the measure is highly usable as it is similar in
design and complexity to existing function measures (for example,
Discharge Mobility Score and Discharge Self-Care Score for IRF) and
that the data elements used in this measure are already in use.
The other commenter who did not support the DC Function measure
raised the following concerns: its performance for stabilization
patients; and its ability to account for patients that change payer
during a HH episode. CMS was able to address the first concern during
the MAP PAC/LTC Workgroup Meeting held on December 12, 2022.
Specifically, CMS clarified that an episode will contribute to the
numerator of DC Function if the observed discharge score meets or
exceeds the expected discharge score, a value determined using clinical
comorbidity and setting-specific parameters at the start or resumption
of care. These parameters can and do predict no improvement among
stabilization patients, that is, the expected discharge score can and
does occasionally equal the observed admission score if clinical
comorbidity and setting-specific parameters indicate no expected
improvement in the risk adjustment model.
The second concern was not raised during the MAP PAC/LTC Workgroup
Meeting; however, we do not find any convincing evidence that it
influences HHA-level performance for the majority of HHAs. Payer
changes will only affect episodes ending between December 31 and March
31. By comparing HHA-level performance calculated using the full
calendar year versus using a dataset that excludes the dates with
possibly affected episodes (January 1 through March 31 and December
31), we assessed the degree to which this requirement influences
performance. The Spearman correlation coefficient between the two
scenarios is 0.97, and the changes in reliability and validity are
smaller than one percentage point. The results imply that including or
excluding affected episodes does not appear to influence HHA-level
performance for the majority of HHAs. We will continue to monitor this
concern in the future, and we will address it accordingly in the future
if necessary.
Shortly after, several CBE-convened MAP workgroups met virtually to
provide input on the DC Function measure. First, the MAP Health Equity
workgroup convened on December 6-7, 2022. The workgroup did not share
any health equity concerns related to the implementation of the DC
Function measure, and only asked for clarification regarding measure
specifications from measure developers. The MAP Rural Health workgroup
met on December 8-9, 2022, during which two members provided support
for the DC Function measure and other workgroup members did not express
rural health concerns regarding the measure. The MAP Post-Acute Care/
Long-Term Care (PAC-LTC) workgroup met virtually on December 12, 2022
and provided input on the DC Function measure. The workgroup voted to
support the staff recommendation of conditional support for rulemaking.
In response to the MAP PAC/LTC Workgroup's preliminary
recommendation, the CBE received one supportive comment and one non-
supportive comment regarding the DC Function measure. The former
commenter supported the measure under the condition that it be reviewed
and refined so that its implementation would support patient autonomy,
and would result in care that would align with patients' personal
functional goals. The latter commenter was concerned with the
applicability of the measure to the different patient populations
served by the various PAC settings. CMS clarified that the DC Function
measure was not designed to compare function across PAC settings, and
that this feature is not a requirement of the IMPACT Act.
Finally, the MAP Coordinating Committee convened on January 24-25,
2023. The CBE received no comments on the PAC/LTC workgroup's
preliminary recommendation for conditional support of the DC Function
measure. The MAP Coordinating Committee upheld the PAC/LTC workgroup's
recommendation of conditional support for rulemaking with 20 votes in
support and one against. We refer readers to the final MAP
recommendations, titled 2022-2023 MAP Final Recommendations available
at https://mmshub.cms.gov/measure-lifecycle/measure-implementation/pre-rulemaking/lists-and-reports.
f. Quality Measure Calculation
The final outcome measure estimates the percentage of HH patients
who meet
[[Page 77759]]
or exceed an expected discharge score during the reporting period. The
final measure's numerator is the number of HH episodes with an observed
discharge function score that is equal to or higher than the calculated
expected discharge function score. The observed discharge function
score is the sum of individual function items at discharge. The
expected discharge function score is computed by risk adjusting the
SOC/ROC observed discharge function score for each HH episode. Risk
adjustment controls for patient characteristics such as SOC/ROC
function score, age, and clinical conditions. The denominator is the
total number of HH episodes in the measure target period (four rolling
quarters) that do not meet the measure exclusion criteria. For
additional details regarding the numerator, denominator, risk
adjustment, and exclusion criteria, refer to the Discharge Function
Score for Home Health Agencies (HHAs) Technical Report available at
https://www.cms.gov/files/document/hh-discharge-function-score-measure-technical-report.pdf.
The final measure implements a statistical imputation approach for
handling ``missing'' standardized functional assessment data elements.
The coding guidance for standardized functional assessment data
elements allows for using ANA codes, resulting in ``missing''
information about a patient's functional ability on at least some
items, at SOC/ROC and/or discharge, for a substantive portion of HH
patients. Statistical imputation replaces these missing values with a
variable based on the values of other, non-missing variables in the
data and which are otherwise similar to the assessment with a missing
value. In this case, statistical imputation allows missing values (for
example, the ANA codes) to be replaced with any value from 1 to 6,
based on a patient's clinical characteristics and codes assigned on
other standardized functional assessment data element. The measure
implements separate imputation models for each standardized functional
assessment data element used in measure construction at SOC/ROC and
discharge. Relative to the current simple imputation method, this
statistical imputation approach increases precision and accuracy and
reduces the bias in estimates of missing item scores. We refer readers
to the Discharge Function Score for Home Health Agencies (HHAs)
Technical Report available at https://www.cms.gov/files/document/hh-discharge-function-score-measure-technical-report.pdf for measure
specifications and additional details on measure testing, including the
method for comparing the statistical imputation approach to the current
simple imputation method.
We solicited public comment on our proposal to adopt the Discharge
Function Score measure. The following is a summary of the comments we
received on our proposal to adopt the DC Function measure, beginning
with the CY 2025 HH QRP, and our responses.
Comment: Most commenters supported the adoption of the proposed
measure, noting its improvement over the current functional process
measure.
Response: We thank commenters for their support of the adoption of
the DC Function measure.
Comment: A commenter supported the addition of the DC Function
measure and urged CMS to consider using the measure to assess the
adequacy of RN staffing.
Response: CMS appreciates the support and will consider future uses
for the measure, including evaluating the adequacy of RN staffing in
home health.
Comment: Some commenters believed the measure's imputation and
risk-adjustment approach were complex and difficult to understand. A
commenter supported the addition of the DC Function measure, though
encouraged greater transparency on how the DC Function measure was
calculated, and requested that HHAs have immediate access to expected
score calculations. Another commenter suggested that CMS provide
greater transparency on the ``expected'' discharge function score and/
or the imputation method. Two additional commenters opposed the
adoption of the DC Function measure and expressed concern with the
proposed imputation approach. A commenter noted that the measure could
vary significantly from the other metrics currently being reported.
Another commenter expressed concerns that publicly reported measures
should be reflective of actual data gathered and calculated.
Response: We thank the commenter for supporting the adoption of the
DC Function measure, and we appreciate the concerns about transparency
of the imputation calculation. We appreciate that statistical
imputation adds additional steps to the measure's calculation; however,
understanding the technical details of imputation and, separately, the
construction of the expected scores, is not needed to correctly
interpret the measure scores. For those who are interested in the
technical details, the methodology and specifications are available in
the Discharge Function Score for Home Health Agencies (HHAs) Technical
Report.\66\ CMS anticipates baseline performance for CY 2023 will be
shared in July 2024 as part of the HH VBP Model.
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\66\ https://www.cms.gov/files/document/hh-discharge-function-score-measure-technical-report.pdf.
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The imputation approach implemented in the proposed DC Function
measure uses each patient's available functional and clinical
information to estimate each ANA value had the item been completed. An
alternative imputation method currently in place for similarly
designed, CBE-endorsed measures under IRF QRP and SNF QRP imputes all
ANA codes to 1 (dependent). Unlike DC Function, as proposed, this
alternative uses no actual data to impute. Additionally, relative to
this alternative, testing demonstrates that the statistical imputation
approach used in the DC Function measure increases precision and
accuracy and reduces bias in estimates of missing item values.
Comment: Some commenters opposed to the adoption of the DC Function
measure expressed concern that the measure only includes a subset of
function items from the assessment instrument and is concerned that
these items are not necessarily the best indicators of patient
functional success when discharged; for example, functional abilities
and goals that better reflect self-care included upper body dressing
and lower body dressing.
Response: We acknowledge that the cross-setting applicability was a
motivating factor in determining function items captured in the
proposed DC Function measure, and the ``upper body dressing'' and
``lower body dressing'' function items were not available across
settings. Nonetheless, the proposed DC Function measure does reflect
the progress of a patient across both the mobility and selfcare
domains. As stated in section III.D.1.b. of this final rule, the TEP
supported the inclusion of both functional domains, since self-care
items impact mobility items and are clinically relevant to function.
Comment: A commenter opposed to the adoption of the DC Function
measure expressed concern with the amount of compliance burden on HHA
staff to become familiar with the new measure.
Response: We disagree that the adoption of the proposed measure
would result in additional burden or require additional training. We
are not proposing changes to the number of
[[Page 77760]]
items required or the reporting frequency of the items reported in the
OASIS in order to report this measure. In fact, this measure requires
the same set of items that are already reported by HHAs in the OASIS.
Additionally, we calculate this measure and provide HHAs with various
resources to review and monitor their HHA performance on this measure,
including provider preview reports. Therefore, HHAs are not required to
update software to successfully report or monitor performance.
Regarding the commenter's concerns about education, we do plan to
provide educational resources to HHAs about the DC Function measure.
Comment: A few commenters opposed to the adoption of the DC
Function measure noted that the CBE is generally required to endorse
the measure.
Response: We direct readers to section III.D.1.b. of this final
rule, where we discuss the topic of CBE endorsement in detail. Despite
the current absence of CBE endorsement for this measure, we still
believe it is important to adopt the DC Function measure into the HH
QRP because, unlike the Discharge Self-Care Score and Discharge
Mobility Score measures found in both IRF QRP and SNF QRP, the DC
Function measure relies on functional status items collected in all PAC
settings, satisfies the requirement of a cross-setting quality measure
set forth in sections 1888(e)(6)(B)(i)(II) and 1899B(c)(1)(A) of the
Act, and assesses both domains of function. We also acknowledge the
importance of the CBE endorsement process and plan to submit the
proposed measure for CBE endorsement in the future. We direct readers
to section III.D.1.a. of this final rule and the technical report for
detailed measures testing results demonstrating that the measure
provides meaningful information which can be used to improve quality of
care, and to the TEP report summaries 67 68 which detail TEP
support for the proposed measure concept.
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\67\ Technical Expert Panel (TEP) for the Refinement of Long-
Term Care Hospital (LTCH), Inpatient Rehabilitation Facility (IRF),
Skilled Nursing Facility (SNF)/Nursing Facility (NF), and Home
Health (HH) Function Measures Summary Report (July 2021 TEP).
https://mms-test.battelle.org/sites/default/files/TEP-Summary-Report-PAC-Function.pdf.
\68\ Technical Expert Panel (TEP) for Cross-Setting Function
Measure Development Summary Report (January 2022 TEP). https://mmshub.cms.gov/sites/default/files/PAC-Function-TEP-Summary-Report-Jan2022-508.pdf.
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Comment: A few commenters encouraged the incorporation of
maintenance care into the measure. One broadly supportive commenter
suggested CMS examine measure(s) that would better capture both
maintenance and improvement in functional status. Another commenter
opposed the adoption of the DC Function measure due to the belief that
this measure encourages HHAs to favor patients with the potential for
improvement at discharge over those in need of maintenance care. For
this reason, the commenter recommended excluding beneficiaries who do
not have improvement goals.
Response: The DC Function measure does not solely reflect
improvement of patients at discharge. The measure estimates the
percentage of patients who meet, as well as exceed, an expected
discharge function score. In other words, if a patient, based on their
own demographic and clinical characteristics, is expected to maintain,
as opposed to improve in, function, then they will still meet the
numerator criteria for this measure. For many patients, the overall
goals of HHA care may include optimizing functional improvement,
returning to a previous level of independence, maintaining functional
abilities, or avoiding institutionalization. For additional details
regarding risk adjustment, please refer to the Discharge Function Score
for Home Health Agencies (HHAs) Technical Report.\69\
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\69\ https://www.cms.gov/files/document/hh-discharge-function-score-measure-technical-report.pdf.
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Comment: A commenter urged CMS to consider alternative assessments
that better incorporate cognition and communication into the measure
calculation.
Response: We agree that cognition and communication are critically
important and related to the safety and independence of patients.
Although not directly assessed for the purpose of measure calculation,
this measure does indirectly capture an HHA's ability to impact a
patient's cognition and communication to the extent that these factors
are correlated to improvements in self-care and mobility. That said, we
agree that communication and cognition are important to assess
directly, and HHAs currently do so through completion of the Brief
Interview for Mental Status (BIMS) and Confusion Assessment Method
(CAM(copyright)) items in section C of the OASIS. Additionally, we
regularly assess the measures in the HH QRP for measurement gaps, and
we will use feedback technical experts and empirical analyses to
determine how to measure communication and cognition going forward.
Comment: A commenter expressed concern about the inconsistency of
PAC providers' recording of functional assessment information,
especially if the items are used for payment, where incentives may
encourage providers to report codes that are advantageous for financial
reasons. This commenter discouraged CMS reliance on OASIS-based
measures of function for payment or quality measurement until their
accuracy or integrity are improved.
Response: CMS has processes in place to ensure reported patient
data are accurate. The OASIS process has multiple regulatory
requirements to ensure accuracy. Our regulations at Sec. 484.55
require that (1) the assessment must be a comprehensive, accurate
assessment of the patient's status and (2) the assessment must
accurately reflect the patient's status. Because these requirements are
CoPs, failure to comply could result in termination from the Medicare
program.
Comment: A commenter requested CMS provide more clarity on its
imputation approach to recoding, specifically contrasting it with a
Rasch analysis used in the unified PAC PPS prototype, to ensure
transparency and clinical significance.
Response: The Rasch analysis in the unified PAC PPS prototype
produces a single value to which every single ANA is recoded for a
given item across all patients and settings. By contrast, under the
imputation approach for the DC Function measure, we estimate a
different imputed value for each patient, based on their clinical
comorbidities, their score on all other GG items, and setting. We
believe our approach accounts for several likely effects: setting-
specific coding guidance and practice differences; function scores
being correlated with clinical comorbidities; and functional scores for
a given GG item being correlated with functional codes on other GG
items, particularly on ``adjacent'' (similar) items. Therefore, we
believe recoding ANAs based on each patient's specific clinical risk
and using all available GG item scores/codes is a more valid approach.
For more detailed measure specifications, we direct readers to the
document titled Discharge Function Score for Home Health Agencies
(HHAs) Technical Report.\70\
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\70\ https://www.cms.gov/files/document/hh-discharge-function-score-measure-technical-report.pdf.
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[[Page 77761]]
Comment: Eight commenters expressed concern that providers have not
had enough time using the measure prior to use in a performance-based
program like HH VBP.
Response: We thank the commenters for their feedback. As stated in
section III.D.1 of this final rule, the HH QRP is adopting this measure
in CY 2025 HH QRP year with data collection for public reporting
beginning with April 1, 2024 discharges. We are finalizing the adoption
of this measure for the HH VBP Program beginning with the CY 2027
payment year, with data collection beginning with January 1, 2025
discharges. This timeline will enable HHAs to report the data for a
nine months in the HH QRP before they are required to report data for
the HH VBP Program. We believe that reporting this measure in the HH
QRP for this time is sufficient time for providers to gain familiarity
with the measure.
We also note that many of the same commenters did not support the
inclusion of this measure in both the HH QRP and HH VBP Program. We
responded to those more general comments in section III.D.1. of this
final rule. CMS anticipates baseline performance for CY 2023 will be
shared in July 2024 as part of the HH VBP Model.
Comment: A commenter supported the DC Function measure, which
includes components for both self-care and mobility, but recommended
CMS explore separating the measure into individual self-care and
mobility function measures so that providers can better identify
treatment goals.
Response: The HH QRP currently utilizes several ``improvement in
function'' measures that address individual functional activities in
both the self-care and mobility domains. As evidenced in the Discharge
Function Score for Home Health Agencies (HHAs) Technical Report,\71\
the Spearman rank correlation between the DC Function and these
measures range from 0.23 to 0.31, indicating a modest positive
correlation and suggesting that the measures address different aspects
of quality related to function. These differences are by design. Unlike
the ``improvement in function'' measures, which evaluate functional
improvement, DC Function quantifies whether the patient met or exceeded
functional expectations at end of care. Additionally, an HHA can
improve DC Function, as a composite measure, by improving individual
activities while maintaining other activities, while it can only
improve the individual ``improvement in function'' measures by
improving the specific activity being measured. In future years, CMS
may consider developing new measures that quantify whether the patient
met or exceeded expectations at the end of care for individual
functions.
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\71\ https://www.cms.gov/files/document/hh-discharge-function-score-measure-technical-report.pdf.
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Comment: A few other commenters expressed concern regarding the
guidance for the GG items will be confused with those for the M1800
item set, which could lead to data fidelity concerns.
Response: As with all other measures, we will routinely monitor
this measure's performance, including the statistical imputation
approach, to ensure that the measure remains valid and reliable.
Finally, we would like to clarify that the adoption of this measure
does not change how HHAs should complete the GG items. As stated in the
OASIS-E Manual, the ANA codes should only be used after determining
that the activity is not completed, and the performance code cannot be
determined based on patient/caregiver report, collaboration with other
agency staff, or assessment of similar activities. However, we
acknowledge that there will be instances where an ANA code is the most
appropriate response. We regularly review and update the manual as
indicated. Additionally, if HHAs have questions related to the
completion of these items, they can submit questions to the HH QRP Help
Desk at [email protected].
Comment: A commenter requested that CMS redesign DC Function so
that is more equitable.
Response: We recognize that social determinants of health may have
an impact on functional outcomes. Testing indicates that adding social
determinants of health, such as dual eligibility and race/ethnicity,
does not substantively affect provider scores for this measure.
However, we will continue to monitor the impact of the previous
factors, as is feasible, on the measures and incorporate them in
measure calculations, as needed, to ensure the measure remains valid
and reliable.
After careful consideration of the public comments we received, we
are finalizing our proposal to adopt the DC Function measure as an
assessment-based outcome measure beginning with the CY 2025 HH QRP as
proposed.
2. Removal of the ``Application of Percent of Long-Term Care Hospital
Patients With an Admission and Discharge Functional Assessment and a
Care Plan That Addresses Function'' Beginning With the CY 2025 HH QRP
We are finalizing the removal of the ``Application of Percent of
Long-Term Care Hospital Patients with an Admission and Discharge
Functional Assessment and a Care Plan That Addresses Function''
(Application of Functional Assessment/Care Plan) measure from the HH
QRP beginning with the CY 2025 HH QRP. Section 42 CFR 484.245(b)(3) of
our regulations specifies eight factors we consider for measure removal
from the HH QRP, and we believe this measure should be removed because
it satisfies two of these factors.
First, the Application of Functional Assessment/Care Plan measure
meets the conditions for measure removal factor one: measure
performance among HHAs is so high and unvarying that meaningful
distinctions in improvements in performance can no longer be made.\72\
Second, this measure meets the conditions for measure removal factor
six: there is an available measure that is more strongly associated
with desired patient functional outcomes. We believe the DC function
measure discussed previously better measures functional outcomes than
the current Application of Functional Assessment/Care Plan measure.
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\72\ For more information on the factors the Centers for
Medicare & Medicaid Services (CMS) uses to base decisions for
measure removal, we refer readers to the Code of Federal
Regulations, Sec. 484.245(b)(3) https://www.ecfr.gov/current/title-42/chapter-IV/subchapter-G/part-484/subpart-E/section-484.245.
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In regards to removal factor one, the Application of Functional
Assessment/Care Plan measure has become topped out, with average
performance rates reaching nearly 100 percent over the past 3 years
(ranging from 96-98 percent during calendar years (CYs) 2019-2021).\73\
For the 12-month period of third quarter of CY 2021, HHAs had an
average score for this measure of 98 percent, with nearly 75 percent of
HHAs scoring 100 percent. The proximity of these mean rates to the
maximum score of 100 percent suggests a ceiling effect and a lack of
variation that restricts distinction among HHAs.
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\73\ CMS. Home Health Agency Data Archive, 2019-2021, Annual
Files National Data. PDC, https://data.cms.gov/provider-data/archived-data/home-health-services.
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In regards to measure removal factor six, the DC Function measure
is more strongly associated with desired patient functional outcomes
than the current
[[Page 77762]]
process measure, the Application of Functional Assessment/Care Plan
measure. As described in section IIII.D.1.e of this final rule, the DC
Function measure has the predictive ability to distinguish patients
with low expected functional capabilities from those with high expected
functional capabilities.\74\ We have been collecting standardized
functional assessment elements across PAC settings since 2016 which has
allowed for the development of the DC Function measure and meets the
statutory requirements to submit standardized patient assessment data
and other necessary data with respect to the domain of functional
status, cognitive function, and changes in function and cognitive
function. In light of this development, this process measure, the
Application of Functional Assessment/Care Plan measure which measures
only whether a functional assessment is completed and a functional goal
is included in the care plan, is no longer necessary, and can be
replaced with a measure that evaluates the HHA's outcome of care on a
patient's function.
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\74\ ``Expected functional capabilities'' is defined as the
predicted discharge function score.
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Because the Application of Functional Assessment/Care Plan measure
meets measure removal factors one and six, we are finalizing to remove
it from the HH QRP beginning with the CY 2025 HH QRP. We also proposed
that public reporting of the Application of Functional Assessment/Care
Plan measure will end by January 2025 or as soon as technically
feasible when public reporting of the DC Function measure will begin
(see section III.F.2. of this final rule).
HHAs will no longer be required to report a Self-Care Discharge
Goal (that is, GG0130, Column 2) or a Mobility Discharge Goals (that
is, GG0170, Column 2) on the OASIS beginning with patients with SOC/ROC
on January 1, 2025. We will remove the items for Self-Care Discharge
Goals (that is, GG0130, Column 2) and Mobility Discharge Goals (that
is, GG0170, Column 2) with the next release of the OASIS. Under our
proposal, these items will not be required to meet HH QRP requirements
beginning with the CY 2025 HH QRP.
We solicited public comment on our proposal to remove the
Application of Functional Assessment/Care Plan measure from the HH QRP
beginning with the CY 2025 HH QRP. The following is a summary and
responses to comments received for the removal of the Application of
Functional Assessment/Care Plan measure.
Comment: All commenters supported the removal of the measure
Application of Long-Term Care Hospital Patients with an Admission and
Discharge Functional Assessment and a Care Plan That Addresses
Function. Some commenters noted that the measure no longer offers
meaningful distinction between home health providers since performance
is high and unvarying.
Response: We thank commenters for their support of the removal of
the Application of Functional Assessment/Care Plan measure.
After careful consideration of the public comments we received, we
are finalizing our proposal to remove the Application of Functional
Assessment/Care Plan measure from the HH QRP beginning with the CY 2025
HH QRP.
3. COVID-19 Vaccine: Percent of Patients/Residents Who Are Up to Date,
Beginning With the CY 2025 HH QRP
a. Background
COVID-19 has been and continues to be a major challenge for PAC
facilities, including HHAs. The Secretary first declared COVID-19 a PHE
on January 31, 2020. As of March 15, 2023, the U.S. has reported
103,801,821 cumulative cases of COVID-19, and 1,121,512 total deaths
due to COVID-19.\75\ Although all age groups are at risk of contracting
COVID-19, older persons are at a significantly higher risk of mortality
and severe disease following infection, with those over age 80 dying at
five times the average rate.\76\ Older adults, in general, are prone to
both acute and chronic infections owing to reduced immunity, and are a
high-risk population.\77\ Adults age 65 and older comprise over 75% of
total COVID-19 deaths despite representing 13.4% of reported cases.\78\
Restrictions on freedom of movement and physical distancing can lead to
a disruption of essential care and support for older persons. Physical
distancing measures that restrict visitors and group activities can
negatively affect the physical and mental health and well-being of
older persons, particularly those with cognitive decline or dementia,
and who are highly care-dependent.\79\
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\75\ Centers for Disease Control and Prevention. COVID Data
Tracker. 2023, January 20. Last accessed March 23, 2023. https://covid.cdc.gov/covid-data-tracker/#cases_totalcases.
\76\ United Nations. Policy Brief: The impact of COVID-19 on
older persons. May 2020. https://unsdg.un.org/sites/default/files/2020-05/Policy-Brief-The-Impact-of-COVID-19-on-Older-Persons.pdf.
\77\ Lekamwasam R, Lekamwasam S. Effects of COVID-19 pandemic on
health and wellbeing of older people: a comprehensive review. Ann
Geriatr Med Res. 2020;24(3):166-172. http://dx.doi.org/10.4235/agmr.20.0027. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7533189/.
\78\ Centers for Disease Control and Prevention. Demographic
trends of COVID-19 cases and deaths in the US reported to CDC. COVID
Data Tracker. 2023, March 15. Last accessed March 23, 2023. https://covid.cdc.gov/covid-data-tracker/#demographics.
\79\ United Nations. Policy Brief: The impact of COVID-19 on
older persons. May 2020. https://unsdg.un.org/sites/default/files/2020-05/Policy-Brief-The-Impact-of-COVID-19-on-Older-Persons.pdf.
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Since the development of the vaccines to combat COVID-19, studies
have shown that being up to date on these vaccines continues to provide
strong protection against severe disease, hospitalization, and death in
adults, including during the predominance of Omicron BA.4 and BA.5
variants.\80\ Initial studies showed the efficacy of FDA-approved
COVID-19 vaccines in reducing the risk of severe outcomes caused by
COVID-19. Further, residents at skilled nursing facilities (SNF) with
high rates of staff testing for COVID-19 were less likely to be
hospitalized or die due to COVID-19 than their counterparts in SNFs
with low rates of staff testing. Prior to the emergence of the Delta
variant of the virus, vaccine effectiveness against COVID-19-associated
hospitalization among adults age 65 and older was 91% for those
receiving a full mRNA vaccination (Pfizer-BioNTech or Moderna), and 84%
for those receiving a viral vector vaccination (Janssen). Adults age 65
and older who were fully vaccinated with an mRNA COVID-19 vaccine had a
94% reduction in risk of COVID-19 hospitalization; those who were
partially vaccinated had a 64% reduction in risk.\81\ Further, after
the emergence of the Delta variant, vaccine effectiveness against
COVID-19-associated hospitalization for adults who received the primary
series of the vaccine was 76% among adults age 75 and older.\82\
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\80\ Chalkias S, Harper C, Vrbicky K, et al. A bivalent omicron-
containing booster vaccine against COVID-19. N Engl J Med.
2022;387(14):1279-1291. doi: 10.0156/NEJMoa2208343. https://www.nejm.org/doi/full/10.1056/NEJMoa2208343.
\81\ Centers for Disease Control and Prevention. Press Release,
April 28, 2021. Fully Vaccinated Adults 65 and Older are 94% Less
Likely to Be Hospitalized with COVID-19. https://www.cdc.gov/media/releases/2021/p0428-vaccinated-adults-less-hospitalized.html.
\82\ Vaccine effectiveness after the emergence of the Delta
variant is based on data from CDC's VISION Network, which examined
32,867 medical encounters from 187 hospitals and 221 emergency
departments and urgent care clinics across nine states during June-
August 2021, beginning on the date the Delta variant accounted for
over 50% of sequenced isolates in each medical facility's state
(Grannis SJ, et al. MMWR Morb Mortal Wkly Rep. 2021;70(37):1291-
1293. doi: http://dx.doi.org/10.15585/mmwr.mm7037e2).
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More recently, since the emergence of the Omicron variants and
availability of
[[Page 77763]]
booster doses, multiple studies have shown that while vaccine
effectiveness against infection has waned, protection is higher among
those receiving booster doses than among those only receiving the
primary series.83 84 85 CDC data show that, among people age
50 and older, those who have received both a primary vaccination series
and booster shots have a lower risk of hospitalization and dying from
COVID-19 than their non-vaccinated counterparts.\86\ Additionally, a
second vaccine booster has been shown to be effective against severe
outcomes related to COVID-19, such as hospitalization or death.\87\
Furthermore, more recent vaccination and booster doses can decrease the
rate of COVID-19 transmission between individuals in close contact.\88\
Early evidence also demonstrates that the bivalent booster,
specifically aimed to combat the prevalent BA.4/BA.5 Omicron
subvariants, provokes a superior antibody response against Omicron than
the initial COVID-19 vaccines, underscoring, the role of up-to-date
vaccination protocols in effectively countering the spread of COVID-
19.\89\
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\83\ Surie D, Bonnell L, Adams K, et al. Effectiveness of
monovalent mRNA vaccines against COVID-19-associated hospitalization
among immunocompetent adults during BA.1/BA.2 and BA.4/BA.5
predominant periods of SARS-CoV-2 Omicron variant in the United
States--IVY Network, 18 states, December 26, 2021-August 31, 2022.
MMWR Morb Mortal Wkly Rep. 2022;71(42):1327-1334. http://dx.doi.org/10.15585/mmwr.mm7142a3.
\84\ Andrews N, Stowe J, Kirsebom F, et al. Covid-19 vaccine
effectiveness against the Omicron (B.1.1.529) variant. N Engl J Med.
2022;386(16):1532-1546. https://www.nejm.org/doi/full/10.1056/NEJMoa2119451.
\85\ Buchan SA, Chung H, Brown KA, et al. Estimated
effectiveness of COVID-19 vaccines against Omicron or Delta
symptomatic infection and severe outcomes. JAMA Netw Open.
2022;5(9):e2232760. http://dx.doi.org/10.1001/jamanetworkopen.2022.32760. https://jamanetwork.com/journals/jamanetworkopen/fullarticle/2796615.
\86\ Centers for Disease Control and Prevention. Daily update
for the United States. COVID Data Tracker. 2023, January 20. Last
accessed January 17, 2023. https://covid.cdc.gov/covid-data-tracker.
\87\ Centers for Disease Control and Prevention. COVID-19
vaccine effectiveness monthly update. COVID Data Tracker. March 23,
2023. https://covid.cdc.gov/covid-data-tracker/#vaccine-effectiveness.
\88\ Tan ST., Kwan AT, Rodriguez-Barraquer I, et al.
Infectiousness of SARS-CoV-2 breakthrough infections and
reinfections during the Omicron wave. Preprint at medRxiv:
\89\ Chalkias S, Harper C, Vrbicky K, et al. A bivalent Omicron-
containing booster vaccine against COVID-19. N Engl J Med
2022;387(14):1279-1291. doi: 10.0156/NEJMoa2208343. https://www.nejm.org/doi/full/10.1056/NEJMoa2208343.
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(1) Measure Importance
Despite the availability and demonstrated effectiveness of COVID-19
vaccinations, significant gaps continue to exist in vaccination
rates.\90\ As of March 15, 2023, vaccination rates among people age 65
and older are generally high for the primary vaccination series (94.3%)
but lower for the first booster (73.6%) among those who received a
primary series) and even lower for the second booster (59.9%) among
those who received a first booster).\91\ Additionally, though the
uptake in boosters among people age 65 and older has been much higher
than among people of other ages, booster uptake still remains
relatively low compared to primary vaccination among older adults.\92\
Variations are also present when examining vaccination rates by race,
gender, and geographic location.\93\ For example, 66.2% of the Asian,
non-Hispanic population have completed the primary series and 21.2%
have received the bivalent booster dose, whereas 44.9% of the Black,
non-Hispanic population have completed the primary series and only 8.9%
have received the bivalent booster dose. Among Hispanic populations,
57.1% of the population have completed the primary series, with 8.5%
receiving the bivalent booster dose, while in White, non-Hispanic
populations, 51.9% have completed the primary series and 16.2% have
received the bivalent booster dose.\94\ Disparities have been found in
vaccination rates between rural and urban areas, with lower vaccination
rates found in rural areas.95 96 Data show that 55.1% of the
population in rural areas have completed the primary vaccination
series, as compared to 66.2% of the population in urban areas.\97\
Receipt of first booster doses was similar between urban (50.4%) and
rural (49.7%) counties.\98\ Receipt of bivalent booster doses has been
lower, with 16.9% of urban population having received the booster dose,
and 10.9% of the rural population having received the booster dose.\99\
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\90\ Centers for Disease Control and Prevention. COVID-19
vaccinations in the United States. COVID Data Tracker. March 23,
2023. https://covid.cdc.gov/covid-data-tracker/#vaccinations_vacc-people-booster-percent-pop5.
\91\ Centers for Disease Control and Prevention. COVID-19
vaccination age and sex trends in the United States, national and
jurisdictional. Last accessed March 24, 2023. Vaccination Trends.
\92\ Freed M, Neuman T, Kates J, Cubanski J. Deaths among older
adults due to COVID-19 jumped during the summer of 2022 before
falling somewhat in September. Kaiser Family Foundation. October 6,
2022. https://www.kff.org/coronavirus-covid-19/issue-brief/deaths-among-older-adults-due-to-covid-19-jumped-during-the-summer-of-2022-before-falling-somewhat-in-september/.
\93\ Saelee R, Zell E, Murthy BP, et al. Disparities in COVID-19
vaccination coverage between urban and rural counties--United
States, December 14, 2020-January 31, 2022. MMWR Morb Mortal Wkly
Rep. 2022;71:335-340. http://dx.doi.org/10.15585/mmwr.mm7109a2.
\94\ Centers for Disease Control and Prevention. Trends in
Demographic Characteristics of People Receiving COVID-19
Vaccinations in the United States. COVID Data Tracker. 2023, January
20. Last accessed March 23, 2023. https://covid.cdc.gov/covid-data-tracker/#vaccination-demographics-trends.
\95\ Saelee R, Zell E, Murthy BP, et al. Disparities in COVID-19
vaccination coverage between urban and rural counties--United
States, December 14, 2020-January 31, 2022. MMWR Morb Mortal Wkly
Rep. 2022;71:335-340. DOI: http://dx.doi.org/10.15585/mmwr.mm7109a2.
\96\ Sun Y, Monnat SM. Rural-urban and within-rural differences
in COVID-19 vaccination rates. J Rural Health. 2022;38(4):916-922.
http://dx.doi.org/10.1111/jrh.12625. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC8661570/.
\97\ Centers for Disease Control and Prevention. Vaccination
Equity. COVID Data Tracker; 2023, January 20. Last accessed January
17, 2023. https://covid.cdc.gov/covid-data-tracker/#vaccination-equity.
\98\ Saelee R, Zell E, Murthy BP, et al. Disparities in COVID-19
vaccination coverage between urban and rural counties--United
States, December 14, 2020-January 31, 2022. MMWR Morb Mortal Wkly
Rep. 2022;71:335-340. http://dx.doi.org/10.15585/mmwr.mm7109a2.
\99\ Centers for Disease Control and Prevention. Vaccination
Equity. COVID Data Tracker; 2023, January 20. Last accessed January
17, 2023. https://covid.cdc.gov/covid-data-tracker/#vaccination-equity.
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We proposed to adopt the COVID-19 Vaccine: Percent of Patients/
Residents who are Up to Date (Patient/Resident COVID-19 Vaccine)
measure for the HH QRP beginning with the CY 2025 HH QRP. This final
measure has the potential to increase COVID-19 vaccination coverage of
patients in HHAs. This final measure also has the potential to prevent
the spread of the virus within the HHA patient population. Although
this population receives services within their own homes, they can
transfer the virus to their caretakers and home healthcare workers, who
could then potentially infect other home health patients. The COVID-19
Vaccine measure will also support the goal of the CMS Meaningful
Measure Initiative 2.0 to ``Empower consumers to make good health care
choices through patient-directed quality measures and public
transparency objectives.'' The Patient/Resident COVID-19 Vaccine
measure will be reported on Care Compare an interactive web tool that
assists individuals by providing information on quality of care. For
more information on Care Compare, we refer readers to our website at:
https://www.medicare.gov/care-compare/. This will provide patients,
including those who are at high risk for developing serious
complications from COVID-19, and their caregivers, with valuable
information they can consider when choosing a HHA. The Patient/Resident
[[Page 77764]]
COVID-19 vaccine measure will also facilitate patient care and care
coordination during the hospital discharge planning process. For
example, a discharging hospital, in collaboration with the patient and
family, could use this measure to coordinate care and ensure patient
preferences are considered in the discharge plan. Additionally, the
Patient/Resident COVID-19 Vaccine measure will be an indirect measure
of HHA action. Since the patient's COVID-19 vaccination status will be
reported at discharge from the HHA, if a patient is not up to date with
their COVID-19 vaccination per applicable CDC guidance at the time they
are admitted, the HHA has the opportunity to educate the patient and
provide information on why they should become up to date with their
COVID-19 vaccination. HHAs may also choose to administer the vaccine to
the patient prior to their discharge from the HHA or coordinate a
follow up visit for the patient to obtain the vaccine at their
physician's office or local pharmacy.
(2) Item Testing
Item testing was conducted for the Patient/Resident COVID-19
Vaccine measure using patient scenarios and cognitive interviews to
assess HHA providers' comprehension of the item and the associated
guidance. The patient scenarios were developed in collaboration with a
team of clinical experts and represented the most common scenarios HHA
staff encounter. The results of the item testing supported its
reliability, and provided information to improve the item itself, as
well as the accompanying guidance.
b. Competing and Related Measures
Section 1899B(e)(2)(A) of the Act requires that, absent an
exception under section 1899B(e)(2)(B) of the Act, each measure
specified under section 1899B of the Act be endorsed by the entity with
a contract under section 1890(a) of the Act. In the case of a specified
area or medical topic determined appropriate by the Secretary for which
a feasible and practical measure has not been endorsed, section
1899B(e)(2)(B) of the Act permits the Secretary to specify a measure
that is not so endorsed, as long as due consideration is given to the
measures that have been endorsed or adopted by a consensus organization
identified by the Secretary.
The Patient/Resident COVID-19 Vaccine measure is not consensus-
based entity (CBE) endorsed. After review of other CBE endorsed
measures, we were unable to identify any CBE endorsed measures for HHAs
focused on capturing COVID-19 vaccination coverage of HHA patients and
found no related measures in the HH QRP addressing COVID-19
vaccination. There have been COVID-19 Vaccination Coverage among
Healthcare Personnel (HCP) measures adopted by the Skilled Nursing
Facility (SNF) QRP, the Inpatient Rehabilitation Facility (QRP) and the
Long-term Care Hospital (LTCH) QRP that captures the percentage of HCPs
who receive a complete COVID-19 vaccination course. HHAs do not
currently report patient/resident or HCP COVID-19 vaccination data.
Therefore, after consideration of other available measures that
assess COVID-19 vaccination rates, we believe the exception under
section 1899B(e)(2)(B) of the Act applies. We intend to submit the
measure for CBE endorsement when feasible.
c. Interested Parties and Technical Expert Panel (TEP) Input
In the development and specification of this measure, a transparent
process was employed to seek input from interested parties and national
experts and engage in a process that allows for pre-rulemaking input in
accordance with section 1890A of the Act. First, the measure
development contractor convened a focus group of patient and family/
caregiver advocates (PFAs) to solicit input. The PFAs believe a measure
capturing raw vaccination rate, irrespective of HHA action, will be
most helpful in patient and family/caregiver decision-making. Next, TEP
meetings were held on November 19, 2021 and December 15, 2021 to
solicit feedback on the development of Patient/Resident COVID-19
vaccination measures and assessment items for the PAC settings. The TEP
panelists voiced their support for PAC Patient/Resident COVID-19
vaccination measures and agreed that developing a measure to report the
rate of vaccination in an HHA setting without denominator exclusions
was an important goal. All recommendations from the TEP were taken into
consideration and applied appropriately where technically feasible and
appropriate. A summary of the TEP proceedings titled Technical Expert
Panel (TEP) for the Development of Long-Term Care Hospital (LTCH),
Inpatient Rehabilitation Facility (IRF), Skilled Nursing Facility
(SNF)/Nursing Facility (NF), and Home Health (HH) COVID-19 Vaccination-
Related Items and Measures Summary Report is available on the CMS
Measures Management System (MMS) Hub. at https://mmshub.cms.gov/sites/default/files/COVID19-Patient-Level-Vaccination-TEP-Summary-Report-NovDec2021.pdf.
d. Measures Applications Partnership Review
The pre-rulemaking process includes making publicly available a
list of quality and efficiency measures, called the Measures Under
Consideration (MUC) List that the Secretary is considering adopting,
through Federal rulemaking process, for use in Medicare programs. This
allows interested parties to provide recommendations to the Secretary
on the measures included on the list. The Patient/Resident COVID-19
Vaccine measure was included on the publicly available 2022 MUC List
for the HH QRP.\100\ Shortly after, several CBE-convened MAP workgroups
met virtually to provide input on the measure. First, the MAP Health
Equity advisory group convened on December 6, 2022. One MAP member
noted that the percentage of true contraindications for the COVID-19
vaccine is low, and the lack of exclusions on the measure makes sense
to avoid varying interpretations of valid contraindications.\101\
Similarly, the MAP Rural Health advisory group met on December 8, 2022
and publicly stated that the measure is important for rural
communities.\102\
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\100\ CMS Measures Management System (MMS). Measure
Implementation: Pre-rulemaking MUC Lists and MAP reports. Last
accessed March 23, 2023 https://mmshub.cms.gov/measure-lifecycle/measure-implementation/pre-rulemaking/lists-and-reports.
\101\ National Quality Forum MAP Health Equity Advisory Group
Materials. Meeting Summary--MUC Review Meeting. Last accessed March
23, 2023. https://www.qualityforum.org/WorkArea/linkit.aspx?LinkIdentifier=id&ItemID=97943.
\102\ National Quality Forum MAP Rural Health Advisory Group
Materials. Meeting Summary--MUC Review Meeting. Last accessed March
23, 2023. https://www.qualityforum.org/WorkArea/linkit.aspx?LinkIdentifier=id&ItemID=97964.
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Prior to convening the MAP PAC/LTC workgroup, the CBE received
seven comments by industry interested parties during the measure's MAP
pre-rulemaking process. Interested parties were mostly supportive of
the measure and recognized that it is important that patients be
vaccinated against COVID-19, and that measurement and reporting is one
important method to help healthcare organizations assess their
performance in achieving high rates of ``up-to-date'' vaccination. One
interested party noted that patient engagement is critical at this
stage of the pandemic because best available information indicates
COVID-19 variants will continue to require additional boosters to avert
case surges. Another interested party noted the benefit of less-
specific criteria for
[[Page 77765]]
inclusion in the numerator and denominator of the Patient/Resident
COVID-19 Vaccine measure, which will provide flexibility for the
measure to remain relevant to current circumstances. Other interested
parties raised concerns about the measure not including measuring the
HHA's action in the numerator and excluding patient refusals from the
denominator, and noted that there could be unintended consequences to
patient access to care should the measure be adopted.
Subsequently, the MAP Post-Acute Care/Long-Term Care (PAC/LTC)
workgroup met on December 12, 2022. The voting workgroup members noted
the importance of reporting patients' vaccination status but raised
concerns that (1) the proposed Patient/Resident COVID-19 Vaccine
measure does not account for patient refusals or those who are unable
to respond, and (2) the difficulty of implementing ``up to date.'' CMS
clarified during the MAP PAC/LTC workgroup meeting that the proposed
Patient/Resident COVID-19 Vaccine measure does not have exclusions for
patient refusals because the proposed measure was intended to report
raw rates of vaccination and this information is important for consumer
choice. Additionally, CMS believes that PAC providers, including HHAs,
are in a unique position to leverage their care processes to increase
vaccination coverage in their settings to protect patients and prevent
negative outcomes. CMS also clarified that the measure defines ``up to
date'' in a manner that provides flexibility to reflect future changes
in CDC guidance. However, the MAP PAC/LTC workgroup reached a 60
percent majority on the vote of ``Do not support for rulemaking'' for
this measure.\103\
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\103\ National Quality Forum MAP Post-Acute Care/Long Term Care
Workgroup Materials. Meeting Summary--MUC Review Meeting. Last
accessed March 23, 2023. https://www.qualityforum.org/WorkArea/linkit.aspx?LinkIdentifier=id&ItemID=97960.
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The MAP received 10 comments by interested parties in response to
the MAP PAC/LTC workgroup recommendations. Interested parties generally
understood the importance of COVID-19 vaccinations in preventing the
spread of COVID-19 infections. However, a majority of commenters did
not recommend the inclusion of this measure for the HH QRP and raised
several concerns. Specifically, several commenters were concerned about
vaccine hesitancy, HHAs' inability to influence measure results based
on factors outside of their control. Commenters also noted that the
proposed Patient/Resident COVID-19 Vaccine measure has not been fully
tested, and encouraged CMS to monitor the measure for unintended
consequences and ensure that the measure has meaningful results. A
commenter was in support of the proposed Patient/Resident COVID-19
Vaccine measure and provided recommendations for CMS to consider.
Including an exclusion for medical contraindications and submitting the
measure for CBE endorsement.
Finally, the MAP Coordinating Committee convened on January 24,
2023, and raised concerns which were previously discussed in the PAC/
LTC workgroup, such as potential for selection bias based on the
patient's vaccination status. CMS noted that this measure does not have
exclusions for patient refusals, since this is a process measure
intended to report raw rates of vaccination, and is not intended to be
an HHA action measure. CMS acknowledged that a measure accounting for
variables (such as HHA actions to vaccinate patients) could be
important, but CMS is focused on a measure which will provide and
publicly report vaccination rates for consumers given the importance of
this information to patients and their caregivers.
The MAP Coordinating Committee recommended three changes to make
the Patient/Resident COVID-19 Vaccine measure acceptable to the
Committee: (i) reconsider exclusions for medical contraindications,
(ii) complete reliability and validity measure testing, and (iii) seek
CBE endorsement. The MAP Coordinating Committee ultimately reached
majority on its voted recommendation of `Do not support with potential
for mitigation.' We refer readers to the final MAP recommendations,
titled 2022-2023 MAP Final Recommendations \104\ and the MAP Final
Report.\105\ Despite the Coordinating Committee's vote, we believe it
is still important to propose the Patient/Resident COVID-19 Vaccine
measure for the HH QRP. As we stated in section III.C.3.e of this final
rule, we did not include exclusions for medical contraindications
because the PFAs we met with told us that a measure capturing raw
vaccination rate, irrespective of any medical contraindications, will
be most helpful in patient and family/caregiver decision-making. We do
plan to conduct reliability and validity measure testing once we have
collected enough data and intend to submit the measure to the CBE for
consideration of endorsement when feasible.
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\104\ 2022-2023 MAP Final Recommendations, can be found at
https://www.qualityforum.org/map/.
\105\ The Final MAP Report is available at https://www.qualityforum.org/WorkArea/linkit.aspx?LinkIdentifier=id&ItemID=98102.
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e. Quality Measure Calculation
The proposed Patient/Resident COVID-19 Vaccine measure is an
assessment-based process measure that reports the percent of home
health patients that are up to date on their COVID-19 vaccinations per
CDC's latest guidance.\106\ This measure has no exclusions and is not
risk adjusted.
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\106\ The definition of ``up to date'' may change based on CDC's
latest guidelines and can be found on the CDC web page, ``Stay Up to
Date with COVID-19 Vaccines Including Boosters,'' at https://www.cdc.gov/coronavirus/2019-ncov/vaccines/stay-up-to-date.html
(updated March 2, 2023).
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The numerator for this measure will be the total number of home
health patients that are up to date with the COVID-19 vaccine during
the reporting period. The denominator for the measure will be the total
number of home health quality episodes with an End of Care OASIS
(Discharge, Transfer or Death at Home) during the reporting period.
The data source for the final Patient/Resident COVID-19 Vaccine
measure is the OASIS assessment instrument for home health patients.
For more information about the final data submission requirements, we
refer readers to section III.E.2 of this final rule. For additional
technical information about this proposed measure, we refer readers to
the draft measure specifications document titled Patient-Resident-
COVID-Vaccine-Draft-Specs.pdf available at: https://www.cms.gov/files/document/patient-covid-vaccine-measure-hh-qrp-specifications.pdf.
We solicited public comments on our proposal to adopt the COVID-19
Vaccine: Percent of Patients/Residents Who Are Up to Date measure
beginning with the CY 2025 HH QRP. The following is a summary of the
comments we received on our proposal to adopt the COVID-19 Vaccine:
Percent of Patients/Residents Who Are Up to Date measure and responses
to comments.
Comment: Commenters who supported the Patient/Resident COVID-19
vaccine QM noted the continued risk of infection, particularly among
older adults, and demonstrated effectiveness of the vaccine were cited
as the main reasons for supporting this CMS proposal. Additionally,
respondents stated that public reporting of this data will be
beneficial to patients and caregivers when making decisions about
choosing an HHA since this would help to incentivize agencies to
provide
[[Page 77766]]
quality education on vaccination to beneficiaries.
Response: We thank the commenters for their support and agree that
the Patient/Resident COVID-19 Vaccine measure would provide patients
and caregivers, including those who are at high risk for developing
serious complications from COVID-19, with valuable information they can
consider when choosing an HHA.
Comment: Some commenters opposed the COVID-19 resident/patient
measure because it does not have exclusions, specifically for those who
have religious exemptions, for medical contraindications, and for
refusals.
Response: As we stated in section III.3.e of this CY 2024 HH PPS
final rule, we did not include exclusions for medical contraindications
because feedback from a patient and family focus group that provided
feedback on the measure emphasized that a measure capturing raw
vaccination rate, irrespective of any medical contraindications, would
be most helpful in patient and family/caregiver decision-making. Based
on this feedback, we believe excluding patients/residents with
contraindications from the measure would distort the intent of the
measure of providing raw COVID-19 patient vaccination rates, while
making the information more difficult for residents/caregivers to
interpret, and hence did not include any exclusions.
Comment: Some commenters opposed the measure because of burden
concerns. The inclusion of another data element in OASIS and
documentation of compliance with the continually changing definition of
``up to date'' were described as likely to cause undue burden to
agencies.
Response: CMS believes HHAs should be assessing whether patients
are up to date with COVID-19 vaccination as a part of their routine
care and infection control processes, and during our item testing, we
heard from HHAs that they are routinely inquiring about COVID-19
vaccination status at start of care. To ensure appropriate coding of
the assessment item, HHAs would be able to use a range of sources of
information to obtain a patient's vaccination status, such as patient
interviews, medical records, proxy response, and vaccination cards
provided by the patient or their caregivers. As with any assessment
item in the OASIS, we will also publish coding guidance and
instructions to further support HHAs in collection of these data.
Comment: Some commenters raised the issue that the measure has not
been tested for validity and reliability, nor was it supported by a
consensus-based entity was also frequently cited as a reason for
opposing its inclusion.
Response: CMS acknowledges that we have not yet tested the measure
for reliability and validity, we have tested the item proposed for the
OASIS to capture data for this measure and its feasibility and
appropriateness. Since a COVID-19 vaccination item does not yet exist
within the OASIS, we developed clinical vignettes to test item-level
reliability of a draft Patient/Resident COVID-19 Vaccine measure. The
clinical vignettes were a proxy for patient records with the most
common and challenging cases HHAs would encounter, similar to the
approach that we use to train HHAs on all new assessment items, and the
results demonstrated strong agreement. We have not completed validity
testing for this QM since the data element is not yet on OASIS.
However, this QM is modeled after other vaccination items and quality
measures used in PAC settings. We intend to complete reliability and
validity testing for this specific Patient/Resident COVID-19 Vaccine
measure once the COVID-19 vaccination item has been added to the OASIS
and we have collected sufficient data. Additionally, we solicited
feedback from our TEP on the proposed assessment item and its
feasibility. No concerns were raised by the TEP regarding obtaining the
information that would be required to complete the new COVID-19
vaccination item.
Comment: Some commenters did not support adoption of this measure
in light of the Administration's announcement of the end of the COVID-
19 PHE on May 11, 2023. Tracking vaccination status was described by
some commenters as no longer relevant based on the end of the PHE and
the vaccine mandate.
Response: Despite the announcement of the end of the COVID-19 PHE,
many people continue to be affected by COVID-19, particularly seniors,
the immunocompromised, and people with disabilities. As mentioned in
the End of COVID-19 Public Health Emergency Fact Sheet,\107\ our
response to the spread of SARS-CoV-2, the virus that causes COVID-19,
remains a public health priority. Even beyond the end of the COVID-19
PHE, we will continue to work to protect Americans from the virus and
its worst impacts by supporting access to COVID-19 vaccines,
treatments, and tests, including for people without health insurance.
Given the continued impacts of COVID-19, we believe it is important to
promote resident vaccination and education, which this measure aims to
achieve. Accordingly, we are aligning our approach with those for other
infectious diseases, such as influenza, by encouraging ongoing COVID-19
vaccination.\108\ Further, published coding guidance will indicate how
to code the item taking into account CDC guidelines, and HHAs could
access the CDC website at any time to find the definition of up to
date. Lastly, this measure as proposed for the HH QRP is not associated
with the PHE declaration, or the Conditions of Participation. This
measure is being proposed to address our priority to empower consumers
to make informed health care choices through resident-directed quality
measures and public transparency, as with previous vaccination
measures.
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\107\ Fact Sheet: End of the COVID-19 Public Health Emergency.
U.S. Department of Health and Human Services. May 9, 2023. https://www.hhs.gov/about/news/2023/05/09/fact-sheet-end-of-the-covid-19-public-health-emergency.html.
\108\ Medicare and Medicaid Programs; Policy and Regulatory
Changes to the Omnibus COVID-19 Health Care Staff Vaccination
Requirements; Additional Policy and Regulatory Changes to the
Requirements for Long-Term Care (LTC) Facilities and Intermediate
Care Facilities for Individuals With Intellectual Disabilities
(ICFs-IID) To Provide COVID-19 Vaccine Education and Offer
Vaccinations to Residents, Clients, and Staff; Policy and Regulatory
Changes to the Long Term Care Facility COVID-19 Testing
Requirements.
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Comment: Commenters also suggested that information on COVID-19
vaccination status was already tracked by other healthcare agencies,
and believe this measure and item constituted an unnecessary
duplication of effort.
Response: We believe that COVID-19 vaccination for high-risk
populations, such as those receiving HH care, is of paramount
importance. This is particularly important for HH patients, who tend to
be older and thus more vulnerable to serious complications from COVID-
19. Therefore, if a patient is not vaccinated at start of care, the HHA
has the opportunity to continue to educate the patient and provide
information on why they should receive the vaccine, irrespective of
whether the patient has received prior education.
Comment: A few commenters argued that the measure itself is not
actually a reflection of an agency's quality, and that just asking a
person if they are up to date on their vaccination does not improve
vaccination uptake, infection control, nor does it provide context for
their answers or meaningful data for quality of care or outcomes.
Response: We believe the COVID-19 vaccination is a beneficial
addition to the other vaccination measure in the HH QRP. We believe it
is an indirect measure of provider action since HHAs have the
opportunity to encourage, as
[[Page 77767]]
well as coordinate, vaccinations among patients. This is particularly
important for HH patients, who tend to be older and thus more
vulnerable to serious complications from COVID-19. CDC data show that,
among people age 50 and older, those who have received both a primary
vaccination series and booster doses have a lower risk of
hospitalization and dying from COVID-19 than their non-vaccinated
counterparts.\109\ Additionally, a second vaccine booster dose has been
shown to reduce risk of severe outcomes related to COVID-19, such as
hospitalization or death, for older patients. The number of patients
who have been vaccinated in a HHA does not impact a HHA's ability to
successfully report the measure to comply with the requirements of the
HH QRP. Finally, we appreciate the commitment of HHAs and HHA efforts
at ensuring patients are educated and encouraged to become and remain
up to date with their COVID-19 vaccinations.
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\109\ Centers for Disease Control and Prevention. Rates of
laboratory-confirmed COVID-19 hospitalizations by vaccination
status. COVID Data Tracker. 2023, February 9. Last accessed March
22, 2023. https://covid.cdc.gov/covid-data-tracker/#covidnet-hospitalizations-vaccination.
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Comment: Multiple commenters described that despite efforts to
educate and encourage patients to stay up to date on their vaccines,
many still decline to take them. Therefore, home health agencies cannot
control patient decisions around vaccination and many PAC settings
cannot deliver the vaccines themselves even if patients wanted them.
Therefore, the ability to affect the measure was perceived as being out
of a HH agency's control and more appropriate for primary care.
Response: We acknowledge that individual residents have a choice
regarding whether to receive a COVID-19 vaccine or booster dose(s), but
patients and their caregivers also have choices about selecting PAC
providers, and it is our role to empower them with the information they
need to make an informed decision by publicly reporting the data we
receive from HHAs on this measure. We understand that despite a HHA's
best efforts, there may be instances where a patient may choose not to
receive a primary or booster dose of the COVID-19 vaccine. However, we
want to remind HHAs that this measure does not mandate patients be up
to date with their COVID-19 vaccine. We are unaware of any access
issues to COVID-19 vaccines or vaccine production delays. This measure
does not require HHAs to administer the vaccine themselves. They could
arrange for the patient to obtain the vaccine via a primary care
provider or work with community pharmacies.
Comment: Some commenters suggested that in order to make the
measure more appropriate for the home health environment, CMS should
focus on promotion of the vaccine rather than whether or not patients
were up to date. This could include a count of the number of documented
encounters agency staff had with a patient and/or their family
concerning the COVID-19 vaccine or promoting and/or offering the COVID-
19 vaccine as the metric.
Response: We thank commenters for alternate measure suggestions. We
believe the measure as currently specified provides the most
appropriate information for the public.
Comment: Some commenters also asked CMS to consider how the measure
may lead to bias. Commenters suggested that home health agencies
serving patient populations that have demonstrated higher vaccine
uptake would have an advantage over home health providers who serve
populations with vaccine hesitancy, and this could also potentially
lead to providers avoiding the care of patients who are not up to date
or do not want the COVID vaccine.
Response: We do not anticipate issues with patient access to HH
care if this measure is adopted. Use or adoption of other vaccination
measures in PAC settings have not previously impacted access to care.
We believe HHAs consider patient care of paramount importance and will
not refuse care to patients based on their vaccination status. We also
believe HHAs should use clinical judgement to determine if a patient is
eligible to receive the vaccination. We intend to monitor closely
whether any proposed change to the HH QRP has unintended consequences
on access to care. Should we find any unintended consequences, we will
take appropriate steps to address these issues in future rulemaking.
After consideration of the public comments we received, we are
finalizing our proposal to adopt the Patient/Resident COVID-19 Vaccine
measure as an assessment-based measure beginning with the CY 2025 HH
QRP as proposed.
E. Form, Manner, and Timing of Data Submission Under the HH QRP
1. Final Schedule for Data Submission of the Discharge Function Score
Measure Beginning With the CY 2025 HH QRP
As discussed in section III.C.1. of the final rule, we proposed to
adopt the Discharge Function Score quality measure beginning with the
CY 2025 HH QRP. The measure first public reported in January 2025 will
be based on data reported on the OASIS assessment beginning with
patients discharged between April 1, 2024 and March 31, 2024 for the CY
2025 HH QRP. Because the Discharge Function Score quality measure is
calculated based on data that are currently submitted to the Medicare
program, there will be no additional information collection required
from HHAs.
We solicited public comments on this proposal to utilize OASIS
assessment data for the Discharge Function Score quality measure
beginning with assessment data from patients discharged between April
1, 2024 and March 31, 2024 for the CY 2025 HH QRP. We received no
comments addressing this proposal. Therefore, after consideration of
the public comments we received, we are finalizing our proposal to
utilize already collected data to report the Discharge Function measure
beginning in CY 2025.
2. Final Schedule for Data Submission of the COVID-19 Vaccine: Percent
of Patients/Residents Who Are Up to Date Beginning With the CY 2026 HH
QRP
As discussed in section III.C.3 of the final rule, we are proposed
to adopt the COVID-19 Vaccine: Percent of Patients/Residents Who Are Up
to Date quality measure beginning with the CY 2025HH QRP. If finalized
as proposed, HHAs will be required to report these OASIS assessment
data beginning with patients discharged between January 1, 2025 and
March 31, 2025 for the CY 2025 HH QRP.
If finalized as proposed, we will revise the OASIS in order for
HHAs to submit data pursuant to this finalized policy. A new item will
be added to the current item set to collect information on whether a
patient is up to date with their COVID-19 vaccine at the time of
discharge from the HHA. A draft of the new item is available in the
COVID-19 Vaccine: Percent of Patients/Residents Who Are Up to Date
Draft Measure Specifications at https://www.cms.gov/files/document/patient-covid-vaccine-measure-hh-qrp-specifications.pdf.
We solicited public comments on this proposal to require HHAs to
report OASIS assessment data for the COVID-19 Vaccine: Percent of
Patients/Residents Who Are Up to Date quality measure. HHAs will be
required to submit data beginning with patients discharged between
January 1, 2025 and March 31, 2025 for public reporting of this QM in
the CY 2026 HH QRP. The
[[Page 77768]]
following is a summary of the comments we received on our proposal to
report OASIS assessment data for the COVID-19 Vaccine for Patients
measure and our response to the comments.
Comment: Some commenters raised burden concerns related to the
COVID-19 vaccine for patients data element. The inclusion of another
data element in OASIS and documentation of compliance with the
continually changing definition of ``up to date'' were described as
likely to cause undue burden to agencies.
Response: CMS believes HHAs should be assessing whether patients
are up to date with COVID-19 vaccination as a part of their routine
care and infection control processes, and during our item testing, we
heard from HHAs that they are routinely inquiring about COVID-19
vaccination status at start of care. To ensure appropriate coding of
the assessment item, HHAs would be able to use a range of sources of
information to obtain a patient's vaccination status, such as patient
interviews, medical records, proxy response, and vaccination cards
provided by the resident or their caregivers. As with any assessment
item in the OASIS, we will also publish coding guidance and
instructions to further support HHAs in collection of these data.
After consideration of the public comments we received, we are
finalizing our proposal to require HHAs to report OASIS assessment data
for the COVID-19 Vaccine: Percent of Patients/Residents Who Are Up to
Date quality measure.
3. Data Elements Finalized for Removal From OASIS-E
CMS plans to remove two OASIS items, the M0110--Episode Timing and
M2200--Therapy Need effective January 1, 2025. These items are no
longer used in the calculation of quality measures already adopted in
the HH QRP, nor are they being used currently for previously
established purposes unrelated to the HH QRP, including payment,
survey, the HH VBP Model or care planning.
CMS finalizes the removal of items from OASIS-E from the specific
time points during a home health episode as outlined in Table C3.
[GRAPHIC] [TIFF OMITTED] TR13NO23.052
For a discussion in the reduction in burden associated with the
removal of these items, see section IX of this final rule.
We requested public comment on our proposal to remove the M0110--
Episode Timing and M2200--Therapy Need items from OASIS-E, effective
January 1, 2025. The following summarizes comments received on this
proposal and our response.
Comment: Commenters unanimously supported the removal of the
M0110--Episode Timing data element.
Response: CMS appreciates support for the removal of this data
element.
Comment: Most commenters supported the removal of the M2200--
Therapy Need data element.
Response: CMS appreciates support for the removal of this data
element.
Comment: Some commenters opposed removal of the M2200--Therapy
Needs data element out of concern that it would limit CMS' ability to
evaluate a patient's therapy need.
Response: CMS appreciates the concern from commenters regarding
CMS's ability to evaluate patient's therapy needs. With a broad set of
new and current data elements on the OASIS-E assessment tool, CMS has
improved the ability of providers to assess functional status and
therapy needs that allows for the removal of the M2200-Therapy Need
data element.
After consideration of the public comments we received, we are
finalizing our proposal to remove the M0110--Episode Timing and M2200--
Therapy Need items from OASIS-E, effective January 1, 2025 as proposed.
F. Policies Regarding Public Display of Measure Data for the HH QRP
1. Background
Section 1899B(g)(1) of the Act requires, in part, that the
Secretary provide for public reporting of PAC provider performance,
including HHAs, on quality measures under section 1899B(c)(1) of the
Act, including by establishing procedures for making available to the
public information regarding the performance of individual PAC
providers with respect to such measures. Section 1899B(g)(2) requires,
in part, that CMS give HHAs opportunity to review and submit
corrections to the data and information to be made public under section
1899B(g)(1) prior to such data being made public. Section 1899B(g)(3)
of the Act requires that such procedures provide that the data and
information with respect to a measure and PAC provider is made publicly
available beginning not later than 2 years after the applicable
specified application date applicable to such measure and provider.
Measure data are currently publicly displayed on the Care Compare
website, an interactive web tool that assists individuals by providing
information on quality of care. For more information on Care Compare,
we refer readers to our website at: https://www.medicare.gov/care-compare/.
2. Public Reporting of the Cross-Setting Functional Discharge Measure
Beginning With the CY 2025 HH QRP
We are finalizing our policy to begin publicly displaying data for
the DC Function measure beginning with the January 2025 refresh of Care
Compare,
[[Page 77769]]
or as soon as technically feasible in a subsequent refresh, using data
collected from April 1, 2023 through March 31, 2024 (Quarter 2 2023
through Quarter 1 2024). If finalized as proposed, an HHAs DC Function
score will be displayed based on four quarters of data. Provider
preview reports will be distributed in October 2024, or as soon as
technically feasible. Thereafter, an HHA's DC Function score will be
publicly displayed based on four quarters of data and updated
quarterly. To ensure the statistical reliability of the data, we are
finalizing that we will not publicly report an HHAs performance on the
measure if the HHA had fewer than 20 eligible cases in any quarter.
HHAs that have fewer than 20 eligible cases will be distinguished with
a footnote that notes that the number of cases/patient stays is too
small to report.
We solicited public comments on this proposal to publicly report
the Discharge Function Score quality measure beginning with CY 2025 HH
QRP. The following is a summary of the comments we received on our
proposal to publicly report the Discharge Function measure and our
responses to the comments.
Comment: Many commenters supported public reporting of the DC
Function measure.
Response: We thank the commenters for their support to publicly
report the proposed measure.
Comment: Some commenters supported public reporting of the DC
Function measure but suggested a longer delay in reporting than the
timeframe discussed in the proposed rule.
Response: CMS appreciates the feedback received related to the time
frame for public reporting. Since this measure will be derived from
assessment data already available on the OASIS, results will be
available to providers in 2024 and the Discharge Function measure will
be able to be reported in CY2025. This will afford providers the time
to review their measure results, CMS sufficient time to provide
additional provider education, and replacement of the Application of
Functional Assessment/Care Plan with the Discharge Function measure in
addressing quality of care related to functional status more
comprehensively.
After consideration of the public comments we received, we are
finalizing our proposal to publicly report the Discharge Function
measure beginning in CY2025.
3. Public Reporting of the Transfer of Health Information to the
Patient Post-Acute Care and Transfer of Health Information to the
Provider Post-Acute Care Measures Beginning With the CY 2025 HH QRP
We are finalizing our decision to begin publicly displaying data
for the measures: (1) Transfer of Health (TOH) Information to the
Provider--Post-Acute Care (PAC) Measure (TOH-Provider); and (2)
Transfer of Health (TOH) Information to the Patient--Post-Acute Care
(PAC) Measure (TOH-Patient). We will begin displaying data with the
January 2025 Care Compare refresh or as soon as technically feasible.
We adopted these measures in the calendar year (CY) 2020 HH Prospective
Payment System (PPS) final rule (84 FR 60478). In response to the
COVID-19 public health emergency (PHE), we released an interim final
rule (85 FR 27595 through 27597) which delayed the compliance date for
the collection and reporting of the TOH-Provider and TOH-Patient
measures. The compliance date for the collection and reporting of the
TOH-Provider and TOH-Patient measures was revised to January 1, 2023 in
the calendar year (CY) 2022 Home Health PPS Rate Update final rule (86
FR 62386 through 62390). Data collection for these two assessment-based
measures began with patients with SOC/ROCs and discharged on or after
January 1, 2023.
We proposed to publicly display data for these two assessment-based
measures based on four rolling quarters, initially using discharges
from April 1, 2023 through March 31, 2024 (Quarter 2 2023 through
Quarter 1 2024), and to begin publicly reporting these measures with
the January 2025 refresh of Care Compare, or as soon as technically
feasible in a subsequent refresh. To ensure the statistical reliability
of the data, we proposed that we will not publicly report an HHA's
performance on the measure if the HHA had fewer than 20 eligible cases
in any quarter. HHAs that have fewer than 20 eligible cases will be
distinguished with a footnote that notes that the number of quality
episodes is too small to report.
We invited public comment on our proposal for the public display of
the (1) Transfer of Health (TOH) Information to the Provider--Post-
Acute Care (PAC) Measure (TOH-Provider) and (2) Transfer of Health
(TOH) Information to the Patient--Post-Acute Care (PAC) Measure (TOH-
Patient) assessment-based measures. The following is a summary of the
comments received:
Comment: Most commenters support the public reporting of the
Transfer of Health (TOH) Information to the Provider--Post-Acute Care
(PAC) Measure (TOH-Provider) and Transfer of Health (TOH) Information
to the Patient--Post-Acute Care (PAC) Measure (TOH-Patient) assessment-
based measures.
Response: CMS thanks commenters for the support of this proposal.
Comment: A few commenters suggested delaying by a few years the
public reporting of the TOH measures to afford more time for review of
data output or to incorporate further changes to the measures.
Response: Providers will have the opportunity to review their TOH
scores via provider reports in 2023 in advance of public reporting.
Consistent with the implementation of these measures in other PAC
settings, we began providing provider education in 2022. Additionally,
our helpdesks have been responding to provider questions about these
measures since data collection began for TOH data elements in January
2023. We believe the TOH measures have addressed substantive public
feedback that resulted in the creation of separate patient and provider
measures.
After consideration of the public comments we received, we are
finalizing our proposal to publicly report the Transfer of Health (TOH)
Information to the Provider--Post-Acute Care (PAC) Measure (TOH-
Provider) and Transfer of Health (TOH) Information to the Patient--
Post-Acute Care (PAC) Measure (TOH-Patient) assessment-based measures,
as proposed beginning with the January 2025 Care Compare refresh or as
soon as technically feasible after.
4. Public Quarterly Reporting of the COVID-19 Vaccine: Percent of
Patients/Residents Who Are Up to Date Beginning With the CY 2026 HH QRP
We are finalizing our policy to begin publicly displaying quarterly
data for the COVID-19 Vaccine: Percent of Patients/Residents Who Are Up
to Date measure beginning with the January 2026 refresh of Care Compare
or as soon as technically feasible after using data collected for Q1
2025 (January 1, 2025 through March 31, 2025). As noted previously, we
are displaying the measure, ``Patient/Resident level COVID-19 Vaccine
percent of patients who are up to date'' based on one quarter of data.
Provider preview reports will be distributed in October 2025, or as
soon as technically feasible. Thereafter, the percent of HHA patients
who are up to date with their COVID-19 vaccinations will be publicly
displayed based on one quarter of data per report and updated with new
data quarterly. To ensure the statistical
[[Page 77770]]
reliability of the data, we proposed that we will not publicly report
an HHAs performance on the measure if the HHA had fewer than 20
eligible cases in any quarter. HHAs that have fewer than 20 eligible
cases will be distinguished with a footnote that notes that the number
of quality episodes is too small to report.
We sought public comment on the proposal for the public display of
the COVID-19 Vaccine: Percent of Patients/Residents Who Are Up to Date
measure beginning with the January 2026 refresh of Care Compare, or as
soon as technically feasible after. The following summarizes comments
received on this proposal and our response.
Comment: Some commenters supported publicly reporting the COVID-19
measure for the benefit the measure information would provide to the
public.
Response: CMS thanks the commenters for their support of this
proposal.
Comment: Some commenters suggested that without CBE endorsement and
measure testing, public reporting should be delayed. Others suggested
reporting the results of patient COVID-19 vaccination status without
characterizing the result as a quality measure.
Response: CMS has a long history of reporting vaccination measures
to support improvement of care and outcomes in healthcare settings. CMS
believe the public reporting of the COVID-19 patient vaccination
measure will be consistent with prior vaccination QMs and addresses an
important, ongoing health concern.
After consideration of the public comments we received, we are
finalizing our proposal to publicly report the COVID-19 Vaccine:
Percent of Patients/Residents Who Are Up to Date measure as proposed
beginning with the January 2026 refresh of Care Compare, or as soon as
technically feasible after.
G. Health Equity Update
1. Background
In the CY 2023 Home Health Payment Rate Update final rule (87 FR
66866), we included a Request for Information (RFI) on several
questions related to a proposed health equity measure concept. CMS
defines health equity as ``the attainment of the highest level of
health for all people, where everyone has a fair and just opportunity
to attain their optimal health regardless of race, ethnicity,
disability, sexual orientation, gender identity, socioeconomic status,
geography, preferred language, or other factors that affect access to
care and health outcomes.'' \110\ CMS is working to advance health
equity by designing, implementing, and operationalizing policies and
programs that support health for all the people served by our programs
and models, eliminating avoidable differences in health outcomes
experienced by people who are disadvantaged or underserved, and
providing the care and support that our beneficiaries need to thrive.
CMS's goals outlined in the CMS Framework for Health Equity 2022-2023
\111\ are in line with Executive Order 13985, on Advancing Racial
Equity and Support for Underserved Communities Through the Federal
Government (January 25, 2021).\112\ The goals included in the CMS
Framework for Health Equity include: strengthening CMS's infrastructure
for assessment, creating synergies across the health care system to
drive structural change, and identifying and working to eliminate
barriers to CMS-supported benefits, services, and coverage. These goals
also support suggested policies outlined in the Executive Order 14095,
on Increasing Access to High-Quality Care and Supporting Caregivers
(April 18, 2023), that seeks to address improvement in the provision of
long-term care and support the caregivers who support patient
care.\113\
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\110\ Centers for Medicare and Medicaid Services. Available at
https://www.cms.gov/pillar/health-equity. Accessed February 1, 2023.
\111\ https://www.cms.gov/files/document/cms-framework-health-equity-2022.pdf.
\112\ Executive Order 13985, on ``Advancing Racial Equity and
Support for Underserved Communities Through the Federal
Government,'' can be found at: https://www.whitehouse.gov/briefing-room/presidential-actions/2021/01/20/executive-order-advancing-racial-equity-and-support-for-underserved-communities-through-the-federal-government/.
\113\ The Executive Order14095 on Increasing Access to High-
Quality Care and Supporting Caregivers can be found at: https://www.whitehouse.gov/briefing-room/presidential-actions/2023/04/18/executive-order-on-increasing-access-to-high-quality-care-and-supporting-caregivers/.
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In addition to the CMS Framework for Health Equity, CMS seeks to
``advance health equity and whole-person care'' as one of eight goals
comprising the CMS National Quality Strategy (NQS).\114\ The NQS
identifies a wide range of potential quality levers that can support
our advancement of equity, including: (1) establishing a standardized
approach for patient-reported data and stratification; (2) employing
quality and value-based programs to publicly report and incentivize the
closing of equity gaps; and, (3) developing equity-focused performance
metrics, regulations, oversight strategies, and quality improvement
initiatives. The NQS also acknowledges the contribution of structural
racism and other systemic injustices to the persistent disparities that
underlie our healthcare system.
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\114\ Centers for Medicare & Medicaid Services. What is the CMS
Quality Strategy? Available at https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Value-Based-Programs/CMS-Quality-Strategy.
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Racial disparities in health, in particular, are estimated to cost
the U.S. an estimated $93 billion in excess medical costs and $42
billion in lost productivity per year, in addition to economic losses
due to premature deaths.\115\ Racial and ethnic diversity has increased
over recent decades in the United States and territories. An increase
in the percentage of people who self-identify as two or more races in
US Census Bureau data accounts for most of the increase in diversity,
rising from 2.9 percent to 10.2 percent between 2010 and 2020.\116\
Social determinants of health, including social, economic,
environmental, and community conditions, may have a stronger influence
on the population's health and well-being than services delivered by
practitioners and healthcare delivery organizations.\117\
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\115\ Ani Turner, The Business Case for Racial Equity, A
Strategy for Growth, W.K. Kellogg Foundation and Altarum, April
2018.
\116\ 2022 National Healthcare Quality and Disparities Report,
page 15. Content last reviewed November 2022. Agency for Healthcare
Research and Quality, Rockville, MD. https://www.ahrq.gov/research/findings/nhqrdr/nhqdr22/index.html.
\117\ 2022 National Healthcare Quality and Disparities Report.
Content last reviewed November 2022, page 2. Agency for Healthcare
Research and Quality, Rockville, MD. https://www.ahrq.gov/research/findings/nhqrdr/nhqdr22/index.html.
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Measure stratification helps identify disparities by calculating
quality measure outcomes separately for different beneficiary
subpopulations. By looking at measure results for different populations
separately, CMS and providers can see how care outcomes may differ
between certain patient populations in a way that will not be apparent
from an overall score (that is, a score averaged over all
beneficiaries). This helps CMS to better fulfill their health equity
goals. For example, certain quality measures related to oral healthcare
outcomes for children, when stratified by race, ethnicity, and income,
show how important health disparities have been narrowed, because
outcomes for children in the lowest income households and for Black and
Hispanic children improved faster than outcomes for children in the
highest income households or for White children.\118\
[[Page 77771]]
These differences in outcomes will not be apparent without
stratification.
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\118\ 2022 National Healthcare Quality and Disparities Report,
page 6. Content last reviewed November 2022. Agency for Healthcare
Research and Quality, Rockville, MD. https://www.ahrq.gov/research/findings/nhqrdr/nhqdr22/index.html.
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Additionally, the RFI solicited public comments on a potential
health equity structural composite measure. We refer readers to the CY
2023 Home Health Payment Rate Update final rule (87 FR 66866) for a
summary of the public comments and suggestions received in response to
the health equity RFI.
We took these comments into account, and we continue to work to
develop policies, quality measures, and measurement strategies on this
important topic. After considering public comments, CMS decided to
convene a health equity technical expert panel to provide additional
input to inform the development of health equity quality measures. The
work of this technical expert panel is described in detail in the
following section.
2. Home Health and Hospice Health Equity Technical Expert Panel
To support new health equity measure development, the Home Health
and Hospice Health Equity Technical Expert Panel (Home Health & Hospice
HE TEP) was convened by a CMS contractor in Fall 2022. The Home Health
& Hospice HE TEP comprised health equity experts from hospice and home
health settings, specializing in quality assurance, patient advocacy,
clinical work, and measure development. The TEP was charged with
providing input on a potential cross-setting health equity structural
composite measure concept as set forth in the CY 2023 Home Health
Payment Rate Update final rule noted previously as part of an RFI
related to the HH QRP Health Equity Initiative. In specific, the TEP
assessed the face validity and feasibility of the potential structural
measure. The TEP also provided input on possible confidential feedback
report options to be used for monitoring health equity. TEP members
also had the opportunity to provide ideas for additional health equity
measure concepts or approaches to addressing health equity in hospice
and home health settings. A summary of the Home Health and Hospice HE
TEP meetings and proposed TEP recommendations are available at https://mmshub.cms.gov/sites/default/files/HomeHealth-Hospice-Health-Equity-TEP-Report-508c.pdf .
3. Anticipated Future Health Equity Activities
CMS is committed to developing approaches to meaningfully
incorporate the advancement of health equity into the HH QRP. We are
considering health equity measures used in other settings like those in
acute care that further health equity in post-acute care. We realize
that the social determinants of health data items in post-acute care
under the IMPACT Act of 2014 differ from the SDOH data items in the
acute care health equity quality measures. We could consider a future
health equity measure like screening for social needs and intervention.
With 30 to 55 percent of health outcomes attributed to SDOH,\119\ a
measure capturing and addressing SDOH could encourage providers to
identify specific needs and connect patients with the community
resources necessary to overcome social barriers to their wellness. We
could specify it using the SDOH data items that we currently collect as
standardized patient assessment data on the OASIS. These SDOH data
items assess health literacy, social isolation, transportation
problems, preferred language (including need or want of an
interpreter), race, and ethnicity. These SDOH data items differ from
data elements considered as screening items in the acute care settings,
which are housing instability, food instability, transportation needs,
utility difficulties, and interpersonal safety. This means that we
might consider in the future adding the SDOH data items used by acute
care providers into the HH QRP as we develop future health equity
quality measures under our HH QRP statutory authority. This supports
our desire to align quality measures across CMS consistent with the CMS
path forward for advancing health equity solutions.\120\ Consistent
with ``The Path Forward: Improving Data to Advance Health Equity
Solutions'' (CMS OMH, November 2022) we also see value in aligning SDOH
data items across all care settings and to the United States Core Data
for Interoperability (USCDI) where applicable and appropriate. The
USCDI is a standardized set of health data classes and constituent data
elements for nationwide, interoperable health information exchange,
including data elements and associated vocabulary standards to support
computerized, interoperable use of SDOH data.\121\
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\119\ World Health Organization (WHO). (n.d.). Social
Determinants of Health. https://www.who.int/health-topics/social-determinants-of-health#tab=tab_1, accessed February 1, 2023.
\120\ https://www.nejm.org/doi/full/10.1056/NEJMp2215539,
February 1, 2023.
\121\ https://www.healthit.gov/isa/united-states-core-data-interoperability-uscdi.
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As we move this important work forward, we will continue to take
input from interested parties. As of this publication, the Initial
Proposals for Updating OMB's Race and Ethnicity Statistical Standards,
(88 FR 5375), has collected public comment. Additionally, the Office of
the National Coordinator for Health IT (ONC) welcomes submissions
proposing additional data classes and data elements via the USCDI ONC
New Data Element and Class (ONDEC) submission system for future
versions of the USCDI.\122\ In addition, while some of the anticipated
health equity efforts will proceed through the rulemaking process,
other activities may be pursued through subregulatory channels, such as
Open-Door Forums (ODF), Medicare Learning Network (MLN), and public
summary reports such as TEP reports or information gathering reports
(IGR).
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\122\ https://www.healthit.gov/isa/ONDEC.
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Although we did not directly solicit feedback to our update, we did
receive some public comments, which we summarize as follows.
Comment: Commenters supported evaluating the potential for future
health equity measures. A commenter encouraged CMS to utilize nurses to
their fullest extent in terms of drawing from their experience and
expertise. Another suggested that CMS capture information about family
caregiver status, support offered to the caregiver(s), and caregiver
experience of care provided to the patient as part of the health equity
initiative. Lastly, another commenter suggested that CMS require health
equity strategies in the Conditions of Participation for Home Health
Agencies and other Medicare and Medicaid participating providers,
particularly health equity accreditation to encourage greater adoption
of health equity strategies.
Response: We thank all the commenters for responding to our update
on this important CMS priority. We will continue to prioritize our
efforts to advance health equity by designing, implementing, and
operationalizing policies and programs that support health for all
people served by our programs.
H. Finalizing Codification of the HH QRP Data Completion Thresholds
1. Compliance
Section 1895(b)(3)(B)(v)(I) of the Act requires that, for the CY
2007 payment determination and subsequent years, each HHA submit to the
Secretary quality data specified by the Secretary in a form and manner,
and at a time, specified by the Secretary. As required in accordance
with subclause (II) for such a year, for any HHA that does not submit
data in accordance with section 1895(b)(3)(B)(v)(I) of the Act with
respect to a given calendar year will result in the reduction of the
annual
[[Page 77772]]
home health market basket percentage increase otherwise applicable to
an HHA for that calendar year by 2 percentage points. In the CY 2016 HH
PPS final rule (80 FR 68703 through 68705), we finalized a proposal to
define the quantity of OASIS assessments each HHA must submit to meet
the pay-for reporting requirement. We finalized a proposal that
increased the reporting threshold for HHAs over three years, starting
with the CY 2017 reporting period. HHAs were required to score at least
70 percent on the Quality Assessment Only (QAO) metric of pay-for-
reporting performance requirement for CY 2017 (reporting period July 1,
2015 to June 30, 2016), 80 percent for CY 2018 (reporting period July
1, 2016 to June 30, 2017) and 90 percent for CY 2019 (reporting period
July 1, 2017 to June 30, 2018) or be subject to a 2 percentage point
reduction to the home health market basket update for that reporting
period. In the 2018 HH PPS final rule (82 FR 51737 through 51738), we
finalized a policy to apply the 90 percent threshold requirements
established in the CY 2016 HH PPS rule to the submission of
standardized patient assessment data beginning with the CY 2019 HH QRP.
2. Proposal To Codify HH QRP Data Completion Thresholds
In the CY 2024 proposed rule (88 FR 43654), we proposed to codify
these already-finalized data completeness thresholds at Sec.
484.245(b)(2)(ii)(A) for measures data collected using the OASIS (88 FR
43737-38). Under this section, we proposed to codify our requirement
that HHAs must meet or exceed a data submission threshold set at 90
percent of all required OASIS and submit the data through the CMS
designated data submission systems. This threshold would apply to
required quality measures data and standardized patient assessment data
adopted into the HH QRP. We also proposed to codify our policy at Sec.
484.245(b)(2)(ii)(B) that a HHA must meet or exceed this threshold to
avoid receiving a 2-percentage point reduction to its annual payment
update for a given CY as codified at Sec. 484.225(b).
We sought public comment on our proposal to codify in regulations
text the HH QRP data completion thresholds at Sec.
484.245(b)(2)(ii)(A) for measures and standardized patient assessment
elements collected using the OASIS and compliance threshold to avoid
receiving 2 percentage point reduction as described under Sec.
484.245(b)(2)(ii)(B). A summary of comments received and CMS response
to public comments is as follows.
Comment: Most commenters who addressed this proposal supported
codification of this regulatory text.
Response: We thank commenters for their support of this important
policy.
Comment: Some commenters supported the goal of codifying the
proposed regulatory text with some suggested changes. These commenters
suggested the removal of language ``. . . within 30-days of the
beneficiary's admission or discharge . . .'' since there are more
factors than a strict 30-day deadline in the application of submission
requirements during the calculation of quality assessments only (QAO)
compliance.
Response: CMS reviewed the comments that suggest a revision to the
proposed regulatory text and is in agreement with suggested change. We
believe that this change will be beneficial to our data collection
activities because it addresses the overall submission requirements for
OASIS data collection that assesses overall HHA compliance for each
submission year, irrespective of the kinds of assessments submitted for
that given year. CMS is concerned with not only the SOC/ROC and
discharge assessments, but assessments collected at other timepoints.
After consideration of the public comments we received, we are
finalizing our proposal to codify in regulations text the HH QRP data
completion thresholds with the suggested replacement of text. CMS
supports the suggested replacement of the timeframe language while
codifying the following language: ``A home health agency must meet or
exceed the data submission threshold for each submission year (July 1-
June 30) set at 90 percent of all required OASIS or successor
instrument records and submitted through the CMS designated data
submission systems''.
I. Principles for Selecting and Prioritizing HH QRP Quality Measures
and Concepts Under Consideration for Future Years: Request for
Information (RFI)
1. Background
CMS has established a National Quality Strategy \123\ for its
quality programs which support a resilient, high-value health care
system promoting quality outcomes, safety, equity and accessibility for
all individuals. The CMS National Quality Strategy is foundational for
contributing to improvements in health care, enhancing patient
outcomes, and informing consumer choice. To advance these goals, CMS
leaders from across the Agency have come together to move towards a
building-block approach to streamline quality measures across CMS
quality programs for the adult and pediatric populations. This
``Universal Foundation'' \124\ of quality measures will focus provider
attention, reduce burden, identify disparities in care, prioritize
development of interoperable, digital quality measures, allow for
cross-comparisons across programs, and help identify measurement gaps.
The development and implementation of the Preliminary Adult and
Pediatric Universal Foundation Measures will promote the best, safest,
and most equitable care for individuals as we all come together on
these critical quality areas.
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\123\ Schreiber M, Richards A, Moody-Williams J, Fleisher L. The
CMS National Quality Strategy: a person-centered approach to
improving quality. Centers for Medicare and Medicaid Services. June
6, 2022. Available at: https://www.cms.gov/blog/cms-national-quality-strategy-person-centered-approach-improving-quality. Opens
in new tab.
\124\ Jacobs D, Schreiber M, Seshamani M, Tsai D, Fowler E,
Fleisher L. Aligning Quality Measures across CMS--The Universal
Foundation. N Engl J Med 2023; 338:776-779. DOI: 10.1056/
NEJMp2215539.
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In alignment with the CMS National Quality Strategy, the HH QRP
endeavors to move towards a more parsimonious set of measures while
continually improving the quality of health care for beneficiaries. In
the CY 2024 proposed rule, we requested information on existing gaps in
HH QRP measures and solicited public comment on either fully developed
HH measures, fully developed measures in other programs that may be
appropriate for the HH QRP, and measurement concepts that could be
developed into HH QRP measures, to fill these measurement gaps (88 FR
43738-40). While we will not be responding to specific comments
submitted in response to this RFI in the CY2024 HH PPS final rule, we
have summarized the comments received, and intend to use this input to
inform future policies.
This RFI consisted of four sections. The first section was a
background. The second section discussed a general framework or set of
principles that CMS utilizes to identify future HH QRP measures. The
third section drew from an environmental scan conducted to identify HH
QRP measurement gaps, and measures or measure concepts that could be
used to fill these gaps. This section solicited public comment on (a)
the set of principles for selecting measures for the HH QRP, (b)
identified measurement gaps, and (c) measures that are available for
immediate use, or that may be adapted or developed for use in the HH
QRP. For a detailed
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presentation of the RFI, see the CY2024 NPRM (88 FR 43738-40). CMS
sought input on data available to develop measures, approaches for data
collection, perceived challenges, or barriers, and approaches for
addressing challenges. We received several comments in response to this
RFI, which are summarized later in this section.
2. Comments on Principles for Selecting and Prioritizing QRP Measures
In general, commenters supported the CMS principles and criteria
for selecting and prioritizing measures. A commenter shared a concern
that the proposed principle of ``provider responses to payment'' raises
concerns due to the ambiguity of the term ``unwanted responses.'' Many
commenters advocated for the addition of stakeholder engagement (for
example, technical expert panels, and review and analysis of
beneficiary and family input) as a guiding principle. A suggestion was
made to include a guiding principle related to discontinuing metrics
without continually adding more metrics given the burden the constant
addition of metrics places on agencies. Another suggestion was to add
the principle of Timeliness and Clarity of CMS data, described as
promoting increased availability and frequency of data with lesser time
lag, and clarity around the reportability and feedback of data to and
from CMS and in compliance with QRP. A respondent advocated for
incorporating ``objectivity'' as a principle, described as prioritizing
claims-based measures over provider reported measures in order to
mitigate measure manipulation and another respondent advocated
incorporation of a guiding principle that only measures for which data
elements are clearly defined, valid, and well standardized be
prioritized for the HH QRP measure set.
3. Comments on HH QRP Measurement Gaps
a. Cognitive Function and Behavioral and Mental Health
While commenters agreed that there may be gaps related to cognitive
function and behavioral and mental health, most were opposed to these
being an area of further exploration in measure development in home
health. They did not see the benefit or feasibility of developing
performance measures around cognition or behavioral and mental health
due to the limited ability to affect these disorders in the home health
setting. Some suggested that if CMS would like to examine how to better
align the behavioral health clinical grouping with the needs of
patients, this could be an area for future consideration for CMMI or
another entity looking at how to better serve older adults with
cognitive and/or behavioral or mental health needs. One gap that was
identified and recommended for future exploration in relation to
cognitive function was the need for HHAs to better identify mild
cognitive impairment. Although the OASIS requires a combination of the
BIMS, CAM, and PHQ-9 to identify cognitive status, one respondent noted
that these assessments are not sufficient to identify mild and mild to
moderate cognitive impairment which were described as being crucial to
intervening in functional decline for home health patients.
Overall there was significant opposition to the implementation of a
measure related to cognitive function and/or behavioral health.
Commenters stated that such measures would not make sense as
performance measure domains in home health care due to limited time,
resources, and expertise to provide interventions that would directly
impact a patient's cognition, behavioral and/or mental health. They
suggested that the focus in HH is to stabilize cognitive function and/
or behavioral health--especially during the limited period the
beneficiary is receiving home health services. While some commenters
stated that the Brief Interview for Mental Status (BIMS) and Confusion
Assessment Method (CAM(copyright)) measures already collected were
sufficient, others objected to their use for quality measurement noting
that a patient's BIMS score is not expected to improve with treatment.
Respondents also suggested that CMS pause adding additional metrics
until there are more data to determine whether they are effective. They
noted that if CMS has decided that BIMS and/or CAM are not effective,
they should be exchanged with new metrics, as opposed to adding
additional metrics on top of CAM and BIMS.
b. Chronic Conditions
Commenters expressed overall support for exploring gaps and
performance measures related to chronic illness in the home health
setting, but emphasized these should focus on maintenance or
stabilization of chronic conditions rather than improvement.
Performance measures aimed at stabilizing chronic conditions and
measuring appropriate interventions for those patients that are
expected to decline were suggested to be a better reflection of quality
home health care than focusing solely on improvement in conditions and
activities, and hospitalization rates. There was also support for
continuing to include these more comprehensively within the case mix
weight, rather than adding additional metrics and further exploration
of measures that assess quality of life for the beneficiary and the
family caregiver in relation to chronic illness.
Commenters supported CMS's effort to align quality measures across
care settings through the Universal Foundation and strongly support CMS
focusing efforts on developing performance measures around chronic
conditions. Commenters stated that although current measures are
directed at managing chronic illnesses, many are physician focused. The
commenters suggested CMS needs to develop performance measures that
address chronic illness in the home health setting. They suggested that
CMS needs to develop performance measures that recognize progressive
chronic conditions for which measures of maintenance and/or
stabilization are a more accurate reflection of quality home health
care. Commenters also suggested that CMS should measure the effect of
appropriate interventions for those patients that are expected to
decline. There was also support for a stratification approach for
quality measurement for patients with chronic illnesses and complex
needs.
c. Pain Management
Commenters supported further exploration of gaps in measurement
related to pain management in home health, particularly the assessment
of pain and its effect on sleep, therapy activities, and day-to-day
activities and function. Pain assessment and management were described
as critically important in the home health environment, and there was a
call to explore how to better incorporate therapy services in pain
assessment, intervention, and quality measurement in the home health
setting. While commenters expressed support for further exploration of
gaps related to pain, they also described confusion based on the prior
CMS decision to remove this domain as a performance measure in home
health due to the opioid crisis, and the need for CMS to send a
consistent message to providers if new measurements were developed. For
pain, standardized assessments were recommended as the best metric to
evaluate, including the standardized pain scale 0-10, Wong-Baker, and
PAINAD. Commenters emphasized the need to have options, as not every
patient fits into one specific scale. They
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also encouraged CMS to recognize that some patients, even those with
substance use disorder, may be appropriately taking opioids or other
pain medications and that should be factored into their plan of care.
They also encouraged CMS to identify tools that can address the
inequities in pain assessment and treatment, specifically among African
Americans.
d. Other Measure Gaps
Additional gaps for further exploration identified by respondents
included identifying and addressing social risk for patients, support
for caregivers and caregiver status, and assessment, treatment and
referral for patients with chronic obstructive pulmonary disease. A
commenter also identified the need to better explore improvement of
delivery and responses to patient satisfaction surveys in home health
in order to improve understanding of patient experiences. Commenters
supported adding measures to the HH QRP that would identify social risk
factors and specifically incorporating financial needs into social risk
factor assessment. One suggestion for measuring this in the home health
setting was adding ``needs navigation'' services as a requirement to
the HH QRP with a measure that confirms whether these services have
been offered or delivered. The Social Need Screening and Intervention
HEDIS measure was also recommended for home health because it is
designed to collect social needs data from multiple sources in addition
to the EMR. There was also support for aligning social risk factor/
social needs measures with the Gravity Project's work to standardize
interoperable social needs data. Commenters also suggested a number of
existing measures to consider for incorporation into the HHQRP program.
A commenter recommended the addition of Caregiver Status to the list of
standardized patient assessment data required for reporting by HHAs and
other PAC providers. Another identified three measurements that if
added to the HH QRP would improve the care of COPD patients in the home
health setting and after discharge: Referral to Smoking Cessation
Counseling or Program, Referral to Pulmonary Rehabilitation Clinic, and
COPD GOLD Strategy treatment for HH patients. Additional suggested
measures for CMS consideration included Advance care planning (ACP),
the Depression Screening and Follow-Up for Adolescents and Adults
(DSF), and person-centered care outcome (PCO) measures. Commenters also
suggested incorporating measures more appropriate for patients at the
end of life in home health: the new patient-reported quality measure
``Felt Heard and Understood'' (already endorsed by the CBE), a measure
on referral or access to palliative care and a measurement of timely
and appropriate referral to hospice.
e. Data Available To Develop Measures
Related to equity, commenters suggested that CMS minimize
additional administrative burdens while striving to gather meaningful
equity-related information. This could entail leveraging data that CMS
already collects from claims. Commenters suggested that health outcome
measures may need to include some form of adjustment for the relative
amount and quality of resources available in different localities to
care for different patient populations. Additional suggestions for
addressing equity included: providing clarity around the definition of
health equity; identifying validated measures of equity and determining
feasibility for assessment at the HH level; incorporating equity as a
case mix indicator and provider resources for management of health
equity challenges with reimbursement; providing cost appropriate
interventions from HH clinicians to achieve outcomes in a HH length of
stay; and providing evidence-based data about interventions that can
affect equity and outcomes.
f. Challenges With Current HH QRP Measures
Overall, commenters focused on voicing their opposition to the CMS'
emphasis on reducing hospitalizations and keeping patients in the
community as the gold standard for quality performance in the home
health setting. This was described as a longstanding frustration for
HHAs and a disincentive to care for patients with complex health needs,
contributing to some HHAs avoiding servicing patients with complex
needs. Opposition was justified by highlighting the growing number of
medically complex patients coming from community rather than post-acute
care referrals, and recognition that home health agencies have limited
ability to prevent hospitalizations with many complex patient
populations/patient conditions. For patients with complex and/or
chronic care needs, measures that address delays in transfers to higher
levels of care may be a better reflection of quality home health care
and transfers to the hospital or a skilled nursing facility may
ultimately be an appropriate discharge disposition. A stratification
approach for quality measurement for patients with chronic illnesses
and complex needs was also described as an appropriate alternative.
Response: We appreciate the input provided by commenters. While we
will not be responding to specific comments submitted in response to
this RFI in this final rule, we intend to use this input to inform our
future measure development efforts.
IV. Changes to the Expanded Home Health Value-Based Purchasing (HHVBP)
Model
A. Background
As authorized by section 1115A of the Act and proposed in the CY
2016 HH PPS final rule (80 FR 68624), the Center for Medicare and
Medicaid Innovation (Innovation Center) implemented the Home Health
Value-Based Purchasing (HHVBP) Model (``original Model'') in nine
states on January 1, 2016. The design of the original HHVBP Model
leveraged the successes and lessons learned from other CMS value-based
purchasing programs and demonstrations to shift from volume-based
payments to a model designed to promote the delivery of higher quality
care to Medicare beneficiaries. The specific goals of the original
HHVBP Model were to--
Provide higher incentives for better quality care with
greater efficiency.
Study new potential quality and efficiency measures for
appropriateness in the home health setting; and,
Enhance the current public reporting process.
The original HHVBP Model resulted in an average 4.6 percent
improvement in HHAs' total performance scores (TPS) and an average
annual savings of $141 million to Medicare without evidence of adverse
risks.\125\ The evaluation of the original Model also found reductions
in unplanned acute care hospitalizations and skilled nursing facility
(SNF) stays, resulting in reductions in inpatient and SNF spending. The
U.S. Secretary of Health and Human Services determined that expansion
of the original HHVBP Model will further reduce Medicare spending and
improve the quality of care and the CMS Chief Actuary certified that
expansion of the HHVBP Model will produce Medicare savings if expanded
to all states.\126\
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\125\ https://innovation.cms.gov/data-and-reports/2020/hhvbp-thirdann-rpt.
\126\ https://www.cms.gov/files/document/certification-home-health-value-based-purchasing-hhvbp-model.pdf.
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On January 8, 2021, CMS announced the certification of the HHVBP
Model for expansion nationwide, as well as the
[[Page 77775]]
intent to expand the Model through notice and comment rulemaking.\127\
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\127\ https://www.cms.gov/newsroom/press-releases/cms-takes-action-improve-home-health-care-seniors-announces-intent-expand-home-health-value-based.
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In the CY 2022 HH PPS final rule (86 FR 62292 through 62336) and
codified at 42 CFR part 484 subpart F, we proposed the decision to
expand the HHVBP Model to all Medicare certified HHAs in the 50 States,
territories, and District of Columbia beginning January 1, 2022. CY
2022 was a pre-implementation year. During CY 2022, CMS provided HHAs
with resources and training, to allow HHAs time to prepare and learn
about the expectations and requirements of the expanded HHVBP Model
without risk to payments. We proposed that the expanded Model will
generally use benchmarks, achievement thresholds, and improvement
thresholds based on CY 2019 data to assess achievement or improvement
of HHA performance on applicable quality measures and that HHAs will
compete nationally in their applicable size cohort, smaller-volume HHAs
or larger-volume HHAs, as defined by the number of complete unique
beneficiary episodes for each HHA in the year prior to the performance
year. All HHAs certified to participate in the Medicare program prior
to January 1, 2022, will be required to participate and will be
eligible to receive an annual Total Performance Score based on their CY
2023 performance.
We proposed the quality measure set for the expanded Model, as well
as policies related to the removal, modification, and suspension of
applicable measures, and the addition of new measures and the form,
manner, and timing of the OASIS-based, Home Health Consumer Assessment
of Healthcare Providers and Systems (HHCAHPS) survey-based, and claims-
based measures submission in the applicable measure set beginning in CY
2022 and subsequent years. We also proposed an appeals process, an
extraordinary circumstances exception policy, and public reporting of
annual performance data under the expanded Model.
Additionally, in the CY 2022 HH PPS final rule (86 FR 62312), we
summarized and responded to comments received on the challenges unique
to value-based purchasing frameworks in terms of health equity and ways
in which we could incorporate health equity goals into the expanded
HHVBP Model. Comments received were related to the use of stabilization
measures to promote access to care for individuals with chronic illness
or limited ability to improve; collection of patient level demographic
information for existing measures; and stratification of outcome
measures by various patient populations to determine how they are
affected by social determinants of health (SDOH).
In the CY 2023 HH PPS final rule (87 FR 66869 through 66876), we
proposed our policy to replace the term baseline year with the terms
HHA baseline year and Model baseline year, and to change the calendar
years associated with each of those baseline years. Specifically, we
changed the HHA baseline year for the CY 2023 performance year from
2021 to 2022 for ``new'' HHAs with CMS certification numbers (CCNs)
with effective dates prior 2022, and the Model baseline year from CY
2019 to CY 2022 starting in CY 2023. Additionally, we summarized the
comments received on future approaches to health equity (HE) in the
expanded HHVBP Model. Comments received were related to the support of
addressing health equity, potential unintended consequences, thorough
consideration and testing of potential HE measures, data collection
and, applying HE data to the expanded Model's cohorts and risk
adjustment models.
In the CY 2024 HH PPS proposed rule (87 FR 43740 through 43752), we
proposed codification of the HHVBP measure removal factors at Sec.
484.380; to remove five and add three quality measures to the
applicable measure set, revise weights of the individual measures
within the OASIS-based measure category and within the claims-based
measure category and, an updated Model baseline year (from CY 2022 to
CY 2023) starting in the CY 2025; and, an amendment to the appeals
process such that reconsideration decisions may be reviewed by the
Administrator with conforming regulation text changes at Sec.
484.375(b)(5). We included an update to the RFI, Future Approaches to
Health Equity in the Expanded HHVBP Model, that was published in the CY
2023 HH PPS rule. We also included a reminder that we will begin public
reporting HHVBP performance data on or after December 1, 2024.
We received public comments related to these provisions from 50
commenters. Commenters included groups representing HHAs, home health
and hospice associations, hospital associations, professional
associations, hospitals, and medical centers. The remaining comments
were from individual practitioners and private citizens. A summary of
the major issues and our responses follow:
B. Proposed Changes to the Applicable Measure Set
We proposed to make changes to the applicable measure set. First,
we proposed to codify the HHVBP measure removal factors effective in CY
2024. Second, we proposed to remove five measures from the current
applicable measure set and add three measures starting in CY 2025.
Third, due to the net change in the number of measures proposed, we
proposed to adjust the weights for the measures in the OASIS-based and
claims-based measure categories starting in CY 2025. Lastly, we
proposed to update the Model baseline year for all measures starting in
CY 2025.
Comment: Some comments agreed with all proposed updates to the
expanded Model. Some commenters requested that we not make any updates
to the expanded Model at this time stating it was too soon, and that we
should wait to make proposals after HHAs have seen data on the proposed
measures. A commenter suggested that before any measure replacement is
adopted, CMS conduct a detailed comparison of the measure that would be
removed and the measure that would be adopted as a replacement to
ensure the replacement measure provides at least the scope and
granularity of information as the measure being replaced, especially in
the case where the measure domain of the proposal would be affected
(such as when a claims-based measure is proposed to replace an OASIS-
based measure).
Response: For the Expanded HHVBP Model, CMS refines the measure set
and selects quality measures with consideration to the domains of the
CMS Quality Strategy that map to the six National Quality Strategy
(NQS) priority areas: (1) Clinical quality of care; (2) Care
coordination; (3) Population/community health; (4) Efficiency and cost
reduction; (5) Safety; and (6) Patient and caregiver-centered
experience. CMS also prioritizes alignment of the measure set with the
HH QRP. Additionally, CMS considers feedback from a Technical Expert
Panel (TEP) and stakeholders when considering refinements to the
measure set. There are eight specific factors that CMS considers for
measure removal, which were detailed in the CY 2022 HH PPS final rule
and are being codified through this final rule. Further, prior to
removing a measure and adopting a replacement, CMS compares the
measures to ensure that the replacement measure is an improvement as
compared to the measure being replaced. CMS assesses the type of
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information covered by the measure as well as the level of detail. This
involves review of the specifications and analysis of the measure
performance and trends. As finalized in the CY 2022 HH PPS rule (86 FR
62315), CMS exercised its waiver authority under section 1115A of the
Act to waive certain requirements of the pre-rulemaking process for the
selection of quality and efficiency measures as necessary to test the
expanded HHVBP Model. In particular, CMS waived the requirements
outlined in section 1890A(a)(1) and (3) through (6) of the Act. Per
section 1890(a)(2) of the Act, which is not waived, CMS makes
information on the measures considered for selection publicly
available. Specifically, this means that, through notice and comment
rulemaking we propose any measures considered for selection, receive
public comments in response, and then finalize the measures in a final
rule. The names of any measures added to the expanded HHVBP Model are
posted on the CMS website by December 1.
Additionally, the adjustments to the applicable measure set
included in this rule are in response to requests from the HHA industry
through public comments on the CY 2022 HH PPS proposed rule and
questions submitted during HHVBP-specific learning events. The comments
applicable to individual proposals are summarized and responded in the
relevant sections as follows.
1. Codification of the HHVBP Measure Removal Factors
In the CY 2022 HH PPS final rule (86 FR 62312), we stated that
removal of an expanded HHVBP Model measure will take place through
notice and comment rulemaking. In that same final rule (86 FR 62311
through 62312), we adopted eight measure removal factors that we
consider when determining whether to remove measures from the expanded
HHVBP Model's applicable measure set:
Factor 1. Measure performance among HHAs is so high and
unvarying that meaningful distinctions in improvements in performance
can no longer be made (that is, topped out).
Factor 2. Performance or improvement on a measure does not
result in better patient outcomes.
Factor 3. A measure does not align with current clinical
guidelines or practice.
Factor 4. A more broadly applicable measure (across
settings, populations, or conditions) for the particular topic is
available.
Factor 5. A measure that is more proximal in time to
desired patient outcomes for the particular topic is available.
Factor 6. A measure that is more strongly associated with
desired patient outcomes for the particular topic is available.
Factor 7. Collection or public reporting of a measure
leads to negative unintended consequences other than patient harm.
Factor 8. The costs associated with a measure outweigh the
benefit of its continued use in the program.
To be consistent with the HH QRP and other quality reporting
programs (that is SNF QRP, IRF QRP, and LTCH QRP) we will finalize to
codify the eight HHVBP measure removal factors for the expanded Model
at Sec. 484.380.
We invited public comments on this proposal. We did not receive
comments specific to the codification of the Measure Removal Factors.
Therefore, we are finalizing this provision without modification.
2. Changes to the Applicable Measure Set
a. Background
In the CY 2022 HH PPS final rule (86 FR 66308 through 66310), we
proposed the applicable measure set effective in the CY 2022 pre-
implementation year and subsequent years, which includes five OASIS-
based measures, two claims-based measures, and five HHCAHPS Survey-
based measures (see Table D1). Details of these measures were included
in Tables 26 and 27 of the CY 2022 HH PPS proposed rule (86 FR 35923
through 35926).
[GRAPHIC] [TIFF OMITTED] TR13NO23.053
In that same final rule (86 FR 62310 through 62313), we stated
that, during the expanded Model, we will address any needed adjustments
or modifications to the applicable measure set. This process involves
notice and comment rulemaking for removing or adding measures and for
adopting changes to measures that we consider to substantially change
the nature of the measure. We also post the names of any measures added
to the expanded Model proposed through the rulemaking process on the
CMS website by the December 1 after publication of the applicable final
rule. Examples of changes that we might consider to be substantive will
be those in which the changes are so significant that the measure is no
longer the same measure, or when a standard of performance assessed by
a measure becomes more stringent, such as changes in acceptable timing
of medication, procedure/process, test administration, or expansion of
the measure to a new setting. If an update to a measure is necessary in
a manner that we consider to not substantially change the nature of the
measure, we will use a sub-regulatory process to incorporate those
updates to the measure specifications that apply to the program.
Specifically,
[[Page 77777]]
we will revise the information that is posted on the CMS website so
that it clearly identifies the updates and provides links to where
additional information on where the updates can be found.
We have determined that five of the measures proposed in the CY
2022 HH PPS final rule require further consideration. Specifically, we
proposed to remove the following measures from the applicable measure
set: (1) OASIS-based Discharged to Community (DTC); (2) OASIS-based
Total Normalized Composite Change in Self-Care (TNC Self-Care); (3)
OASIS-based Total Normalized Composite Change in Mobility (TNC
Mobility); (4) claims-based Acute Care Hospitalization During the First
60 Days of Home Health Use (ACH); and (5) claims-based Emergency
Department Use without Hospitalization During the First 60 Days of Home
Health (ED Use).
We proposed to replace these five measures with three measures (see
Table D2). Specifically, we proposed to add the following measures: (1)
the claims-based Discharge to Community-Post Acute Care (DTC-PAC)
Measure for Home Health Agencies; (2) the OASIS-based Discharge
Function Score (DC Function) measure; and (3) the claims-based Home
Health Within-Stay Potentially Preventable Hospitalization (PPH)
measure. The claims-based DTC-PAC measure will replace the OASIS-based
DTC measure. The OASIS-based DC Function measure will replace the two
OASIS-based TNC measures (Self-Care and Mobility). The claims-based PPH
measure will replace the claims-based ACH and ED Use measures.
We proposed to make these changes to the applicable measure set
beginning with the CY 2025 performance year and subsequent performance
years. The proposed changes will align the measures used in the
expanded HHVBP Model with the measures in the HH QRP and publicly
reported on the Care Compare website. This alignment will support
comparisons of provider quality and streamline home health providers'
data capture and reporting processes. Table D2 summarizes the proposed
applicable measure set that will be effective for the CY 2025
performance year (CY 2027 payment year).
BILLING CODE 4120-01-P
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[GRAPHIC] [TIFF OMITTED] TR13NO23.055
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BILLING CODE 4120-01-C
b. Changes to the Applicable Measure Set
We proposed to make all changes to the applicable measure set
discussed in this rule beginning with the CY 2025 performance year,
thus all changes will affect the same payment year beginning with the
CY 2027 payment year.
(1) Proposal To Replace the OASIS-based DTC Measure With the Claims-
Based DTC-PAC Measure Beginning CY 2025
We proposed to replace the current OASIS-based DTC measure with the
claims-based DTC-PAC measure. The claims-based DTC-PAC measure assesses
successful discharge to the community from an HHA, with successful
discharge to the community including no unplanned re-hospitalizations
and no death in the 31 days following discharge. This measure was
adopted as part of the Home Health Quality Reporting Program (HH QRP)
in the CY 2017 HH PPS final rule (81 FR 76765 through 76770). Details
about the measure can be found in the CY 2017 HH PPS final rule (81 FR
76765 through 76770) and the CY 2018 HH PPS final rule (84 FR 60564
through 60566). One difference between the current OASIS-based DTC
measure and the proposed claims-based DTC-PAC measure is the time
period of the measure. The proposed claims-based DTC-PAC measure uses
two years of claims data, whereas the current OASIS-based DTC measure
uses one year of OASIS data. Furthermore, the claims-based DTC-PAC
measure is aligned across PAC settings in terms of risk-adjustment,
exclusions, numerator, and measure intent, whereas the OASIS-based DTC
measure is not aligned. Therefore, making the replacement is in
accordance with Measure Removal Factor 4: A more broadly applicable
measure (across settings, populations, or conditions) for the
particular topic is available.
Additionally, the replacement will further align the expanded HHVBP
Model applicable measure set with the HH QRP measures. The HH QRP added
the claims-based DTC measure in 2017 and stopped publicly reporting the
OASIS-based DTC measure in 2017. The proposed use of the claims-based
DTC-PAC measure has additional benefits as compared to the current
OASIS-based DTC measure in that it assesses broader outcomes by
assessing post-discharge hospitalization and mortality. Specifically,
it first examines whether a patient was discharged to the community
from the PAC setting. For patients discharged to the community, this
measure examines whether they remained alive in the community without
an unplanned admission to an acute care hospital or LTCH in the 31-day
post- discharge observation window following discharge to the
community.
(2) Proposal To Jointly Replace the OASIS-Based TNC Self-Care and TNC
Mobility Measures With the OASIS-Based Discharge Function Score Measure
Beginning CY 2025
We proposed to jointly replace the TNC Self-Care and TNC Mobility
measures with the DC Function measure. We adopted the TNC Self-Care and
TNC Mobility measures in the CY 2019 HH PPS final rule (83 FR 56529
through 56535) for use in the original Model beginning with performance
year 4 (CY 2019). The TNC measures, which are composite measures,
replaced three individual measures (Improvement in Bathing, Improvement
in Bed Transferring, and Improvement in Ambulation-Locomotion). For
these composite measures, HHA performance on the three mobility OASIS-
items are included in the TNC measures. The TNC measures also include
six additional activities of daily living (ADL) measures to create a
more comprehensive assessment of HHA performance across a broader range
of patient ADL outcomes. The TNC measures report the magnitude of
patient change (either improvement, no change, or decline) across six
self-care and three mobility patient functional activities. This
methodology accounts for changes to the scores on individual OASIS
items while also considering that not all patients are able to improve
on all aspects of each composite measure. The DC Function measure
determines how successful each HHA is at achieving an expected level of
functional ability for its patients at discharge. An expectation for
discharge function score is built for each HHA episode by accounting
for patient characteristics that impact their functional status. The
final DC Function measure for a given HHA is the proportion of that
HHA's episodes where a patient's observed discharge score meets or
exceeds their expected discharge score. Functional status is measured
through Section GG of OASIS assessments, which are cross-setting items.
Section GG evaluates a patient's capacity to perform daily activities
related to three self-care (GG0130) activities and eight mobility
(GG0170) activities.
The DC Function measure has been proposed for adoption in all PAC
settings. We included the proposed DC Function measure on the 2022
Measure Under Consideration (MUC) list for the Inpatient Rehabilitation
Facility QRP, Home Health QRP, Long Term Care Hospital QRP, SNF QRP,
and SNF VBP.\128\ It is proposed for the Skilled Nursing Facility (SNF)
Value-Based Purchasing program in the FY 2024 SNF PPS proposed rule and
in this CY 2024 HH PPS proposed rule for adoption in the HH QRP
beginning CY 2025; details about the measure can be found in section
III.D. of the proposed rule. We proposed adopting the measure for the
expanded HHVBP Model on the same timeline as the HH QRP (CY 2025) given
that the GG items used in the measure have gone through extensive
testing, and the measure has received conditional support for
rulemaking as part of the most recent Measure Applications Partnership
(MAP) process. While the DC Function measure is not yet implemented in
the HH QRP or other PAC programs, the OASIS data elements used to
calculate this measure have been collected since 2019. As such, we
believe HHAs have had sufficient time to ensure successful reporting of
the data elements needed for this measure.
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\128\ See CMS, Measures Under Consideration List for 2022 (Dec.
1, 2022), available at https://mmshub.cms.gov/sites/default/files/2022-MUC-List.xlsx.
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Replacement of the TNC measures with the DC Function measure will
further align the expanded HHVBP Model measure set with the HH QRP
measures, as well as with other PAC settings. For these reasons, this
replacement is in accordance with Measure Removal Factor 4.
Additionally, the DC Function measure addresses self-care and mobility
through a single measure rather than two measures, thereby streamlining
the calculation and reporting of measure results.
(3) Proposal To Jointly Replace the Acute Care Hospitalization During
the First 60 Days of Home Health Measure and Emergency Department Use
Without Hospitalization During the First 60 Days of Home Health Measure
With the Home Health Within Stay Potentially Preventable
Hospitalization (PPH) Measure Beginning CY 2025
We proposed to jointly replace the Acute Care Hospitalization
During the First 60 Days of Home Health Measure (``ACH'' measure) and
Emergency Department Use Without Hospitalization During the First 60
Days of Home Health Measure (``ED Use'' measure) with the Home Health
Within Stay Potentially Preventable
[[Page 77781]]
Hospitalization (PPH) Measure. The current specifications for the PPH
measure are available on the CMS website at https://www.cms.gov/files/document/hh-qrp-specificationspotentiallypreventablehospitalizations.pdf.
The CY 2022 HH PPS final rule (86 FR 62340 through 62345) proposed
the joint replacement of the ACH measure and ED Use measure with the
PPH measure in the HH QRP beginning CY 2023. This replacement under the
HH QRP was made under Measure Removal Factor 6: A measure that is more
strongly associated with desired patient outcomes for the particular
topic is available. Additional details of the reason for replacement
are found in the CY 2022 HH PPS final rule (86 FR 62340 through 62345).
Because these measures have been proposed to be jointly replaced with
the PPH measure in the HH QRP beginning CY 2023, we are proposing to
remove them from the expanded HHVBP Model.
In the CY 2022 HH PPS proposed rule (86 FR 35929), we requested
comments on whether we should align the expanded HHVBP Model with the
proposed changes for the HH QRP by proposing to remove the same two
measures (``ACH'' and ``ED Use'' measures) from the expanded Model in a
future year. As summarized in the CY 2022 HH PPS final rule (86 FR
62312), the feedback was generally supportive, recommending that the
expanded HHVBP Model's applicable measure set align with the HH QRP
measures. Replacing ACH and ED Use with PPH will further align the
expanded Model's applicable measure set with the HH QRP measures.
We proposed no changes to the five HHCAHPS Survey-based measures
used for the expanded HHVBP Model.
We invited public comments on these proposals.
Comment: Several commenters supported the changes to the applicable
measure set, some stating their belief that measures should be
harmonized with those in HH QRP and other VBP programs as well as other
CMS initiatives creating efficiencies for HHAs' performance improvement
strategies. A commenter expressed their support for reducing the total
number of measures in the Model. Another commenter stated that the
Discharge Function measure (when viewed in combination with the DTC-PAC
measure) shows a more balanced reflection of a patient's return to
function in the home setting and successful care transitions from Post
Acute Services to independence in the home environment.
Response: We appreciate this supportive feedback.
Comment: A few commentors commented that it was too soon to make
changes to the applicable measure set, given that HHAs have invested a
significant amount of effort to improve their performance on the
original set of measures and are not prepared to begin shifting to
accommodate a new set of applicable measures, and that changes will
require software updates that are costly and time-consuming.
Response: The policy updates included in this rule are effective in
CY 2025. This means HHAs new to the expanded Model will have had three
years to improve performance on the applicable measures proposed in the
CY 2022 HH PPS final rule. And, those HHAs located in the nine states
that competed in the original Model have had five years to improve
performance on those same measures. By including the new measure set in
the 2024 rulemaking cycle, HHAs have more than a year to prepare. And,
we believe we have given sufficient notice so that software updates can
be made timely.
Comment: Most commenters were supportive of the replacement of the
OASIS-based DTC measure with the claims-based DTC-PAC measure. A
commenter stated their belief that the claims-based version is a better
measure of their patients' discharge to community rates.
Response: We appreciate these commenters' understanding of the
value of the DTC-PAC measure and the supportive feedback.
Comment: A commenter expressed their concern that the DTC-PAC
measure will penalize HHAs for patients with progressive disease states
and for outcomes that are beyond the control of the HHA.
Response: Since the introduction of this measure into the HH QRP,
we have not seen evidence to corroborate these concerns.
Comment: Most comments related to concerns about adoption of the DC
Function measure in the expanded HHVBP Model were also submitted
regarding the HH QRP. Mutual concerns are related to the imputation
approach and methodology, validity of measure testing, lack of
Consensus-Based Entity (CBE) endorsement, timing and broad approach for
implementation, and applicability for maintenance patients. As stated
in the proposed rule, final achievement thresholds and benchmarks will
be provided in the July 2024 Interim Performance Report (IPR). To help
provide feedback to HHAs on the applicable measure set effective in CY
2025, we plan to make the most current HHA-specific performance data
for the applicable measures available to each HHA in iQIES. We intend
for this to include current performance relative to other HHAs
nationally as soon as administratively possible and before the start of
the CY 2025 performance year and again before the IPR scheduled for
July 2025.
Comment: The majority of commenters were supportive of replacing
the ACH and ED Use measures with the PPH measure stating their belief
that this measure reflects that not all hospitalizations or ED visits
that occur while a patient is receiving home health services can be
mitigated or prevented; the measure more accurately reflects the
efforts that HHAs undertake to prevent hospitalizations without
penalizing them for taking on more acutely ill patients; and is more
likely to reflect whether HHAs are providing proper management and care
as well as clear discharge instructions and referrals, allowing CMS to
better assess quality of care for the purposes of the expanded HHVBP
Model.
Response: We appreciate these commenters' understanding of the
value of the PPH measure and the supportive feedback.
Comment: A commenter expressed concern that the PPH measure does
not effectively gauge readmissions and does not truly mirror the
quality of care of an HHA without providing reasons for their concern.
Another commenter recommended a delay in the inclusion of this measure
into the expanded Model until CMS can provide additional transparency
with data around coding practices of inpatient providers.
Response: Since the introduction of this measure into the HH QRP,
we have not seen evidence to corroborate these concerns. Additionally,
as indicated in the CY 2022 HH PPS final rule (86 FR 62343), the
process of developing the measure specifications included performing
analyses on Medicare claims data to identify the most frequent
diagnoses associated with admissions among home health beneficiaries.
After consideration of the public comments received, we are
finalizing these provisions without modification.
3. Measure Categories
As shown in Table D3, the expanded Model utilizes established
measure categories that represent the data sources including OASIS-
based, claims-based, and HHCAHPS Survey-based. Although measures in the
original Model have been added, removed, or substituted in the past,
the measure category weights have remained constant, maintaining the
weighting
[[Page 77782]]
proportions of 35 percent, 35 percent, and 30 percent for OASIS-based,
claims-based and HHCAHPS Survey-based measures for the larger-volume
cohort, respectively. For HHAs in the smaller-volume cohort, the
weighting proportions of the OASIS-based and claims-based measures are
50 percent and 50 percent, respectively. Weights for individual
measures within these categories have changed in the past due to
changes to the applicable measure set (for example, replacing three
individual OASIS-based measures with the two TNC measures) and to
encourage improvement in the claims-based measures. With the proposed
changes to the applicable measures in the proposed rule, the number of
measures within the OASIS-based measure category will change. Table D3
illustrates the change in the measure set including the removal of the
OASIS-based DTC measure, the replacement of the two OASIS-based TNC
change measures to the OASIS-based DC Function measure, and the
replacement of the claims-based Acute Hospitalization Measure and
claims-based ED Use Measure for the claims-based PPH measure. Despite
the changes to the applicable measure set, we intend to maintain the
existing measure categories and their relative weights. For example,
for the larger-volume cohort, the claims-based measures will continue
to have a total weight of 35 percent. The relatively higher weight
given to the claims-based measures reflects our belief in the
importance of those measures relative to OASIS-based measures, which
use self-reported data and that the incentive to reduce hospital
utilization is maintained. We continually monitor the effects of
weighting and will propose changes if we determine there is a need
through future rulemaking.
[GRAPHIC] [TIFF OMITTED] TR13NO23.056
4. Weighting and Redistribution of Weights Within the Measure
Categories
a. Background
As proposed in the CY 2022 HH PPS final rule (86 FR 62240), the
expanded HHVBP Model uses the same policies regarding the weighting of
measures and the redistribution of weights when measures or measure
categories are missing as under the original Model (83 FR 56536).
As previously discussed in section IV.B.2.b of the proposed rule,
to align with quality measures used in the HH QRP, CMS proposed to
replace the OASIS-based DTC measure with the claims-based DTC measure,
jointly replace the claims-based ACH and ED Use measures with the
claims-based PPH measure, and jointly replace the OASIS-based TNC
Change in Mobility and TNC Change in Self-Care measures with the OASIS-
based DC Function measure in CY 2025 and subsequent performance years.
Due to these changes to the applicable measure set and the data
sources, CMS proposed changes in weights and redistribution of weights
within the measure categories accordingly.
b. Quality Measure Weights Within Measure Categories
Along with the proposed revisions to the current measure set, we
proposed to revise the weights of the individual measures within the
OASIS-based measure category and within the claims-based measure
category. Currently, the OASIS-based, claims-based, and HHCAHPS Survey-
based measures
[[Page 77783]]
contribute 35 percent, 35 percent, and 30 percent, respectively, to the
Total Performance Score (TPS) for HHAs in the larger-volume cohort. For
HHAs in the smaller-volume cohort, the OASIS-based and claims-based
measures both contribute 50 percent to the TPS. The weights of the
measure categories, when one category is missing, are based on the
relative weight of each category for which measures are available. For
example, if an HHA is missing the HHCAHPS Survey-based measure
category, the remaining two measure categories (OASIS-based and claims-
based) each have a weight of 50 percent. Table 28 in the CY 2022 HH PPS
final rule (86 FR 62323 through 62324) presents the current weights for
measures and measure categories under various reporting scenarios.
Table D4 shows the measure weights by quality measure in the
expanded HHVBP Model currently in place and proposed for CY 2025 and
subsequent performance years for HHAs in the larger-volume and smaller-
volume cohort, respectively.
As discussed in section IV.B.3 of the proposed rule, for HHAs in
the larger-volume cohort, we are keeping the measure category weights
unchanged at 35 percent, 35 percent, and 30 percent for OASIS-based,
claims-based, and HHCAHPS Survey-based measure categories,
respectively. Similarly, for HHAs in the smaller-volume cohort, we are
keeping the measure category weights unchanged at 50 percent and 50
percent for OASIS-based and claims-based measure categories,
respectively. By keeping these measure category weights unchanged, the
number of individual measures in each measure category will affect the
magnitude of the individual measure weights. As proposed, changes to
the applicable measure set will decrease the OASIS-based measures from
five measures to three, while the number of individual measures for the
claims-based measures and HHCAHPS Survey-based measures will remain
unchanged. Given these proposals, the individual measure weights within
the OASIS-based measure category will be higher than those under the
current applicable OASIS-based measure category. The subsequent
sections discuss in more detail the proposed measure weight
redistributions for each measure category.
(1) Proposal To Redistribute Weights Within the OASIS-Based Measure
Category
Because we proposed to replace the two TNC measures jointly with
the DC Function measure, we proposed that the sum of the TNC measure
weights be given to the DC Function measure. This will maintain the
same relative weight for functional measures. Due to the proposed
removal of the OASIS-based DTC measure, we also proposed to distribute
the weight for that measure across the remaining three OASIS-based
measures. In addition, we proposed to maintain a relatively small
weight for Improvement in Dyspnea compared to the other measures in the
applicable measure set. Under the current measure set, Improvement in
Dyspnea is weighted at 5.833 for larger-volume HHAs and 8.333 for
smaller-volume HHAs. Similarly, under the proposed applicable measure
set, Improvement in Dyspnea will be weighted at 6.000 for the larger-
volume cohort and 8.571 for the smaller-volume cohort. This approach
aims to encourage improvement in quality of care, while reducing its
importance relative to other quality measures that encourage both
improvement and maintenance of quality care for all home health
patients. These proposed changes will be effective in CY 2025. Table D4
describes the proposed measure weight redistributions for all measure
categories by larger-volume and smaller-volume cohort, respectively. In
addition to increasing the individual measure weight for Improvement in
Dyspnea to 6.000, CMS proposed to increase the individual measure
weight for Improvement in Management of Oral Medications to 9.000 and
to assign the individual measure weight for DC Function to 20.000 for
HHAs in the larger-volume cohort. These changes maintain the overall
weight of the OASIS-based measures at 35 percent for the larger-volume
cohort and 50 percent for the smaller-volume cohort.
[[Page 77784]]
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(2) Proposal To Redistribute Weights Within the Claims-Based Measure
Category
Because we proposed to remove the ACH and ED Use measures, we
proposed to allot an individual measure weight of 26.000 to the final
PPH measure. The redistribution to the PPH measure is intended to give
this measure approximately the same combined weight as the ACH and ED
Use measures had previously. In addition, CMS proposed to allot an
individual measure weight of 9.000 to the claims-based DTC-PAC measure
for the larger-volume cohort. The slight increase in weight for the
claims-based DTC-PAC measure maintains the same overall weight of
35.000 for claims-based measures for the larger-volume cohort. Table D4
lists the corresponding individual claims-based measure weight
redistributions applicable to HHAs in the smaller-volume cohort.
(3) Weights Within the HHCAHPS-Based Measure Category
Given there were no changes proposed to the measures within the
HHCAHPS Survey-based measure category, we proposed to keep the
individual measure weights for measures in this measure category
unchanged. Specifically, each HHCAHPS Survey-based measure will
continue to have an individual measure weight of 6.000 for HHAs in the
larger-volume cohort. Given that HHAs in the smaller-volume cohort are
not assessed based on their HHCAHPS Survey-based measure performance,
the individual measure weight is set to zero (0.000) for the smaller-
volume cohort (see Table D4).
We invited public comments on these proposals.
Comment: A few commenters provided feedback related to the
redistribution of weights for individual measures within the OASIS-
based measure category. A commenter stated that the weight of the DC
Function measure was too high. Another commenter expressed concern that
the weight of the DC Function measure is more than the combined weight
of the two TNC measures it is replacing.
Response: With the reduction in the number of total measures in the
program and in the OASIS category, and the decision to maintain the
weights of each category, it was necessary to increase weight in either
some or all the measures in the OASIS category. When redistributing the
weights among the remaining measures in the OASIS category, we selected
a weight for the DC Function measure that is slightly higher than the
current combined weight of the TNC measures. We selected this weight
because of our belief that function is critical for beneficiaries to
safely remain in their home. Further, the measure's robust risk
adjustment methodology that captures the different functional potential
of all home health patients and the imputation methodology that
mitigates missing data challenges and limits gaming makes it an
important quality measure that should have the weight that it has in
the expanded Model. As with all our measures, we will monitor and
evaluate the impact of the weighting of the DC Function measure.
Comment: A few commenters stated that the redistribution of weights
for the DTC-PAC and PPH measures are too heavy and will promote
``cherry-picking.'' They believe the PPH measure targets patients with
at least one potentially preventable hospitalization observation stay
during a home health episode, and is challenging for patients with
complex needs, who have chronic
[[Page 77785]]
conditions that are subject to exacerbation. Another commenter suggests
that the weight of the DTC-PAC measure seems extreme for patients that
are often at a stage in disease progress but are not ready to elect the
Medicare Hospice Benefit.
Response: Although the total number of measures have been reduced
overall, there has not been any reduction in the weight or the number
of measures in the claims category. The PPH measure may be considered
as an improvement of the ACH measure because it includes those
conditions that are preventable, and we kept its weight very close to
the original Model. Evaluation of the ACH readmission measure showed
better quality results and did not identify any access issues. We
decided to maintain the weight of the PPH measure to encourage further
improvement in reducing hospitalizations that are potentially
preventable. We believe our proposed weighting will encourage increased
focus on quality of care and on accountability for areas of significant
Medicare spending, which includes hospitalizations. The DTC-PAC measure
excludes patients discharged to home or facility-based hospice care.
Thus, discharges to hospice are not considered discharges to community,
but rather are excluded from the measure calculation. We wish to also
note that including 31-day post-discharge mortality outcomes is
intended to identify successful discharges to community, and to avoid
the potential unintended consequence of inappropriate community
discharges that bypass hospice care. As with all our measures, we will
monitor and evaluate the impact of the weighting of the PPH measure.
Comment: Another commenter believes that the weighting of the PPH
measure (26%) is disproportionately weighted higher than other
important measures and devalues the patient's functional improvement
and ability to remain at home long term; and the next-highest measure
weighting is the new DC Function measure (20%). A commenter recommend
that CMS change the weighting of PPH measure to 20% and the weighting
of the DTC-PAC measure to 15%. While the PPH measure looks at a single
outcome, the DC Function measure (when considered in combination with
the DTC-PAC measure) provides a more balanced reflection of a patient's
return to function in the home setting and successful care transitions
from PAC services to independence in the home environment. Accordingly,
this commenter recommends that CMS reduce the weighting of the claims-
based PPH measure to 20% and the increase the weighting of the DTC-PAC
measure to 15%.
Response: We agree that the DC Function and DTC-PAC measures are
important measures. As discussed in this section, while we proposed to
weight these two measures lower than the PPH measure, as the commenter
noted, the DC Function measure is the next heaviest weighted measure,
followed by DTC-PAC measure (which has the same weighting as
Improvement in Management of Oral Medications). As previously noted, we
selected the weight for PPH to encourage further improvement in
reducing hospitalizations that are potentially preventable and place
increased focus on accountability for areas of significant Medicare
spending. We believe the proposed reweighting balances our interest in
encouraging focus on reducing hospitalizations as well as on other
quality improvement efforts, such as achieving an expected level of
functional ability for patients at discharge and successful discharge
to the community from an HHA. As with all our measures, we will monitor
and evaluate the impact of the weighting of the DC Function measure.
Regarding the commenter's suggestion to reweight the PPH measure to 20
percent and the DTC-PAC measure to 15 percent, for introduction of
these measures into HHVBP, we are proposing weights for these two
measures that are close to the weights for the current claims-based
measures. We will continue to evaluate these measures and will be
convening a TEP and will solicit their input on weighting.
Comment: Some commenters believed that the proposed reweighting may
disincentivize some HHAs from serving vulnerable populations that are
at risk for hospitalizations. A commenter stated that the proposed
reweighting may incentivize hospital stays.
Response: Although the total number of measures have been reduced
overall, requiring some reweighting of measures to occur, there has not
been any reduction in the weight of the claims-based measure category
or the number of measures in the claims-based measure category and only
a minute change to the PPH measure. We believe that the selected
weighting will encourage HHAs to further enhance their service
structures to appropriately address the needs of Medicare beneficiaries
of all types by using quality improvement processes that support the
expanded Model's quality measures, including processes intended to
reduce hospitalizations. We do not believe that the proposed weighting
of the measures will discourage HHAs from serving vulnerable
populations or incentivize further hospital stays. Rather, we believe
that weighting the measures to increase the emphasis on the PPH measure
will encourage HHAs to increase the coordination with other providers
and suppliers such as physicians and inpatient facilities (hospitals
and post-acute care (PAC) facilities) in order to reduce ED visits and
hospital admissions as was determined in the evaluation of the HHVBP
model. We note that the claims-based PPH measure is included in the HH
QRP and reflects goals consistent with other CMS initiatives that focus
on reducing avoidable hospital admissions, such as the Hospital
Readmissions Reduction Program. We expect the proposed increase in the
weight of the PPH measure to incentivize avoiding hospital stays, not
additional hospitalizations. We also do not expect that the weighting
will cause HHAs to implement policies that do not serve vulnerable
populations at risk of hospitalization, but will instead encourage care
coordination between HHAs and other health care providers to avoid
hospitalizations, which may result in improved care for all
beneficiaries, including vulnerable populations.
Comment: Although we did not propose changes to the weights for the
measure categories, a few comments expressed concerns about the weights
of the measure categories as described previously. MedPAC believes the
weights for the OASIS-based measure category are too heavy given their
concerns about the accuracy of OASIS data. One national association
stated that some of their members believe the weight assigned to
HHCAHPS measure category is too high claiming that the types of
beneficiaries their members serve--lower socioeconomic status, more
complex, often dual eligible status--are less likely to complete the
HHCAHPS survey. They request that CMS look at how to account for
discrepancies in HHCAHPS response rates based on the population served
in the expanded HHVBP Model.
Response: We will add the weighting of measure categories to the
agenda for the TEP planned for November of this year and share these
comments with the HHVBP Technical Expert Panel (TEP) and we will
monitor to determine if the measures will impact beneficiaries of lower
socioeconomic status.
We received no comments concerning individual measure weights for
the HHCAHPS-based measure category.
[[Page 77786]]
After consideration of the public comments received, we are
finalizing these provisions without modification.
(4) Alternatives Considered
Several measure weighting alternatives were considered prior to
choosing the previously discussed proposals. Tables D5 describes these
alternative options for HHAs in the larger-volume cohort, including
weights proportional to the weights for the initial measure set (Option
1), maintaining measure category weights consistent with current
measure set weights and equal within-category weights (Option 2), using
equal measure category weights and maintaining within-category weight
proportions (Option 3), using equal measure category weights and equal
within-category weights (Option 4), and having equal weights for all
measures (Option 5). We also considered these options for the smaller-
volume cohort and came to the same conclusions. Therefore, we only
provided a table with measure weighting alternatives for the larger-
volume cohort.
[GRAPHIC] [TIFF OMITTED] TR13NO23.058
Of these alternatives, Option 1 is most consistent with the final
weights and most consistent with the weights used for the current
measure set; however, it fails to apply the minimal weight possible for
Improvement in Dyspnea. Similarly, Options 2-4 do not reduce the weight
for Improvement in Dyspnea and deviate more substantially than Option 1
from the current weighting scheme. By attributing equal weight to all
measures in the proposed measure set, Option 5 satisfies the minimal
weight criterion for Improvement in Dyspnea; however, it does so at the
expense of applying the same weight, which is inconsistent with
previous decisions about apply differential weighting to measures to
incentivize HHAs to act on improving measures with higher weights in
the applicable measure set as outlined in the CY 2022 HH PPS final rule
(86 FR 62322).
5. Updates to the Model Baseline Year
a. Background
In the CY 2022 HH PPS final rule, we proposed that the first Model
baseline year for the expanded HHVBP Model will be CY 2019 (January 1,
2019 through December 31, 2019), the first performance year will be CY
2023, and the first payment year will be CY 2025 (86 FR 62294 through
62300). We decided on CY 2019 as the Model baseline year, as opposed to
CY 2020 or CY 2021, due to the potentially de-stabilizing effects of
the public health emergency (PHE) on the CY 2020 data and because it
was the most recent full year of data available prior to CY 2020. The
performance year and payment year were proposed after originally
proposing CY 2022 to be the first performance year and CY 2024 to be
the first payment year. We decided to delay implementation by 1 year to
allow additional time for HHAs to prepare and learn about the expanded
Model, thus CY 2022 was defined as the pre-implementation year. In the
CY 2023 HH PPS final rule, we changed the Model baseline year to CY
2022 (87 FR 66869 through 66874). We decided to use more recent data
from the CY 2022 time period because it is more likely to be aligned
with performance years' data under the expanded Model, and provide a
more appropriate baseline for assessing HHA improvement for all
measures under the expanded Model as compared to both the pre-PHE CY
2019 data, as previously proposed for existing HHAs, and the CY 2021
data, as previously proposed for new HHAs certified between January 1,
2019 and December 31, 2020.
Additionally, in the CY 2022 HH PPS final rule (86 FR 62308 through
62309),
[[Page 77787]]
we proposed the current measure set, as indicated in Table 25 of that
final rule. The removal and replacement of measures from the current
measure set necessitates an updated implementation and data reporting
timeline, which will be applied to all applicable measures so that the
Model baseline year is consistent across measures.
b. Proposal To Update the Model Baseline Year
Beginning with performance year CY 2025, we proposed to update the
Model baseline year to CY 2023 for all applicable measures in the
proposed measure set, including those measures included in the current
measure set. The one exception is the new claims-based DTC-PAC measure,
which uses two years of data. As such, the Model baseline year for the
claims-based DTC-PAC measure will be CY 2022 and CY 2023 for the 2-year
performance year spanning CY 2024 and CY 2025. For performance years CY
2023 and CY 2024, the Model baseline year will continue to be CY 2022.
Table D6 lists the data periods for each measure and respective Model
baseline, performance year, and payment years.
[GRAPHIC] [TIFF OMITTED] TR13NO23.059
If we finalize our proposal to use CY 2023 for the Model baseline
year, we will provide HHAs with the final achievement thresholds and
benchmarks in the July 2024 Interim Performance Report (IPR). For all
measures but the claims-based DTC-PAC measure, this timeline allows for
one year of performance between the first performance year and the
proposed updated Model baseline year. Because the claims-based DTC-PAC
measure is a two-year measure, there will be no gap between the
proposed updated Model baseline year and the first performance year,
which will be consistent with the rollout of the original HHVBP Model,
in which benchmarks and achievement thresholds using CY 2015 data were
made available to HHAs during the summer of the first performance year
(CY 2016).
Furthermore, because the claims-based DTC-PAC measure is a 2-year
measure, there will be an overlap in how discharge to community is
measured for the expanded Model. Specifically, CY 2024 performance will
be based on the current measure set, which includes the OASIS-based DTC
measure. For the OASIS-based DTC measure, CY 2024 performance will be
compared to baseline year CY 2022. CY 2025 performance will be based on
the proposed measure set, which includes the claims-based DTC-PAC
measure and thus replaces the OASIS-based DTC measure. Because the DTC-
PAC measure is a two-year measure, CY 2025 performance for the claims-
based DTC-PAC measure will be calculated based on two years of
performance data (CY 2024/2025) and compared to two years of baseline
year data (CY 2022/2023). Thus, for both the OASIS-based DTC measure
and the claims-based DTC-PAC measure, CY 2022 data will be used to
calculate performance in a Model baseline year, and CY 2024 data will
be used to calculate performance in a performance year. Beyond CY 2025,
data for calculating DTC-PAC performance will continue to overlap. For
example, CY 2026 DTC-PAC (claims-based) performance will be based on
data from CY 2025/2026, which overlaps by one year with the CY 2025
DTC-PAC (claims-based) performance year data. See Table D7. The DTC-PAC
measure was designed as a 2-year measure to optimize reliability. In
addition, each performance year will consist of 1 year of performance
data that does not overlap with the prior performance year data, which
provides sufficient opportunity to capture quality improvement over
time. Finally, the DTC-PAC (claims-based) will provide a smoother
performance trend over time compared to 1-year measures by reflecting
performance across a longer reporting period.
[[Page 77788]]
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c. Alternatives Considered
We considered several alternative timelines for updating the Model
baseline year. First, we considered leaving the baseline year at CY
2022 for those measures on the previously proposed measure set. We
opted against this alternative because it uses less recent data and
makes it more difficult for HHAs to track which achievement thresholds
and benchmarks are based on which years of baseline data.
Second, because of the time between the Model baseline year and the
performance year, we considered delaying the implementation of the
claims-based DTC-PAC measure by one year. Under this scenario, the
measure's baseline year will remain CY 2022/2023, but the measure's
first performance year will be CY 2025/2026. The first payment year
that uses the claims-based DTC-PAC measure will then be CY 2028. As
such, CY 2025 will be a transition year in between the current
applicable measure set and the proposed applicable measure set. During
this transition year, the OASIS-based DTC measure could be retained
through CY 2025 or removed. Retaining the OASIS-based DTC measure
during the transition year will ensure that the concept of being
discharged to the community will be reflected in all performance and
payment years, while removing it before the transition year will better
align with the removal of the other measures as proposed. Because we
view the concept of being discharged to the community as an important
aspect of home health quality, we favor retaining the OASIS-based DTC
measure during the transition year over removing it, assuming we delay
implementation of the claims-based DTC measure. We rejected delayed
implementation, however, because it temporarily increases the
complexity of the expanded Model and requires that the Model uses the
legacy OASIS-based DTC measure for another year, despite its removal
from the HH QRP.
Third, we considered delaying implementation of the OASIS-based DC
Function measure, which is proposed for CY 2025 implementation in the
HH QRP as indicated in section III.D.1. of the proposed rule. Although
a delay will allow more time to evaluate the measure's performance
prior to HHVBP implementation, data utilized in this measure have been
a part of the HH QRP's OASIS assessment tool since CY 2019. We prefer
the proposed timeline for the OASIS-based DC Function measure because
it expedites alignment with the HH QRP, SNF VBP, and the other PAC
programs and the timing corresponds with the proposed removal and
replacement of other measures in the Model.
Lastly, we considered delaying implementation for all replacement
measures, such that their Model baseline years will end on December 31,
2023, and their first performance years will end on December 31, 2026
(CY 2026 for the OASIS-based DC Function and claims-based PPH measures
and CY 2025/2026 for the claims-based DTC-PAC measure). Under this
alternative, the first payment year to use the proposed applicable
measure set will be CY 2028. We favor the proposed timeline because we
prefer aligning more closely with the HH QRP measure set as early as
possible.
We invited public comments on this proposal.
Comment: Many commenters requested that we not change the Model
baseline year, claiming it ``moves the goal post'' negating the quality
improvement efforts they have made in preparation for the expanded
Model. Another commenter believe that moving the baseline penalizes
HHAs that took the initiative to improve quality and rewards those HHAs
that have not started improving performance since the start of the
expanded HHVBP Model. A couple of commenters expressed concern that
baseline data will not be available until October 2024.
Response: We believe that updating the Model baseline in 2025
serves several purposes: (1) it measures an HHA's improvement based on
recent changes in performance using the most current data available,
(2) it establishes a baseline year that it is the same for the existing
measures as for the newly adopted measures, and (3) it supports
continuous quality improvement. We appreciate the comments regarding
the consideration of HHAs' efforts to improve quality. However, to add
new measures to HHVBP, we must establish a Model baseline year for
these measures. We believe that it is beneficial to align the Model
baseline year for the existing measures with the new measures,
particularly given that the new measures contribute heavily to the HHA
performance scores. Maintaining different Model baseline years could
cause more burden and confusion, compared to updating the Model
baseline year for all measures at the same time. The expanded HHVBP
Model performance scoring methodology rewards progress in raising
quality scores not only through improvement points, but also through
achievement points. Under the expanded Model, achievement is
prioritized relative to improvement. As we stated in the CY 2023 HH PPS
final rule (87 FR 66874), quality improvement efforts undertaken by
HHAs that show impact on performance year quality scores may be
recognized through achievement points, regardless of when those efforts
were initiated. For example, an HHA that has improved their overall
quality will potentially get more achievement points attributed to
their TPS than from improvement points and would potentially result in
the same payment adjustment if we had not changed the baseline. As
stated in the proposed rule, final achievement thresholds and
benchmarks will be provided in the July 2024 Interim Performance Report
(IPR). To help provide feedback to HHAs on the applicable measure set
effective in CY 2025, we plan to make the most current HHA-specific
performance data for the applicable measures available to each HHA in
iQIES. We intend for this to include current performance relative to
other HHAs nationally as soon as
[[Page 77789]]
administratively possible and before the start of the CY 2025
performance year and again before the first IPR scheduled for July
2025.
After consideration of the public comments received, we are
finalizing the provisions without modification.
6. Future Topics for Measure Considerations
We will take into consideration opportunities for further alignment
with measures in the HH QRP and publicly reported on Home Health Care
Compare because alignment will facilitate comparative assessments of
provider quality and streamline home health providers' data capture and
reporting processes. If we consider adding new measures that require
data that is not already collected through existing quality measure
data reporting systems, we will propose that option in future
rulemaking while being mindful of provider burden.
To further the goals of the CMS National Quality Strategy, CMS
leaders from across the Agency have come together to move towards a
building-block approach to streamline quality measures across CMS
quality programs for the adult and pediatric populations. This
``Universal Foundation'' \129\ of quality measures will focus provider
attention, reduce burden, identify disparities in care, prioritize
development of interoperable, digital quality measures, allow for
cross-comparisons across programs, and help identify measurement gaps.
The development and implementation of the Preliminary Adult and
Pediatric Universal Foundation Measures will promote the best, safest,
and most equitable care for individuals as we all come together on
these critical quality areas. As CMS moves forward with the Universal
Foundation, we will be working to identify foundational measures in
other specific settings and populations to support further measure
alignment across CMS programs as applicable.
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\129\ Jacobs, D.B., Schreiber, M., Seshamani, M., Tsai, D.,
Fowler, E., & Fleisher, L.A. (2023). Aligning quality measures
across CMS--the universal foundation. New England Journal of
Medicine, 388(9), 776-779. https://www.nejm.org/doi/full/10.1056/NEJMp2215539.
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In recognition of persistent health disparities and the importance
of closing the health equity gap, we will consider future modifications
that promote health equity and ways in which we could incorporate
health equity goals into the Model. Any changes will be proposed in
future notice and comment rulemaking.
While we did not make any specific proposals here, we invited
interested parties to suggest future measures and the value they may
provide to the expanded HHVBP Model.
Comment: We received one suggestion for a measure to be included in
the Model, the Medicare Spending Per Beneficiary measure.
Response: We appreciate this suggestion and will share it with the
HHVBP TEP as future measures for consideration is an agenda item for
the TEP planned for November of this year.
C. Proposed Changes to the Appeals Process
1. Background
As codified at Sec. 484.375, the appeals process under the
expanded HHVBP Model allows HHAs to submit recalculation requests for
the interim performance reports and the Annual Total Performance Score
(TPS) and Payment Adjustment Report (Annual Performance Report or APR).
Under this process, an HHA may also make a reconsideration request if
it disagrees with the results of a recalculation request for the APR.
We refer the reader to the CY 2022 HH PPS final rule (86 FR 62331
through 62332) for details of the appeals process. We also proposed (86
FR 62329) that we will make available the Final APR after all
reconsideration requests are processed and no later than 30 calendar
days before the payment adjustment takes effect annually, both for
those HHAs that requested a reconsideration and all other competing
HHAs.
2. Proposed Revisions
We proposed revisions to the policy at Sec. 484.375(b)(5) to
acknowledge the ability of the CMS Administrator to review
reconsideration decisions, and to change the time for filing a request
for reconsideration. In particular, we proposed to amend Sec.
484.375(b)(5) to specify that an HHA may request Administrator review
of a reconsideration decision within 7 days from CMS' notification to
the HHA contact of the outcome of the reconsideration request. We
proposed to amend Sec. 484.375(b)(5) to state that the CMS
reconsideration official issues a written decision that is final and
binding 7 calendar days after the decision unless the CMS Administrator
renders a final determination reversing or modifying the
reconsideration decision. And, that an HHA may request within 7
calendar days of the decision that the CMS Administrator review the
reconsideration decision. The CMS Administrator may decline to review
the reconsideration decision, render a final determination, or choose
to take no action on the request for administrative review.
Reconsideration decisions are considered final if the CMS Administrator
declines an HHA's request for review or if the CMS Administrator does
not take any action on the HHA's request for review within 14 days.
This proposed change will ensure that accountability for the
decisions of CMS is vested in a principal officer and brings the
reconsideration review process to a more similar posture as other CMS
appeals entities that provide Administrator review. This revision also
ensures that HHAs are aware that administrative review is available to
those HHAs who wish to seek additional review of a reconsideration
decision.
We invited public comment on this proposal.
Comment: In addition to support of the added step to the HHVBP
appeals process, a commenter asked that we give HHAs more time to make
the final request. Another commenter suggested that we notify them why
an appeal is not moving forward.
Response: To accommodate the time needed to process all
reconsideration requests, issue final reports, notify HHAs of their
payment adjustment percentages for the upcoming calendar year 30 days
before the start of that year, and submit payment adjustment
percentages to the MACs, we cannot extend the period of time to make a
final request. We thank you and appreciate the suggestion to notify an
HHA of why an appeal is not moving forward. We believe that providing
the Administrator's rationale for declining review would be burdensome.
However, we will monitor the issue and consider it for future
rulemaking if appropriate.
After consideration of the public comments received, we are
finalizing the proposed provisions without modification.
D. Public Reporting Reminder
In the CY 2022 HH PPS final rule (86 FR 62332 through 62333), we
proposed that we will publicly report the following information for the
expanded HHVBP Model:
Applicable measure benchmarks and achievement thresholds
for each small- and large-volume cohort.
For each HHA that qualified for a payment adjustment based
on the data for the applicable performance year--
Applicable measure results and improvement thresholds;
The HHA's Total Performance Score (TPS);
[[Page 77790]]
The HHA's TPS Percentile Ranking; and
The HHA's payment adjustment for a given year.
In that same rule, we stated that we anticipate this information
will be made available to the public on a CMS website on or after
December 1, 2024, the date by which we will intend to complete the CY
2023 Annual Report appeals process and issuance of the Final Annual
Report to each competing HHA. For each year thereafter, we anticipate
following the same approximate timeline for publicly reporting the
payment adjustment for the upcoming calendar year. This policy is
codified at Sec. 484.355(c). We did not propose any changes to this
policy. This simply serves as a reminder of our existing policy.
We did not receive comments on this reminder.
E. Health Equity Update
1. Background
In the Calendar Year 2023 Home Health Prospective Payment System
Proposed Rule (CMS-1766-P), we included a Request for Information (RFI)
on a future approach to health equity in the expanded HHVBP Model. We
define health equity as ``the attainment of the highest level of health
for all people, where everyone has a fair and just opportunity to
attain their optimal health regardless of race, ethnicity, disability,
sexual orientation, gender identity, socioeconomic status, geography,
preferred language, or other factors that affect access to care and
health outcomes.'' \130\ We are working to advance health equity by
designing, implementing, and operationalizing policies and programs
that support health for all the people served by our programs and
models, eliminating avoidable differences in health outcomes
experienced by people who are disadvantaged or underserved, and
providing the care and support that our enrollees need to thrive. Our
goals outlined in the CMS Framework for Health Equity 2022-2032 \131\
are in line with Executive Order 13985, ``Advancing Racial Equity and
Support for Underserved Communities Through the Federal Government.''
\132\ The goals included in the CMS Framework for Health Equity serve
to further advance health equity, expand coverage, and improve health
outcomes for the more than 170 million individuals supported by our
programs, and sets a foundation and priorities for our work including:
strengthening our infrastructure for assessment, creating synergies
across the health care system to drive structural change, and
identifying and working to eliminate barriers to CMS-supported
benefits, services, and coverage.
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\130\ Centers for Medicare and Medicaid Services. Available at
https://www.cms.gov/pillar/health-equity. Accessed February 1, 2023.
\131\ https://www.cms.gov/files/document/cms-framework-health-equity-2022.pdf.
\132\ https://www.whitehouse.gov/briefing-room/presidential-actions/2021/01/20/executive-order-advancing-racial-equity-and-support-for-underserved-communities-through-the-federal-government/.
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In addition to the CMS Framework for Health Equity, CMS seeks to
``advance health equity and whole-person care'' as one of eight goals
comprising the CMS National Quality Strategy (NQS).\133\ The NQS
identifies a wide range of potential quality levers that can support
our advancement of equity, including: (1) establishing a standardized
approach for patient-reported data and stratification; (2) employing
quality and value-based programs to address closing equity gaps; and,
(3) developing equity-focused data collection, analysis, regulations,
and quality improvement initiatives.
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\133\ Centers for Medicare & Medicaid Services. What is the CMS
Quality Strategy? Available at https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Value-Based-Programs/CMS-Quality-Strategy.
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A goal of this NQS is to address persistent disparities that
underly our healthcare system. Racial disparities, in particular, are
estimated to cost the U.S. $93 billion in excess medical costs and $42
billion in lost productivity per year, in addition to economic losses
due to premature deaths.\134\ At the same time, racial and ethnic
diversity has increased in recent years, with an increase in the
percentage of people who identify as two or more races accounting for
most of the change, rising from 2.9 percent to 10.2 percent between
2010 and 2020.\135\ Therefore, we need to consider ways to reduce
disparities, achieve equity, and support our diverse beneficiary
population through the way we measure quality and display the data.
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\134\ Ani Turner, The Business Case for Racial Equity, A
Strategy for Growth, W.K. Kellogg Foundation and Altarum, April
2018.
\135\ 2022 National Healthcare Quality and Disparities Report.
Content last reviewed November 2022. Agency for Healthcare Research
and Quality, Rockville, MD, https://www.ahrq.gov/research/findings/nhqrdr/nhqdr22/index.html.
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We solicited public comments via the previously discussed RFI on
policy changes that we should consider on the topic of health equity.
We specifically requested input on whether we should explore
incorporating adjustments into the expanded HHVBP Model to reflect the
varied patient populations that HHAs serve around the country and tie
equity-focused outcomes to the payment adjustments we make based on HHA
performance under the Model. We refer readers to the CY 2023 HH PPS
final rule (87 FR 66876), for a summary of the public comments and
suggestions we received in response to the health equity RFI. We will
take these comments into account as we continue to work to develop
policies and quality measures on this important topic.
2. Anticipated Future State
We are committed to developing approaches to meaningfully
incorporate the advancement of health equity into the expanded HHVBP
Model. As we move this important work forward, we will continue to take
input from interested parties. We also note that there are proposals
being made to implement a health equity adjustment in the Hospital
Inpatient Quality Reporting Program and the SNF Value-Based Purchasing
Program. At this time, however, we will give HHAs time to learn the
requirements of the expanded Model, gather at least two years of
performance data, and study effects of the expanded Model on health
equity outcomes before incorporating any potential changes to the
expanded Model regarding health equity.
Comment: Several commenters expressed their support of the approach
described in this update, particularly the plan to gather two years of
performance data prior to adding a HE adjustment. However, a commenter
strongly encouraged CMS to continue to pursue ways to incentivize the
achievement of health equity in the expanded HHVBP Model without delay
as they believe that the learning process related to the Model can
occur simultaneously with CMS actively continuing efforts to further
health equity. A commenter encouraged CMS to create a standardization
of social determinants for health data collection and analysis. Another
commenter expressed concerns that those HHAs that accept complex
patients that have significant issues associated with SDH may have
poorer outcomes and may exclude patients that will negatively impact
their payments. This same commenter asked that we consider a more
efficient way to gather information related to health equity.
Response: We appreciate these comments and will share them with the
HHVBP TEP as the incorporation of health equity is an agenda item for
the TEP planned for November of this year.
[[Page 77791]]
V. Medicare Home Intravenous Immune Globulin (IVIG) Items and Services
A. General Background
1. Statutory Background
Division FF, section 4134(a) of the CAA, 2023 added coverage and
payment of items and services related to administration of IVIG in a
patient's home of a patient with a diagnosed primary immune deficiency
disease furnished on or after January 1, 2024, by amending the existing
IVIG benefit category at section 1861(s)(2)(Z) of the Act. In addition,
section 4134(b) of Division FF of the CAA, 2023 amended section 1842(o)
of the Act by adding a new paragraph (8) that established the payment
for IVIG administration items and services. Under the CAA, 2023
provision, payment for these IVIG administration items and services is
required to be a bundled payment, made to a supplier for all items and
services related to administration of IVIG furnished in the home during
a calendar day separate from the payment for the IVIG product.
2. Overview
Primary immune deficiency diseases (PIDD) are conditions triggered
by genetic defects that cause a lack of and/or impairment in antibody
function, resulting in the body's immune system not being able to
function in a normal way. Immune globulin (Ig) therapy is used to
temporarily replace some of the antibodies (that is, immunoglobulins)
that are missing or not functioning properly in people with PIDD.\136\
The goal of Ig therapy is to use Ig obtained from normal donor plasma
to maintain a sufficient level of antibodies in the blood of
individuals with PIDD to fight off bacteria and viruses. Ig is
formulated for both intravenous and subcutaneous administration (SCIg).
Clinicians can prescribe either product to the beneficiary with PIDD
according to clinical need and preference, and beneficiaries can switch
between intravenous and subcutaneous administration of Ig.
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\136\ Perez EE, Orange JS, Bonilla F, et al. (2017) Update on
the use of immunoglobulin in human disease: A review of evidence;
Journal Allergy Clin Immunol. 139(3S): S1-S46.
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3. Legislative Summary
Section 642 of the Medicare Prescription Drug, Improvement, and
Modernization Act of 2003 (Pub. L. 108-173) amended section 1861 of the
Act to provide Medicare Part B coverage of the IVIG product for the
treatment of PIDD in the home, but not the items and services involved
with administration.
Section 101 of the Medicare IVIG Access and Strengthening Medicare
and Repaying Taxpayers Act of 2012 (Medicare IVIG Access Act) (Pub. L.
112-242) mandated the establishment, implementation, and evaluation of
a 3-year Medicare Intravenous Immune Globulin (IVIG) Demonstration
Project (the Demonstration) under Part B of title XVIII of the Act. The
Demonstration was implemented to evaluate the benefits of providing
coverage and payment for items and services needed for the home
administration of IVIG for the treatment of PIDD, and to determine if
it would improve access to home IVIG therapy for patients with PIDD.
The Medicare IVIG Access Act mandated that Medicare would establish a
per visit payment amount for the items and services necessary for the
home administration of IVIG therapy for beneficiaries with specific
PIDD diagnoses. The Demonstration did not include Medicare payment for
the IVIG product which continues to be paid under Part B in accordance
with section 1842(o) and 1847(A) of the Act. The Demonstration covered
and paid a per visit payment amount for the items and services needed
for the administration of IVIG in the home. Items may include infusion
set and tubing, and services include nursing services to complete an
infusion of IVIG lasting on average three to five hours.\137\
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\137\ Updated Interim Report to Congress: Evaluation of the
Medicare Patient Intravenous Immunoglobulin Demonstration Project,
2022: https://innovation.cms.gov/data-and-reports/2022/ivig-updatedintrtc.
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On September 28, 2017, Congress passed the Disaster Tax Relief and
Airport and Airway Extension Act of 2017 (Pub. L. 115-63). Section 302
of Public Law 115-63 extended the Demonstration through December 31,
2020.
Division CC, section 104, of the Consolidated Appropriations Act,
2021 (CAA, 2021) (Pub. L. 116-260), further extended the Demonstration
for another 3 years through December 31, 2023.
Division FF, section 4134 of the CAA, 2023 (CAA, 2023) (Pub. L.
117-328) mandated that CMS establish permanent coverage and payment for
items and services related to administration of IVIG in a patient's
home of a patient with PIDD. The permanent home IVIG items and services
payment is effective for home IVIG administration furnished on or after
January 1, 2024. Payment for these items and services is required to be
a separate bundled payment made to a supplier for all administration
items and services furnished in the home during a calendar day. The
statute provides that payment amount may be based on the amount
established under the Demonstration. The standard Part B coinsurance
and the Part B deductible is required to apply. In addition, that
statute states that the separate bundled payment for these IVIG
administration items and services does not apply for individuals
receiving services under the Medicare home health benefit. The CAA,
2023 provision clarifies that a supplier who furnishes these services
meet the requirements of a supplier of medical equipment and supplies.
4. Demonstration Overview
Under the Demonstration, which will end on December 31, 2023,
Medicare provides a bundled payment under Part B, that is separate from
the IVIG product, for items and services that are necessary to
administer IVIG in the home to enrolled beneficiaries who are not
otherwise homebound and receiving services under the home health
benefit. The Demonstration only applies to situations where the
beneficiary requires IVIG for the treatment of certain PIDD diagnoses
or was receiving SCIg to treat PIDD and wishes to switch to IVIG.
Services covered under the Demonstration are required to be
provided and billed by specialty pharmacies enrolled as durable medical
equipment (DME) suppliers, that provide the Medicare Part B-covered Ig.
The covered items and services under the Demonstration are paid as a
single bundle and are subject to coinsurance and deductible in the same
manner as other Part B services. HHAs are not eligible to bill for
services covered under the Demonstration but can bill for services
related to the administration of IVIG if the patient is receiving
services under a home health episode of care, in which case the home
health payment covers the items and services.
In order to participate in the Demonstration, beneficiaries must
meet the following requirements:
Be eligible to have the IVIG paid for at home under Part B
FFS.
Have a diagnosis of PIDD.
Not be enrolled in a Medicare Advantage plan.
Cannot be in a home health episode of care on the date of
service (in such circumstances, the home health payment covers the
items and services).
Must receive the service in their home or a setting that
is ``home like''.
To participate in the Demonstration, the beneficiary must submit an
application, signed by their physician.
DME suppliers billing for the items and services covered under the
[[Page 77792]]
Demonstration must meet the following requirements:
Meet all Medicare, as well as other national, state, and
local standards and regulations applicable to the provision of services
related to home infusion of IVIG.
Be enrolled and current with the National Supplier
Clearinghouse.
Be able to bill the DME Medicare Administrative
Contractors (MACs).
CMS implemented a bundled per visit payment amount under the
Demonstration, statutorily required to be based on the national per
visit low-utilization payment adjustment (LUPA) for skilled nursing
services used under the Medicare HH PPS established under section 1895
of the Act. The payment amount is subject to coinsurance and
deductible.
For billing under the Demonstration, CMS established a ``Q'' code
for services, supplies, and accessories used in the home under the IVIG
Demonstration:
Q2052--(Long Description)--Services, supplies, and
accessories used in the home under Medicare Intravenous immune globulin
(IVIG) Demonstration.
Q2052--(Short Description)--IVIG demo, services/supplies.
The code is used for the IVIG Demonstration only. Suppliers must
bill Q2052 as a separate claim line on the same claim for the IVIG
drug.
B. Scope of Expanded IVIG Benefit
As discussed previously, Division FF, section 4134 of the CAA, 2023
added coverage of items and services related to the administration of
IVIG in a patient's home to the existing IVIG benefit category at
section 1861(s)(2)(Z) of the Act, effective January 1, 2024. Currently,
IVIG is covered in the home under Part B if all of the following
criteria are met:
It is an approved pooled plasma derivative for the
treatment of primary immune deficiency disease.
The patient has a diagnosis of primary immune deficiency
disease.
The IVIG is administered in the home.
The treating practitioner has determined that
administration of the IVIG in the patient's home is medically
appropriate.
Therefore, as section 4134(a)(1) of the CAA, 2023 adds the items
and services (furnished on or after January 1, 2024) related to the
administration of IVIG to the benefit category defined under section
1861(s)(2)(Z) of the Act (the Social Security Act provision requiring
coverage of the IVIG product in the home), the same beneficiary
eligibility requirements for the IVIG product would apply for the IVIG
administration items and services described in section V.A.4. of this
final rule. Subpart B of Part 410 of the regulations set out the
medical and other health services requirements under Part B. The
regulations at Sec. 410.10 identify the services that are subject to
the conditions and limitations specified in this subpart. Section
410.10(y) includes intravenous immune globulin administered in the home
for the treatment of primary immune deficiency diseases. Section 410.12
outlines general basic conditions and limitations for coverage of
medical and other health services under Part B, as identified in
section 410.10. Section 410.12(a) includes the conditions that must be
met in order for these services to be covered, and include the
following:
When the services must be furnished. The services must be
furnished while the individual is in a period of entitlement.
By whom the services must be furnished. The services must
be furnished by a facility or other entity as specified in Sec. Sec.
410.14 through 410.69.
Physician certification and recertification requirements.
If the services are subject to physician certification requirements,
they must be certified as being medically necessary, and as meeting
other applicable requirements, in accordance with subpart B of part
424.
As the definition of IVIG at section 1861(zz) of the Act now
includes the items and services necessary to administer IVIG in the
home, we proposed to add the term ``items and services'' to the
regulation at Sec. 410.10(y). Furthermore, sub-regulatory guidance
documents (that is, IVIG LCD (33610) \138\ and IVIG Policy Article
(A52509) \139\) provide direction on coding and coverage for the IVIG
product at home. Through the Local Coverage Determination (LCD) for
Intravenous Immune Globulin (L33610),\140\ the Durable Medical
Equipment Medicare administrative contractors (DME MACs) specify the
Healthcare Common Procedure Coding System (HCPCS) codes for which IVIG
derivatives are covered under this benefit. Therefore, a beneficiary
must be receiving one of the IVIG derivatives specified under the LCD
for IVIG in order to qualify to receive the items and services covered
under section 1861(s)(2)(Z) of the Act. Furthermore, for any item
(including IVIG) to be covered by Medicare, it must (1) be eligible for
a defined Medicare benefit category, (2) be reasonable and necessary
for the diagnosis or treatment of illness or injury or to improve the
functioning of a malformed body member, and (3) meet all other
applicable Medicare statutory and regulatory requirements. Guidance for
the LCD for IVIG \141\ identifies the ICD-10-CM codes that support
medical necessity for the provision of IVIG in the home. These
diagnosis codes are listed in Table E1.
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\138\ https://www.cms.gov/medicare-coverage-database/view/lcd.aspx?LCDId=33610.
\139\ https://www.cms.gov/medicare-coverage-database/view/article.aspx?articleId=52509.
\140\ Local Coverage Determination (LCD): IVIG (L33610) https://www.cms.gov/medicare-coverage-database/view/lcd.aspx?LCDId=33610&ContrId=389.
\141\ https://www.cms.gov/medicare-coverage-database/view/article.aspx?articleId=52509.
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BILLING CODE 4120-01-P
[[Page 77793]]
[GRAPHIC] [TIFF OMITTED] TR13NO23.061
BILLING CODE 4120-01-C
In accordance with this guidance, a beneficiary must be diagnosed
with one of the primary immune deficiencies identified by the ICD-10-CM
codes, set out in Table E1 and as updated in subregulatory guidance to
qualify to receive the items and services covered under section
1861(s)(2)(Z) of the Act. This guidance is revised as needed by the DME
MACs to reflect updated and changed ICD-10-CM codes. And finally, in
order to qualify to receive IVIG in the home, section 1861(zz) of the
Act requires that a treating practitioner must have determined that
administration of the IVIG in the patient's home is medically
appropriate. Accordingly, we will update this guidance pursuant to the
CAA, 2023 to reflect the expansion of the benefit to the items and
services related to the administration of IVIG at home. Leveraging the
existing regulations and sub-regulatory guidance will maintain one set
of standards across the entire IVIG benefit (that is, for the product
and for the related items and services). This will result in seamless
implementation from the existing IVIG Demonstration, thereby ensuring
immediate access for beneficiaries requiring such items and services.
We solicited comments on our proposal to add ``items and services'' to
the regulation at Sec. 410.10(y).
Comment: We received seven comments on the implementation of the
home IVIG items and services payment. Overall, commenters were
supportive of CMS's proposed regulations to implement the home IVIG
items and services payment in a manner that seamlessly carries out the
law as enacted. Commenters agreed that ``home infusion offers better
access to infused therapies for beneficiaries living in rural areas and
with disabilities, while improving clinical outcomes.'' Another
commenter reiterated the benefits of home IVIG administration discussed
in the 2022 IVIG Demonstration Report to the Congress, stating
advantages such as better access to IVIG, decrease in transportation
barriers, higher rates of compliance, and reduced risk of infection.
Response: We appreciate commenters support of the proposals in this
rule.
Final Decision: We are finalizing the amendment to the regulation
at Sec. 410.10(y) to add ``items and services'' as proposed.
1. Items and Services Related to the Home Administration of IVIG
Section 101(c) of the Medicare IVIG Access Act established coverage
for items and services needed for the in-home administration of IVIG
for the treatment of primary immunodeficiencies under a Medicare
demonstration program. We stated in the CY 2024 HH PPS proposed rule
(88 FR 43754) that we interpret section 4134 of the CAA, 2023 to make
permanent coverage of the same items and services under the existing
IVIG Demonstration to ensure continuous and comprehensive coverage for
beneficiaries who choose to receive home IVIG therapy. Under the
Demonstration, the bundled payment for the items and services necessary
to administer the drug intravenously in the home includes the infusion
set and tubing, and nursing services to complete an infusion of IVIG
lasting on average three to five hours.\142\ Although ``items
[[Page 77794]]
and services'' are not explicitly defined under section 4134 of the
CAA, 2023, we believe the items and services covered under the
Demonstration are inherently the same items and services that would be
covered under the payment added to the benefit category at section
1861(s)(2)(Z) of the Act. While we did not enumerate a list of services
that must be included in the separate bundled payment, we stated in the
proposed rule that we anticipate that the nursing services would
include such professional services as IVIG administration, assessment
and site care, and education. Moreover, it would be up the provider to
determine the services and supplies that would be appropriate and
necessary to administer the IVIG for each individual. This may or may
not include the use of a pump. Because IVIG does not have to be
administered through a pump (although it can be), external infusion
pumps are not covered under the DME benefit for the administration of
IVIG. An external infusion pump is only covered under the DME benefit
if the infusion pump is necessary to safely administer the drug. The
Local Coverage Determination (LCD) for External Infusion Pumps identify
the drugs and biologicals that the DME Medicare Administrative
Contractors (MACs) have determined require the use of such pumps and
cannot be administered via a disposable elastomeric pump or the gravity
drip method.\143\ As such, under the IVIG Demonstration, coverage
cannot extend to the DME pump, and therefore would not be covered
separately under the home IVIG items and services payment.
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\142\ Updated Interim Report to Congress: Evaluation of the
Medicare Patient Intravenous Immunoglobulin Demonstration Project,
August 2022 found at: https://innovation.cms.gov/data-and-reports/2022/ivig-updatedintrtc.
\143\ https://www.cms.gov/medicare-coverage-database/view/lcd.aspx?LCDId=33794.
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We invited comments on any additional interpretations of items and
services that may be considered under the scope of the home IVIG
benefit. We did not receive any comments suggesting coverage of
additional items and services under this payment. Therefore we expect
that suppliers will furnish the same items and services under the
permanent benefit, as provided under the Demonstration. We remind
commenters that the IVIG product is covered under a separate payment.
2. Home IVIG Items and Services and the Relationship to/Interaction
With Home Health and Home Infusion Therapy Services
Prior to enactment of the CAA, 2023, IVIG administration items and
services were explicitly excluded from coverage under the Part B IVIG
benefit. However, if a beneficiary was considered homebound and
qualified for the home health benefit, the items and services needed to
administer IVIG in the home could be covered as home health services.
Section 4134(b) of the CAA, 2023 excludes the IVIG items and services
bundled payment in the case of an individual receiving home health
services under section 1895 of the Act. Therefore, a beneficiary does
not have to be considered confined to the home (that is, homebound) in
order to be eligible for the home IVIG benefit; however, homebound
beneficiaries requiring items and services related to the
administration of home IVIG, and who are receiving services under a
home health plan of care, may continue to receive services related to
the administration of home IVIG as covered home health services. As
such, in the case that a beneficiary is receiving home health services
under the home health benefit, the home health agency could continue to
bill for these items and services under the home health benefit and the
drug would be continued to be paid under Part B. A separate payment for
the IVIG items and services under the IVIG benefit would be prohibited.
With regard to the home infusion therapy (HIT) services benefit,
Medicare payment for home infusion therapy services is for services
furnished in coordination with the furnishing of intravenous and
subcutaneous infusion drugs and biologicals specified on the DME LCD
for External Infusion Pumps (L33794),\144\ with the exception of
insulin pump systems and certain drugs and biologicals on a self-
administered drug exclusion list. In order for the drugs and
biologicals to be covered under the Part B DME benefit they must
require infusion through an external infusion pump. If the drug or
biological can be infused through a disposable pump or by a gravity
drip, it does not meet this criterion. IVIG does not require an
external infusion pump for administration purposes and therefore, is
explicitly excluded from the DME LCD for External Infusion Pumps.
However, subcutaneous immunoglobulin (SCIg) is covered under the DME
LCD for External Infusion Pumps, and items and services for
administration in the home are covered under the HIT services benefit.
While a DME supplier and a HIT supplier (or a DME supplier also
enrolled as a HIT supplier) could not furnish services related to the
administration of immunoglobulin (either IVIG or SCIg) to the same
beneficiary on the same day, a beneficiary could potentially receive
services under both benefits for services related to the infusion of
different drugs. For example, a DME supplier also accredited and
enrolled as a HIT supplier, could furnish HIT services to a beneficiary
receiving intravenous acyclovir as well as IVIG, and bill both the IVIG
and the HIT services benefits on the same date of service. We also
recognize that a beneficiary may, on occasion, switch from receiving
immunoglobulin subcutaneously to intravenously and vice versa, and as
such, utilize both the HIT services and the IVIG benefits within the
same month.
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\144\ Local Coverage Determination (LCD): External Infusion
Pumps (L33794) https://www.cms.gov/medicare-coverage-database/view/lcd.aspx?LCDId=33794.
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We invited comments on how typical it is for a patient to alternate
between receiving IVIG and SCIg and the frequency with which it may
occur. The following is a summary of the comments received and our
responses.
Comment: Commenters representing people with primary
immunodeficiency diseases, provided several reasons why patients may
alternate between IVIG and SCIg. They explained that the route of
administration affects the types of adverse reactions for patients
receiving Ig therapy. They stated that IVIG may have more systemic
adverse events such as headaches and nausea, whereas, SCIg may have
more local reactions related to self-infusions. Other reasons for
switching may be related to age, dexterity, and other physical
abilities, as well as comfort level, convenience, or physician
recommendation.
Response: We appreciate this explanation and will consider these
comments as we move forward with implementation to ensure that the
benefit meets the needs of beneficiaries impacted by primary
immunodeficiency diseases.
Comment: A few commenters had questions and comments pertaining to
the delivery of these services by HHAs. Commenters stated that
furnishing IVIG in the home would be overly burdensome on HHAs who may
already be challenged by staffing shortages or who may not be
``equipped to infuse the product, for example, being unable to secure
experienced infusion nurses.'' Other commenters questioned whether the
beneficiary could receive IVIG as an outpatient under Part B (that is,
at the physician's office or infusion center), stating the beneficiary
would have to switch to another agency or a home infusion therapy
supplier if their HHA does not have staff who are able to administer
the product.
Response: To clarify: these IVIG administration services can only
be
[[Page 77795]]
billed by a DME supplier. If an HHA does not have staff able to furnish
these services, they are not required to do so. However, the items and
services related to the administration of IVIG in the home, and as
identified on the home health plan of care, would be included in the
payment for the 30-day home health period payment. As such, HHAs must
provide home health items and services included on the plan of care
either directly or under arrangement and must bill and be paid under
the HH PPS for such covered home health services. Thus, if an HHA is
unable to furnish the items and services related to the administration
of IVIG (as indicated in the plan of care) in the home, they are
responsible for arranging these services (including arranging for
services in an outpatient facility) and are required to bill these
services as home health services under the HH PPS.
We note that this aligns with current practice as it applies
payment under the IVIG demonstration and Medicare home health coverage
and payment. Under the IVIG demonstration program, beneficiaries who
are receiving care under the Medicare home health benefit are not
eligible to have covered services separately paid for under the
Demonstration as these services have always been covered under the
Medicare home health benefit.
Therefore, we believe concerns about access to care for non-
homebound beneficiaries and additional burden on HHAs are misplaced, as
this permanent policy is simply an extension of current practice under
the Demonstration.
Comment: A few commenters provided feedback related to the home
infusion therapy services benefit, specifically regarding changing the
definition of ``infusion drug administration calendar day,'' and
bundling the Part B disposable supplies with the home infusion therapy
services.
Response: We remind commenters that the home infusion therapy
services benefit is a separate benefit from the home IVIG items and
services benefit, and as such, comments related to payment for home
infusion therapy services are out of the scope of this final rule.
C. IVIG Administration Items and Services Payment
As discussed previously, section 101 of the Medicare IVIG Access
Act established the authority for a Demonstration providing payment for
items and services needed for the in-home administration of IVIG. We
stated in the CY 2024 HH PPS proposed rule that we believe the
provisions established under that law serve as the basis for the
conditions for payment with respect to the requirements that must be
met for Medicare payment to be made to suppliers for the items and
services covered under section 1861(s)(2)(Z) of the Act.
1. Home IVIG Administration Items and Services Supplier Type
Section 4134(b) of the CAA, 2023 amends section 1842(o) of the Act
by adding a new paragraph (8) that establishes a separate bundled
payment to the supplier for all items and services related to the
administration of such intravenous immune globulin, described in
section 1861(s)(2)(Z) of the Act to such individual in the patient's
home during a calendar day. Section 4134(c) of the CAA, 2023 amends
section 1834(j)(5) of the Act, which are a requirement for suppliers of
medical equipment and supplies, by adding a new subparagraph (E),
clarifying with respect to payment, that items and services related to
the administration of intravenous immune globulin furnished on or after
January 1, 2024, as described in section 1861(zz) of the Act, are
included in the definition of medical equipment and supplies. This
means that suppliers that furnish IVIG administration items and
services must meet the existing DMEPOS supplier requirement for payment
purposes under this benefit. Suppliers of IVIG administration items and
services must enroll as a DMEPOS supplier and comply with the Medicare
program's DMEPOS supplier standards (found at 42 CFR 424.57(c)) and
DMEPOS quality standards to become accredited for furnishing medical
equipment and supplies. Further, in order to receive payment for home
IVIG items and services, the supplier must also meet the requirements
under subpart A of part 424--Conditions for Medicare Payment. The
DMEPOS supplier may subcontract with a provider in order to meet the
professional services identified in section V.B.1. of this final rule.
All professionals who furnish services directly, under an individual
contract, or under arrangements with a DMEPOS supplier to furnish
services related to the administration of IVIG in the home, must be
legally authorized (licensed, certified, or registered) in accordance
with applicable Federal, State, and local laws, and must act only
within the scope of their State license or State certification, or
registration. A supplier may not contract with any entity that is
currently excluded from the Medicare program, any State health care
programs or from any other federal procurement or non-procurement
programs. We did not receive any comments on the supplier type who may
furnish home IVIG items and services.
2. Home IVIG Administration
Section 1861(s)(2)(Z) of the Act defines benefit coverage of
intravenous immune globulin for the treatment of primary immune
deficiency diseases in the home. Under the IVIG Demonstration,
beneficiaries are eligible to participate if they receive IVIG services
in ``their home or a setting that is `home like' \145\.'' Section
410.12(b) identifies the supplier types who can furnish the services
identified at Sec. 410.10. Section 410.38 provides the conditions for
payment for DME suppliers and identifies the institutions that may not
qualify as the patient's home. As such, the home administration of IVIG
items and services must be furnished in the patient's home, defined as
a place of residence used as the home of an individual, including an
institution that is used as a home. An institution that is used as a
home may not be a hospital, CAH, or SNF as defined in Sec. 410.38(b).
We did not receive any comments on our definition of ``home.''
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\145\ Intravenous Immune Globulin Demonstration MLN Fact Sheet:
https://www.cms.gov/files/document/mln3191598-intravenous-immune-globulin-demonstration.pdf.
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D. Home IVIG Items and Services Payment Rate
1. Payment Amount for Home IVIG Items and Services for CY 2024
Section 1842(o) of the Act provides the authority for the
development of a separate bundled payment for Medicare-covered items
and services related to the administration of intravenous immune
globulin to an individual in the patient's home during a calendar day,
in an amount that the Secretary determines to be appropriate. This
payment may be based on the payment established pursuant to section
101(d) of the Medicare IVIG Access Act. Section 4134(d) of the CAA,
2023, amends section 1833(a)(1) of the Act to provide that, with
respect to items and services related to the administration of IVIG
furnished on or after January 1, 2024, as described in section 1861(zz)
of the Act, the amounts paid shall be the lesser of the 80 percent of
the actual charge or the payment amount established under section
1842(o)(8).
In accordance with section 101(d) of the Medicare IVIG Access Act,
the Secretary established a per visit payment amount for the items and
services needed for the in-home administration of IVIG based on the
[[Page 77796]]
national per visit low-utilization payment amount (LUPA) under the
prospective payment system for home health services established under
section 1895 of the Act. Per the Demonstration, the bundled payment
amount for services needed for the home administration of IVIG includes
infusion services provided by a skilled nurse. Therefore, the bundled
payment is based on the LUPA amount for skilled nursing, based on an
average 4-hour infusion. The initial payment rate for the first year of
the Demonstration, was based on the full skilled nursing LUPA for the
first 90 minutes of the infusion and 50 percent of the LUPA for each
hour thereafter for an additional 3 hours. Thereafter, the payment rate
is annually updated based on the nursing LUPA rate for such year. The
service is subject to coinsurance and deductibles like other Part B
services.
As stated in section V.B.1. of the CY 2024 HH PPS proposed rule, we
believe that payment under section 1861(s)(2)(Z) of the Act covers the
same items and services covered under the IVIG Demonstration. Likewise,
we also agreed that the professional services needed to safely
administer IVIG in the home would be services furnished by a registered
nurse. Therefore, we stated that we believe setting the CY 2024 payment
rate for the home IVIG items and services under section 1861(s)(2)(Z)
of the Act, based on the CY 2023 payment amount established under the
Demonstration ($408.23) is appropriate. However, although the
Demonstration used the LUPA rate, which is annually adjusted by the
wage index budget neutrality factor, as well as the home health payment
rate update percentage, we stated that we believe it is appropriate to
propose to update the CY 2023 IVIG services Demonstration rate by only
the CY 2024 home health payment rate update percentage (proposed 2.7%)
and not include the wage index budget neutrality factor, as the IVIG
items and services payment rate is not statutorily required to be
geographically wage adjusted. Therefore, we proposed that the home IVIG
items and services payment rate for CY 2024 would be $408.23 * 1.027 =
$419.25.
Further, although section 1842(o) of the Act states that payment is
for the items and services furnished to an individual in the patient's
home during a calendar day, we stated that we believe that, as the
statute aligns the payment amount with such amount determined under the
Demonstration, the best reading of ``calendar day'' is ``per visit.''
Additionally, we stated that we would expect a supplier to furnish only
one visit per calendar day.
We proposed to establish a new Subpart R under the regulations at
42 CFR part 414 to incorporate payment provisions for the
implementation of the IVIG items and services payment in accordance
with section 1842(o) of the Act for home IVIG items and services
furnished on or after January 1, 2024. We proposed at Sec.
414.1700(a), that a single payment amount is made for items and
services furnished by a DMEPOS supplier per visit. We proposed at Sec.
414.1700(b), to set the initial payment amount equivalent to the CY
2023 ``Services, Supplies, and Accessories Used in the Home under the
Medicare IVIG Demonstration'' payment amount, updated by the proposed
CY 2024 home health update percentage of 2.7 percent.\146\
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\146\ The final home health update percentage is 3.0.
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We solicited comments on these payment proposals, including the
proposed CY 2024 payment rate. The following is a summary of the
comments received and our responses.
Comment: A commenter agreed with the approach CMS has taken to
calculate the payment in accordance with the approach taken in the
Demonstration. This commenter stated appreciation for recognizing that
a registered nurse should be delivering this care.
Response: We thank the commenter for their support of the payment
approach.
Comment: Two commenters stated that CMS should reevaluate the LUPA-
based rate calculation to ensure reimbursement is commensurate with the
extensive services required to provide equitable access to IVIG
treatments in the home, including for those beneficiaries residing in
rural areas. A commenter stated that the proposed LUPA-based rate
calculation may undervalue significant services and resources involved
in the provision of home-based IVIG therapy. Another commenter
suggested that CMS raise the rate to reflect five hours of the LUPA
rate, rather than the initial four hours established under the Medicare
IVIG Access Act.
Response: The Demonstration payment rate was initially set in
accordance with the national per-visit LUPA amount under the HH PPS, as
directed by section 101(d) of the Medicare IVIG Access Act. CMS tied
payment to the LUPA amount for skilled nursing because payment is for
infusion services furnished by a skilled nurse. As payment under the
permanent benefit is for these same services, we believe setting the CY
2024 payment rate for the home IVIG items and services under section
1861(s)(2)(Z) of the Act, based on the CY 2023 payment amount
established under the Demonstration is appropriate. However, while the
demonstration continued to use the LUPA rate to annually update this
payment amount, we proposed to update the CY 2023 IVIG services
Demonstration rate by only the CY 2024 home health payment rate update
percentage and not include the wage index budget neutrality factor,
which is included in the LUPA update. The commenter does not state what
other services beyond skilled nursing are involved in the provision of
home-based IVIG therapy; however, we remind the commenter that this
payment is strictly for the items and services needed to administer the
IVIG in the patient's home. The IVIG product is covered under separate
statutory authority. Regarding the suggestion to raise the payment rate
to reflect five hours of the full LUPA rate for skilled nursing, a
review of the Updated Interim Report to Congress: Evaluation of the
Medicare Patient Intravenous Immunoglobulin Demonstration Project \147\
shows that physicians' offices average 3.14 hours of infusion time and
hospital outpatient facilities average 3.09 hours infusion time. As
such, we continue to believe that the initial calculation methodology
established under the Demonstration program is sufficient to continue
under the permanent benefit.
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\147\ https://innovation.cms.gov/data-and-reports/2022/ivig-updatedintrtc.
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Comment: A commenter agreed with our approach to not apply a
geographic wage adjustment to the permanent IVIG item and services
payment.
Response: We thank the commenter for their support.
Final Decision: We are finalizing our proposal to update the CY
2024 home IVIG items and services payment rate by the CY 2024 home
health payment rate update. The final home health update is 3.0
percent. The CY 2024 home IVIG items and services payment rate for CY
2024 is $408.23 * 1.030 = $420.48.
(a) Annual Payment Update
As discussed previously, the IVIG Demonstration used the nursing
LUPA rate, which is annually adjusted by the wage index budget
neutrality factor, as well as the home health update percentage, as the
payment rate for such year of services. In the CY 2024 HH PPS proposed
rule we stated that, because the IVIG services payment is not
geographically wage adjusted, we believe it is more appropriate to
[[Page 77797]]
annually adjust the IVIG items and services payment rate only by the
home health payment update percentage. As such we proposed at Sec.
414.1700(c), beginning in 2025, the per-visit payment amount from the
prior year will be annually increased by the home health update
percentage for the current calendar year. We solicited comments on the
use of the home health update percentage to annually update the IVIG
items and services payment beyond CY 2024.
Comment: A commenter supported the proposal to annually update the
IVIG items and services payment for CY 2025 and subsequent calendar
years by the home health update percentage.
Response: We thank the commenter for their support.
Final Decision: We are finalizing our proposal to update the CY
2025 home IVIG items and services payment rate and subsequent years, by
the home health payment rate update for such year.
E. Billing Procedures for Home IVIG Items and Services
In order to ensure a smooth transition for DME suppliers to bill
for the items and services related to the home administration of IVIG,
we will use the existing Q-code (Q2052) under the Demonstration, with a
new descriptor (``Services, Supplies, and Accessories used in the Home
for the Administration of Intravenous Immune Globulin (ivig)'') in
order to bill for items and services under Medicare FFS. The Q-code
will continue to be billed separately from, or on the same claim as,
the J-code for the IVIG product and will be processed through the DME
MACs. The Q-code should be billed as a separate claim line on the same
claim for the same place of service as the J-code for the IVIG. In
cases where the IVIG product is mailed or delivered to the patient
prior to administration, the date of service for the administration of
the IVIG (the Q-code) may be no more than 30 calendar days after the
date of service on the IVIG product claim line. No more than one Q-code
should be billed per claim line per date of service.
If a provider is billing for multiple administrations of IVIG on a
single claim, then the supplier will bill the Q-code for each date of
service on a separate claim line, which will be payable per visit (that
is, each time the IVIG is administered). There may be situations in
which multiple units of IVIG are shipped to the patient and billed on a
single ``J'' code claim line followed by more than one Q-code
administration claim line, each with the date of service on which the
IVIG was administered. However, only one Q-code shall be paid per
infusion date of service. To implement the requirements for this
separate bundled payment under section 1861(s)(2)(Z) of the Act, we
will issue a Change Request (CR) prior to implementation of this
payment, including the Q-code needed for billing, outlining the
requirements for the claims processing changes needed to implement this
payment.
VI. Hospice Informal Dispute Resolution and Special Focus Program
A. Background and Statutory Authority
Division CC, section 407 of the Consolidated Appropriations Act
(CAA), 2021, amended Part A of Title XVIII of the Act to add a new
section 1822, and amended sections 1864(a) and 1865(b) of the Act,
establishing new hospice program survey and enforcement requirements,
required public reporting of survey information, and a new hospice
hotline.
The provisions in the CAA, 2021, direct the Secretary to create a
Special Focus Program (SFP) for poor-performing hospice programs, give
authority for imposing enforcement remedies for noncompliant hospice
programs, and require the development and implementation of a range of
remedies as well as procedures for appealing determinations regarding
these remedies. These enforcement remedies can be imposed instead of,
or in addition to, termination of the hospice programs' participation
in the Medicare program. The remedies include civil money penalties
(CMP), directed in-service training, directed plan of correction,
suspension of all or part of payments, and appointment of temporary
management to oversee operations.
In the CY 2022 HH PPS final rule (86 FR 62240), we addressed
provisions related to hospice survey enforcement and other activities
described in the rule. A summary of the finalized CAA, 2021 provisions
regarding hospice survey and enforcement can be found in the CY 2022 HH
PPS final rule (86 FR 62243), available at https://www.govinfo.gov/content/pkg/FR-2021-11-09/pdf/2021-23993.pdf. We finalized all the CAA,
2021 provisions related to hospice survey and enforcement in CY 2022
rulemaking except for the SFP. As outlined in the CY 2022 HH PPS final
rule, we stated that we will consider public comments we received and
seek additional collaboration with stakeholders to further develop a
revised proposal and methodology for the SFP.
In the FY 2023 Hospice Wage Index and Payment Rate Update and
Hospice Quality Reporting Requirements final rule (87 FR 4566) (Hospice
rule), we affirmed our intention to initiate a hospice Technical Expert
Panel (TEP) to provide input on the structure and methodology of the
SFP. Public comments received in response to the FY 2023 Hospice rule
generally supported CMS's efforts to establish an SFP and to convene a
TEP as part of the SFP development. A 30-day call for nominations was
held July 14 through August 14, 2022, and nine TEP members were
selected, representing a diverse range of experience and expertise
related to hospice care and quality. A CMS contractor convened a TEP in
October and November 2022, which provided feedback and considerations
on the preliminary SFP concepts, including developing a methodology to
identify hospice poor-performers, criteria for completing the SFP and
for termination from Medicare when a hospice cannot complete the SFP,
and public reporting. Details from the TEP meetings, including their
recommendations, are available in the TEP summary report \148\ on the
CMS website at https://www.cms.gov/medicare/quality-safety-oversight-certification-compliance/hospice-special-focus-program.
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\148\ 2022 Technical Expert Panel and Stakeholder Listening
Sessions: Hospice Special Focus Program Summary Report (April 28,
2023).
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B. Proposed Regulatory Provisions
1. Overview
We proposed in Subpart M--Survey and Certification of Hospice
Programs, to add new definitions of ``Hospice Special Focus Program,''
``IDR,'' ``SFP status,'' and ``SFP survey'' at Sec. 488.1105. We also
proposed a hospice informal dispute resolution process at Sec.
488.1130 to provide hospice programs an informal opportunity to resolve
disputes related to condition-level survey findings for those hospice
programs that are seeking recertification from the State survey agency
(SA), CMS, or reaccreditation from the Medicare-approved accrediting
organization (AO) for continued participation in Medicare. Informal
dispute resolution would also be offered to hospice programs following
a complaint or validation survey and those in the SFP. We proposed the
specific details on the hospice SFP at Sec. 488.1135, which includes
the criteria for selection and completion of the SFP, hospice
termination from Medicare, and public reporting of the SFP. We proposed
that the hospice SFP would commence as of
[[Page 77798]]
the effective date of the rule, and we anticipated selecting SFP
hospices in CY 2024. We also proposed to periodically review the
effectiveness of the methodology and the algorithm.
We received 58 comments on the Hospice IDR and SFP proposals.
Overall, a majority of commenters agreed with the intent and purpose of
the IDR process and SFP. However, commenters had concerns about the
data sources and individual measures chosen for the SFP algorithm, as
well as concerns about various steps of the algorithm. Commenters also
inquired about the various aspects of the SFP program, including
selection criteria, graduation and termination criteria, technical
assistance, and public reporting. Other commenters expressed support
for the program as proposed but requested additional details regarding
certain aspects of the SFP, such as how the algorithm will be monitored
and how hospices will be selected for the SFP.
2. Proposed Definitions (Sec. 488.1105)
We proposed to add four new definitions to Sec. 488.1105, that
would define the hospice SFP, IDR, SFP status, and SFP survey. The
proposed definitions are as follows:
Hospice Special Focus Program (SFP) means a
program conducted by CMS to identify hospices as poor performers, based
on defined quality indicators, in which CMS selects hospices for
increased oversight to ensure that they meet Medicare requirements.
Selected hospices either successfully complete the SFP program or are
terminated from the Medicare program.
IDR stands for informal dispute resolution.
SFP status means the status of a hospice
provider in the SFP with respect to the provider's progress in the SFP,
which is indicated by one of the following status levels: Level 1--in
progress; Level 2--completed successfully; or Level 3--terminated from
the Medicare program.
SFP survey refers to a standard survey as
defined in this section and is performed after a hospice is selected
for the SFP and is conducted every 6 months, up to 3 occurrences.
We did not receive comments on the proposed definitions, and we are
finalizing them as proposed. (See 42 CFR 488.1105.)
3. Informal Dispute Resolution (Sec. 488.1130)
We proposed at new Sec. 488.1130 to make an Informal Dispute
Resolution (IDR) process available to hospice programs to address
disputes related to condition-level survey findings following a hospice
program's receipt of the official survey Statement of Deficiencies and
Plan of Correction, Form CMS-2567. The proposed IDR for hospices would
be similar to the process already in existence for home health
agencies. The IDR process for hospice programs, like that of HHAs, is
for condition-level survey findings which may be the impetus for an
enforcement action. Standard-level findings alone do not trigger an
enforcement action and are not accompanied by appeal and hearing
rights. The proposed IDR process would provide hospice programs an
informal opportunity to resolve disputes regarding survey findings for
those hospice programs seeking recertification from the SA, CMS, or
reaccreditation from the AO for continued participation in Medicare.
Additionally, the proposed IDR may be initiated for programs under SA
monitoring (either through a complaint investigation or validation
survey) and those in the proposed SFP. For hospice programs deemed
through a CMS-approved AO, the AO would receive the IDR request from
their deemed hospice program, following the same process and
coordinating with CMS regarding any enforcement actions. In accordance
with 42 CFR 488.5(a)(4), AOs must have a comparable survey process to
the SAs. For deemed hospice programs, the AO communicates any
condition-level findings to the applicable CMS Location. If a deemed
hospice fails to meet the Medicare requirements or shows continued
condition-level noncompliance, deemed status is generally removed and
compliance oversight is placed under the SA. The purpose of the
proposed IDR process would be to provide an opportunity to settle
disagreements at the earliest stage, prior to a formal hearing, and to
conserve time and money resources potentially spent by the hospice, the
SA, and CMS. The proposed IDR process may not be used to refute an
enforcement action or selection into the SFP. Additionally, we proposed
that failure of CMS, or the State or the AO, as appropriate, to
complete IDR must not delay the effective date of any enforcement
action.
When survey findings indicate a condition-level deficiency (or
deficiencies), the hospice program would be notified in writing of its
opportunity to request an IDR for those deficiencies. This notice would
be provided to the hospice program when the CMS-2567 Statement of
Deficiencies and Plan of Correction is issued to the hospice. We
proposed that the hospice's request for IDR must be submitted in
writing (electronically or hard copy), include the specific survey
findings that are disputed, and be submitted within the same 10
calendar days allowable for submitting an acceptable plan of
correction.
The proposed IDR provision balances the need for hospice programs
to avoid unnecessary disputes and protracted litigation using the most
rapid mechanism for correcting deficiencies and aligning with the
interests of hospice patients/caregivers. IDR is meant to be an
informal process whereby the provider has an opportunity to address the
surveyor's findings, either by disputing them or providing additional
information.
We proposed that if any survey findings are revised or removed by
the State or CMS based on IDR, and if CMS accepts the IDR results, the
CMS-2567 would be revised accordingly. If CMS accepts the IDR results
and the revised Form CMS-2567, then CMS would adjust any enforcement
actions imposed solely due to those cited and revised deficiencies. If
the survey findings are upheld by CMS or the state following IDR, the
Form CMS-2567 would not be revised based on the IDR and there would not
be adjustments to the enforcement actions.
Comment: Many commenters supported the establishment of an IDR
process for hospices.
Response: We thank the commenters for their support of the IDR
process for hospices.
Comment: A commenter suggested that CMS consider including language
that promotes avoidance of the IDR process when findings surpass a
certain level of seriousness.
Response: We thank the commenters for their suggestion but are not
accepting it. Immediate jeopardy findings are cited at the condition-
level on the Form CMS-2567. As with HHAs, hospice providers may dispute
condition-level findings during IDR since such findings may be the
impetus for an alternative sanction or termination. This would give the
hospice provider an opportunity to present evidence in support of its
position prior to imposition of a remedy or termination. However, a
hospice's initiation of the IDR process will not postpone or otherwise
delay the effective date of any enforcement action, especially if there
was an immediate jeopardy finding. Additionally, the IDR process does
not guarantee a finding will be overturned and may even convince
hospices that, because there is ample support for the survey findings,
[[Page 77799]]
it would be unwise to pursue litigation. Further, if any findings are
revised or removed based on IDR, the official Statement of Deficiencies
is revised accordingly and any enforcement actions imposed as a result
of those revised or removed deficiencies are adjusted accordingly. CMS
will publish guidance on the IDR process and address limitations for
the use of IDR for hospices following the rule's finalization.
Comment: A commenter questioned whether a more formal process
involving an independent third party may be needed to ensure impartial
assessment and resolution of the concerns raised through the IDR
process.
Response: We are not aware of any concerns with the HHA IDR process
since its inception in 2014. Therefore, we anticipate the IDR process
for hospices will also be effective, based on its similarity to the HHA
IDR process.
Comment: Several commenters recommended that CMS publish guidance
on timeframes in the hospice IDR process. The commenters recommended as
a reasonable timeframe for the IDR process to be completed to be 14
days and 30 calendar days from the date the dispute is filed.
Response: Following the rule's finalization, CMS will publish
guidance for the hospice IDR process, similar to the guidance
established for the HHA IDR. We will include timeframes for the process
and for completing the IDR as expeditiously as possible.
Comment: A commenter recommended that CMS develop a process to
track providers utilizing the IDR process and the final resolutions,
and that CMS ensure the final IDR resolution, if changed from the
initial findings in the CMS-2567, is reflected in a revised CMS-2567
and posted to the tracking process.
Response: The national surveyor database (iQIES) tracks the IDR
process. If findings are changed due to IDR, a revised CMS-2567 is sent
to the provider and updated in the national database.
Comment: Some commenters stated that they believed that the IDR
should be available to hospices to refute SFP selection. Also,
commenters noted that the first hospices selected for SFP would not
have had the benefit of the IDR. Some commenters had concerns on the
applicability of the IDR process as it relates to survey and
substantiated complaint data used to choose providers for the SFP.
Commenters also stated that the IDR outcome should be considered a part
of the data used prior to making a final choice on hospice selection
into the SFP.
Additionally, commenters encouraged CMS to standardize the survey
process, enhance data interpretation accuracy and consistency, and not
count condition-level deficiencies that are being disputed in the IDR
process in the SFP algorithm. Commenters also noted that if CMS
implements the SFP as proposed, the IDR process will not be available
for deficiencies already cited until 2024.
Response: The IDR process provides an opportunity for a hospice
provider to dispute any active condition-level findings upon receipt of
survey findings. The SFP algorithm utilizes survey data from the
finalized survey reports (CMS-2567), which are not pending IDR or
subject to disputes.
Final Decision: After considering the public comments, CMS is
finalizing the hospice IDR as proposed. (See 42 CFR 488.1130.)
4. Special Focus Program (Sec. 488.1135)
Section 1822(b) of the Act requires the Secretary to conduct a
Special Focus Program for hospice programs that the Secretary has
identified as having substantially failed to meet applicable
requirements of the Act. We proposed at Sec. 488.1135 a hospice SFP to
address issues that place hospice beneficiaries at risk for poor
quality of care through increased oversight. We proposed that specific
criteria would be used to determine whether a hospice program
participates in the SFP as outlined in the proposed rule. We also
proposed the hospice SFP would commence as per the effective date of
this final rule when published, and we anticipate selecting SFP
hospices starting in CY 2024. We proposed to periodically review the
effectiveness of the methodology and the algorithm and make adjustments
through rulemaking as necessary.
a. Proposed Hospice Special Focus Program Algorithm
In establishing the proposed Hospice SFP, we examined the Special
Focus Facility program for nursing homes and its methodology for
facility selection. Although the proposed methodology for the hospice
program SFP is similar in certain facets, the proposed SFP methodology
is tailored specifically to this setting and to the data that is
available to evaluate hospice performance.
We proposed to identify a subset of 10 percent of hospice programs
based on the highest aggregate scores determined by the algorithm. The
hospices selected for the SFP from the 10 percent would be determined
by CMS.
To identify ``poor performance,'' we have identified several
indicators, namely, survey reports with Condition-Level Deficiencies
(CLDs) and complaints with substantiated allegations, and CMS Medicare
data sources from the Hospice Quality Reporting Program (HQRP)
(Medicare claims and Consumer Assessment of Healthcare Providers and
Systems (CAHPS[supreg]) Hospice Survey). These indicators, which can be
used to identify potential poor performance, have been integrated into
the proposed SFP algorithm to assist in identifying potential hospice
providers for the SFP.
As discussed previously, we proposed to use multiple data sources
to provide a comprehensive view of the quality of care provided at the
identified hospices. The compilation of these data sources illustrates
areas of concern--validated/identified issues based on in-person/on-
site review of a hospice to meet Medicare requirements; caregiver and
public complaints about hospices not providing quality of care or not
meeting Medicare requirements; and quality measures that inform the
public of whether a hospice is providing expected care processes or
outcomes. We believe these are indicators of poor quality hospice care.
The final SFP algorithm is designed as an initial step in identifying
poor quality indicators.
b. Proposed Use of Medicare Data Sources To Identify Poor Performing
Hospices
To identify hospices with poor quality indicators, we proposed
using the most recent complete Medicare hospice data from two data
sources: (1) hospice surveys; and (2) Medicare HQRP. Each source
represents distinct dimensions of hospice care that we have identified
as related to a hospice's performance or practices. From these data
sources, we proposed to use multiple indicators of hospice care
delivery to identify poor performing hospices (see Table 1). Hospices
would be identified for potential SFP enrollment if they (1) have data
from any of the aforementioned data sources; (2) are listed as an
active provider (that is, have billed at least one claim to Medicare
FFS in the last 12 months); and (3) operate in the United States,
including the District of Columbia and U.S. territories. Each data
source and the quality indicators are discussed further later in this
preamble. Based on these proposed criteria, in CY 2019 through CY 2021
analytic file, 5,943 hospices out of 6,093 active hospice providers
(97.5 percent) would be eligible for participation in the SFP.
[[Page 77800]]
[GRAPHIC] [TIFF OMITTED] TR13NO23.062
(1) Hospice Survey Data
(a) Quality-of-Care Condition-Level Deficiencies (CLDs)
Hospices are surveyed for compliance with hospice program
requirements prior to becoming certified as a hospice provider in
Medicare (initial certification survey) and then at least once every 36
months (standard survey for recertification (Sec. 418.1110)), with
roughly one-third of all hospices being surveyed each year. A post-
survey revisit or follow-up survey may also occur to determine if the
hospice corrected cited deficiencies and are in substantial compliance
with all requirements. Hospice survey data (initial certification,
standard recertification, and follow-up) is collected on the
Certification And Survey Provider Enhanced Reports (CASPER) system. CMS
will be posting publicly available hospice survey finding information
to the Quality, Certification and Oversight Report (QCOR) website in CY
2023. For information related to the hospice survey process, we
encourage the public to review the CMS State Operations Manual (SOM),
Appendix M (Internet-Only Manual, Publication 100-07).
A CLD is cited on a survey when a hospice is found to be
noncompliant with all or part of a condition of participation (CoP),
which is one of the health and safety requirements all hospices are
required to meet to participate in Medicare. As discussed in the QSOG
memo (QSO-23-08-Hospice) issued on January 27, 2023, a significant
change in the hospice survey protocol was made to provide an enhanced
approach to investigating the quality-of-care provided to hospice
patients. While each of the 23 CoPs continues to have equal weight in
the final certification and enforcement decision, special attention is
directed to those CoPs directly impacting patient care for purposes of
the proposed SFP. Consistent with this enhanced survey process, we have
identified 11 CoPs that directly contribute to the quality of care
delivered to patients, their caregivers, and families, and believe that
a cited CLD on any one of them may indicate a hospice is providing poor
quality-of-care. Therefore, we proposed to include the 11 quality-of-
care CLDs (noted in Table F2) as data indicators in the SFP algorithm.
The SFP algorithm would focus on quality-of-care CLDs because they are
based on observable quality concerns seen and reported by hospice
surveyors to identify hospices that provide poor quality-of-care to
hospice patients. Additionally, we did not propose to include all 23
hospice CoPs because we did not want to dilute the methodology's
ability to identify quality concerns. However, in the proposed rule we
noted that we may explore incorporating other CoPs into the
methodology, and we solicited comments on an alternative approach that
would incorporate other CoPs in the calculation for the SFP algorithm.
[GRAPHIC] [TIFF OMITTED] TR13NO23.063
We proposed to count the total number of quality-of-care CLDs from
the previous 3 consecutive years of data. Our analysis of data from CY
2019 through 2021 found that very few hospices are not present in the
survey data, and that the overwhelming majority of hospices (88.3
percent of all proposed SFP-eligible hospices or 5,248 out of 5,943)
had no quality-of-care CLDs cited over these 3 years. Of the 5,943
hospices identified that will be SFP-eligible under the CY 2019-2021
data, 5.7 percent (that is, 341 hospices) are not present in the survey
data. This means that each of those 341 hospices has not yet received
its standard survey or their survey results had not been
[[Page 77801]]
recorded as of the time the data was accessed for analysis from the
CASPER system and/or had no recorded substantiated complaint in the
iQIES). Considering public comments received on the CY 2022 HH PPS
final rule (86 FR 62240) and the SFP TEP feedback, stakeholders
expressed concern about inter-surveyor reliability and state-to-state
variability in survey policy as potential drawbacks of including survey
data as part of the SFP program methodology. However, the TEP also
acknowledged the importance and value of survey data that identifies
whether a hospice complies with Medicare requirements to support basic
care quality. Furthermore, the TEP supported using the total count of
quality-of-care CLDs to indicate significant noncompliance with
multiple CoPs. To address the inter-surveyor reliability and
variability concerns, we have implemented improvements to surveyor
training guidelines to increase surveyor standardization between SAs
and AOs. Based on our efforts to improve surveyor training, and
considering the TEP and stakeholder concerns, we proposed to count the
total number of quality-of-care CLDs from the last 3 consecutive years
of data.
(b) Substantiated Complaints
In addition to quality-of-care CLDs, we proposed to include the
total number of substantiated complaints received against a hospice in
the last 3 consecutive years of data before the release of the SFP
selection list. Complaints against a hospice may be filed with the SA
or Beneficiary and Family Centered Care Quality Improvement
Organization at any time by a patient and/or caregiver(s) and hospice
staff members (see generally SOM Chapter 5, Complaint Procedures). Once
a complaint is filed with the SA, the SA can conduct an unannounced
complaint investigation survey to substantiate or refute the
allegations. If the allegation is found to be substantiated or
confirmed, the SA informs the hospice and submits the findings to
iQIES. A post-survey revisit or follow-up survey may also occur to
determine if the hospice has made corrections and is in compliance with
all requirements. A hospice may have many complaints filed against
them, but not all complaints may be substantiated upon SA review. The
results of the review of complaints are submitted to the iQIES system,
which is not publicly available. Like quality-of-care CLDs, most
hospices in our analysis currently have no substantiated complaints in
the identified 3-year period. Our CY 2019-2021 survey data analysis
found that currently 81.8 percent of hospice programs (that is, 4,860
of the 5,943 SFP-eligible hospices) have had no substantiated
complaints over the past 3 years. As noted previously, there are 5.7
percent of eligible hospices that have no survey data, or in other
words, there is missingness in the survey data for those hospices.
Unlike quality-of-care CLDs, where missingness is likely due to the
absence of a recent survey, the absence of substantiated complaints
from this data is likely because the hospice program has no
substantiated complaints.
(2) Hospice Quality Reporting Program (HQRP) Data
In addition to survey data, we proposed to use quality measures
from the HQRP to capture hospice care processes and beneficiary/
caregiver care experiences. The HQRP includes data submitted by
hospices via the Hospice Item Set (HIS), Medicare hospice claims, and
the CAHPS Hospice Surveys. All Medicare-certified hospices must comply
with these reporting requirements or face penalties for a failure to
report, although some hospices may be exempt from reporting certain
measures.\149\ This ensures that most hospices have these data
available for use in the SFP algorithm. These quality measure data are
publicly available in the Provider Data Catalog (PDC) at https://data.cms.gov/provider-data/topics/hospice-care and Care Compare at
https://www.medicare.gov/care-compare/?providerType=Hospice. A
description of current HQRP measures and public reporting dates is
available online. We proposed to include five publicly reported HQRP
measures to identify poor performing hospices. The proposed measures
are as follows:
---------------------------------------------------------------------------
\149\ Information on the reporting requirements and Annual
Payment Update payment penalties for the failure to report can be
found on the HQRP Overview website or section 1814(i) of the Act.
Medicare claims-based measure:--Hospice Care Index (HCI)
Overall Score
CAHPS Hospice Survey Data measures:
++ Help for Pain and Symptoms
++ Getting Timely Help
++ Willingness to Recommend this Hospice
++ Overall Rating of this Hospice
(a) Hospice Care Index (HCI)
We proposed including the HCI overall score based on eight quarters
of Medicare claims data. The HCI captures multiple aspects of care
delivery across ten indicators that comprise a composite HCI overall
score, with hospices earning a point for each indicator met (range: 0-
10 such that a lower score indicates lower quality of care). The
proposed HCI overall score indicates hospice care quality between
admission and discharge (HCI Technical Report and 86 FR 42528).
Moreover, the HCI score is based on Medicare claims data, which provide
direct evidence of care delivery decisions at a hospice that is readily
available for all hospices. For public reporting, hospices with less
than 20 claims over the eight quarters are excluded from reporting the
measure. The HCI measure would also be suppressed if any 1 of the 10
indicators is not reported for any reason as each indicator is a key
component of the measure and all ten are necessary to derive the HCI
score. Additional details of the HCI, such as the quality measure
specifications, individual indicator information, data period, and
exclusion criteria, are available in the HQRP Quality Measure (QM)
User's Manual posted on the HQRP Current Measures web page. The SFP TEP
and previous public comments generally supported the inclusion of HCI
data in the preliminary methodology because the HCI captures a robust
majority of hospices participating in Medicare and covers key aspects
of the hospice care continuum. Our analysis of FYs 2019 to 2021
(excluding January through June 2020) HCI data found that 78.3 percent
of hospice programs (that is, 4,656 of the 5,943 SFP-eligible hospices)
had a publicly reported HCI score. The overwhelming majority of those
hospices receive an HCI score of 8 or more out of 10--4,007 (86.1
percent) of the 4,656 SFP eligible hospices with a publicly reported
HCI score.
(b) CAHPS Hospice Survey
To represent decedent/caregiver experience of hospice care, and in
consideration of TEP and stakeholder perspectives, we proposed using
four measures from the CAHPS Hospice Survey: (1) help for pain and
symptoms; (2) getting timely help; (3) willingness to recommend the
hospice; and (4) overall rating of the hospice. CAHPS Hospice Survey
measure scores are calculated across eight rolling quarters for all
hospices with at least 30 completed surveys. Some hospices do not
participate in CAHPS as new hospices are exempt from reporting CAHPS
measures for the calendar year in which they receive their CMS
Certification Number (CCN), and hospices can apply for a CAHPS
exemption if they serve fewer than 50 survey--eligible decedents/
caregivers in a given calendar year. The CAHPS Hospice measures are
[[Page 77802]]
publicly available from the Provider CAHPS Hospice Survey Data file on
the Hospice PDC. Additional details are in the QM User's Manual on the
HQRP Current Measures web page and the CAHPS Hospice Survey website at
https://www.hospicecahpssurvey.org/. These CAHPS Hospice Survey measure
scores are also publicly reported on the Care Compare website at
https://www.medicare.gov/care-compare/?providerType=Hospice. As
discussed in the SFP TEP report, TEP and other stakeholders agreed that
the algorithm is strengthened by including the four CAHPS Hospice
Survey measures as they reflect caregiver-reported experiences in key
areas of hospice quality not reflected in claims or inspection surveys.
From the CAHPS Hospice Survey data, we proposed to use adjusted
bottom-box scores of the four measures described previously to create a
CAHPS Hospice Survey Index. As described in the CMS document,
``Calculating CAHPS[supreg] Hospice Survey Top-, Middle-, and Bottom-
Box Scores,'' that summarizes the steps we use to calculate CAHPS
Hospice Survey measure scores, ``bottom-box'' scores are calculated for
each respondent as ``100'' if the respondent selected the least
positive response categories for that question and ``0'' if the
respondent selected a different response category; survey respondents
who do not answer a question are not included in the scoring of that
question. In the CAHPS Hospice Survey, different questions have
different response scales, so the bottom-box responses vary across the
survey. For example, for questions with response options of ``Yes,
definitely,'' ``Yes, somewhat,'' and ``No,'' the bottom-box response is
``No''; for questions with response options of ``Never,''
``Sometimes,'' ``Usually,'' and ``Always,'' where ``Always'' indicates
the most positive response, the bottom-box responses are both ``Never''
and ``Sometimes''; Person-level bottom-box scores for each question are
then adjusted for mode of survey administration and case-mix to produce
hospice-level bottom-box scores. Bottom-box scores for a particular
question can be interpreted as the percentage of respondents who
selected the least positive response category(ies) after adjusting for
mode of survey administration and differences in the mix of decedent/
caregiver characteristics across hospices. Composite measure scores,
such as those for Help for Pain and Symptoms and Getting Timely Help,
are formed by taking the average of fully adjusted hospice-level
question scores within the composite. We proposed using bottom-box
scores for the SFP, because they quantify reported problematic care
experiences. To create the CAHPS Hospice Survey Index, we proposed to
calculate a single score for each hospice by taking a weighted sum of
the bottom-box scores for the four CAHPS measures, as described later
in this section. Specifically, we proposed that the two measures that
represent overall assessments of hospice care (that is, Willingness to
Recommend this Hospice and Overall Rating of this Hospice) each be
given a weight of 0.5 as these measures assess similar concepts. We
proposed to weight the other two measures, Help for Pain and Symptoms
and Getting Timely Help, at 1.0 each to reflect that these measures
assess distinct aspects of care.
To illustrate, not including usually applied adjustments to the
data for case mix and mode of survey administration, if Hospice A
received a bottom-box score of 100 on the Overall Rating of this
Hospice, that means that all the survey respondents responded to the
question and gave the hospice an overall rating of zero to six, the
least positive possible responses (middle-box options: 7-8; top-box
option: 9-10). The hospice could then receive, a bottom-box score of 0
on the Help for Pain and Symptoms measure, meaning none of the survey
respondents selected the least positive responses on any of the
questions that make up this measure. If Hospice A also received a
bottom-box score of 12 on the Willingness to Recommend this Hospice and
a bottom-box score of 4.5 on the Getting Timely Help measure, meaning
that approximately 12 percent and 4.5 percent of respondents,
respectively, selected the bottom-box scores, then Hospice A's total
CAHPS Hospice Survey Index will be 60.5, calculated as follows: ((100 +
12) * 0.5) + (0 + 4.5) = 60.5. The maximum value for the CAHPS Hospice
Survey Index would be 300 points. For this index, a lower number of
points would indicate a higher quality score.
Our analysis of CYs 2019 to 2021 (excluding January through June
2020) CAHPS Hospice Survey data found that 49.3 percent of eligible
hospice programs (2,929 of the 5,943 SFP-eligible hospices) report the
four CAHPS Hospice Survey measures. Compared to the other three
indicators (quality-of-care CLDs, substantiated complaints, and HCI),
the scores from the four CAHPS measures are more dispersed around their
average value. The average CAHPS Hospice Survey Index value for these
four measures combined is 24, with an overall range of 2 to 83 from the
SFP-eligible hospices (lower scores indicate better performance; total
possible range: 0-300). The distribution of these values is roughly
symmetric and centered on an average such that the likelihood of
observing a value different from the average value becomes smaller the
further away the value is from the average.
c. Final Data Source Preparation
We proposed to compile the data for the algorithm indicators
(quality-of-care CLDs, substantiated complaints, HCI, the four CAHPS
Hospice measures) and remove hospices not eligible for SFP to create a
single score for every hospice. A Medicare-certified hospice program
would be included in the algorithm if it--(1) is an active provider
that has billed at least one claim to Medicare FFS in the last 12
months as captured in iQIES; and (2) has data for at least one
algorithm indicator.
For the HCI and CAHPS data, we proposed to pull the latest HCI and
CAHPS data from the Hospice PDC. For example, we would use data from
November 2023 to identify the pool of hospices eligible to be in the
SFP on or after January 1, 2024.
(1) Survey Data and HCI
For the survey data, we proposed the following steps to prepare
data for the algorithm:
Step One: We would pull 3 consecutive years of survey data
preceding the release of the SFP selection list, including data for all
relevant hospice survey types (initial certification, standard,
complaint, and follow-up surveys). For identifying the pool of hospices
eligible to be in the SFP on or after January 1, 2024, we would use
2020-2023 survey data.
Step Two: From the survey data in Step One, we would count
the total number of quality-of-care CLDs for each hospice in the data
file. Quality-of-care CLDs can be found in any hospice survey (initial
certification, standard, complaint, follow-up). They are denoted within
a survey under specific citation codes (Table F2).
Step Three: From the data file in Step One, we would count
the total number of substantiated complaints for each hospice in the
data file. Substantiated complaints can be found in complaint and
follow-up hospice surveys.
Our initial analysis found that the proposed SFP-eligible hospices
may have missing indicators from the survey data (quality-of-care CLDs,
substantiated complaints) and/or HCI. To address the algorithm's
missing data for these indicators, we proposed standardizing
[[Page 77803]]
each indicator for quality-of-care CLDs, substantiated complaints, and
HCI. When the data for each indicator is standardized, it is rescaled
to have a mean of zero and a standard deviation of one. We proposed
that hospices missing any of these three indicators would be assigned a
value of zero for that indicator after standardization (see section
VI.B.4.d. of this final rule).
(2) CAHPS[supreg] Hospice Survey Data
As discussed previously, CAHPS Hospice Survey data are not
available for hospices that are exempt from participating due to size
or newness, or for hospices for which there are fewer than 30 completed
surveys over an eight-quarter reporting period. Since these hospices
may differ systematically from hospices that do have publicly reported
CAHPS Hospice Survey data, we do not believe it is appropriate to
assign hospices the average value of the CAHPS Hospice Survey Index if
they are missing these data. After standardizing the CAHPS Hospice
Survey measures (using the same process for survey data and HCI in
sections VI.B.4. and VI.B.4.d. of this final rule), we proposed
addressing missing CAHPS Hospice Survey data by averaging the total
number of data indicators used to derive the score. The score for
hospices with missing CAHPS Hospice Survey data would be based solely
on all other indicators (CLDs, complaints, and HCI), and the score for
hospices with available CAHPS Hospice Survey data includes the CAHPS
Hospice Survey Index in addition to the other indicators (see section
VI.B.4.d.(2) of this final rule).
d. Proposed Data Source Standardization
We proposed standardizing each indicator (that is, quality-of-care
CLDs, substantiated complaints, HCI, and the CAHPS Hospice Survey
Index) to compare indicators equally despite each data source's
different units of measurement. For example, both quality-of-care CLDs
and substantiated complaints are continuous variables that have no
ceiling to how many quality-of-care CLDs or substantiated complaints a
single hospice can receive. In contrast, a hospice can only receive a
maximum value of 10 from the HCI quality measure. Therefore, if we do
not rescale HCI, we will be deemphasizing the importance of HCI for the
SFP as a relevant dimension of care quality because the range of
possible values for HCI is much smaller than the range of possible
values for quality-of-care CLDs and substantiated complaints. By
standardizing the data as proposed, we can understand how different the
indicator is for a single hospice compared to the indicator from the
average hospice and shift the unit to a magnitude of difference from
the average across all indicators to compare the data source indicators
under a shared measurement unit.
As a simplified example to illustrate the importance of
standardization, Hospice A has one quality-of-care CLD and an HCI score
of 3. These two numbers' absolute differences are two (3 HCI - 1
quality-of-care CLD = 2). However, examining the absolute difference in
these numbers does not indicate that Hospice A delivers poor care
quality. To better explain how these two indicators relate to one
another and quality, we look at the likelihood that Hospice A will
receive one quality-of-care CLD and the likelihood that it will receive
an HCI score of 3. To determine this likelihood, we proposed comparing
these numbers to the respective averages of all other hospices for the
indicators. The average number of quality-of-care CLDs for hospices is
a little less than 0.5. Most hospices have zero quality-of-care CLDs.
While a quality-of-care CLD of one is larger than the average (0.5),
the magnitude of difference between the one quality-of-care CLD in
Hospice A and the 0.5 quality-of-care CLDs for the average hospice is
not very large. When considering HCI, the average HCI score for all
hospices is 8.9 (a higher HCI score indicates better performance on the
measure). An HCI score of three is a large difference from the average
of 8.9, and as a result, it is unlikely that a hospice will receive
this kind of score if it was an average HCI performer. The likelihood
of observing a value different from the average is the type of
information we proposed to include to determine poor performers. By
standardizing the indicators, we shift our interpretation from what
value they received to an estimation of how likely they are to receive
the value if they were an average hospice. This approach would improve
the algorithm's ability to identify those hospice programs with the
most unlikely values across our four indicators and those that are the
poorest performers across indicators compared to all other active
hospices in the SFP analytic file.
The previous fictitious example illustrates how indicators are
standardized. We proposed to adopt the most common standardization
method, which would be applied to each of the indicators for a specific
hospice (hospice indicators). For each indicator, this would be done by
taking the indicator's observed value for the hospice and subtracting
that indicator's average value for all hospices. We would then divide
this number (the difference) by the standard deviation, a common
measure of data variance, to tell us how clustered data are around the
average (see the following equation).
[GRAPHIC] [TIFF OMITTED] TR13NO23.064
As a function of this proposed approach, all indicators are
centered with a mean of zero and a standard deviation of one. The
transformed indicator would represent how many standard deviations
better or worse than average a hospice's observed value is. The
standardized scores under this proposed approach are additive, and
their sum represents how many standard deviations above or below
average the hospice is across all indicators.
(1) Proposed Weighting of the Standardized Values
The proposed standardization discussed earlier allows an
indicator's data to be compared to another standardized indicator.
Therefore, we would be comparing how different the observed value is
from the average value to make all indicators mathematically equal. We
proposed to weight each indicator by multiplying an indicator by a
constant value to account for their relative importance in the
methodology.
As part of our consideration for determining the weights for each
indicator, the TEP and stakeholder listening sessions offered
considerations related to weighting the data sources. In discussing the
weighting of substantiated complaints, quality-of-care CLDs, and HCI,
the TEP and stakeholders agreed that they represent relevant dimensions
of care quality but did not raise concerns or discuss whether one of
these indicators was more or less indicative of care quality
[[Page 77804]]
relative to another. However, the TEP and stakeholders emphasized the
importance of patient and caregiver perspectives represented by the
CAHPS measures, noting they are the most integral dimension of hospice
care quality. As discussed in the SFP TEP report on page 15, ``some TEP
members argued that the valuable perspectives of families and
caregivers on the CAHPS Hospice Survey justified weighting it more than
other data sources.'' Based on the feedback from the TEP and
stakeholder listening sessions, we proposed to weight the CAHPS Hospice
Survey Index by twice that of the other measures (that is, multiply the
standardized value CAHPS Hospice Survey Index by two).
(2) Proposed Approach for Missing CAHPS Data
In three of the four indicators used in the algorithm, data exhibit
an exceptional amount of concentration around the average value for the
indicator. We proposed replacing missing values in quality-of-care
CLDs, substantiated complaints, and HCI with the average value for each
of those indicators for an individual hospice to assign a score to that
hospice (see the discussion of standardization in this section of the
final rule). In other words, we proposed to assign hospices missing any
of these three indicators a value of zero for that indicator after
standardization, which is equivalent to the average value.
The CAHPS Hospice Survey Index is distinct from these other three
indicators for several reasons warranting separate treatment for its
missingness. First, the CAHPS Hospice Survey Index does not exhibit the
same high concentration around the average value as the other measures.
This means that there is more variability in the CAHPS Hospice Survey
Index than in the other indicators. As a result of this increased
variability, it is less likely that missing values would be close to
the average value if they were observable. Second, more hospices are
missing CAHPS Hospice Survey data than are missing data for other
indicators in the algorithm. In our review of the CY 2019-2021 analytic
file (excluding January 1-June 30, 2020), there is CAHPS Hospice Survey
data for only about 49 percent of all SFP-eligible hospices. Due to
reporting exemptions for small and/or newer hospices, those missing
values are disproportionately from that cohort of providers. Because of
this trend, it is difficult to draw any conclusions about the missing
values given that there are no data from small hospices by which we can
compare if the smaller/newer hospice CAHPS average is similar to those
for which we have observed data. Third, hospices with fewer than 50
distinct beneficiaries can file for an exemption from reporting CAHPS.
If we replace missing CAHPS Hospice Survey measure values with the
average value, poor performing small hospices could benefit from being
small by opting into being treated as an average hospice by becoming
exempt from reporting their poor CAHPS Hospice Survey measure values.
While this action is highly unlikely, the ability of small hospices to
request an exemption is a consideration; however, we do not believe the
proposed algorithm creates incentives for providers to either request
an exemption or withhold CAHPS Hospice Survey reporting altogether. For
these reasons, we proposed a different treatment for CAHPS Hospice
Survey missingness. Instead of replacing missing CAHPS Hospice Survey
measure scores with the average values for those measures, we proposed
to run hospices with data for CAHPS Hospice Survey measures through a
version of the algorithm that considers the CAHPS Hospice Survey Index,
and for those hospices that do not have CAHPS Hospice Survey data,
through a version of the algorithm that does not consider the CAHPS
Hospice Survey Index. To make the two resulting scores comparable, we
then average the scores based on the total number of indicators used to
calculate the score. We believe this approach mitigates concerns
regarding a potential incentive to request an exemption or withhold
CAHPS Hospice Survey data.
For the hospices without CAHPS Hospice Survey data, we proposed to
divide their scores by three because their score was calculated from
three indicators: quality-of-care CLDs, substantiated complaints, and
HCI. For the hospices with CAHPS Hospice Survey data, we proposed to
divide their scores by five because the weight on the CAHPS Hospice
Survey Index means it is mathematically counted twice, so the
indicators will be quality-of-care CLDs, substantiated complaints, HCI,
and the CAHPS Hospice Survey Index, which is counted twice due to the
weight of two on the indicator. This approach to handling missing CAHPS
data is beneficial because it does not make assumptions about the
values for missing CAHPS data.
With CAHPS Hospice Survey Index:
[GRAPHIC] [TIFF OMITTED] TR13NO23.065
Without CAHPS Hospice Survey Index:
[GRAPHIC] [TIFF OMITTED] TR13NO23.066
(3) Example Results
To illustrate how the proposed algorithm would behave, we discuss
later in this section how two example hospices' (Hospice A's and
Hospice B's) algorithm scores would be produced based on their
indicator values. As discussed previously, the methodology will be one
step in determining whether a hospice is selected for the SFP.
Hospice A is a large hospice, serving 500 beneficiaries on average
over the last 3 years. Over the past 3 years, they received zero
quality-of-care CLDs, two substantiated complaints, and an HCI score of
nine. At the same time, their CAHPS Hospice Survey Index measure is
44.5, which is larger than the average value of 28, which may indicate
a quality concern. When we standardize these values to examine how
different they are from the average hospice, we find that their
quality-of-care CLD standardized value is zero, their substantiated
complaint standardized value is 0.6, their HCI is 0.1, and their CAHPS
Hospice Survey Index is 2.4. As we suspected, three of their indicators
[[Page 77805]]
are closely in line with the average hospice. Only their CAHPS Hospice
Survey Index of 2.4 tells us that their bottom-box scores for the four
quality measures is 2.4 standard deviations away from the average
hospice. We would then include these four indicators in the algorithm:
0 + 0.6-0.1 + (2*2.4) = 5.3. As explained previously, for hospices with
CAHPS data, we would divide their scores by five, and since Hospice A
has a CAHPS Hospice Survey Index, the final value would be divided by
five. Hospital A's final algorithm score is: 5.3/5 = 1.06. We then take
this score and compare it to all other scores generated from all
hospices and put them in order from highest to lowest, and we find that
Hospice A ranks at 331. Because of the algorithm's emphasis on CAHPS,
Hospice A's poor CAHPS Hospice Survey Index would make it more likely
to be identified as a candidate, but because Hospice A performed well
on the other three indicators, it would be less likely to be selected
as a SFP participant compared to other hospices.
Hospice B is a mid-sized hospice serving an average of 120 distinct
beneficiaries over the past 3 years. It has not reported CAHPS Hospice
Survey data across the four measures. They received 42 substantiated
complaints, 15 quality-of-care CLDs, and an HCI of 10. The number of
substantiated complaints and quality-of-care CLDs are quite high even
though they have achieved all 10 indicators of HCI. After we
standardize, Hospice B's quality-of-care CLD value is 9.2, its
complaint rate is 16.4, and its HCI is 0.9. We would calculate Hospice
B's score in the following way: 9.2 + 16.4-0.9 = 24.7. As explained
previously, for hospices without CAHPS[supreg] data, we would divide
their scores by three, and since Hospice B does not have a CAHPS
Hospice Survey Index, this final value would be divided by three: 24.7/
3 = 8.2. When comparing this score of 8.2 to all other hospices, we
find that Hospice B has the highest algorithm score among all hospices,
indicating it has the poorest quality indicator outcomes. Even though
its HCI score is high and we do not know its CAHPS value, Hospice B's
high substantiated complaint rate and high number of quality-of-care
CLDs would make it more likely to be selected for the SFP.
Comment: Commenters expressed various concerns over the use of
CAHPS[supreg] Hospice Survey measures and the CAHPS Hospice Survey
Index as an appropriate indicator in the proposed SFP algorithm, while
also acknowledging the importance of including caregiver voices in the
algorithm. Many commenters noted that slightly more than half of
hospices do not have publicly available CAHPS data and wondered if not
having CAHPS data would make a hospice less likely to be placed in the
SFP. Commenters also identified a possible unanticipated consequence of
using CAHPS data that weighting the CAHPS Index more heavily in the
algorithm may create an undesirable incentive for hospices to not
report CAHPS data or to try and influence caregiver responses. A
commenter proposed penalizing hospices that do not report CAHPS Hospice
survey data by assuming that their CAHPS Index input would fall in the
bottom percentile of this measure. Some commenters expressed concern
about the reliability and ``subjectivity'' of the CAHPS Hospice Survey
data or expressed a preference for claims-based measures, such as the
HCI, over survey-based measures. Several commenters also expressed
concern that the use of CAHPS may disproportionately impact providers
serving underserved communities, as those providers often have poorer
CAHPS scores.
Response: We appreciate the commenters' concerns regarding the
strengths, limitations, and potential drawbacks of the CAHPS Index.
We acknowledge commenters' concern that the inclusion of CAHPS
Hospice Survey data may seem inconsistent with the original purpose of
the CAHPS Hospice Survey, but we maintain that this survey data as
publicly reported quality measures in the HQRP is appropriate to
include for the SFP. The CAHPS Hospice Survey was developed to provide
information to patients and caregivers to help them select a hospice
program, to aid hospices in quality improvement, and to provide CMS
with information for monitoring hospice performance.\150\ The use of
CAHPS data for the SFP aligns with these foundational goals, as it
monitors hospice performance and publicly reports the list of poor
performing hospices to aid in patient and caregiver decision-making.
While CMS recognizes that the number of providers not reporting the
data is a limitation of the CAHPS Hospice Survey data, the CAHPS data
nonetheless represent an essential component to identifying provider-
level issues in care delivery that will be addressed by participation
in the SFP.
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\150\ CAHPS Hospice Survey. (2022). CAHPS Hospice Survey Fact
Sheet. https://www.hospicecahpssurvey.org/globalassets/hospice-cahps4/home-page/cahps_hospice_survey_fact_sheet_january-2022.pdf.
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The proposed rule included two versions of the algorithm. The first
version calculated scores for hospices that do have publicly reported
CAHPS Hospice Survey Data. The second version calculated scores for
hospice providers that do not have publicly reported CAHPS Hospice
Survey data. This approach produced comparable scores that consider the
CAHPS data when it is available without speculating about what the
missing values of CAHPS might be for those 51 percent of providers that
do not currently report CAHPS Hospice Survey data.
The TEP and stakeholder listening sessions emphasized the
importance of the caregiver perspective. As was presented to
stakeholders, each algorithm input is intended to capture an integral
concept of poor care delivery. When questioned for feedback, all TEP
members strongly believed CAHPS Hospice Survey data were critical to
include in the SFP algorithm, and some even believe that the valuable
perspectives of family and caregivers justified weighting it more
heavily compared to the other algorithm inputs. It was further
mentioned that not only was the caregiver perspective very important,
but that it would capture aspects of quality that are not found in the
inspection survey or claims-based data. These opinions were expressed
again after presenting the TEP with potential data issues such as the
high amount of missing provider-level CAHPS Hospice Survey data. As a
result of this stakeholder emphasis, CMS proposed to weight the CAHPS
Hospice Survey Index as twice that of other inputs, so that it accounts
for 40 percent of the proposed algorithm score among providers with
CAHPS Hospice Survey data.
Initial analyses demonstrated that this approach does not
significantly help or hurt providers with or without CAHPS Hospice
Survey data. In examining the algorithm scores described in the
proposed rule, there was not a statistically significant difference in
the share of providers with and without CAHPS Hospice Survey data that
were deemed eligible for SFP selection (that is, those that fell in the
bottom 10 percent). Among the 2,929 hospices that reported CAHPS
Hospice survey data, 293 (10 percent) were in the bottom 10 percent.
While among the 3,014 hospices that did not report CAHPS Hospice Survey
data, 302 (10 percent) fell in the bottom 10 percent. This is
consistent with expectations, as there is no evidence suggesting that
providers that report CAHPS Hospice Survey data deliver significantly
better or worse care than those that do not report. To put it another
way, these initial results demonstrate that there is no incentive
[[Page 77806]]
for providers to withhold reporting their CAHPS values as there is no
intrinsic benefit to doing so within the structure of the algorithm--
providers that need SFP intervention are just as likely to be
identified when they have CAHPS data as when they do not have CAHPS
data. As a result, CMS believes the best course moving forward is
through the algorithm as proposed. We remain open to continued
discussions with interested parties and will make potential refinements
in the future to these policies, as determined necessary.
We believe that this evidence should further ease the concerns
expressed by commenters regarding providers choosing not to report
CAHPS Hospice Survey data. As described previously, the proposed
approach provides no incentive for providers to opt out of reporting
because it is unlikely that suppressing CAHPS data would help providers
avoid SFP eligibility. Among providers that did not have publicly
reported CAHPS Hospice Survey data in August 2023 data, nearly 98
percent did not meet the requirements to report data due to being a low
volume or a new hospice. Additionally, if the required quality data in
the HQRP is not reported by each designated submission deadline,
beginning in FY 2024, the hospice will be subject to a payment
reduction of 4 percentage points from its annual payment update (APU)
to deter against non-reporting (86 FR 42528). CMS will monitor the
rates of exemption and non-reporting of CAHPS Hospice Survey data and
evaluate whether changes to the algorithm are necessary for future
rulemaking should these rates drastically increase.
CMS also appreciates commenters' concerns that providers may seek
to influence caregiver survey responses if CAHPS Hospice Survey data
are used to help identify poor performing hospices. The CAHPS Hospice
Survey contains guidelines governing how providers are permitted to
communicate about the survey with patients and caregivers, preventing
them from unfairly influencing how caregivers respond.\151\ If
providers wish to encourage caregivers to complete the survey, they are
required to encourage all caregivers to do so. Providers are not
allowed to attempt to influence CAHPS responses in any way, including
asking the questions before the survey is administered, offering
benefits for favorable responses, offering incentives for completing
the survey, or contacting caregivers directly regarding survey
responses.
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\151\ Centers for Medicare and Medicaid Services. (2022). CAHPS
Hospice Survey Quality Assurance Guidelines, Version 9.0. https://www.hospicecahpssurvey.org/globalassets/hospice-cahps4/quality-assurance-guidelines/cahps-hospice-survey-quality-assurance-guideline-v9.0-september-2022.pdf.
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CMS does not believe it would be beneficial to penalize hospices
that do not report CAHPS Hospice Survey data by assigning them a score
from the bottom percentile. The vast majority of providers that do not
report CAHPS Hospice Survey data do not report because of size (that
is, fewer than 50 survey-eligible patient/family caregiver pairs during
the reference year) or newness. Providers should not be punished for
their size or newness. Still, as noted earlier, CMS will monitor the
number of non-exempt providers that choose not to submit CAHPS Hospice
Survey data and evaluate whether changes to the algorithm are necessary
for future rulemaking if the numbers of such hospices grow
significantly. Additionally, as noted earlier, if a non-exempt hospice
provider chooses not to submit data, the provider will be subject to a
payment reduction of 4 percentage points from their APU (beginning in
FY 2024) as another deterrent against non-reporting (86 FR 42528).
With respect to commenters' concerns about the reliability of CAHPS
Hospice Survey data, presently, there is no empirical evidence to
suggest that the CAHPS Hospice Survey data are statistically
unreliable. The CAHPS Hospice Survey was developed to produce
standardized information about patient and caregiver experiences of
care that allows for meaningful comparison across hospices.\152\ An
analysis of CAHPS Hospice Survey based on the data reported by 2,500
hospice providers participating in the survey's national implementation
found the CAHPS measures to be both valid and reliable.\153\ The HQRP
public reporting requirements are designed to ensure that each CAHPS
component measure is a reliable indicator of hospice quality in that
domain. We seek to include CAHPS Hospice Survey data in addition to the
claims-based HCI because the two data sources measure different aspects
of hospice quality and complement each other.
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\152\ Centers for Medicare and Medicaid Services. (2022). CAHPS
Hospice Survey Quality Assurance Guidelines, Version 9.0. https://www.hospicecahpssurvey.org/globalassets/hospice-cahps4/quality-assurance-guidelines/cahps-hospice-survey-quality-assurance-guideline-v9.0-september-2022.pdf.
\153\ Rebecca Anhang Price, Brian Stucky, Layla Parast, Marc N.
Elliott, Ann Haas, Melissa Bradley, and Joan M. Teno. Development of
Valid and Reliable Measures of Patient and Family Experiences of
Hospice Care for Public Reporting. Journal of Palliative Medicine.
Jul 2018.924-932. http://doi.org/10.1089/jpm.2017.0594.
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We appreciate commenters' concerns that the way CAHPS Hospice
Survey data are collected might systematically disadvantage providers
that provide care to historically underserved populations. This type of
potential disadvantage could occur if the CAHPS Hospice Survey design
or data collection process systematically scored providers serving
underserved populations worse than providers of the same quality that
deliver care to populations that are not underserved. This exact
concern has been investigated in the scholarly literature on the CAHPS
Hospice Survey and there is presently no evidence to demonstrate that
such a bias exists.\154\
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\154\ Davlyatov, G., He, M., Orewa, G., Qu, H., & Weech-
Maldonado, R. (2023). Are Hospice Google Ratings Correlated With
Patient Experience Scores? Evidence from a National Hospice Study.
The American Journal of Hospice & Palliative Care,
10499091231160186. https://doi.org/10.1177/10499091231160186.
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One study examined the effects of caregiver and decedent
characteristics on CAHPS Hospice Survey scores to determine if there is
a need to adjust the reported scores by these characteristics to better
measure caregivers' experiences.\155\ The authors aimed to identify
patient and caregiver characteristics of the populations that different
providers serve and how those factors were related to CAHPS Hospice
Survey responses in ways that may not reflect underlying differences in
quality of care. The authors analyzed 915,442 patients across 2,513
providers between April 2015 and March 2016 and estimated the
association between decedent and caregiver characteristics and the
response percentile of the caregiver's CAHPS Hospice Survey. Decedent
characteristics included age at death, gender, race/ethnicity,
education, payer for hospice care, primary diagnosis, final setting of
care, and length of final episode of hospice care. Caregiver
characteristics included age, education, gender, language spoken at
home, language of survey completion, and relationship to the decedent.
The results of this analysis found that the payer for hospice care,
caregiver education, and survey language/language spoken at home were
the characteristics that were most associated with CAHPS Hospice survey
scores and the authors recommended adjusting provider-level CAHPS
results for these
[[Page 77807]]
factors. There was not strong evidence that other adjustments were
required. All of the authors' recommended case mix adjustments are
currently incorporated in the CAHPS Hospice Survey data
reporting.156 157 These adjusted data are used in the
proposed SFP algorithm.
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\155\ Parast, L., Haas, A., Tolpadi, A., Elliott, M.N., Teno,
J., Zaslavsky, A.M., & Price, R.A. (2018). Effects of Caregiver and
Decedent Characteristics on CAHPS Hospice Survey Scores. Journal of
Pain and Symptom Management, 56(4), 519-529. https://doi.org/10.1016/j.jpainsymman.2018.07.014.
\156\ Hospice CAHPS Survey. Calculating CAHPS[supreg] Hospice
Survey Top-, Middle-, and Bottom-Box Scores. https://www.hospicecahpssurvey.org/globalassets/hospice-cahps4/public-reporting/scoring-and-analysis/cc-previous-documents/pr-calculations/steps-for-scoring-cahps-hospice-survey-measures-for-website-2018q3-final.pdf.
\157\ CAHPS Hospice Survey. (2020). Updates to the Case-Mix
Adjustment Approach for Publicly Reported CAHPS[supreg] Hospice
Survey Results. https://www.hospicecahpssurvey.org/globalassets/hospice-cahps4/public-reporting/scoring-and-analysis/cc-previous-documents/pr-calculations/updates-to-cahps-hospice-survey-cma-over-time_march-2020.pdf.
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A second study compared CAHPS Hospice Survey responses of
caregivers for Black, Hispanic, and white patients.\158\ This study
compared the experiences of Black patients and Hispanic patients to
white patients who received care from the same hospice providers. The
authors found that, on average, the CAHPS Hospice Survey scores that
providers received from caregivers of Black and Hispanic patients were
better than white patients. However, the average CAHPS Hospice Survey
scores were lower for providers who cared for more Black patients and
Hispanic patients, which suggests that these populations receive
hospice care from poorer quality providers. Together, these findings
serve as evidence against bias in the methodology of the CAHPS Hospice
Survey and support the conclusion that lower CAHPS Hospice Survey
scores for providers caring for underserved populations may be
reflective of lower quality care delivery.
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\158\ Price, R.A., Parast, L., Haas, A., Teno, J.M., & Elliott,
M.N. (2017). Black And Hispanic Patients Receive Hospice Care
Similar To That Of White Patients When In The Same Hospices. Health
Affairs (Project Hope), 36(7), 1283-1290. https://doi.org/10.1377/hlthaff.2017.0151.
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A third study found that there is a strong association between
CAHPS Hospice Survey scores and the Google Ratings of hospice
providers.\159\ This may suggest that both CAHPS Hospice Survey data
and Google Ratings measure similar aspects of caregiver experience,
which in turn increases confidence about the reliability of the CAHPS
Hospice Survey data. The authors further found that providers located
in areas with higher racial and ethnic minority populations had both
worse CAHPS Hospice Survey scores and lower Google Ratings, which
further supports the conclusion that lower CAHPS Hospice Survey scores
for these providers are reflective of concerning care quality rather
than bias in the CAHPS Hospice Survey process.
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\159\ Davlyatov, G., He, M., Orewa, G., Qu, H., & Weech-
Maldonado, R. (2023). Are Hospice Google Ratings Correlated With
Patient Experience Scores? Evidence from a National Hospice Study.
The American Journal of Hospice & Palliative Care,
10499091231160186. https://doi.org/10.1177/10499091231160186.
---------------------------------------------------------------------------
The evidence generated by these studies leads us to conclude that
providers that receive a poor algorithm score are delivering a level of
care that warrants further attention. The intention of this process is
to improve care delivery across all hospice providers, including within
those providers that serve historically underserved populations.
Final Decision: After considering public comments, CMS is
finalizing the inclusion of CAHPS Hospice Survey data in the SFP
algorithm as proposed, which includes using the BBVs of four CAHPS
Hospice Survey measures to create the Hospice CAHPS Index,
standardizing the CAHPS Index, double weighting the CAHPS Index in the
algorithm, and using two versions of the algorithm to address missing
CAHPS Hospice Survey data (See 42 CFR 488.1135(b).) We remain open to
continued discussions with interested parties and will make potential
refinements in the future to these policies, as determined necessary.
Comment: Many commenters expressed appreciation for the inclusion
of a claims-based measure in the SFP algorithm but noted concerns about
the number of hospices that did not have publicly reported HCI data and
whether missing HCI data would make a hospice less likely to be a
candidate for the SFP. Commenters also expressed concerns with the
methodological choice to assign hospices with missing HCI scores a
value equal to the overall mean of hospices reporting HCI scores.
Specifically, commenters were concerned that assigning a mean value
could result in poor performing hospices receiving a higher HCI score
than they might if they had a publicly reported HCI score. Some
commenters also voiced a concern that a hospice, in order to avoid SFP
placement, may choose not to report HCI if, for example, they had a
poor score.
Response: We appreciate the comments regarding the HCI; as
correctly noted by commenters, approximately 21 percent of hospices did
not have a publicly reported HCI score.\160\ Hospice providers that do
not have HCI scores are likely to be small (fewer than 20 discharges
over 2 years), new (insufficient data to observe 20 discharges), or
both. Of the 1,287 hospices without publicly reported HCI scores, 1,209
(94 percent) had fewer than 11 discharges per year.
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\160\ From August 2022 Hospice Public Refresh, which contains
data from 04/01/2019-12/31/2019; 07/01/2020-9/30/2021 (excludes
first two quarters of 2020).
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In conducting preliminary analyses, hospice providers that did not
have a publicly reported HCI score were significantly less likely to be
identified in the candidate list of the SFP. This suggests that the
algorithm may be limited in its ability to identify poor performing
hospices with under 20 discharges over two years. For hospices without
publicly reported HCI scores, their algorithm scores are most related
to their performance on the condition-level deficiency and
substantiated complaint inputs because providers without an HCI score
are typically too small to have publicly reported CAHPS data. Providers
that have persistently discharged fewer than 20 patients every two
years would continue to be assigned the average HCI in future years and
be assessed primarily by their number of substantiated complaints and
condition-level deficiencies. New hospice providers will presumably
have publicly reported HCI scores in future years of data. We
acknowledge the potential limitations of HCI data, but the benefits of
using the HCI score, including that it is based on claims data, that it
captures care processes occurring at a hospice, and that it has no
additional data reporting burden, outweigh the concerns. Alternative
approaches to including claims data may be considered in future
rulemaking.
As noted in the proposed rule, when hospice providers do not have a
publicly reported HCI score, they are assigned an HCI score equal to
the mean (average) score among providers reporting an HCI score. The
way missingness in HCI is generated and the distribution of publicly
reported HCI scores motivated the decision to assign the mean value. In
the publicly reported HCI data, provider-level missingness occurs in
one of two ways. First, if the hospice provider is new then it is
automatically granted an exemption and does not generate an HCI score.
Second, if the provider has less than 11 claims, then its HCI score is
not reported to protect the anonymity of its beneficiaries. Unlike
other HQRP measures, the HCI score is a claims-based measure, and
providers cannot avoid reporting it. As a result, missingness is driven
by factors that we presently assess are not related to the quality-of-
care delivery. Among providers with available data, the average HCI
score was nine out of a
[[Page 77808]]
maximum (best) value of ten. Roughly 90 percent of hospices had an HCI
score of seven or higher. Due to the idiosyncratic generation of
missingness in the HCI data and the high clustering around the mean for
those with HCI data, we conclude that, absent other information, it is
reasonable to assume that a non-reporting hospice's HCI score would be
close to the average HCI score. This approach also avoids unduly
punishing or rewarding small and/or new providers in the algorithm just
for being small or new. As noted in the proposed rule, HCI scores are
standardized in the algorithm to allow compatibility with other inputs.
Therefore, providers receive positive values reflecting how much their
HCI score is higher than the mean, or negative values reflecting how
much their HCI score is lower than the mean.
Calculation of the HCI score is automatic and based only on claims
data. Hospice providers of sufficient size that participate in the HQRP
cannot opt out of having a publicly reported HCI score, meaning there
is no risk of providers choosing not to report this measure.
Additionally, as noted previously, if the required quality data in the
HQRP is not reported by each designated submission deadline, the
hospice will be subject to a payment reduction of 4 percentage points
from its APU (beginning in FY2024) to deter against non-reporting (86
FR 42528).
Final Decision: After considering public comments, we are
finalizing without modification the inclusion of the HCI score, the
standardization of the HCI score, and how missing HCI scores are
handled in the SFP algorithm, specifically by replacing a hospice's
missing score with zero after standardization which is equivalent to
replacing it with the average value. (See 42 CFR 488.1135(b).) We
remain open to continued discussions with interested parties and will
make potential refinements in the future to these policies, as
determined necessary.
Comment: Many commenters believe that both survey data measures,
condition-level deficiencies (CLDs) and complaints should be scaled in
the algorithm based on the size of a hospice (for example, per 100
beneficiaries). There were also concerns about the backlog in
accreditation survey completion largely due to the COVID-19 Public
Health Emergency (PHE). Commenters also questioned the accuracy of
survey data given possible issues of duplicated CLDs or substantiated
complaints, along with issues related to staffing shortages and
surveyor training at both state agencies and accrediting organizations.
Commenters offered the following suggestions on how to better include
survey data in the SFP algorithm: by using surveys older than 36-months
to reduce the number of hospices with missing survey data and including
two additional types of CLDs in the algorithm.
Response: We appreciate the comments regarding the survey data
measures. In testing the proposed algorithm, we determined that there
was not a linear relationship between the number of CLDs identified in
hospice surveys and the average number of beneficiaries that a CLD
provider served each year. Using CLDs and complaints as a rate per 100
beneficiaries, for example, relies on the assumption that there is an
identifiable linear relationship between those two indicators and the
number of beneficiaries a hospice serves. For example, such an
assumption would suggest that two providers of the same quality would
have different numbers of CLDs based solely on the number of
beneficiaries they serve. Providers of all sizes have the same
opportunity to have a CLD cited in that any CLD can be cited on a
provider's accreditation or standard inspection survey, in which all
providers must participate, with the majority of providers regardless
of size having no CLD citations over the last 3 years. While we agree
that large hospices have more opportunities to receive complaints than
small hospices because they serve more patients, this does not change
the opportunity for substantiation (that is, a complaint cannot be
substantiated if the surveyor does not find evidence that supports the
complaint). This is why we are counting substantiated complaint surveys
because, as the TEP indicated, these complaints have been reviewed and
confirmed with an on-site survey. Additionally, we will also continue
to monitor the relationship between CLDs, complaints, and size, but the
current evidence does not suggest that CLD citations increase as
providers take on more beneficiaries.
CMS appreciates commenters' concerns about the timeliness and
quality of survey data. The COVID-19 PHE has led to a backlog of
routine surveys, but this backlog is anticipated to clear over the next
year as state survey agencies (SAs) and accreditation organizations
(AOs) prioritize surveys of hospices that have not had a survey in 36
months. In the proposed SFP algorithm, providers that did not have
available survey data were assigned the mean number of CLDs and
substantiated complaints for purposes of algorithm scoring. There is no
significant association between missing survey data and the probability
of being a candidate for the SFP.
As noted by many commenters, CMS has implemented improvements to
surveyor training guidelines via a revised SOM, Appendix M. CMS
continually monitors surveyor training to ensure it is up to date with
regulations and requirements. A revised SOM Appendix M and Surveyor
Basic Training for hospice programs has been fully implemented as of
May 2023. All AO and SA surveyors were required to take the updated
surveyor training (see 42 CFR 488.1115(a)). CMS has an active process
for identifying and remedying inconsistencies. We are currently working
on developing surveyor skills review (SSR) trainings to test surveyor
competency.
Some commenters also had a concern that complaints may be ``double
counted'' if a complainant submitted to both a state agency and
accreditation organization. There is a possibility that a substantiated
complaint might be counted twice as part of the calculation if a
specific complaint is investigated by both the SA and AO on separate
dates. We will monitor the data to determine the incidence of such an
occurrence and evaluate whether changes to the algorithm are necessary
for future rulemaking.
We thank commenters for the suggestions on additional ways to
incorporate survey data into the SFP algorithm. While using surveys
that are more than 36 months old would have the potential to reduce the
number of hospices with missing survey data, this would also introduce
concerns that the algorithm is using outdated information when
assessing hospice quality. Therefore, only the most recent standard
survey will be included in the SFP algorithm. Regarding the suggestion
to include CLDs related to two additional Conditions of Participation:
Sec. 418.106--Drugs and Biologicals, Medical Supplies, and Equipment,
and Sec. 418.100--Organization and Administration of Services, we will
consider these suggestions for future iterations of the algorithm
pending additional analyses.
Comment: Commenters who used publicly available data to assess the
distribution of complaints and CLDs stated they could not replicate our
analysis of these distributions.
Response: The SFP algorithm methodology will assist with
approximating scores but will not be fully replicable due to variations
in timeframes of data updates or acquisition.
[[Page 77809]]
Final Decision: After considering public comments, we are
finalizing the inclusion of unscaled CLDs and unscaled substantiated
complaints from 3 consecutive years of data, the standardization of
both inputs, and replacing a hospice's missing CLDs or substantiated
complaints with zero after standardization which is equivalent to
replacing it with the average value in the SFP algorithm as proposed.
(See 42 CFR 488.1135(b).) We remain open to continued discussions with
interested parties and will make potential refinements in the future to
these policies, as determined necessary.
Comment: Some commenters expressed concern that due to the lack of
HCI and CAHPS data for a large number of providers, many hospices would
be excluded from the SFP algorithm.
Response: As mentioned in the proposed rule, the proposed algorithm
methodology captures a vast majority of hospices (97.6 percent of all
active hospice providers) as a hospice is included if they have any one
of the indicators and meet the other inclusion criteria (that is, are
active and located in the United States, including territories).
Comment: Many commenters requested additional information on how
CMS would monitor and review the SFP program as it is implemented. A
commenter also worried that CMS risks penalizing hospice providers that
provide high-quality care if all providers received high scores in the
algorithm.
Response: We plan to monitor the algorithm inputs for changes to
the measures, including the addition or removal of measures, that would
affect the results of the SFP algorithm. This will include continued
monitoring of providers that opt-out of reporting quality measures,
input metrics exhibiting signs of ``topping out'', large swings in
input summary statistics and distributions, input outliers, and
provider recidivism. The proposed hospice SFP intends to improve
overall provider performance in those providers that are delivering
poor care to beneficiaries. The hospice SFP is not intended to
arbitrarily enroll providers that perform well. As part of our
continued monitoring, CMS will evaluate how potential SFP providers
will be differentiated from providers that do not need additional
attention. As the proposed SFP improves care delivery across providers,
CMS may consider changing components of the program such as the number
of SFP eligible providers or the number of SFP participants if
warranted.
Comment: Many commenters expressed confusion around why the
algorithm, as described in the proposed rule, differed in many ways
from the algorithm presented to the TEP, as noted in the SFP TEP
Report.\161\
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\161\ Abt Associates. (2022). 2022 Technical Expert Panel and
Stakeholder Listening Sessions: Hospice Special Focus Program
Summary Report. https://www.cms.gov/files/document/2022-technical-expert-panel-tep-and-stakeholder-listening-sessions-hospice-special-focus-program.pdf.
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Response: The purpose of convening the SFP TEP was to seek ideas
and input from a diverse group of hospice experts through thoughtful
discussion on all aspects of the SFP, including the algorithm. Feedback
provided by the SFP TEP, along with feedback received from additional
stakeholder listening sessions, helped to inform CMS' development of
the proposed SFP methodology and other criteria. Based on that
feedback, CMS made decisions regarding the final specifications to the
proposed SFP to ensure the best use of the available data.
Final Decision: After considering public comments received, we are
finalizing the use of Medicare data sources (Hospice Survey Data and
HQRP data), the approach to preparing the data, data source
standardization, addressing missing CAHPS and HCI data, and data source
weights for the SFP algorithm as proposed. (See 42 CFR 488.1135(b).) We
remain open to continued discussions with interested parties and will
make potential refinements in the future to these policies, as
determined necessary.
e. Proposed Selection Criteria
Based on public comment in the CY 2022 HH PPS final rule and
recommendations from the SFP TEP and other stakeholders, we proposed a
SFP selection process that utilizes a no-stratification approach. In
addition, we considered the input of the SFP TEP and stakeholders, who
expressed that the selection approach should identify the poorest
performing hospices, regardless of characteristics, such as size or
location, and therefore favored an approach with no stratification by
state or otherwise.
We proposed at Sec. 488.1135(b) that hospices with AO deemed
status that are placed in the SFP would not retain deemed status and
would be placed under CMS or, as needed, SA oversight jurisdiction
until completion of the SFP or termination.
We proposed that the number of hospices selected to participate in
the SFP would be determined in the first quarter of each calendar year.
The claims-based quality measure data used in the algorithm is not
available until November of each calendar year. This data is needed to
run the algorithm, which is used to establish the aggregate score from
which SFP participants are selected. As an SFP selectee, a hospice
would not be removed from the SFP until they either meet the criteria
for graduation or are terminated from the Medicare program.
Comment: Several commenters questioned how CMS will use discretion
to select hospice programs for the SFP from a list of 10 percent of
highest scoring hospices.
Response: We will select the poorest performing hospices, from the
10 percent selectee list based on the finalized SFP algorithm score, in
sequential value. As the focus of the SFP is to encourage improvement
through increased oversight, not on hospices already on an enforcement
path, hospices under an active enforcement action, for which they are
already on a 6-month termination track or subject to other remedies,
would not be considered for selection into the SFP for that designated
period.
Comment: A commenter questioned if CMS would examine the 300
hospices cited in the OIG report \162\ specifically for consideration
for the SFP.
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\162\ Hospice Deficiencies Pose Risks to Medicare Beneficiaries.
https://oig.hhs.gov/oei/reports/oei-02-17-00020.pdf?utm_source=summary-page&utm_medium=web&utm_campaign=OEI-02-17-00020-PDF.
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Response: We will utilize the finalized algorithm to select
hospices for SFP enrollment.
Comment: Several commenters urged CMS to provide a preview period
of data or delay implementation of the SFP.
Response: We finalized most CAA, 2021 hospice provisions in the
CY2022 Home Health Prospective Payment System Rate Update, effective
January 1, 2022, except for the SFP. SFP implementation was delayed at
that time to allow stakeholder feedback in its development. The SFP is
the final CAA provision to be implemented, and we believe further delay
would likely impact patient and family health and safety. Hospices are
aware of their status for each element used in the algorithm and had
opportunities to preview these elements prior to the use in the
algorithm. We will continuously assess the finalized algorithm's
effectiveness and the program's overall impact.
Comment: A commenter suggested CMS develop an outline of
expectations for providers who are selected for the SFP. They suggest
this outline should include surveys every six months, the provision of
technical assistance, the role of enforcement remedies, and the SFP
completion requirements. Additionally, the SFP should allow
[[Page 77810]]
struggling providers to partner with CMS to better understand the
hospice regulations and their implementation.
Response: CMS will send a letter to hospice programs selected for
the SFP, which will detail steps about completion the SFP. Hospice
programs selected for the SFP would receive a survey every 6 months
that follows the usual survey procedures, including plans of correction
and revisits if needed. A deemed hospice program selected for the SFP
would have its deemed status removed while in the SFP and would be
placed under CMS oversight (for example, CMS or SA surveys) until the
hospice completes the SFP.
While CMS is not providing direct technical assistance, we will
ensure that SFP hospices are aware of the various resources and tools
available to assist them in improving quality.
Comment: A commenter stated that CMS may wish to consider the size
of the provider in some cases; for example, if a large provider caring
for many beneficiaries scores in the 10 percent of all providers with
the poorest performance on the algorithm, prioritizing the inclusion of
the large provider in the SFP may have the potential to improve care
for many beneficiaries. The commenter also noted, at the same time,
small providers should not be exempt from selection for the SFP just
because of their size if the care they furnish raises significant
quality concerns.
Response: We appreciate the commenters suggestions. However, as
discussed previously, all hospices will be ranked by their scores and
selected for SFP participation. The number of selected hospices,
annually, will be based on program resources.
Comment: A commenter questioned if a third party will carry out the
hospice SFP activity and how CMS will evaluate the program and measure
success.
Response: CMS continues to consider the TEP's recommendation to use
a third party, but regardless of whether CMS uses a third party for the
initial implementation of the SFP, we will continue to consider whether
that is the most effective approach to operating the SFP. We will
maintain the ultimate responsibility for the implementation and
evaluation of the SFP. We will monitor the finalized algorithm's
effectiveness at selecting hospices and the SFP's overall impact and
evaluate whether changes to the algorithm are necessary.
Final Decision: After considering public comments, we are
finalizing the SFP selection criteria as proposed. (See 42 CFR
488.1135(b)). We remain open to continued discussions with interested
parties and will make potential refinements in the future to these
policies, as determined necessary.
f. Proposed Survey and Enforcement Criteria
As indicated in section 1822(b)(2) of the Act, once in the SFP, a
hospice must be surveyed ``not less than once every 6 months.'' Based
on the TEP discussion, TEP members agreed with the 6-month
recertification survey frequency for hospices in the SFP, and we
proposed this frequency at proposed Sec. 488.1135(c). Additionally,
SFP hospices would be subject to one or more remedies specified in
Sec. 488.1220, and progressive enforcement remedies, as appropriate,
at the discretion of CMS and consistent with 42 CFR part 488, subpart
N. When CMS chooses to apply one or more remedies specified in Sec.
488.1220, the remedies would be applied on the basis of noncompliance
with one or more conditions of participation and may be based on
failure to correct previous deficiency findings as evidenced by repeat
condition-level deficiencies. The enforcement remedies could be imposed
for an SFP hospice with condition-level deficiencies on a SFP survey or
complaint survey while in the program. Furthermore, if subsequent
surveys also result in the citation of a condition-level deficiency or
deficiencies for an SFP hospice, the enforcement remedies imposed could
be of increasing severity. Increasing severity could mean a higher CMP
than was imposed for the earlier noncompliance or increasing from one
remedy to more than one remedy being imposed. CMS would use its
discretion on a case-by-case basis to determine what remedies are most
appropriate given the survey results, and the hospice may be subject to
remedies of increasing severity.
Comment: Some commenters expressed concerns about variability
between surveyors and among states that may occur when varying
disciplines are represented on survey teams. Several commenters stated
that these discrepancies can lead to variances in survey findings.
Response: All SA and AO surveyors must successfully complete CMS
Basic Hospice Surveyor Training and any additional training as
specified by CMS regardless of profession or discipline. All active SA
and AO surveyors have completed this training, updated in early 2023,
to ensure consistent skills and knowledge. We encourage informing the
applicable CMS Location for any specific concerns about surveyor
variability.
Comment: A commenter stated that there is a lack of consistent
staffing across SAs and AOs, which could have the inadvertent effect of
delaying the timely surveying of hospice providers as is prescribed in
the proposed rule, thereby making it more difficult for a provider to
graduate from the SFP.
Response: We will provide oversight to ensure adherence to survey
processes and schedules.
Comment: A commenter questioned how CMS will ensure that SAs comply
with the survey timeframes required for the SFP and how this will be
enforced. Additionally, the commenter questioned if hospice SFP
providers will have a mechanism to report if they have not received
their required surveys within the 18-month timeframe.
Response: We continue to consider the TEP's recommendation to use a
third party. Whether or not CMS uses a third party for the initial
implementation of the SFP, we will identify the most effective and
efficient approach to operating the SFP.
We will provide oversight to ensure adherence to survey processes
and schedules. We will provide a letter to hospices selected for the
SFP outlining the process and designating a single point of contact
regarding any questions or concerns, including those regarding SFP
survey schedule timeliness.
Comment: Several commenters urged CMS to consider technical
assistance (TA) for hospices in the SFP to support their performance
improvement. Commenters pointed to discussions in the CY22 HH PPS final
rule and the TEP recommendations report, where technical assistance was
discussed. The commenters noted that the TEP report strongly
recommended that TA be mandatory for hospices that are part of the SFP
and that a list of approved TA providers, which should include state
and national hospice associations, should be made available. A
commenter noted that technical assistance was not mentioned in the
proposed rule but rather there was an exclusive focus on enforcement
remedies.
Response: We appreciate the commenters' suggestions and note that
we already provide educational materials that address the regulations
and survey process, which are free to providers. These materials
include, but are not limited to, the CMS Hospice Basic Surveyor
Training available to surveyors and providers on the Quality, Safety
and Education Portal (QSEP) and four provider-specific quality-in-focus
(QIF) hospice trainings on the QSEP public access page. As the hospice
SFP progresses, CMS will continue to assess the need for additional
educational
[[Page 77811]]
opportunities/materials for all hospices. Additionally, hospice
programs can secure TA and private consulting services that are
separate from the SFP.
Final Decision: After considering public comments, we are
finalizing the SFP survey and enforcement criteria as proposed. (See 42
CFR 488.1135(d).)
g. Proposed SFP Completion Criteria
The TEP generally agreed that to complete and graduate from the
SFP, SFP hospices should have no CLDs cited for two consecutive 6-month
recertification surveys in an 18-month timeframe. TEP members also
suggested that SFP hospices should have no substantiated complaints and
less than a defined number of standard-level deficiencies (SLDs) on two
consecutive 6-month recertification surveys within the 18-month
timeframe to complete the SFP. TEP members recommended a stepwise
completion process, with SFP hospices preliminarily graduating after
completing two consecutive 6-month recertification surveys within the
18-month timeframe in accordance with all proposed completion
requirements at Sec. 488.1135(d). We considered the TEP's
recommendations. However, we proposed that SFP hospices have no CLDs
for any two SFP surveys in an 18-month period. Therefore, we proposed
at new Sec. 488.1135(d) that a hospice will have completed the SFP if
it has, in an 18-month timeframe, no CLDs cited or IJ's for any two 6-
month SFP surveys, and has no pending complaint survey triaged at an
immediate jeopardy or condition-level, or has returned to substantial
compliance with all requirements. If there are complaint investigations
or a 36-month recertification survey for a hospice while in the SFP,
the SFP timeline may extend beyond the 18-month timeframe. The official
completion date would be the date of the CMS notice letter informing
the hospice of its removal from the SFP. After completing the SFP,
hospice programs would receive a 1-year post SFP survey and then would
start a new standard 36-month survey cycle.
Comment: A commenter suggested CMS should take action to ensure
providers who graduate from the SFP are removed in a manner consistent
with the proposed timeframe.
Response: Hospices are released from the SFP upon CMS notification
of program completion based on the completion criteria at proposed
Sec. 488.1135(d). We will publish updates on the CMS SFP web page as
expeditiously as possible as hospices complete the SFP.
Comment: A commenter questioned how CMS will ensure that SAs comply
with the survey timeframes required for the SFP and how this will be
enforced. Additionally, the commenter questioned if hospice SFP
providers will have a mechanism to report if they have not received
their required surveys within the 18-month timeframe.
Response: We will provide oversight to ensure adherence to survey
processes and schedules. We will provide a letter to hospices selected
for the SFP outlining the process and designating a single point of
contact regarding any questions or concerns, including those regarding
SFP survey schedule timeliness.
Final Decision: After considering public comments, we are
finalizing the SFP completion criteria as proposed. (See 42 CFR
488.1135(d).)
h. Proposed Termination Criteria
We proposed that a hospice in the SFP that fails any two SFP
surveys, by having any CLDs on the surveys, in an 18-month period, or
pending complaint investigations triaged at IJ or condition-level,
would be considered for termination from the Medicare program as
proposed at new Sec. 488.1135(e). This criterion would apply to all
hospices, regardless of geographical location, and reflects some TEP
recommendations. CMS would issue the termination notice letter to the
hospice program in accordance with 42 CFR 489.53. Depending on the
deficiencies that brought a hospice into the SFP, CMS recognizes that a
provider may need a reasonable period to achieve substantial
compliance. But, if the hospice is not able to achieve substantial
compliance for surveys conducted during the SFP, they would be
considered for termination from the Medicare program. Those providers
that are unable to resolve the deficiencies that brought them into the
SFP and cannot meet the completion criteria of having no CLDs cited for
any two SFP surveys during an 18-month period, would be placed on a
termination track. If a hospice in the SFP has an IJ-level deficiency
cited during a survey, CMS would follow the requirements at Sec.
488.1225.
Comment: A commenter noted that potential termination in the
Medicare program is so severe that some hospices may rather incur a 4
percent payment penalty than risk having to shut down the hospice if
terminated from the Medicare program and questioned if CMS considered
how the proposed the SFP might incentivize hospices to withhold data
rather than face the penalty of termination.
Response: We appreciate the comments and will monitor hospice data
submission to see if it appears that the SFP has a significant impact
on hospice data submission, and evaluate whether changes to the
algorithm are necessary.
Final Decision: After considering public comments, we are
finalizing the SFP termination criteria as proposed. (See 42 CFR
488.1135(e).)
i. Public Reporting of SFP Information
Public reporting of the proposed SFP includes making accessible
both general information about the SFP program and hospices selected
for SFP. Section 1822(a)(2)(B) of the Act requires hospice survey
findings to be ``prominent, easily accessible, readily understandable,
and searchable for the general public and allows for timely updates.''
We proposed in new Sec. 488.1135(f) to publicly report, at least
on an annual basis, the hospice programs selected for the SFP under
proposed Sec. 488.1135(b). This information would be posted on a CMS
public-facing website at https://www.cms.gov/medicare/quality-safety-oversight-certification-compliance/hospice-special-focus-program, or a
successor website. Specifically, we proposed that the website include,
at a minimum, general information, program guidance, a subset
consisting of 10 percent of hospice programs based on the highest
aggregate scores determined by the algorithm, and SFP selections from
the 10 percent subset as determined by CMS, and SFP status as proposed
in the definitions at Sec. 488.1105.
Comment: Some commenters noted that CMS may be exceeding its
authority in posting both the bottom 10 percent list and the SFP
participant list because the statute does not suggest that both lists
should be displayed. However, other commenters supported the
publication of both lists and believe it would be important information
to consumers. There were also comments expressing concern about how
often the SFP information would be updated and whether a hospice should
still be included in publicly reported SFP lists even after their
completion of the program.
Response: CMS appreciates the comments regarding public reporting
of the SFP. As stated in the proposed rule, we intend to publish the
list of SFP participants (those selected for the program) along with
the list containing the 10 percent of hospices with the highest (worst)
algorithm scores from which the SFP participants were chosen. We do not
believe we are exceeding our authority in posting the
[[Page 77812]]
10 percent of hospices with the highest (worst) algorithm scores
because the statute states that survey reports, enforcement actions,
and any other information determined appropriate by the Secretary shall
be published on a CMS public website in a manner that is prominent,
easily accessible, readily understandable, and searchable. We agree
with commenters that this information can serve as a useful tool for
consumers looking for hospice care and is similar to information posted
publicly for the nursing home Special Focus Facility (SFF) program. The
SFF program also posts information about nursing homes that have been
terminated from the Medicare program as well as those that have
graduated from the SFF program as key resources for consumers and other
interested parties. We intend to follow a process similar to that of
the SFF in order to ensure that analogous information is available for
the hospice SFP. The list will be reported annually beginning at
program implementation. As the program continues, we will publish
periodic updates as hospices complete the program.
Final Decision: After considering public comments, we are
finalizing the public reporting guidelines regarding SFP status as
proposed. (See 42 CFR 488.1135(f)).
VII. Changes Regarding Durable Medical Equipment, Prosthetics,
Orthotics, and Supplies (DMEPOS)
A. Medicare Durable Medical Equipment, Prosthetics, Orthotics, and
Supplies (DMEPOS) Fee Schedule Adjustments
1. Background
a. Durable Medical Equipment, Prosthetics, Orthotics, and Supplies
Competitive Bidding Program
Section 1847(a) of the Act, as amended by section 302(b)(1) of the
Medicare Prescription Drug, Improvement, and Modernization Act of 2003
(Pub. L. 108-173, December 8, 2003), mandates the Medicare Durable
Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS)
Competitive Bidding Program (CBP) for contract award purposes to
furnish certain competitively priced DMEPOS items and services subject
to the CBP--
Off-the-shelf (OTS) orthotics, for which payment would
otherwise be made under section 1834(h) of the Act;
Enteral nutrients, equipment, and supplies described in
section 1842(s)(2)(D) of the Act; and
Certain DME and medical supplies, which are covered items
(as defined in section 1834(a)(13) of the Act) for which payment would
otherwise be made under section 1834(a) of the Act.
For a list of product categories included in the DMEPOS CBP, please
refer to https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/DMEPOSCompetitiveBid/Round-2021/PCs. Areas in which the CBP are not
implemented are known as non-competitive bidding areas (non-CBAs). We
use the term ``former CBAs'' to refer to the areas that were formerly
CBAs prior to a gap in the CBP, to distinguish those areas from ``non-
CBAs.'' More information on why there was a gap in the CBP from January
1, 2019, through December 31, 2020, can be found in the November 14,
2018 final rule titled ``Medicare Program; End-Stage Renal Disease
Prospective Payment System, Payment for Renal Dialysis Services
Furnished to Individuals With Acute Kidney Injury, End-Stage Renal
Disease Quality Incentive Program, Durable Medical Equipment,
Prosthetics, Orthotics, and Supplies (DMEPOS) Competitive Bidding
Program (CBP) and Fee Schedule Amounts, and Technical Amendments To
Correct Existing Regulations Related to the CBP for Certain DMEPOS,''
(83 FR 56922).
b. Fee Schedule Adjustment Methodology for Non-CBAs
Section 1834(a)(1)(F)(ii) of the Act requires the Secretary to use
information on the payment determined under the Medicare DMEPOS CBP to
adjust the fee schedule amounts for DME items and services furnished in
all non-CBAs on or after January 1, 2016. Section 1834(a)(1)(F)(iii) of
the Act requires the Secretary to continue to make these adjustments as
additional covered items are phased in under the CBP or information is
updated as new CBP contracts are awarded. Similarly, sections
1842(s)(3)(B) and 1834(h)(1)(H)(ii) of the Act authorize the Secretary
to use payment information from the DMEPOS CBP to adjust the fee
schedule amounts for enteral nutrition and OTS orthotics, respectively,
furnished in all non-CBAs. Section 1834(a)(1)(G) of the Act requires
the Secretary to specify the methodology to be used in making these fee
schedule adjustments by regulation, and to consider, among other
factors, the costs of items and services in non-CBAs (where the
adjustments would be applied) compared to the single payment amounts
for such items and services in the CBAs.
The methodologies set forth in Sec. 414.210(g) account for
regional variations in prices, including for rural and non-contiguous
areas of the United States. In accordance with Sec. 414.210(g)(1),
regional adjustments to fee schedule amounts for each state in the
contiguous United States and the District of Columbia, are determined
based on the definition of region in Sec. 414.202, which refers to
geographic areas defined by the Bureau of Economic Analysis (BEA) in
the Department of Commerce for economic analysis purposes (79 FR
66226). Under Sec. 414.210(g)(1)(i) through (iv), adjusted fee
schedule amounts for areas within the contiguous United States are
determined based on regional prices limited by a national ceiling of
110 percent of the regional average price and a floor of 90 percent of
the regional average price (79 FR 66225). Under Sec. 414.210(g)(1)(v),
adjusted fee schedule amounts for rural areas are based on 110 percent
of the national average of regional prices. Under Sec. 414.210(g)(2),
fee schedule amounts for non-contiguous areas are adjusted based on the
higher of the average of the single payment amounts for CBAs in non-
contiguous areas in the United States, or the national ceiling amount.
Under existing rules, ZIP codes for rural, non-rural, and non-
contiguous areas are used to establish geographic areas that are then
used to define non-CBAs for the purposes of the DMEPOS fee schedule
adjustments. A rural area is defined in Sec. 414.202 as a geographic
area represented by a postal ZIP code, if at least 50 percent of the
total geographic area of the area included in the ZIP code is estimated
to be outside any Metropolitan Statistical Area (79 FR 66228). A rural
area also includes a geographic area represented by a postal ZIP code
that is a low population density area excluded from a CBA in accordance
with section 1847(a)(3)(A) of the Act at the time the rules in Sec.
414.210(g) are applied. Non-contiguous areas refer to areas outside the
contiguous United States--that is, areas such as Alaska, Guam, and
Hawaii (81 FR 77936).
Section 3712 of the of the CARES Act (Pub. L. 116-136, as enacted
on March 27, 2020) revised the fee schedule amounts for certain DME and
enteral nutrients, supplies, and equipment furnished in non-CBAs
through the duration of the emergency period described in section
1135(g)(1)(B) of the Act. Specifically, this emergency period is the
Public Health Emergency (PHE) for COVID-19, including renewals of the
PHE.
Section 3712(a) of the CARES Act directed the Secretary to
implement Sec. 414.210(g)(9)(iii) (or any successor regulation), to
apply the transition rule described in such section to all
[[Page 77813]]
applicable items and services as planned through December 31, 2020, and
through the duration of the emergency period described in section
1135(g)(1)(B) of the Act, if longer. Therefore, section 3712(a) of the
CARES Act continued our policy at Sec. 414.210(g)(9)(iii) of paying
for DMEPOS items and services furnished in rural and non-contiguous
non-CBAs based on a 50/50 blend of adjusted and unadjusted fee schedule
amounts through December 31, 2020, or through the duration of the
emergency period, whichever is longer. This fee schedule adjustment in
rural and non-contiguous areas results in fee schedule amounts that are
approximately 66 percent higher than the fully adjusted fee schedule
amounts previously paid for DMEPOS items and services furnished in non-
rural areas in the contiguous United States.
Section 3712(b) of the CARES Act directed the Secretary to increase
the fee schedule amounts for DMEPOS items and services furnished in
non-CBAs other than rural and non-contiguous non-CBAs through the
duration of the COVID-19 PHE (the emergency period described in section
1135(g)(1)(B) of the Act). Beginning March 6, 2020, the payment rates
for DME and enteral nutrients, supplies, and equipment furnished in
these areas was based on 75 percent of the adjusted fee schedule amount
and 25 percent of the historic, unadjusted fee schedule amount until
the end of the emergency period, which results in higher payment rates
as compared to the fully adjusted fee schedule amounts under Sec.
414.210(g)(9)(iv). This increased payments so that they are
approximately 33 percent higher than the payments at the fully adjusted
fee schedule amounts.
In the May 8, 2020, interim final rule with comment period (IFC)
(85 FR 27550) titled ``Medicare and Medicaid Programs, Basic Health
Program, and Exchanges; Additional Policy and Regulatory Revisions in
Response to the COVID-19 Public Health Emergency and Delay of Certain
Reporting Requirements for the Skilled Nursing Facility Quality
Reporting Program'' (hereinafter referred to as the ``May 2020 COVID-19
IFC''), conforming changes were made to Sec. 414.210(g)(9), consistent
with section 3712(a) and (b) of the CARES Act.
The final rule entitled, ``Medicare Program; Durable Medical
Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) Policy Issues,
and Level II of the Healthcare Common Procedure Coding System (HCPCS);
DME Interim Pricing in the CARES Act; Durable Medical Equipment Fee
Schedule Adjustments To Resume the Transitional 50/50 Blended Rates To
Provide Relief in Rural Areas and Non-Contiguous Areas'' published in
the December 28, 2021 Federal Register (86 FR 73860) (hereinafter CY
2022 DMEPOS final rule), established fee schedule adjustment
methodologies for items and services furnished in non-CBAs on or after
February 28, 2022, or the date immediately following the duration of
the emergency period described in section 1135(g)(1)(B) of the Act (42
U.S.C. 1320b-5(g)(1)(B)), whichever is later.
The CY 2022 DMEPOS final rule explained that the 50/50 blended
rates in non-contiguous non-CBAs will continue to be paid, but the 50/
50 blend would no longer be a transition rule under Sec. 414.210(g)(9)
and would instead be the fee schedule adjustment methodology for items
and services furnished in these areas under Sec. 414.210(g)(2) unless
revised in future rulemaking. For items and services furnished in non-
contiguous non-CBAs, the fee schedule amounts for such items and
services furnished on or after the effective date of the CY 2022 DMEPOS
final rule (February 28, 2022), or the date immediately following the
duration of the emergency period described in section 1135(g)(1)(B) of
the Act, whichever is later, would be adjusted so that they are equal
to a blend of 50 percent of the greater of the average of the SPAs for
the item or service for CBAs located in non-contiguous areas or 110
percent of the national average price for the item or service
determined under Sec. 414.210(g)(1)(ii) and 50 percent of the
unadjusted fee schedule amount for the area, which is the fee schedule
amount in effect on December 31, 2015, increased for each subsequent
year beginning in 2016 by the annual update factors specified in
sections 1834(a)(14), 1834(h)(4), and 1842(s)(1)(B) of the Act,
respectively, for durable medical equipment and supplies, off-the-shelf
orthotics, and enteral nutrients, supplies, and equipment (86 FR
73873).
As explained in the CY 2022 DMEPOS final rule, the 50/50 blended
rates in rural contiguous areas will continue to be paid, but the 50/50
blend would no longer be a transition rule under Sec. 414.210(g)(9)
and would instead be the fee schedule adjustment methodology for items
and services furnished in these areas under Sec. 414.210(g)(2) unless
revised in future rulemaking. For items and services furnished in rural
contiguous areas on or after February 28, 2022, or the date immediately
following the duration of the emergency period described in section
1135(g)(1)(B) of the Act, whichever is later, the fee schedule amounts
would be adjusted so that they are equal to a blend of 50 percent of
110 percent of the national average price for the item or service
determined under Sec. 414.210(g)(1)(ii) and 50 percent of the fee
schedule amount for the area in effect on December 31, 2015, increased
for each subsequent year beginning in 2016 by the annual update factors
specified in sections 1834(a)(14), 1834(h)(4), and 1842(s)(1)(B) of the
Act, respectively, for DME and medical supplies, off-the-shelf
orthotics, and enteral nutrients, supplies, and equipment (86 FR
73873).
For items and services furnished on or after February 28, 2022, or
the date immediately following the termination of the emergency period
described in section 1135(g)(1)(B) of the Act (42 U.S.C. 1320b-
5(g)(1)(B)) (that is, the COVID-19 PHE), whichever is later, in all
other non-rural, non-CBAs within the contiguous United States, the fee
schedule amounts would be equal to 100 percent of the adjusted payment
amount established under Sec. 414.210(g)(1)(iv).
2. Current Issues
Section 4139 of Division FF, Title IV, Subtitle D of the CAA, 2023
sets the fee schedule adjustment methodologies for non-competitive
bidding areas through the remainder of the duration of the emergency
period described in section 1135(g)(1)(B) of the Act or December 31,
2023, whichever is later. The federal PHE for COVID-19, declared by the
Secretary under Section 319 of the Public Health Service Act, expired
at the end of the day on May 11, 2023. We proposed to make conforming
changes to the regulation at 42 CFR 414.210(g)(9) to account for these
changes.
Specifically, section 4139(a) of the CAA, 2023 directs the
Secretary to implement 42 CFR 414.210(g)(9)(v) (or any successor
regulation), to apply the transition rule described in the first
sentence of such section to all applicable items and services furnished
in areas other than rural or noncontiguous areas through the remainder
of the duration of the emergency period described in section
1135(g)(1)(B) of the Act (42 U.S.C. 1320b-5(g)(1)(B)) or December 31,
2023, whichever is later. This continues the policy set forth by
section 3712(b) of the CARES Act, which requires CMS to pay for these
DMEPOS items and services furnished in areas other than rural or
noncontiguous areas based on 75 percent of the adjusted fee schedule
amount and 25 percent of the historic, unadjusted fee schedule amount
until the end of the emergency period. This
[[Page 77814]]
increases payments so that they are approximately 33 percent higher
than the payments at the fully adjusted fee schedule amounts.
Section 4139(b) of the CAA, 2023 directs the Secretary to not
implement 42 CFR 414.210(g)(9)(vi) of title 42, Code of Federal
Regulations (or any successor regulation) until the date immediately
following the last day of the emergency period described in section
1135(g)(1)(B) of the Act (42 U.S.C. 1320b-5(g)(1)(B)), or January 1,
2024, whichever is later. This change has the effect of continuing the
policy at Sec. 414.210(g)(9)(vi), but changes the February 28, 2022
date in the regulation to January 1, 2024. That is, the fee schedule
amount for all non-CBAs is equal to the adjusted payment amount
established under paragraph (g) of this section only until the date
immediately following the last day of the emergency period described in
section 1135(g)(1)(B) of the Act (42 U.S.C. 1320b-5(g)(1)(B)), or
January 1, 2024, whichever is later.
Additionally, section 4139 of the CAA, 2023 does not affect the
current adjusted fee schedule amounts in former CBAs. In accordance
with Sec. 414.210(g)(10), the fee schedule amounts in the former CBAs
will continue to be based on the single payment amounts from 2018
increased by update factors for subsequent calendar years until new
competitive bidding contracts are in place.
2. Final Changes
We received several comments supporting the conforming changes to
the regulations related to implementation of section 4139 of the CAA,
2023.
We thank the commenters for their support of the proposed changes.
We are finalizing the proposed conforming changes to Sec.
414.210(g)(9), consistent with requirements in section 4139(a) and
4139(b) of the CAA, 2023. First, section 4139 of the CAA, 2023 does not
change the current policy under Sec. 414.210(g)(9)(iii) of paying for
DMEPOS items and services furnished in rural and non-contiguous non-
CBAs based on a 50/50 blend of adjusted and unadjusted fee schedule
amounts through the duration of the PHE for COVID-19. While section
4139 of the CAA, 2023 does not specifically mention Sec.
414.210(g)(9)(iii), we believe that section 4139(b) of the CAA, 2023
prohibits implementation of the regulation language in Sec.
414.210(g)(vi) until the date immediately following the last day of the
PHE, or January 1, 2024. This regulation applies the transition rules
for the adjusted payment amount in the non-CBAs established under
paragraph (g) of Sec. 414.210 to items and services furnished in ``all
areas,'' and it also provides for extension of the transition 50/50
blended rates in rural, non-contiguous areas and non-rural areas
through December 31, 2023, if the PHE ends prior to that date. We are
finalizing the revision of Sec. 414.210(g)(9)(vi), as described in
this rule. Further, we are finalizing, the proposed revision of Sec.
414.210(g)(9)(iii), to state that for items and services furnished in
rural areas and non-contiguous areas (Alaska, Hawaii, and U.S.
territories) with dates of service from June 1, 2018 through the
duration of the emergency period described in section 1135(g)(1)(B) of
the Act (42 U.S.C. 1320b-5(g)(1)(B)) or December 31, 2023, whichever is
later, based on the fee schedule amount for the area is equal to 50
percent of the adjusted payment amount established under this section
and 50 percent of the unadjusted fee schedule amount. We are finalizing
the conforming changes to Sec. 414.210(g)(2) for the rural and non-
contiguous areas in order to reference the December 31, 2023 date
specified in section 4139 of the CAA, 2023.
We are finalizing the revision of Sec. 414.210(g)(9)(v) to state
that for items and services furnished in areas other than rural or
noncontiguous areas with dates of service from March 6, 2020 through
the remainder of the duration of the emergency period described in
section 1135(g)(1)(B) of the Act (42 U.S.C. 1320b-5(g)(1)(B)) or
December 31, 2023, whichever is later, the fee schedule amount for the
area is equal to 75 percent of the adjusted payment amount established
under this section and 25 percent of the unadjusted fee schedule
amount. We are finalizing the proposal to remove outdated text from
Sec. 414.210(g)(9)(v) that states ``for items and services furnished
in areas other than rural or noncontiguous areas with dates of service
from the expiration date of the emergency period described in section
1135(g)(1)(B) of the Act (42 U.S.C. 1320b-5(g)(1)(B)), through December
31, 2020, the fee schedule amount for the area is equal to 100 percent
of the adjusted payment amount established under this section.'' This
is text that was added in the May 2020 COVID-19 IFC (85 FR 27571), as
section 3712(b) of the CARES Act required CMS to pay the higher fee
schedule amounts for the duration of the emergency period described in
section 1135(g)(1)(B) of the Act (42 U.S.C. 1320b-5(g)(1)(B)), but it
did not specify the fee schedule amounts that should be in effect if
the emergency period ends before December 31, 2020. If not for section
3712(b) of the CARES Act, CMS would have paid the fully adjusted fee
schedule amounts for DME items and services furnished in non-rural and
contiguous non-CBAs until December 31, 2020. As such, Sec.
414.210(g)(9)(v) specified that the fee schedule amounts in non-rural
and contiguous non-CBAs would again be based on 100 percent of the fee
schedule amounts adjusted in accordance with Sec. 414.210(g)(1)(iv) if
the emergency period described in section 1135(g)(1)(B) of the Act (42
U.S.C. 1320b-5(g)(1)(B)) ended before December 31, 2020. As this
situation no longer applies and is in the past, we are finalizing the
proposal to remove this obsolete text from Sec. 414.210(g)(9)(v).
We are finalizing the proposal to revise Sec. 414.210(g)(9)(vi) to
state that for items and services furnished in all areas with dates of
service on or after the date immediately following the duration of the
emergency period described in section 1135(g)(1)(B) of the Act, or
January 1, 2024, whichever is later, the fee schedule amount for the
area is equal to the adjusted payment amount established under
paragraph (g) of this section. Finally, we are finalizing the proposal
to make conforming changes to Sec. 414.210(g)(2) for the rural and
non-contiguous areas in order to specify the December 31, 2023 date
specified in section 4139 of the CAA, 2023.
Finally, section 4139(c) of the CAA, 2023 authorizes the Secretary
to implement the provisions of this section by program instruction or
otherwise. Given that the PHE for COVID-19 ended on May 11, 2023, which
is prior to when the proposed changes to the regulations would be
finalized, we stated in the proposed rule that we intend to issue
program instructions or other subregulatory guidance to effectuate the
changes, as previously described (88 FR 43767). We stated that we
believed this approach will serve to ensure a smooth transition after
the end of the PHE for COVID-19. We issued Transmittal 12068 and 12228,
which updated the quarterly DMEPOS Fee Schedule and included a
discussion of the changes required by section 4139 of the CAA,
2023.163 164
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\163\ https://www.cms.gov/files/document/r12068cp.pdf.
\164\ https://www.cms.gov/files/document/r12228cp.pdf.
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B. Scope of the Benefit and Payment for Lymphedema Compression
Treatment Items
1. Statutory Authority
Effective for items furnished on or after January 1, 2024, section
4133(a)(1)
[[Page 77815]]
of Division FF, Title V, Subtitle D of the CAA, 2023 amends section
1861 of the Act, adding subparagraph (JJ) to subsection (s)(2) and
coverage under a new benefit category under Medicare Part B for
lymphedema compression treatment items as defined in new subsection
(mmm) of section 1861 of the Act. Section 4133(a)(2) of the CAA, 2023
amends section 1833(a)(1) of the Act, adding subparagraph (GG) to
indicate that the amount paid for lymphedema compression treatment
items defined in section 1861(mmm) of the Act shall be equal to 80
percent of the lesser of the actual charge or the amount determined
using the payment basis established by the Secretary under paragraph
(1) of new subsection (z) of section 1834 of the Act. Paragraph (2) of
new subsection (z) of section 1834 of the Act prohibits payments under
Part B for lymphedema compression treatment items furnished other than
at such frequency as the Secretary may establish. Paragraph (3) of new
subsection (z) of section 1834 of the Act specifies that in the case of
lymphedema compression treatment items that are included in a
competitive bidding program under section 1847(a) of the Act, the
payment basis under section 1847(a) of the Act shall be the payment
basis determined under the competitive bidding program, and the
Secretary may use information on the payment determined under the
competitive bidding program to adjust the payment amount otherwise
determined under section 1834(z) of the Act for an area that is not a
competitive bidding area under section 1847 of the Act. Section
4133(a)(3) of the CAA, 2023 amends section 1847(a)(2) of the Act,
adding lymphedema compression treatment items to the competitive
bidding program under subparagraph (D) of section 1847(a)(2) of the
Act. Finally, section 4133(b)(3) of the CAA, 2023 amends section 1834
of the Act under subsections (a)(20)(D) and (j)(5) to mandate
application of the DMEPOS quality standards and accreditation and
DMEPOS supplier enrollment and supplier standards requirements,
respectively, to suppliers of lymphedema compression treatment items.
2. Background
Currently, Medicare Part B does not include coverage for lymphedema
compression treatment items other than compression pumps and
accessories that meet the definition of DME covered under the DME
benefit category under section 1861(n) of the Act. Section 4133 of the
CAA, 2023 amends the Act to establish a new Part B benefit category for
lymphedema compression treatment items.
The lymphatic system is an integral component of the human
circulatory system and consists of lymphatic vessels, lymph nodes and
associated lymphoid organs.165 166 The International Society
of Lymphology defines lymphedema as ``an external (and/or internal)
manifestation of lymphatic system insufficiency and deranged lymph
transport'' and is ``a symptom or sign resulting from underlying
lymphatic disease.'' \167\ The Centers for Disease Control and
Prevention (CDC) defines lymphedema as swelling due to a buildup of
lymph fluid in the body.\168\ According to the National Institutes of
Health (NIH) National Library of Medicine, lymphedema is a chronic
disorder characterized by swelling under the skin caused by the
inability of protein rich lymph fluid to drain, usually due to a
blockage or damage to the lymph system.\169\ Additionally, according to
the National Lymphedema Network, this swelling commonly occurs in the
arm or leg, but it may also occur in other body areas including the
breast, chest, head and neck, and genitals.\170\ Lymphedema develops
when a body region, where lymphatic vessels and lymph nodes are missing
or impaired, becomes overloaded with lymphatic fluid. Lymphedema is a
chronic condition with no definitive curative treatment that can become
progressive, so early detection and institution of decompressive
measures are essential in avoiding its potentially disabling
sequela.171 172 173 174 The gradual accumulation of plasma
and cellular components into the interstitial tissue space leads to a
chronic inflammatory process that can result in long-term tissue
changes and permanent structural damage to the affected anatomical site
and its overlying skin layer.175 176 177 These changes also
make the patient more susceptible to skin and potentially disabling or
life-threatening soft tissue infections.178 179 The physical
manifestations of lymphedema are tissue swelling, pain, heaviness and
difficulty using the affected body part.\180\
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\165\ Aspelund A, Robciuc MR, Karaman S, Makinen T, Alitalo K.
Lymphatic System in Cardiovascular Medicine. Circulation Research.
2016. Volume 118(3). 515-530.
\166\ Suamia H, Scaglioni MF. Anatomy of the Lymphatic System
and the Lymphosome Concept with Reference to Lymphedema. Seminars in
Plastic Surgery. 2018 Feb; 32(1): 5-11.
\167\ International Society of Lymphology Executive Committee.
The Diagnosis and Treatment of Peripheral Lymphedema. Lymphology 28
(1995).
\168\ Lymphedema CDC.gov. https://www.cdc.gov/cancer/survivors/patients/lymphedema.htm.
\169\ Lymphedema. Bryan C. Sleigh; Biagio Manna, September 2018.
Found at https://www.ncbi.nlm.nih.gov/books/NBK537239/.
\170\ https://lymphnet.org/what-is-lymphedema.
\171\ Korpan MI, Crevenna R, Fialka-Moser V. Lymphedema a
Therapeutic Approach in the Treatment and Rehabilitation of Cancer
Patients. American Journal of Physical Medicine and Rehabilitation.
2011. May. 90(suppl). S69-S75.
\172\ Preston NJ, Seers K, Mortimer PS. Physical therapies for
reducing and controlling lymphoedema of the limbs. Cochrane Database
of Systematic Reviews 2004, Issue 4. Art. No.: CD003141.
\173\ The International Society of Lymphology. The Diagnosis and
Treatment of Peripheral Lymphedema: 2020 Consensus Document of the
International Society of Lymphology. Lymphology. 2020. 53: 3-19.
\174\ King M, Deveaux A, White H, Rayson. Compression garments
versus compression bandaging in decongestive lymphatic therapy for
breast cancer-related lymphedema: a randomized controlled trial.
Support Care Cancer. 2012; 20: 1031-1036.
\175\ Korpan MI, Crevenna R, Fialka-Moser V. Lymphedema a
Therapeutic Approach in the Treatment and Rehabilitation of Cancer
Patients. American Journal of Physical Medicine and Rehabilitation.
2011. May. 90(suppl). S69-S75.
\176\ Warren AG, Brorson H, Borud LJ, Slavin SA. Lymphedema A
Comprehensive Review. Annals of Plastic Surgery. 2007. Vol 59, No.
4. 464-472.
\177\ Ly CL, Kataru RO, Mehrara B. Inflammatory Manifestations
of Lymphedema. Int J Mol Scie. 2017. Jan; 18(1): 171.
\178\ Grada AA, Phillips TJ. Lymphedema, Pathophysiology and
clinical manifestations. J Am Academ Dermatol. 2017;77: 1009-20.
\179\ Bakar Y, Tugral A. Lower Extremity Lymphedema Management
after Gynecologic Cancer Surgery: A Review of Current Management
Strategies. Ann of Vasc Surg. 2017. Vol. 44; 442-450.
\180\ Warren AG, Brorson H, Borud LJ, Slavin SA. Lymphedema A
Comprehensive Review. Annals of Plastic Surgery. 2007. Vol 59, No.
4. 464-472.
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Lymphedema occurs in four stages. Stage one may have no outward
signs or symptoms but is evidenced by abnormal flow through the
lymphatic system. When stage two is reached, there is some swelling
that may be alleviated by elevation or compression. Stage three is
diagnosed by swelling of an area that does not resolve with elevation
and there may be skin thickening and scarring. The fourth stage is
characterized by severe swelling and skin abnormalities.\181\
Infections such as cellulitis and sepsis may result from lymphedema due
to the dense protein rich nature of the lymphatic fluid and requires
treatment with antibiotics.\182\ Lymphedema is treated in two phases:
an acute ``intensive'' phase (Phase 1) and a maintenance phase (Phase
2). In Phase 1 ``the individual is typically
[[Page 77816]]
wrapped with medical short-stretch compression bandages. In Phase 2,
one goal is for the patient to be able to wear gradient pressure
garments during the day and compression bandaging or alternatives (like
nighttime garments) at night.\183\ Studies have shown that gradient
compression garments are effective in reducing and/or preventing
progression of lymphedema in the arm and leg.\184\ They have also shown
to be effective in maintaining limb circumference.
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\181\ The Johns Hopkins Hospital https://www.hopkinsmedicine.org/health/treatment-tests-and-therapies/treating-lymphedema.
\182\ https://www.cancerresearchuk.org/about-cancer/coping/physically/lymphoedema-and-cancer/infection-lymphoedema#;~:text=Infection%20in%20people%20with%20lymphoedema,and%
20will%20need%20antibiotic%20treatment.
\183\ Korpan MI, Crevenna R, Fialka-Moser V. Lymphedema: a
therapeutic approach in the treatment and rehabilitation of cancer
patients. Am J Phys Med Rehabil. 2011 May;90(5 Suppl 1):S69-75. doi:
10.1097/PHM.0b013e31820be160. PMID: 21765266.
\184\ Yasuhara H, Shigematsu H, Muto T. A study of the
advantages of elastic stockings for leg lymphedema. Int Angiol. 1996
Sep;15(3):272-7. PMID: 8971591. https://pubmed.ncbi.nlm.nih.gov/8971591/.
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Gradient compression garments designed for daytime use, while an
individual is awake, are different than those for nighttime use, when
an individual is asleep. Gradient compression garments meant for
daytime (waking) provide a higher level of compression, and use of them
while sleeping could cause new or additional damage to the affected
tissue.\185\ Additionally, gradient compression garments appropriate
for daytime use can inadvertently become repositioned at night while
the individual is sleeping and cause a tourniquet effect, essentially
cutting off circulation to the limb and resulting in further
swelling.\185\ In contrast, gradient compression garments made for
nighttime use or times of low activity offer milder compression and are
less snug against the skin.\186\ Wearing gradient compression garments
designed for nighttime use may also help with skin abnormalities
resulting from lymphedema and can help prevent a phenomenon called
``creeping refill,'' where swelling reoccurs during sleep.\187\
Generally, more serious cases require gradient compression garments for
both daytime and nighttime use. Various types of nighttime garments
have been designed as alternatives to the daytime compression system
garments. Nighttime garments apply gentle gradient pressure to the limb
through a garment with a foam liner and a series of adjustable straps.
The garments are non-elastic and provide low resting pressure on the
limb, making them safe to wear while sleeping at night.\188\ Many of
these garments are custom-made, but there are ready-to-wear options
available as well. The elastic fibers of daytime compression garments
will break down with wear. Because nighttime garments are made of
inelastic components, compared to the day-time garments, they do not
commonly break down with wear and last longer. While proper care will
increase the lifespan of nighttime garments, they will need to be
replaced sometime within 1 to 3 years if used daily. Studies showed if
the garments are used with aftercare regimen, that is, they are in
minimum contact with moisturizer during use, they could last
longer.\189\ In meetings with CMS, some clinicians and lymphologists
indicated that they believe that the nighttime garments are quite
durable and can last for 2 to 3 years because the materials are more
durable than the materials used with the daytime garments. They also
indicated that previous versions used strapping in addition to more
durable foam materials and could last for up to 5 years. In comparison,
daytime garments are elastic garments that are typically made of
breathable elastic fabrics such as nylon, cotton, spandex or natural
rubber to provide compression and therefore have a much shorter
lifespan of approximately 6 months.\190\
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\185\ Lymphedema Products, LLC. (2019, September 11). Day
Compression vs Night Compression. Lymphedemaproducts.com. https://www.lymphedemaproducts.com/blog/day-vs-night-compression-wear/.
\186\ Caring Touch Medical, Inc. Can You Sleep in a Lymphedema
Sleeve? Caringtouchmed.com. https://www.caringtouchmed.com/can-you-sleep-in-a-lymphedema-sleeve/.
\187\ Mastectomy Shop. Can You Sleep in a Lymphedema Sleeve?
Mastectomyshop.com. https://www.mastectomyshop.com/blogs/can-you-sleep-in-a-lymphedema-sleeve/.
\188\ McNeely, M. L. et al. Nighttime compression supports
improved self[hyphen]management of breast cancer related lymphedema:
A multicenter randomized controlled trial. Cancer 128, 587-596
(2021).
\189\ Macintyre, Lisa Ph.D.; Gilmartin, Sian BSc; Rae, Michelle
BSc; Journal of Burn Care & Research: September/October 2007--Volume
28--Issue 5--pp 725-733.
\190\ Mukhopadhyay, A., & Shaw, V. P. (2022). Reliability
analysis of stretchable workwear fabric under abrasive damage:
Influence of stretch yarn composition. Journal of Natural Fibers,
20(1).
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Gradient compression garments are either standard fit or custom-
fit. Standard compression garments are also referred to as ready-made
or ready-to-wear and are widely available pre-made, off-the-shelf and
in a range of standard sizes. Individuals with mild or moderate
lymphedema can often use standard fit garments. Standard gradient
compression garments are easier to measure and are readily available at
retailers without requiring a prescription, but they do not conform as
well to limbs or provide homogenous compression. Standard fit
compression wear for all gradient compression garments come in
different compression classification ranges specified in mmHg. While
there are no national standards for gradient compression hosiery,\191\
the most common compression classification ranges for hosiery in the
U.S. include: 8-15 mmHg (mild), 15-20 mmHg (medium or over the
counter), 20-30 mmHg (firm or medical class 1), 30-40 mmHg (extra firm
or medical class 2), and 40-50 mmHg (medical class 3).\192\ For all
compression ranges, the highest compression is at the ankle or wrist,
and compression slowly decreases as it moves up the extremity. Some
manufacturers' compression class pressure ranges for hosiery may be
different from the compression class ranges used for upper limb
gradient compression garments.\193\
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\191\ Lymphedema Framework. Best Practice for the Management of
Lymphoedema. International Consensus. London. MEP Ltd, 2006. https://www.woundsme.com/uploads/resources/contentlowbar;11160.pdf.
\192\ Lymphedema Products, LLC. Determining Compression Levels.
Lymphedemaproducts.Com. https://www.lymphedemaproducts.com/blog/how-to-determine-compression-levels-for-your-garments/ garments/.
\193\ Lympoedema Framework. Best Practice for the Management of
Lymphoedema. International Consensus. London. MEP Ltd, 2006. https://www.woundsme.com/uploads/resources/content_11160.pdf.
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Alternatively, custom-fit gradient compression garments are
garments that are uniquely sized, shaped, and custom-made to fit the
exact dimensions of the affected extremity (circumferential
measurements are every 1 and a half to 2 inches) and provide more
accurate and consistent gradient compression to manage the individual's
symptoms.\194\ The type of gradient compression garment prescribed is
influenced by the site and extent of the swelling, together with the
individual's comfort, lifestyle, preferences, and ability to apply and
remove garments. Poorly fitting gradient compression garments may not
contain or resolve the lymphedema, can cause tissue damage, may be
uncomfortable, and can dissuade a patient from long-term usage and
adherence.\195\
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\194\ https://www.forwardhealth.wi.gov/kw/html/3485_Compression_Garments.html.
\195\ Doherty DC, Morgan PA, & Moffatt CJ (2009). Hosiery in
Lower Limb Lymphedema. J Lymphoedema, 4(1), 30-37. https://www.woundsme.com/uploads/resources/content_11160.pdf.
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Custom-fit gradient compression garments are typically required
when an individual has severe shape distortion and/or short, long, or
bulky limbs.\196\ In addition, individuals with complex lower limb and
torso lymphedema often
[[Page 77817]]
require custom-fit gradient compression garments, as do those who need
special adaptations or when there is need for varying levels of
pressure within the same garment.\197\ Some studies indicate that
approximately 50 percent of lymphedema patients require custom-fit
gradient compression garments versus standard fit gradient compression
garments for effective treatment, although estimates
vary.198 199
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\196\ Chang M-H, Chang DW, & Patel KM (2022). ``Lymphedema Risk
Reduction and Management'' in Principles and Practice of Lymphedema
Surgery, 2nd Ed., 78-90. https://www.sciencedirect.com/topics/medicine-and-dentistry/compression-garment.
\197\ Doherty DC, Morgan PA, & Moffatt CJ (2009). Hosiery in
Lower Limb Lymphedema. J Lymphoedema, 4(1), 30-37. https://www.woundsme.com/uploads/resources/content_11160.pdf.
\198\ Lymphedema Advocacy Group (2021 Apr). ``Cost and
Utilization of Lymphedema Compression Garments.'' https://lymphedematreatmentact.org/wp-content/uploads/2021/04/Cost-and-Utilization-of-Lymphedema-Compression-Garments.pdf.
\199\ Boyages J, Xu Y, Kalfa S, Koelmeyer L, Parkinson B, Mackie
H, Viveros H, Gollan P, & Taksa L (2017). Financial cost of
lymphedema borne by women with breast cancer. Psychooncology, 26(6),
849-855. doi: 10.1002/pon.4239. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5484300/.
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3. Current Issues: Scope of the Benefit for Lymphedema Compression
Treatment Items
In the CY 2024 HH PPS proposed rule (88 FR 43654), we proposed to
implement a new benefit category established at section 1861(s)(2)(JJ)
of the Act for ``lymphedema compression treatment items'' defined at
section 1861(mmm) of the Act as standard and custom fitted gradient
compression garments and other items determined by the Secretary that
are--
Furnished on or after January 1, 2024, to an individual
with a diagnosis of lymphedema for the treatment of such condition;
Primarily and customarily used to serve a medical purpose
and for the treatment of lymphedema, as determined by the Secretary;
and
Prescribed by a physician (or a physician assistant, nurse
practitioner, or a clinical nurse specialist (as these terms are
defined in section 1861(aa)(5)) to the extent authorized under State
law).
In response to the CY 2024 HH PPS proposed rule (88 FR 43654), we
received a number of comments from individuals health care providers
and suppliers, medical associations, and medical device companies. More
comments were received from healthcare consulting and medical
technology organizations. In this section, we provide the proposed
payment methodology, and a summary of the comments we received as well
as our responses.
We proposed that any other items covered under this new benefit
category in addition to gradient compression garments must also use
compression in treating lymphedema since the specific category of
medical items to be covered under section 1861(s)(2) of the Act are
``lymphedema compression treatment items.'' Similarly, we proposed that
this benefit category is limited to compression treatment items and
does not include professional lymphedema treatment services or other
services not directly related to the furnishing of the lymphedema
compression treatment items. Payment for any covered professional
service related to these items would be made under the Medicare
Physician Fee Schedule. The statute limits the benefit to items used
for the treatment of lymphedema as determined by the Secretary, and we
proposed that this includes items used to treat all types or diagnoses
of lymphedema, but does not include the same items when used to treat
injuries or illnesses other than lymphedema. In other words, if a
gradient compression garment or other lymphedema compression treatment
item is furnished to treat an injury or illness other than lymphedema,
those items would not be classified under the Medicare benefit category
for lymphedema compression treatment items. The following is a summary
of the comments we received and our responses.
Comment: A commenter recommended that CMS work with suppliers and
manufacturers of compression garments, and the clinical community who
have expertise in providing services to patients with lymphedema in
developing the scope of benefit and payment for lymphedema compression
treatment items. A commenter stated that the need for custom fit
supplies should be based on the medical expertise of the prescribing
healthcare provider and patients should not face undue burdens. A
commenter expressed concern that the proposed provisions in this rule
would not remove barriers to eligibility for custom garments.
Response: We are appreciative of these comments. During the process
of developing scope of benefit, payment, and coding policies for the
new benefit for lymphedema compression items, we consulted with medical
professionals, suppliers, manufacturers, trade organizations, and
patients via public comments and meetings. Concerning coverage and the
determination of a specific beneficiary's medical need for lymphedema
compression treatment items, these concerns are outside the scope of
this rulemaking. The final rule implements the new benefit category for
lymphedema compression treatment items established under section 4133
of the CAA, 2023, and does not address coverage for these items or the
Medicare coverage process or criteria.
Comment: A commenter urged CMS to reconsider the interpretation
section 4133 of the Consolidated Appropriations Act, 2023. The
commenter stated that Congress intended to make lymphedema compression
treatment items available and accessible to Medicare beneficiaries with
illnesses other than lymphedema. The commenter supports Congress'
intent to expand patient access to lymphedema compression treatment
items and urged CMS to ensure that its coverage and payment policies
are consistent with and promote Congress' intent of expanding patient
access to lymphedema compression treatment items. Another commenter
stated that phlebolymphedema is lymphedema secondary to chronic venous
insufficiency and that all patients with CVI (CEAP scores C3-C6) should
be considered lymphedema patients.
Response: Section 4133 of the Consolidated Appropriations Act, 2023
establishes section 1861(mmm)(1) of the Act, stating that the new
benefit is to be ``furnished to the individual with a diagnosis of
lymphedema for the treatment of such condition''. As such, we are
finalizing the proposed rule to limit the scope of the new benefit for
lymphedema compression treatment items to items furnished to an
individual with a diagnosis of lymphedema and not illnesses other than
lymphedema.
In accordance with section 1861(mmm)(2) of the Act we are defining,
in addition to the standard and custom fitted gradient compression
garments that are included in the scope of the benefit, what ``other
items as determined by the Secretary'' are included within the scope of
the benefit. We proposed that other compression items used to treat
lymphedema that would be covered under this benefit category in
addition to gradient compression garments would include ready-to-wear,
non-elastic, gradient compression wraps with adjustable straps such as
the items described by HCPCS code A6545. In addition, we proposed that
clinicians (or other qualified professionals) that furnish these items
become enrolled and accredited as DMEPOS suppliers to bill for these
items as lymphedema compression treatment items per section
1834(j)(5)(E) of the Act or payment for the items applied during phase
one of decongestive therapy would not be allowed. We also note that
while these items may be covered under the new
[[Page 77818]]
Part B benefit for lymphedema compression treatment items, the
professional services associated with applying these items would need
to be covered under a different Medicare benefit category for Medicare
payments to be made for these services. We specifically solicited
comments on the topic of coverage of compression bandaging items under
the new benefit for lymphedema compression treatment items. We also
solicited comments on whether the professional services of applying
these bandages could be covered under another Medicare benefit
category, such as outpatient physical therapy services under section
1861(p) of the Act or physician services under section 1861(s) of the
Act. The following is a summary of the comments we received and our
responses.
Comment: Several commenters thanked and supported CMS for the
inclusion of compression bandaging systems being covered during the
intensive/decongestive phase of the treatment. However, many commenters
were concerned about the proposal that compression bandaging systems
applied in a clinical setting as part of phase one decongestive therapy
would be covered to the exclusion of their coverage during other phases
of the treatment despite being critical to improvement and maintenance
phases of treatment. Several commenters requested CMS consider
including coverage of bandaging not only for the initial acute or
decongestive phase (Phase 1), but also for the maintenance phase (Phase
2) of treatment for patients who use compression wraps and bandaging
systems in addition to the coverage of daytime and nighttime garments.
A few commenters shared concerns over terms used in the proposed
rule. A commenter recommended that CMS eliminate a reference to
``bandaging systems'' and replace with language that includes
``lymphedema bandages and related supplies such as foam rolls or
sheets, lining materials.'' Several commenters indicated that patients
need ``sets of garments'' as opposed to individual garments.
Many commenters requested CMS ensure inclusion of bandaging for
various body parts including stretch bandages, firm bandaging, custom
and adjustable wraps, bandage liners, night garments, Kinesio tape,
Circaid wraps, Ready wraps, digital bandaging, elastic and non-elastic
wraps, rolls of gauze bandaging, wraps for foot, calf, knee, thigh,
hand, arm, Velcro bandage/compression systems, all knit type garments,
compression socks/sleeve/gloves/gauntlets/pantyhose/thigh highs,
standard fitted compression garments for the chest and back, such as
compression bras which are able to hold a breast prosthesis; and toe
caps that may be used for long term treatment, nighttime or other
phases of treatment.
Response: We appreciate the comments on a variety of different
viewpoints on bandaging, bundling payments and how to approach payment
for therapists and other skilled professionals. We understand and agree
that bandaging may be provided at different phases of the beneficiary's
treatment of lymphedema and the use of bandaging can continue at
various stages of lymphedema as long as medically necessary. We are
clarifying that payment for compression bandaging systems under this
benefit category is not limited to Phase 1 (acute or decongestive
therapy) but is also available under Phase 2 (maintenance therapy).
With regards to payment, we note that currently a therapist who applies
compression bandaging supplies during Phase 1 of treatment can bill for
the service of applying the bandages using CPT codes 29581 and 29584.
It is important to note, however, that if the CPT codes are billed and
paid for a particular date of service, then billing for the bandaging
supplies used during that date of service using the HCPCS A codes is
not allowed and would be denied as it would result in duplicate payment
of the supplies since the Medicare payment amounts for codes 29581 and
29584 include payment for the compression bandaging supplies.
We are finalizing the proposal to cover gradient compression wraps
with adjustable straps and compression bandages under the new benefit
as well as accessories necessary for the effective use of gradient
compression garments and wraps with adjustable straps. In response to
comments about ensuring inclusion of bandaging for various body parts
we are adding more HCPCS codes, in addition to those originally
proposed, to be clearer about the inclusion of bandaging and
accessories for the various body parts. Detailed discussion on HCPCS
coding is included in section 4 ``Healthcare Common Procedure Coding
System (HCPCS) Codes for Lymphedema Compression Treatment Items'' and a
list of HCPCS codes being added is included in Table FF-A 2.
With regard to the reference to ``compression bandaging systems'',
we are finalizing the use of the term ``compression bandaging systems''
in our regulations at 42 CFR 410.36(4)(iii) for lymphedema compression
treatment items that are comprised of a combination of individual
lymphedema compression bandages and related supplies as well as kits
that can include both lymphedema bandages and related supplies used to
create the compression bandaging system.
Comment: Many commenters requested that CMS provide separate
payment for the measurement and fitting services to ensure that
patients receive the best care for their individual needs and that
clinicians, therapists, and certified fitters are paid fairly and
directly for the service they provide in all settings where fittings
may be provided. Some commenters suggested they had greater trust in
therapists than in general DMEPOS suppliers for garment measurement,
believing that therapists provided more accurate measurements. Some
commenters suggested precedent with orthotics and prosthetics for
separate codes specifically for fitting services (with varying
recommendations for the specific codes that could be created), and
these codes may also assist in reimbursement in the event follow-up
visits are needed to assess possible re-fitting as limb size may change
significantly over time (for example, HCPCS level 1 code 97760
``Orthotic management and training'' when services are not provided by
a DMEPOS supplier).
A commenter expressed concern that DMEPOS suppliers may not be
prepared for the influx of referrals for lymphedema compression
treatment garments, and that only separate payment for fitting services
would alleviate wait times or other access issues.
At the same time, many commenters expressed concerns with aspects
that would arise from separate payment for fitting services. A
commenter expressed concern that the patient receive clear and correct
pricing for each garment, regardless of how the fitting services are
provided. A commenter stated that therapists may use multiple garment
suppliers which may create complications in arranging for separate
payment for fitting.
A commenter believed the proposal to implement a separate fitting
component where payment is made to a therapist for taking measurements
would be difficult for suppliers, particularly those that maintain a
physical office where patients can attend a complimentary fitting
appointment with a trained fitter.
Several commenters expressed concern with responsibility for
replacement of ill-fitting garments if separate payment for fitting
services were established. While most commenters believe that
separately paid fitters should not bear financial responsibility for
garments that do not fit as expected, a commenter
[[Page 77819]]
recommended that if the garment matches the written fitting order, the
fitter should bear responsibility for the cost of replacement in the
event of a poor fit. A commenter specifically recommended that since
the supplier retains responsibility for replacement or alteration of an
ill-fitting garment, their payment should include the cost of fitting.
A commenter noted that improperly measured garments could be altered
(so full replacement may not be necessary) and that even with accurate
measurement there is no guarantee of proper fit since there can be
reduction or increase in the patient's condition during the weeks
between measuring and receipt of the garment.
A few commenters support the proposal to bundle payment for fitting
and garments and that it be coordinated by enrolled DMEPOS suppliers A
commenter indicated that if DMEPOS suppliers are enabled to act as
administrator of payments for these services it would allow DMEPOS
suppliers to set rates and administer payments without oversight or
infrastructure to address non-payments, appeals and other unforeseen
billing and reimbursement circumstances. Several commenters shared
concerns that DMEPOS suppliers may not be ideal or have adequate
training for measuring, assisting in choices or educating patients with
certain circumstances such as lymphedema in sensitive areas,
compression choices based on sensitivities or personal challenges in
doffing and donning, or reach and balance concerns and may lead to
delay and regression in treatment. A few commenters believe DMEPOS
suppliers will have financial incentives that do not account for
patient needs or preference. A few commenters indicated there is a
difference between the measuring and fitting services provided by a
DMEPOS supplier as compared to a therapist and indicated that when
DMEPOS suppliers perform the measuring services the garment is
typically sent to the patients home and the supplier is not required to
follow-up with the patient whereas with therapists the garment is sent
to the therapists office where they ensure the garment fits properly
and the patient's comfort and functional needs are met leading to
higher rates of compliance. A commenter indicated that the differences
should be acknowledged in the payment.
Response: We appreciate the many concerns commenters expressed both
in support and against the idea of separate payment for fitting
services. In the proposed rule, we noted that therapists often take
measurements of affected body areas and perform other fitting services
related to the furnishing of gradient compression garments. These
measurements are an integral part of furnishing the custom garments and
in some cases, the standard garments, and the suppliers of the garments
are responsible for fitting the garments they furnish. Typically,
DMEPOS suppliers are responsible for all aspects of furnishing the
item, including fitting and measuring services. Following that
approach, a supplier receiving payment for furnishing a lymphedema
compression treatment item to a beneficiary has responsibility for
ensuring that any necessary fitting, training (how to appropriately
don/doff and maintain), and adjustment services are provided as part of
furnishing the item. The supplier receiving payment for the garment may
work out an arrangement with the therapist for the fitting component
that is an integral part of furnishing the item. Although we solicited
comments on the option of paying separately for the fitting component
furnished by the therapist and then backing this payment out of the
payment for the garment, we did not propose this policy. We did not
propose this policy because of the many complexities associated with
this policy and the comments reinforced that this is a very complicated
alternative that requires careful analysis and consideration. We do not
believe we are in a position to implement such a policy in 2024, but it
is something we could consider under future rulemaking if we believe it
would improve the administration of this new DMEPOS benefit category.
As part of the DMEPOS supplier standards, a supplier must accept
return of substandard items. In cases where a mistake is made in
measuring and fitting the beneficiary for gradient compression
garments, resulting in the furnishing and payment for custom gradient
compression garments that do not properly fit the patient, the risk
would be assumed by the fitter and not the supplier to accept return of
the garments and cover the cost of two replacement garments. Again, we
did not propose to make separate payment for the fitting services under
this benefit when furnished by a supplier other than the supplier of
the garments; however, we specifically solicited comments on the topic
and comments on options to resolve the issues we outlined previously.
We recognize that there is not necessarily a standard industry practice
for the fitting and training components for furnishing lymphedema
compression garments and sought comment on whether there are best
practices in this space that CMS should consider further in the future.
We also solicited comments on whether any HCPCS Level I (Current
Procedural Terminology or CPT[supreg]) codes may describe the services
of the therapist in these scenarios. The following is a summary of the
comments we received and our responses.
Comment: A commenter recommended a specific proposal where the 20
percent beneficiary copay would be directed to the fitter for these
services while the supplier of the garment would receive 80 percent of
the allowed payment amount for the garment.
Response: The CAA, 2023 did not modify or exempt lymphedema
compression treatment items from the normal copay requirements that
apply to Medicare items and services, so we do not intend to direct
that beneficiaries make copayments for these items to fitters rather
than the DMEPOS suppliers of the items.
Comment: A few commenters are concerned that having DME suppliers
administer payment for these services may open a window for abuse of
Federal anti-kickback laws in the industry.
Response: With regard to the concerns raised by the commenters
about the Federal anti-kickback statute, while all applicable parties
must comply with this law, such concerns are outside the scope of this
rulemaking.
Comment: A few commenters requested CMS to require non-clinician
fitters to complete a training program, while a few other commenters
requested CMS to adopt quality standards for non-clinician fitters of
lymphedema compression treatment items. Alternatively, a few commenters
recommended CMS provide a separate payment to clinicians for providing
DME services and did not support DME suppliers administrating payment
for these critical services. A commenter requested clarification from
CMS on whether private practice physical (PT) and occupational
therapists (OT) are exempt from proposed surety bond requirements if
the business is solely owned and operated by the PT or OT's. This
commenter requested CMS to premise payment on enrolling as a DME
supplier. Some commenters expressed concern that CMS may have omitted
from the proposal the full range of medical professionals who provide
fitting services. Some commenters recommend that CMS support the
establishment of an industry-standard licensing or certification
process for fitting services to ensure training in garment selection,
fabric type, compression class and the necessary
[[Page 77820]]
options for specific disease states, and presentation, while other
commenters expressed concern with limiting fitting services to certain
licensed health professionals in a way that may reduce access in areas
of the country already struggling with a lack of lymphedema treatment
professionals.
Response: Suppliers of lymphedema compression treatment items are
required to become enrolled DMEPOS suppliers, which in turn requires
the supplier to obtain a surety bond, become accredited, and be in
compliance with the DMEPOS supplier standards and quality standards.
Medical professionals that currently provide fitting services are able
to enroll in Medicare as DMEPOS suppliers and receive such bundled
payment for garments and related supply services provided to
beneficiaries. We will consider whether specific quality standards for
suppliers of lymphedema compression treatment items should be added to
the DMEPOS quality standards in the future. With regards to the comment
requesting exemption from the surety bond requirements, we note that
section 1834(a)(16) of the Act requires DMEPOS suppliers to maintain a
surety bond of at least $50,000 as a condition for the receipt or
renewal of a Medicare provider number.
Comment: Several comments noted that fitting may be required not
only for patients wearing custom garments, but also ready-to-wear
products, although some comments specifically noted that the time
required to fit for custom garments is longer. Some commenters stated
that patients sometimes require multiple visits to ensure a proper fit,
particularly for patients with more complex cases. A few commenters
also noted that in certain complex cases it may be necessary for the
supplier or manufacturer to interact with the therapist to co-engineer
a custom garment, so CMS should ensure appropriate reimbursement for
this type of work. A commenter urged CMS to collect and make public
data on where beneficiaries are accessing lymphedema products, whether
through suppliers or therapists, and to implement an auditing process
to ensure that therapists are being adequately reimbursed.
Response: We appreciate these comments. Payment for all services
necessary for furnishing a gradient compression garment are included in
the rates paid by Medicaid State agencies and we proposed to use the
average Medicaid payment rate plus twenty percent as the payment basis
for Medicare (when such Medicaid rates are available). Therefore,
Medicare payments likewise include payment for all services necessary
for furnishing the gradient compression garment, which is consistent
with how Medicare payment is made for other DMEPOS items and services.
We intend to closely monitor access to lymphedema compression treatment
items and related services necessary for the effective use of these
items to ensure that the Medicare payments for these items are
appropriate.
Comment: A few commenters raised concerns that bundling payment for
a lymphedema compression treatment item that is supplied by a DMEPOS
supplier where the measuring and fitting of the item is performed by a
therapist or other practitioner would require the therapist or
practitioner to enter into a financial relationship with the DMEPOS
supplier that would implicate the physician self-referral law at
section 1877 of the Act. A commenter requested that CMS clarify that a
financial relationship between a DMEPOS supplier and a therapist or a
practitioner who performs the fitting component of the service would be
permissible under the physician self-referral law.
Response: Section 1877 of the Act, also known as the physician
self-referral law: (1) Prohibits a physician from making referrals for
certain designated health services payable by Medicare to an entity
with which he or she (or an immediate family member) has a financial
relationship, unless an exception applies; and (2) prohibits the entity
from filing claims with Medicare (or billing another individual,
entity, or third-party payer) for those referred services. A financial
relationship is an ownership or investment interest in the entity or a
compensation arrangement with the entity. The statute establishes a
number of specific exceptions and grants the Secretary the authority to
create regulatory exceptions for financial relationships that do not
pose a risk of program or patient abuse.
The physician self-referral law would be implicated only if the
therapist or practitioner who provides the fitting component of a
service is a physician or the immediate family member of a physician
(as defined at Sec. 411.351) and there is a financial relationship
between the therapist or practitioner and the DMEPOS supplier. Where
the physician self-referral law is implicated, a physician's referrals
to the DMEPOS supplier with which the physician (or the immediate
family member of the physician) has the financial relationship will not
be prohibited if all the requirements of an applicable exception are
satisfied. We note that several statutory and regulatory exceptions may
be applicable to the type of financial relationship described by the
commenters.
We are finalizing the proposal to include payment for fitting
services in the overall payment for lymphedema compression treatment
garments that CMS will make to Medicare-enrolled DMEPOS suppliers that
furnish lymphedema compression treatment items to Medicare
beneficiaries.
Finally, there are accessories such as zippers in garments, liners
worn under garments or wraps with adjustable straps, and padding or
fillers that are not compression garments but may be necessary for the
effective use of a gradient compression garment or wraps with
adjustable straps. There are also accessories like donning and doffing
aids for different body parts such as lower limb butlers or foot
slippers that allow the patients to put on the compression stockings
with minimum effort and are not used with compression bandaging systems
or supplies.
We proposed that accessories necessary for the effective use of
gradient compression garments and gradient compression wraps with
adjustable straps would also fall under this new benefit for lymphedema
compression treatment items. For example, a liner that is used with a
garment because it is needed to prevent skin breakdown could be covered
under the new benefit because it is necessary for the effective use of
the garment. We solicited comments on the topic of coverage of
accessories necessary for the effective use of gradient compression
garment or wraps with adjustable straps, including what HCPCS codes
should be established to describe these items, as well as comments on
whether there are additional items other than the gradient compression
garments, gradient compression wraps with adjustable straps, and
compression bandaging supplies that could potentially fall under the
new benefit category for lymphedema compression treatment items. The
following is a summary of the comments we received and our responses.
Comment: All commenters supported the addition of accessories to
the items and services covered under the Medicare benefit category for
lymphedema compression treatment items. Several commenters thanked and
supported CMS's proposal to include accessories such as donning and
doffing aids that assist patients with putting on compression items.
Several commenters indicated that lymphedema treatment items are
customizable and vary widely
[[Page 77821]]
by patient but are especially important for Medicare recipients who are
more likely to have multiple co-morbidities that restrain their
strength and range of motion. A few commenters indicated the need to
account for layering garments as recommended by clinicians. A few
commenters described these items as part of a ``build'' of a garment/
solution and suggested they have unique HCPCS codes to support the
``build.''
Several commenters requested clarification on the term ``padding''
suggesting this should be itemized for the sake of comprehensiveness
and include foam sheets, foam rolls, cotton or synthetic padding,
stockinette, customized foam cutouts, and chip pads as well as Swell
Spots or similar quilted items to be used under clothing. A commenter
suggested padding be listed according to use (that is, skin protection
and cushioning, compression, fibrosis). A commenter indicated that the
proposed definition in 42 CFR 410.36(a)(4) needs additional language to
better describe the wide range of accessories that are necessary for
effective use of medically necessary lymphedema compression treatment
items.
Many commenters indicated the need for coverage of aids that
facilitate use and enhance compliance rates such as: adhesive roll on,
fasteners and closures, bandage liners, donning and doffing aids (such
as limb butlers, foot slippers, liners, silicone donning lotions, and
bandaging supplies), padding, skin barrier stocking, accessories which
are attached to and modify the lymphedema treatment garment, and
accessories which are separate from the lymphedema garments such as
oversleeves and undersleeves. Many commenters made suggestions on the
range of accessories for which HCPCS codes are needed. Many commenters
identified the following accessories for HCPCS code development:
stockinettes, customized foam cutouts, foam pads, foam chips, bandage
rollers (manual and motorized), bandaging liners, medium-stretch
bandages, under-bandage pads and bandage liners, and short-stretch
bandages, securing tape, donning and doffing aids such as wire frame
butlers, easy slide sleeves, donning gloves, lubricants and adhesives,
garment washing fluid, oversleeves, strap extenders, lobe straps, tape
measures, garter belts, zippers, pull loops, silicone bands, comfort/
flexion zones, outer jackets, and fitting lotion.
A few commenters indicated that padding is generally durable but
only some is washable and that materials break down over time and need
replacement every 1 to 2 years. The commenter indicated bandages lose
their stretch and need replacing at least every 4 to 6 weeks. A few
commenters requested CMS clarify that lymphedema compression treatment
items and pneumatic compression pumps may be covered concurrently if
medically necessary. A commenter suggested that supporting the cost of
donning and doffing aids would benefit patients who lack the mobility
to don and doff the garments themselves.
Response: We appreciate the detailed lists and comments that the
commenters have provided to us on the types of accessories as well as
suggestions for accessory HCPCS codes. We thank commenters for the
support of our proposal to cover accessories necessary for the
effective use of gradient compression garments and gradient compression
wraps with adjustable straps, including donning and doffing aids, under
the new lymphedema compression treatment items benefit. We recognize
that the form accessories may take in relation to the garments and
wraps is varied with some accessories part of the garment as furnished
such as zippers and others separate such as liners worn under garments
or wraps. We believe the proposed definition of accessories for
lymphedema compression treatment items at 42 CFR 410.36(a)(4) captures
the variance in form and range of accessories that are needed for the
effective use of garments and wraps with adjustable straps. We also
believe that additional specification in terms of type or use on the
term ``padding'' that is provided as an example in the definition is
not necessary to clarify the scope of the benefit and are finalizing
the definition as proposed. Concerning HCPCS codes to describe these
items, as commenters note, there is a wide array of accessories on the
market that can be used to facilitate effective use of the garments or
wraps. Given the number and types of accessories available, we have
initially established a not otherwise specified code for accessories,
as shown in Table FF A 2, that will be effective January 1, 2024 for
use in identifying accessories used in conjunction with lymphedema
garments and wraps. We believe it is important to have a code in place
on January 1, 2024 for identifying such items and we refer readers to
the public HCPCS process, described at https://www.cms.gov/medicare/coding/medhcpcsgeninfo/hcpcspublicmeetings, as a means for modifying
the code set in the future. Since Medicare coverage determinations have
not been developed at this time for different types of accessories used
in conjunction with lymphedema garments and wraps, the coverage
determinations for any claims submitted for these items must be made on
an individual, claim-by-claim basis, beginning on January 1, 2024. We
note that one code for these accessories is all that will be needed to
process claims for these items and services. Should CMS develop an NCD
or LCDs with specific medical necessity criteria for different types of
accessories in the future, we would add codes for the different types
of accessories addressed in these coverage determinations for Medicare
claims processing purposes. With respect to concurrent coverage of
lymphedema compression treatment items and pneumatic compression pumps,
DME MACs will continue to make determinations on the medical necessity
of items and services, including items that fall under the new benefit
category for lymphedema compression treatment items and existing
benefit categories.
4. Healthcare Common Procedure Coding System (HCPCS) Codes for
Lymphedema Compression Treatment Items
HCPCS codes are divided into two principal subsystems, referred to
as Level I and Level II of the HCPCS. Level I of the HCPCS is comprised
of Current Procedural Terminology (CPT), a numeric coding system
maintained by the American Medical Association (AMA). HCPCS Level II is
a standardized coding system that is used primarily to identify drugs,
biologicals and non-drug and non-biological items, supplies, and
services not included in the CPT codes, such as ambulance services and
DMEPOS when used outside a physician's office. As shown in Table FF-A
1, there are currently HCPCS Level II codes for compression garments
(stockings, sleeves, gloves, and gauntlets) and compression wraps with
adjustable straps that may be used in the treatment of lymphedema and
other conditions.
BILLING CODE 4120-01-P
[[Page 77822]]
[GRAPHIC] [TIFF OMITTED] TR13NO23.067
BILLING CODE 4120-01-C
The items described by HCPCS codes A6531, A6532, and A6545 are
covered by Medicare under the Part B benefit for surgical dressings at
section 1861(s)(5) of the Act, when used in the treatment of an open
venous stasis ulcer. Total allowed charges for these three codes in
2022 was approximately $2.5 million, with around $1.9 million for the
non-elastic, below knee, gradient compression wrap with adjustable
straps described by code A6545, $500,000 for the below knee, gradient
compression stocking code A6531, and $100,000 for the below knee,
gradient compression stocking code A6532. We did not propose to change
this policy with this rule, but we addressed the codes for items when
they are covered under Medicare Part B as surgical dressing versus when
they are covered under Medicare Part B as lymphedema compression
treatment for billing and claims processing purposes. We therefore
proposed to add three new HCPCS codes for use when billing for A6531,
A6532, and A6545 items used as surgical dressings. The proposed codes
are as follows:
A--Gradient compression stocking, below knee, 30-40 mmhg, used
as surgical dressing in treatment of open venous stasis ulcer, each
A--Gradient compression stocking, below knee, 40-50 mmhg, used
as surgical dressing in treatment of open venous stasis ulcer, each
A--Gradient compression wrap with adjustable straps, non-
elastic, below knee, 30-50 mmhg, used as surgical dressing in treatment
of open venous stasis ulcer, each
The surgical dressing fee schedule amounts for codes A6531, A6532, and
A6545 would be applied to the three new codes. The remaining discussion
in this section addresses the coding for the lymphedema compression
treatment items.
For gradient compression stockings, we proposed to use existing
codes A6530 through A6541, and code A6549 from Table FFA-1. For codes
A6530 through A6541, we solicited comments on whether we should
maintain the three pressure level differentiations in the codes and
whether these differentiations should be something other than 18-30,
30-40, and 40-50 mmHg. We also solicited comments on whether there is a
better way to describe the body areas these garments cover rather than
``below knee,'' ``thigh-length,'' ``full-length/chap style,'' and
[[Page 77823]]
``waist-length.'' For each code, we proposed to add a matching code for
the custom version of the garment. For example, if we continue to use
codes A6530 through A6532 for below knee stockings with the current
descriptions, we would add corresponding codes for the custom versions
of these garments, such as the following:
A--Gradient compression stocking, below knee, 18-30 mmhg,
custom, each
A--Gradient compression stocking, below knee, 30-40 mmhg,
custom, each
A--Gradient compression stocking, below knee, 40-50 mmhg,
custom, each
For gradient compression garments for the upper extremities and
areas of the body, we proposed to use existing codes A6549 and S8420
through S8428. We proposed renumbering codes S8420 through S8428 as
``A'' codes rather than S codes. We proposed removing the words
``ready-made'' and revising ``custom made'' to ``custom'' for the codes
for the upper extremity gradient compression garments and replacing the
word ``pressure'' with ``compression,'' in order to be consistent with
the wording for the codes for the lower extremity garments. We proposed
to add the word ``arm'' in front of the word ``sleeve'' for the upper
extremity garments. We also proposed to add a code for a custom
gauntlet. Finally, we proposed to add the word ``each'' to the
description for each code. We proposed that if no other changes are
made, the new codes would be as follows:
A--Gradient compression arm sleeve and glove combination, each
A--Gradient compression arm sleeve and glove combination,
custom, each
A--Gradient compression arm sleeve, each
A--Gradient compression arm sleeve, custom, medium weight,
each
A--Gradient compression arm sleeve, custom, heavy weight, each
A--Gradient compression glove, each
A--Gradient compression glove, custom, medium weight, each
A--Gradient compression glove, custom, heavy weight, each
A--Gradient compression gauntlet, each
A--Gradient compression gauntlet, custom, each
We solicited comment on whether separate codes are needed for
mastectomy sleeves or whether these items can be grouped together under
the same codes used for other arm sleeves (S8422 thru S8424). We
solicited comments on whether there is a need to retain codes S8420
through S8428, in addition to the renumbered A code versions, for use
by other payers other than Medicare. If these codes are retained, they
would be invalid for Medicare use, but could be used by other payers in
lieu of the new A codes.
We also proposed to add the following new codes for other upper
body areas:
A--Gradient compression garment, neck/head, each
A--Gradient compression garment, neck/head, custom, each
A--Gradient compression garment, torso and shoulder, each
A--Gradient compression garment, torso/shoulder, custom, each
A--Gradient compression garment, genital region, each
A--Gradient compression garment, genital region, custom, each
For all of the codes for the upper extremities and upper body
areas, we solicited comments on whether we should establish codes for
pressure level differentiations similar to the pressure level
differentiations in codes A6530 through A6541, possibly replacing the
words medium and heavy weight, as well as whether codes are needed for
additional upper body areas.
We proposed the following new codes for nighttime garments:
A--Gradient compression garment, glove, padded, for nighttime
use, each
A--Gradient compression garment, arm, padded, for nighttime
use, each
A--Gradient compression garment, lower leg and foot, padded,
for nighttime use, each
A--Gradient compression garment, full leg and foot, padded,
for nighttime use, each
For gradient compression wraps with adjustable straps, we proposed to
use code A6545 in Table FF-A 1 for below knee wraps and solicit
comments on whether additional codes or coding revisions are needed for
the purpose of submitting claims for gradient compression wraps with
adjustable straps. Regarding HCPCS codes for compression bandaging
systems, we believe more codes are needed than existing codes S8430
(Padding for compression bandage, roll) and S8431 (Padding for
compression bandage, roll), for example, to describe the supplies used
in a compression bandaging system consisting of more than two layers.
We also believe that specific base sizes should be added to the code,
for example ``10cm by 2.9m'' rather than the vague unit of ``roll'' and
are soliciting comments on HCPCS coding changes needed to adequately
describe the various compression bandaging systems used for the
treatment of lymphedema. Finally, as noted in section VII.B.3. of this
rule, we solicited comments on HCPCS codes needed to describe
accessories necessary for the effective use of gradient compression
garments or wraps with adjustable straps. The following is a summary of
the comments we received and our responses.
Comment: Several commenters recommended that flat-knit garments
have separate codes from circular-knit garments. A commenter supported
development of separate HCPCS codes for circular knit vs flat knit
garments as they have different costs and are appropriate for different
patients.
Response: While some commenters supported having different codes
for flat knit and circular knit garments, we do not believe this
differentiation is necessary since it is our understanding that the
majority of flat knit garments are custom garments, and the majority of
circular knit garments are non-custom. We believe that having separate
codes for custom and non-custom codes should be sufficient to address
this difference in garment material.
Comment: A few commenters expressed general support for existing
compression stocking codes (A6530-41 and A6549). A few commenters
indicated that changes to these codes would affect existing processes,
knowledge, and experience throughout the insurance industry. A few
commenters did not support any changes in these codes. A few commenters
supported changes to the A6530-41 and A6549 codes to reflect the
different kinds of knits, lengths, and other variations in garments,
including the addition of modifiers to describe each criterion when
billed with a specific HCPCS code. Other commenters favored
establishing new codes with additional textile and technology
specifications instead of using the existing compression stocking
codes. A few commenters indicated that the number of proposed HCPCS
codes was inadequate. A few commenters made suggestions on codes on
custom versions of Existing Gradient Compression Stocking Codes (A6530-
41 and A6549). A commenter recommended custom nighttime compression
garments be available at any compression pressure and custom non-
elastic gradient compression wrap at any compression pressure.
A commenter suggested expanding and updating the codes for each
type of material (circular knit, flat knit, inelastic wraps) and
indicating whether it is ready made or custom made. Many commenters
offered suggestions on better ways to describe body areas.
[[Page 77824]]
Several commenters suggested adding descriptions that would apply to
multiple body areas, including toe and individual toes, calf, foot,
ankle, below knee, knee, above knee, thigh, pelvis, and pelvis and
thigh(s), genital, head, neck, chest, torso, arm, hand, and finger.
Several commenters suggested descriptions for items that apply to a
range of body areas, including shorts, thigh to waist length
compression shorts, ankle to waist length compression capris, full body
suit, biker short and adding ``knee-high'' or ``thigh-high'' to
descriptions, combined gauntlet and arm sleeve, and torso only
(bodysuits, bras, axillary compression items, vests, abdominal
compression items, short-sleeve shirts, and long-sleeve shirts) and
chest/torso compression garments. A few commenters noted the need for
descriptions that would cover garment items used for multiple body
areas. A commenter suggested ``high rise panty'' or ``high rise panty
with leg'' or ``bicycle short style'' to clarify that stocking
definitions include the buttocks, the foot, open or closed toe, as well
as a partial leg on the non-affected side. A commenter indicated the
need for a description that would apply to a standard thigh high
compression garment on one leg to a custom panty hose with 2 legs of
differing lengths and compression levels. A commenter indicated the
need for a description that would apply to a garment item that covers
an entire limb/body part or is divided into components to allow ease of
donning/doffing and best coverage per patient. The description should
also be inclusive of all body parts with appropriate codes for each. A
few commenters suggested new HCPCS billing codes for items such as
custom flat knit compression waist high pantyhose (with multiple
compression levels in different body parts) and a groin compression
panel option.
Response: We thank the commenters for providing comments on the use
of the existing codes (A6530-41 and A6549) and for support of our
proposal. After careful review, we believe that retaining the existing
longstanding compression stocking codes will work to identify and
describe these items and will be less disruptive across all payer
settings than establishing new HCPCS codes that would replace the
existing codes. Some commenters suggested separate new codes or
modifications to the existing codes to distinguish custom versions of
garments, different types of textiles (flat and custom knit), different
pressure designations or different body areas. We thank commenters for
supporting our proposal to add a matching code for the custom version
of each garment and are adding these new codes for use on January 1,
2024. We also proposed use of existing not otherwise specified code
A6549 and are finalizing this along with a change to the code
descriptor from ``stocking/sleeve'' to ``garment'' to clarify its use
as a gradient compression garment code. We thank commenters for the
numerous suggestions on ways to describe the various body areas that
gradient compression areas can cover, including ranges of body areas
and descriptions such as ``high rise panty with leg.'' After careful
review, we have identified in Table FF-A 2 new codes that we will be
finalizing as part of this rule with an effective date of January 1,
2024, including gradient compression garment codes for the genital
regions, neck/head and toe caps. In addition to the new codes in Table
FF-A 2, we are retaining the following existing codes, with revisions
to the descriptors where applicable as noted previously, that are also
available to describe lymphedema compression treatment items:
[GRAPHIC] [TIFF OMITTED] TR13NO23.068
We believe it is important to have a set of codes in place on
January 1, 2024, that will generally meet the needs of the majority of
patients. However, we recognize that additional refinements may be
necessary. As such, the public HCPCS process, described at https://www.cms.gov/medicare/coding/medhcpcsgeninfo/hcpcspublicmeetings is
available as a means for modifying the code set in the future.
Comment: Many commenters offered suggestions on changes to the
proposal on differentiating pressure levels for HCPCS codes A6530-41
and A6549. A commenter supported the pressure levels described, while
adding language to acknowledge that they do not include all pressure
levels available. A few commenters supported including compression
levels higher than 50 mmHg. A commenter recommended aligning the
pressure level differentiations in codes A6530-A6541 to the compression
class designations utilized by providers to ensure that higher levels
of compression are captured for reimbursement. A few commenters
suggested separate treatment of pressure levels for circular and flat
knit garments. A commenter suggested including nighttime compression
items at any compression pressure. Another commenter suggested
including pressure level differentiations with all items for upper
extremity and upper body areas. A few commenters suggested use of Mild
Pressure, Moderate Pressure, Maximum Pressure across all codes because
some vendors use class levels and some use specific levels. A commenter
indicated that
[[Page 77825]]
ranges of compression be explicitly covered (15-20 mmHg, 20-30 mmHg,
30-40 mmHg, and 40-50 mmHg). A commenter recommended keeping the
pressure levels the same for lower and upper extremity garments. A
commenter suggested having a standard and custom garment for each
pressure level as well as for each garment type. A commenter suggested
adding a matching code for the custom version of the garment, dividing
custom garments by compression class (18-30 mmHg; 30-40 mmHg; 40-50
mmHg) and custom flat knit garments (15-21 mmHg; 22-32 mmHg; 33-46+
mmHg).
Response: We believe that the existing pressure designations in
mmHg generally capture how these items are presented and marketed in
the U.S. market. We believe a change to an alternative pressure
designation such as mild, moderate or maximum pressure would present
more challenges for billing and be more disruptive to the lymphedema
market. However, we recognize that the existing pressure ranges that
end in 50 mmhg that we proposed may not capture all the pressure levels
available, so we are revising the following gradient compression
stocking code pressure ranges by removing ``40-50 mmhg'' and adding
``40 mmhg or greater'' to ensure that higher levels of compression are
addressed in both the standard and custom versions:
A--Gradient compression stocking, below knee, 40 mmhg or
greater, each
A--Gradient compression stocking, below knee, 40 mmhg or
greater, custom, each
A--A6535 Gradient compression stocking, thigh length, 40 mmhg
or greater, each
A--Gradient compression stocking, thigh length, 40 mmhg or
greater, custom, each
A--A6538 Gradient compression stocking, full length/chap
style, 40 mmhg or greater, each
A--Gradient compression stocking, full length/chap style, 40
mmhg or greater, custom, each
A--A6541 Gradient compression stocking, waist length, 40 mmhg
or greater, each
A--Gradient compression stocking, waist length, 40 mmhg or
greater, custom, each
Table FF-A2 also includes the five new A codes that instead of
finalizing as proposed, we are finalizing by adding ``40 mmhg or
greater'' to the stocking code pressure ranges.
Comment: A few commenters expressed general support for the
addition of new HCPCS codes for use when billing for A6531, A6532, and
A6545 items used as surgical dressings only. Several commenters
disagreed with the addition of three new HCPCS codes for use when
billing for A6531, A6532, and A6545 items used as surgical dressings. A
few commenters suggested that the addition of new codes was
unnecessary. Another commenter suggested current HCPCS modifiers are
sufficient to differentiate these garments when used for different
purposes and was concerned with overcomplicating coding decisions.
Several commenters believe it might require a change to existing wound
care guidance, affect national and local coverage determinations, and
increase administrative burden. A few commenters indicated that the new
HCPCS codes would be confused with existing HCPCS codes. A commenter
indicated that the addition of new codes would lead to payment errors.
A few commenters recommended that existing A6531, A6532, and A6545
codes not be modified for coverage of lymphedema compression garments
and that new codes be developed to describe items under the new benefit
to avoid confusion.
Response: We appreciate the comments and agree with commenters that
establishing new codes for lymphedema compression garments would be
preferable to modifying the existing A6531, A6532, and A6545 surgical
dressing codes for use under the new benefit as proposed. To avoid
confusion and disruption associated with repurposing the existing
A6531, A6532, and A6545 surgical dressing codes, instead of finalizing
new A codes for the existing A6531, A6532 and A6545 codes under the
surgical dressing benefit and retaining A6531, A6532 and A6545 for use
under the lymphedema benefit as proposed, we are instead finalizing new
A codes for the following gradient compression garment and wrap codes
under the lymphedema compression benefit effective January 1, 2024.
A--Gradient compression stocking, below knee, 30-40 mmhg, each
A--Gradient compression stocking, below knee, 40 mmhg or
greater, each
A--Gradient compression wrap with adjustable straps, below
knee, 30-50 mmhg, each
Additionally, we will revise the descriptors of existing A6531, A6532,
and A6545 to clarify their use under the surgical dressing benefit. For
example, A6531 would read ``Gradient compression stocking, below knee,
30-40 mmhg, used as surgical dressing, each.''
Comment: On CMS's proposal to use existing A6549 and S8428-S8428
codes, a few commenters supported renumbering S8420 through S8428 to A
codes. A commenter suggested replacing the terms ``medium weight'' and
``heavy weight'' with compression values, or, in the alternative,
adding section defining the range of compression values that qualify as
``medium weight'' and ``heavy weight.'' A few commenters disagreed with
renumbering S-8420 through S8428 to A codes and indicated it could lead
to problems with claims payment by private and other payers. A few
commenters expressed general support for existing codes for upper
extremities and body garments (A6549, S8420-28). A few commenters
indicated support for the addition of codes for upper body areas. A
commenter supported the addition of codes for non-limb areas of the
body. A commenter recommended that existing codes not be changed
because they are used across the insurance industry. A few commenters
supported differentiating pressure levels for codes for upper
extremities and body areas. A commenter agreed with differentiation for
upper limb garment, suggesting differentiation by compression ranges
(20-30, 30-40, 40-50 mmHg) or compression class level (for example,
Class 1, Class 2, Class 3). Another commenter supported the three-
pressure level differentiations but indicated the need to distinguish
circular-knit and flat-knit compression garments. A commenter suggested
the coverage of gradient compression garments such as the compression
arm sleeve with shoulder attachment and the compression arm sleeve with
gauntlet attachment. A commenter also suggested that the proposed list
of arm sleeves needs should include ``A--Gradient compression arm
sleeve and gauntlet, custom'' as they believe it is frequently
prescribed and indicated. A commenter did not support retention of
HCPCS codes S8420-S8428, indicating that they could be included with
other code changes effective in 2024. Another commenter also supported
the removal of the ``S'' codes due to difficulties obtaining a Medicare
denial when other insurers require use of these garment codes for the
upper extremities. A commenter supported maintaining HCPCS codes S8420-
S8428 because they are used by insurers for diagnoses other than
lymphedema. Other commenters noted billing challenges if not all
Medicaid and commercial payers adopt the replacement ``A'' codes for
HCPCS codes S8420-S8428.
Response: Thank you for your comments on our proposal to use
[[Page 77826]]
existing HCPCS code A6549 and to add new ``A'' codes based on the
S8420-S8428 codes for upper extremity gradient compression garments.
After careful review, we are finalizing the addition of A codes that
align with the codes and descriptors of S8420 through S8428 along with
the following changes to the A code descriptors: removing the words
``ready-made,'' revising ``custom made'' to ``custom,'' replacing the
word ``pressure'' with ``compression,'' adding ``each,'' and adding the
word ``arm'' in front of the word ``sleeve'' for the upper extremity
garments. We are also finalizing the addition of a code for a custom
gauntlet as proposed. Based on commenter input, we will retain codes
S8420 through S8428, in addition to the new A code versions, for use by
other payers other than Medicare. The ``S'' codes will be invalid for
Medicare use, but they could be used by other payers in lieu of the new
upper extremity garment ``A'' codes. Similar to the lower extremity
gradient compression garments, we did not find a need to further
differentiate the proposed upper extremity codes based on circular-knit
and flat-knit compression materials. Since the majority of flat-knit
garments are custom garments and circular-knit garments are non-custom
garments, we do not believe further stratification of the proposed
custom and non-custom upper extremity HCPCS codes is necessary for this
distinction. While some commenters recommended adding pressure level
differentiations such as (20-30, 30-40, 40-50 mmHg) or compression
class level (for example, Class 1, Class 2, Class 3) to the upper
extremity codes, we believe the long-standing ``S'' codes that are
being established as A codes provide a way to identify upper extremity
gradient compression garments without further stratification by
pressure level. Our review of the cost of these items also does not
generally support a need to stratify by pressure level tiers. We will
retain the medium and heavy weight terminology in the new sleeve and
arm ``A'' codes from the predicate S8422, S8423, S8425 and S8426 codes.
The new codes we are finalizing in Table FF-A 2 identify the new
gradient compression garment codes we are adding for upper limb and
non-limb areas of the body such as the neck and head and the genital
regions. In addition to the new codes in Table FF-A 2, we are
finalizing the addition of the following new A codes that align with
the codes and descriptors of S8420 through S8428, as discussed
previously, effective January 1, 2024:
A--Gradient compression arm sleeve and glove combination,
custom, each
A--Gradient compression arm sleeve and glove combination, each
A--Gradient compression arm sleeve, custom, medium weight,
each
A--Gradient compression arm sleeve, custom, heavy weight, each
A--Gradient compression arm sleeve, each
A--Gradient compression glove, custom, medium weight, each
A--Gradient compression glove, custom, heavy weight, each
A--Gradient compression glove, each
A--Gradient compression gauntlet, each
Comment: Many commenters made suggestions on codes for mastectomy
sleeves. Many commenters supported including mastectomy sleeves in the
codes for compression sleeves and not creating separate mastectomy
codes. Many commenters did not believe it was necessary to distinguish
via separate coding patients with breast cancer from patients with
other types of lymphedema. A commenter opposed the inclusion of
mastectomy or other procedures in the new codes for lymphedema
compression treatment items. Another commenter noted that all sleeves
for mastectomy are the same as all compression garments used for
lymphedema, so they did not see a need for separate codes. A few
commenters suggested not using the L8010 HCPCS code for a compression
sleeve. Several commenters suggested deleting code L8010.
Response: We appreciate the recommendations provided related to
whether separate codes are needed for mastectomy sleeves and if items
can be grouped together under the same codes used for other arm sleeves
(S8422 thru S8424). After reviewing the comments, we agree that
separate codes are not necessary to distinguish mastectomy sleeves from
other arm compression sleeves used for lymphedema. We will also
continue to consider what to do with regard to the status of existing
code L8010 Breast prosthesis, mastectomy sleeve and may announce our
views in advance of a future public meeting related to the HCPCS code
set.
Comment: A few commenters supported new HCPCS codes for nighttime
garments in general. A commenter supported coverage of a nighttime
chipped foam compression garment for the body parts that are affected.
A few commenters indicated the need for additional codes. A commenter
indicated that there should be fewer HCPCS codes for nighttime
garments. Another commenter recommended additional codes to reflect
nighttime use of padded head/neck garments for lymphedema management.
Concerning gradient compression wraps with adjustable straps, a
commenter indicated the need for codes for gradient compression wraps
for below knee and above knee and a code for a full-leg wrap. Another
commenter indicated that gradient compression wraps with adjustable
straps should include: foot wraps, calf wraps, knee wraps, thigh wraps,
hand wraps, and arm wraps. A commenter indicated that additional HCPCS
codes need to be established for wraps for different parts of the body.
With respect to other comments related to garments or wraps with
adjustable straps, a commenter indicated that the term ``with
adjustable straps'' refers to both garments and wraps. The commenter
indicated that it might be clearer to eliminate ``with adjustable
straps,'' which would indicate coverage for wraps that are adjustable
by straps or by other means.
Response: Thank you for your comments on the HCPCS codes for
nighttime garments and gradient compression wraps with adjustable
straps. We appreciate the support for our proposal to add the following
nighttime garment codes and will be finalizing these codes for use
effective January 1, 2024.
A--Gradient compression garment, glove, padded for nighttime
use, each
A--Gradient compression garment, arm, padded for nighttime
use, each
A--Gradient compression, lower leg and foot, padded, for
nighttime use, each
A--Gradient compression garment, full leg and foot, padded,
for nighttime use, each
Table FF-A 2 identifies the new nighttime garment HCPCS codes that
we are adding to the HCPCS code set effective January 1, 2024,
including a bra garment and custom versions of the glove, arm, lower
leg and full leg and foot nighttime garments. Regarding gradient
compression wrap coding, we proposed to use existing code A6545 to
identify below knee gradient compression wraps with adjustable straps.
As discussed in a prior response, to avoid confusion with repurposing
the existing A6545 code used for surgical dressings, we will establish
a new A code to describe below knee gradient pressure wraps with
adjustable straps under the new lymphedema benefit for use effective
January 1, 2024. We appreciate the commenters input on additional
coding for other areas of the body and descriptor language. We
[[Page 77827]]
believe that including adjustable straps in the descriptor for gradient
pressure wrap with adjustable straps is necessary to help identify the
general type of wrap that supplies gradient pressure and are retaining
this terminology. Table FF-A 2 includes the new codes we are adding for
gradient pressure wraps with adjustable straps and includes wraps for
above knee, full leg, and foot.
Comment: Many commenters provided comments on a range of issues
related to HCPCS Codes for lymphedema compression items. A few
commenters indicated that the number of proposed HCPCS codes was
inadequate. Many expressed support for a range of new codes. A few
supported a proposal for 229 new HCPCS codes that differentiate between
textiles and technologies (circular knit, flat knit, inelastic
adjustable wraps). A commenter supported development of a code for each
individual component. A commenter indicated that limiting the number of
HCPCS codes would not reflect the large variety of lymphedema
compression treatment items. Commenters also provided suggestions on
codes for bandaging systems. A commenter indicated a need for more
codes than the existing S bandaging codes as lymphedema bandaging
systems can include: short-stretch compression bandages, stockinette or
tubular gauze sleeves, finger/toe bandages, rolled padding (synthetic
or foam), adhesive tape, foam pads, chip pads; chip bags. A commenter
recommended that HCPCS codes should be added for lymphedema compression
bandaging kits for: a single upper limb; two upper limbs; a single
lower limb; and two lower limbs. Some commenters supported new codes
for bandages and recommended that the descriptors be based on the width
and length. A commenter requested that CMS ensure these garments/
bandaging/padding are properly identified via the HCPCS codes. Another
commenter submitted a list of recommended new HCPCS codes for bandaging
system components that were based on size. A commenter indicated that
many of the longer and wider bandages specifically used on large lower
extremity legs, hips and buttocks are too long or too wide for existing
HCPCS code categories and need to correct the description or add a new
code. A commenter cited concerns using the same codes as traditional
bandaging materials will result in reimbursement that is too low.
Response: We thank the commenters for the detailed HCPCS
recommendations for lymphedema compression treatment items. We have
identified in the chart 57 HCPCS codes that we are finalizing for
lymphedema compression treatment items and accessories, as discussed in
the previous responses. We recognize that additional refinements to the
code set may be necessary, thus we direct readers to the HCPCS Level II
coding process, described at https://www.cms.gov/medicare/coding/medhcpcsgeninfo/hcpcspublicmeetings, which provides a means for
modifying the HCPCS code set for lymphedema compression treatment items
in the future. Regarding the commenter's request for 229 new HCPCS
codes that differentiate between textiles and technologies (circular
knit, flat knit, inelastic adjustable wraps), we do not currently see a
Medicare program need to add codes at this level of specificity. If
commenters continue to believe that coding for one textile vs. another
(for example, circular knit vs. flat knit) would still be useful after
January 1, 2024, we direct commenters to the HCPCS Level II coding
process described previously. We appreciate the suggestions for HCPCS
coding changes needed to describe the various compression bandaging
systems used for the treatment of lymphedema. We agree with commenters
that more codes are needed beyond existing codes S8430 (Padding for
compression bandage, roll) and S8431 (Compression bandage, roll) to
describe the bandaging systems.
Therefore, after careful review of the comments, we are
establishing new HCPCS codes, effective January 1, 2024, to describe
the following bandaging system components: upper and lower extremity
bandage liners; high density foam rolls; long, medium and short stretch
bandages; high density foam sheets and pads; low density channel and
flat foam sheets; padded foam and textile; and tubular protective
absorption layers with and without padding. These new codes will allow
suppliers to separately identify the supplies that are being furnished
to the patient as opposed to establishing bandaging kit HCPCS codes
delineated by the extremity body type. The list of the new HCPCS
bandaging codes and descriptors that we are adding to the HCPCS code
set effective January 1, 2024 is available in Table FF-A 2. Similar to
the disposition of the other existing S codes, we will retain bandaging
codes S8430 and S8431 in the HCPCS code set for use by other payers. We
are also establishing a new gradient compression bandaging supply not
otherwise specified code, effective January 1, 2024, that will be
available for use in identifying bandaging supplies that are not
identified by a unique HCPCS code. Since this is a new benefit
category, payment for lymphedema compression treatment items will be
established in accordance with the requirements at section 1834(z) of
the Act and will not be based on the surgical dressing payment
requirements for traditional Medicare bandaging at 42 CFR 414.220.
BILLING CODE 4120-01-P
[[Page 77828]]
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[GRAPHIC] [TIFF OMITTED] TR13NO23.070
BILLING CODE 4120-01-C
5. Procedures for Making Benefit Category Determinations and Payment
Determinations for New Lymphedema Compression Treatment Items
We proposed to implement the new Part B benefit for lymphedema
compression treatment items and the initial set of HCPCS codes to
identify these items for claims processing purposes, effective January
1, 2024. In the future, as new products come on the market and
refinements are made to existing technology, there will be a need to
determine whether these newer technology items are lymphedema
compression treatment items covered under this new benefit and what
changes to the HCPCS are needed to identify these items for claims
processing purposes. There will also be a need to establish payment
amounts for the newer items in accordance with the payment rules
established as part of this rulemaking.
Currently, CMS uses the procedures at 42 CFR 414.114 to make
benefit category determinations and payment determinations for new
splints and casts, parenteral and enteral nutrition (PEN) items and
services covered under the prosthetic device benefit, and intraocular
lenses (IOLs) inserted in a physician's office covered under the
prosthetic device benefit. CMS uses the same procedures at 42 CFR
414.240 to make benefit category determinations and payment
determinations for new DME items and services, prosthetics and
orthotics, surgical dressings, therapeutic shoes and inserts, and other
prosthetic devices other than PEN items and services and IOLs inserted
in a physician's office. These procedures involve the use of the HCPCS
public meetings where consultation from the public is obtained on
preliminary HCPCS coding determinations for new items and services.
Public consultation is also obtained at these meetings on preliminary
benefit category determinations and preliminary payment determinations
for the new items and services. To ensure appropriate and timely
consideration of future items that may qualify as lymphedema
compression treatment items, we proposed to use these same procedures
to make benefit category determinations and payment determinations for
new lymphedema compression treatment items. Future
[[Page 77830]]
changes to the HCPCS codes established in section 2 of this rule for
lymphedema compression treatment items would also be made using this
public meeting process.
We proposed to use the same process described in Sec. 414.240 to
obtain public consultation on preliminary coding, benefit category, and
payment determinations for new lymphedema compression treatment items.
That is, when a request is received for a new HCPCS code or change to
an existing HCPCS code(s) for a lymphedema compression treatment item,
CMS would perform an analysis to determine if a new code or other
coding change is warranted and if the item meets the definition of
lymphedema compression treatment item at section 1861(mmm) of the Act.
A preliminary payment determination would also be developed for items
determined to be lymphedema compression treatment items and are
implemented in April or October of each year. The preliminary
determinations would be posted on CMS.gov approximately 2 weeks prior
to a public meeting. As part of this coding and payment determination
process, it may be necessary to combine or divide existing codes; in
this situation, we proposed to follow the same process as outlined in
42 CFR 414.236. After consideration of public input on the preliminary
determinations, CMS would post final HCPCS coding decisions, benefit
category determinations, and payment determinations on CMS.gov, and
then issue program instructions to implement the changes.
In addition to these proposals for initial payment determinations
for lymphedema treatment items and the proposed process for addressing
new lymphedema treatment items, as required by the Act, we also
proposed to revise the DMEPOS regulations to include lymphedema
treatment items in the competitive bidding process. We proposed changes
to 42 CFR 414.402 to add lymphedema treatment items to the definition
of ``items'' for competitive bidding, Sec. 414.408 to include
lymphedema treatment items in the list of items for which payment would
be made on a lump sum purchase basis under the competitive bidding
program in accordance with any frequency limitations established under
proposed subpart Q in accordance with section 1834(z)(2) of the Act,
and Sec. 414.412 to add reference to the proposed subpart Q to the bid
rules. The following is a summary of the comments we received and our
responses.
We received approximately 14 comments from suppliers,
manufacturers, professional, State and national trade associations,
beneficiaries and their caregivers related to the proposal to use the
same process for benefit category and payment determination for future
lymphedema compression treatment items as for new DMEPOS items and the
inclusion of lymphedema compression treatment items in the DMEPOS
competitive bidding program mandated by section 1847(a) of the Act.
Comment: Commenters opposed the inclusion of lymphedema compression
treatment items in the DMEPOS competitive bidding program due to
concerns that competitive bidding could result in reduced access to
these items for beneficiaries. Commenters supported the proposed use of
the existing process for addressing benefit category and payment
determinations for DMEPOS for benefit category and payment
determinations for lymphedema compression treatment items in the
future.
Response: Section 1847(a)(2)(D) of the Act mandates the inclusion
of lymphedema compression treatment items in the DMEPOS competitive
bidding program, and the proposed changes to the regulation were merely
conforming changes to reflect this statutory requirement. We note
however, that section 1847(a)(3) of the Act provides discretionary
authority to exempt certain areas and items from the DMEPOS competitive
bidding program, including rural areas and areas with low population
density within urban areas that are not competitive, unless there is a
significant national market through mail order for a particular item or
service, and items and services for which the application of
competitive acquisition is not likely to result in significant savings.
In addition, section 1847(b)(2) of the Act mandates certain conditions
that must be met before contracts can be awarded under the DMEPOS
competitive bidding program. A contract may not be awarded to a
supplier that does not meet applicable quality and financial standards
and State licensure requirements. Contracts may not be awarded in a
competitive bidding area unless access to a choice of multiple
suppliers in the area is maintained and total amounts to be paid in the
area are expected to be less than the total amounts that would
otherwise be paid. Section 1847(a)(5) of the Act provides authority for
and regulations at 42 CFR 414.420 establish a physician authorization
process which requires contract suppliers to furnish specific brands of
items the beneficiary's physician or treating practitioner prescribes
to avoid an adverse medical outcome for the beneficiary. These
requirements and additional terms for contract suppliers that ensure
access to quality items and services under the program are spelled out
in the regulations at 42 CFR 414.422. CMS closely monitors the DMEPOS
competitive bidding program to ensure that all suppliers are in
compliance with the terms of their contracts and access to quality
items and services is maintained at all times.
We appreciate the comments in support of using the existing DMEPOS
process for addressing benefit category and payment determinations for
new lymphedema compression treatment items.
After consideration of the public comments, we are finalizing that
future items that the public considers to be lymphedema compression
items would be addressed by CMS pursuant to the same process as the
benefit category and payment determination process for new DMEPOS items
(including the HCPCS public meeting process) at 42 CFR 414.240, as
proposed. We are also finalizing the conforming changes to 42 CFR
414.402, 42 CFR 414.408 and 42 CFR 414.412 to incorporate lymphedema
compression treatment items in the competitive bidding program as
proposed.
6. Enrollment, Quality Standards, and Accreditation Requirements for
Suppliers of Lymphedema Compression Treatment Items and Medicare Claims
Processing Contractors for These Items
Section 1834(a)(20) of the Act requires the establishment of
quality standards for suppliers of DMEPOS that are applied by
independent accreditation organizations. Section 4133(b)(1) of the CAA,
2023 amends section 1834(a)(20)(D) of the Act to apply these
requirements to lymphedema compression treatment items as medical
equipment and supplies.
Section 1834(j) of the Act requires that suppliers of medical
equipment and supplies obtain and continue to periodically renew a
supplier number in order to be allowed to submit claims and receive
payment for furnishing DMEPOS items and services. The suppliers must
meet certain supplier standards in order to possess a supplier number
and are also subject to other requirements specified in section 1834(j)
of the Act. Section 4133(b)(2) of the CAA, 2023 amends section
1834(j)(5)(E) of the Act to include lymphedema compression treatment
items as medical equipment and supplies subject to the requirements of
section 1834(j) of the Act.
[[Page 77831]]
Suppliers of DMEPOS meeting the requirements of sections
1834(a)(20) and 1834(j) of the Act, and related implementing
regulations at 42 CFR 424.57 must enroll in Medicare or change their
enrollment using the paper application Medicare Enrollment Application
for DMEPOS Suppliers (CMS-855S) or through the Medicare Provider
Enrollment, Chain, and Ownership System (PECOS). For more information
on supplier enrollment, go to: https://www.cms.gov/medicare/provider-enrollment-and-certification/become-a-medicare-provider-or-supplier.
Regulations at 42 CFR 421.210 establish regional contractors to
process Medicare claims for DMEPOS items and services. These
contractors are known as Durable Medical Equipment Medicare
Administrative Contractors (DME MACs). We proposed to include
lymphedema compression treatment items as DMEPOS items that fall within
the general text of section 421.210(b)(7) for other items or services
which are designated by CMS. Thus, claims for these items would be
processed by the DME MACs.
Comment: Many commenters disagreed that fitting specialists like
therapists should not have an undue burden of having to apply as a
DMEPOS supplier and adhere to enrollment, quality standards and
accreditation. A commenter agreed that all those who provide and fit
garments should be accredited and should adhere to all quality
standards.
Response: We appreciate all the comments in regard to Medicare
enrollment, quality standards and accreditation. Section 1834(j)(5)(E)
of the Act mandates that to receive Medicare payment for lymphedema
items and services, suppliers must enroll in Medicare, receive a
supplier number, and meet all of the same supplier standards as a
DMEPOS supplier.
We are finalizing Medicare enrollment, quality standards, and
accreditation requirements for suppliers of lymphedema compression
treatment items as proposed.
7. Payment Basis and Frequency Limitations for Lymphedema Compression
Treatment Items
Section 1834(z)(1) of the Act mandates an appropriate payment basis
for lymphedema compression treatment items defined in section 1861(mmm)
of the Act and specifically identifies payment rates from other
government and private sector payers that may be taken into account in
establishing the payment basis for these items. These sources include
payment rates used by Medicaid state plans, the Veterans Health
Administration (VHA), group health plans, and health insurance coverage
(as defined in section 2791 of the Public Health Service Act). Section
1834(z)(1) of the Act also indicates that other information determined
to be appropriate may be taken into account in establishing the payment
basis for lymphedema compression treatment items.
Based on our research, Medicaid state plans generally classify and
provide lymphedema compression treatment items in the same manner as
other durable medical equipment and supplies for home health. While
State Medicaid Director Letter #18-001 focuses on how states may
demonstrate compliance with the restriction on claiming federal
financial participation for ``excess'' durable medical equipment
spending, it describes how Medicaid state plan payment for the broader
category of such items (outside of a managed care contract) is usually
made either through established fee schedules, a competitive bidding
process of the state's design, or through a manual pricing methodology
based on the invoice submitted with each claim.\200\ For the purpose of
this final rule, we took into account the average Medicaid fee schedule
payment amounts across all states that have published fee schedule
amounts for these items in developing, in part, an appropriate payment
basis for lymphedema compression treatment items under Medicare. These
fee schedule payment amounts will be finalized based on the average
Medicaid fee schedules in effect at the time this rule is
finalized.\201\
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\200\ Available at https://www.medicaid.gov/federal-policy-guidance/downloads/smd18001.pdf.
\201\ At the time of writing, this would include fee schedule
amounts from up to 38 state Medicaid plans.
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The VHA does not have established fee schedules for lymphedema
compression treatment items, but rather follows a policy of paying for
these items based on the reasonableness of vendor pricing. Based on our
conversations with the VHA, we understand that for these items, vendor
prices at or below acquisition cost plus 50 percent is typically
considered reasonable, while Medicaid state plans typically pay for
DMEPOS items that do not have fee schedule amounts at acquisition cost
plus 20 to 30 percent. Given this difference in the allowed supplier
margin, the amounts determined to be reasonable payment rates for these
items by the VHA may be approximated by increasing the average Medicaid
payment rate by 20 to 30 percent. While the VHA may not have fee
schedule amounts for these items, the Department of Defense's TRICARE
system maintains fee schedule amounts for lower-extremity lymphedema
compression garments. These amounts are approximately equal to the
average Medicaid fee schedule amount plus 20 percent. Therefore, we
believe that the average Medicaid fee schedule amount plus 20 percent
represents what other government payers such as the VHA and TRICARE
consider an appropriate payment basis for these items and a slightly
higher payment basis than the average payment rates established by
Medicaid state plans that have fee schedule amounts for these items; we
sought comments on this. We also conducted a search of internet prices
for lymphedema compression treatment items and found these prices to be
in line with the TRICARE fee schedule amounts and average Medicaid fee
schedule amounts plus 20 percent. We believe that appropriate payment
amounts for Medicare for lymphedema compression treatment items would
be payment amounts that approximate the payment rates determined to be
reasonable by other government payers such as TRICARE, State Medicaid
agencies, and, as previously explained, estimates of the payment rates
determined to be reasonable by the VHA based on 120 percent of the
average Medicaid state plan rates. Because these rates are in line with
internet retail prices, we have not closely examined non-government
payers.
Having taken into account the payment amounts from the various
sources, as previously described, as required by the Act, we proposed
to set payment amounts for lymphedema compression treatment items using
the following methodology. Where Medicaid state plan payment amounts
are available for a lymphedema compression treatment item, we proposed
to set payment amounts at 120 percent of the average of the Medicaid
payment amounts for the lymphedema compression treatment item. Where
Medicaid payment amounts are not available for an item, we proposed to
set payment amounts at 100 percent of the average of internet retail
prices and payment amounts for that item from TRICARE. Where payment
amounts are not available from Medicaid state plans or TRICARE for a
given lymphedema compression treatment item, we proposed to base
payment amounts based on 100 percent of average internet retail prices
for that item. We sought
[[Page 77832]]
comment on these payment methodologies and whether further adjustments
are appropriate.
As previously noted, payment rates established by Medicaid, the
VHA, and TRICARE for the supply of these items includes payment for
fitting services and any other services necessary for furnishing the
item, including training beneficiaries in the proper use of these
items. The cost of these services is also reflected in the price
suppliers would charge a beneficiary directly. For these reasons, we
believe that our payment methodology will implicitly incorporate
payment for these services. As noted earlier, taking measurements of
affected body areas and other fitting services necessary for furnishing
lymphedema compression treatment items are an integral part of
furnishing the items and the suppliers receiving payment for furnishing
lymphedema compression treatment items are responsible for ensuring
that any necessary fitting services are provided as part of furnishing
the items.
The following table presents a preliminary example of what payment
amounts may be, based on the proposed methodology described, as
previously detailed, and certain HCPCS codes that we proposed to be
classified under the Medicare Part B benefit category for lymphedema
treatment items. This table reflects the application of our methodology
to the underlying data sources as they were available in early 2023.
[GRAPHIC] [TIFF OMITTED] TR13NO23.071
Final payment amounts will be determined in accordance with the
methodology as previously detailed based on the most recent data
available in late 2023 and will most likely be higher than these
example payment amounts. Beginning January 1, 2025, and annually
thereafter, these final payment amounts will be updated by the
percentage change in the Consumer Price Index for All Urban Consumers
(CPI-U) for the 12-month period ending June of the preceding year.
When new items are added to this benefit category, following the
process outlined in section 3 of this section of this rule, the data
sources (Medicaid, TRICARE, VHA, or internet prices) may not initially
be available for establishing an appropriate payment amount. We
proposed that in this situation, until the data necessary for
establishing the payment amount becomes available, the DME MACs would
consider what an appropriate payment amount would be for each item on
an individual, claim-by-claim basis and may consider using pricing for
similar items that already have established payment amounts.
We received approximately 62 comments related to the proposed
payment methodology: eight from organizations of providers, suppliers,
or manufacturers; 15 from individual supply businesses or practices;
and 39 from individual beneficiaries, caregivers, or providers. A
summary of the major issues raised in these comments and our responses
are as follows.
Comment: Several commenters, without specifically voicing concern
or support for our proposed payment methodology, emphasized the need to
balance payment amounts high enough to support beneficiary access and
low enough to ensure that copays remain affordable to beneficiaries.
Response: We agree with these comments and believe that our
proposed payment methodology meets
[[Page 77833]]
these goals. We share the commenters views that beneficiary copayments
will affect access to the products and their health outcomes.
Comment: Some commenters expressed concern that the proposed
payment amounts appeared low compared to what the commenters pay out of
pocket for specific garments, and some of these commenters also
requested limits to the copayment amount (either limited to a specific
dollar amount or reduced to zero).
Response: Beneficiary copayment amounts under Medicare are
determined by statute, and CMS did not propose to or intend to waive or
modify beneficiary copayment amounts for lymphedema compression
treatment items in the proposed rule. While we appreciate concerns
regarding payment amounts for specific items, many of the items
mentioned by commenters were custom garments for which we did not
provide example pricing. We expect that custom garments will have
payment amounts substantially higher than standard garments. For
example, based on our payment methodology, the payment amount for a
standard gradient compression arm sleeve would be approximately $58
while the payment amount for a custom gradient compression arm sleeve
would be approximately $175. There will always be situations where
specific items cost more or less than the Medicare payment amount but
our methodology is sound because we believe that most items described
by each code will be adequately covered by the payment amount
established. As outlined in the DMEPOS Quality Standards, enrolled DME
suppliers are required to provide all items as ordered by the
prescribing provider.
Comment: Several commenters expressed concern that the proposed
payment methodology would result in payment amounts that are below the
supplier's cost for furnishing the items, with one noting specifically
that average internet pricing may be skewed by large online retailers
selling garments that may not be medical-grade garments. The commenters
urged the adoption of a more ``real world'' method for payment
determination, without offering specific suggestions for an alternate
model.
Response: We thank the commenters for sharing this concern. Our
methodology is designed to approximate what the VHA pays suppliers for
veterans to have appropriate access to lymphedema treatment items, and
we are not aware of any access concerns that veterans have experienced.
We note that the use of internet retail pricing is a long-established
method of determining commercial prices for use in the DME payment
determination process. When collecting internet retail prices for use
in any such averages, we only consider prices for items that meet the
requirements for payment under each code in question. Specifically
addressing the commenters' concern, we would exclude from consideration
any items that are not medical-grade items, and for this reason we
often must exclude retail listings from common consumer internet
retailers. We continue to believe that prices from online suppliers of
medical-grade products offer real-world examples of commercial pricing
for use in the Medicare payment determination process when other
payers, such as VHA or State Medicaid agencies, do not have established
pricing histories.
Comment: A commenter disagreed with our proposed payment
methodology, raising a number of specific concerns. These include
concerns that many payers, including Medicaid state plans and TRICARE,
have not consistently covered lymphedema compression garments and do
not represent large shares of the market, and so these sources would
not represent appropriate pricing information. The commenter expressed
further concerns that Medicaid pricing may not be available for many
proposed codes and may not be at a level sufficient to ensure
appropriate patient access. The commenter stated that internet prices
may not account for costs of compliance and claims filing faced by
Medicare DMEPOS suppliers and that cash-pay transactions have reduced
administrative burden, but that customers may face charges in addition
to the item price upon check out (such as shipping and handling). The
commenter proposed an alternate payment methodology based on the
average manufacturer's Minimum Advertised Price (MAP) plus 20 percent,
together with recommendations to simplify the calculation of payment
amounts by using the average ratio of standard to custom garment prices
and the ratio of prices for different compression levels of the same
garment type. The commenter separately submitted to CMS confidential
commercial MAP amounts to support our analysis of this proposed
methodology. Other commenters expressed their support for this
commenter's proposal.
Response: We appreciate the comment and the alternative pricing
proposal. In developing our payment methodology, we have tried to set
payment amounts at a level high enough to ensure beneficiary access,
while low enough to ensure that copay amounts do not present a barrier
for beneficiaries. As we expressed, we continue to believe that the
most appropriate source for Medicare payment determination would be the
prices paid by the Veteran's Health Administration (VHA). While the VHA
does not publish national fee schedules for these items, we believe
that our payment methodology is a good approximation of what the VHA
would pay. We recognize that there are gaps in the available data among
TRICARE, Medicaid, and other payors. We believe that internet retail
prices continue to be the most appropriate source of commercial pricing
to fill these gaps, as this has been a longstanding method of pricing
used for Medicare DMEPOS items that has not hindered beneficiary access
to DMEPOS items. We note that internet retailers often offer free
shipping in order to compete with brick-and-mortar businesses. We agree
that cash-pay transactions may be administratively simpler than billing
insurance. However, suppliers and providers that accept insurance also
enjoy a far higher volume; for this reason, it is common practice in
healthcare for large insurers to receive a substantial discount off of
the cash price, despite the additional administrative burden. We have
carefully considered the proposed alternative payment methodology. Our
analysis shows that across a representative sample of compression
treatment garments, this alternative methodology would result in
payment amounts approximately 35 percent higher than our imputed VHA
\202\ or TRICARE payment amounts. There is no evidence that
beneficiaries of the VHA or TRICARE programs experience difficulty
accessing compression treatment garments, so it would be difficult to
justify the need for such a significantly higher payment amount--and
commensurately higher beneficiary copay--for Medicare, potentially
resulting in payment amounts that are too high, which, as noted
previously, was a concern of other commenters.
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\202\ Imputation based on 120 percent of the average of up to 38
Medicaid state plan fee schedules as currently in effect.
---------------------------------------------------------------------------
Comment: A commenter recommended that decongestive therapy services
and the associated supplies be covered by Part A/B MACs or Home Health
Services as they believe there would be problems with implementing
decongestive therapy services if they are covered by a non-DME MAC
contractor while the DME MACs cover the associated supplies since
providers and suppliers have up to one year to submit
[[Page 77834]]
the claim and DME MACs are unable to verify if decongestive therapies
were covered to appropriately allow the related supplies.
Response: We are not finalizing our alternative proposal, but we
appreciate the comments concerning the implementation problems that
could arise with separate payment for the bandaging and fitting therapy
services. As stated earlier, while compression bandaging systems are
included in the lymphedema treatment items benefit category when
applied during Phase 1 (acute or decongestive therapy) and/or Phase 2
(maintenance therapy), payment for decongestive therapy services would
not be covered under this lymphedema treatment items benefit category,
and so would not fall within the established remit of the Part B MACs.
Comment: A commenter requested that the payment amounts should be
set by the individual DME MACs, or alternatively established as the
manufacturer's MAP plus 50 percent.
Response: We are required by statute to establish payment amounts
for these items. Contractor pricing is generally reserved for
situations where we do not have adequate data to establish payment
amounts for newly developed items or where codes represent such a
disparate variety of items that a single payment amount would prove
impractical (such as for ``not otherwise classified'' codes). Regarding
the proposal to pay MAP plus 50 percent, as noted earlier, we have not
seen evidence that beneficiaries experience difficulties accessing
lymphedema treatment garments through the VHA or TRICARE at the payment
amounts they set, so we do not believe there is good justification for
Medicare to burden beneficiaries with the substantial higher copay
implied by the commenter's proposed reimbursement methodology.
Comment: A commenter expressed broad support for the proposed
payment methodology, but expressed concern that data may not be
available to establish payment amounts for custom garments if it were
necessary to use the fallback approach of internet retail pricing.
Response: We appreciate the comment and understand that many common
internet suppliers do not offer custom garments or do not make pricing
publicly available. However, we believe that a sufficient number of
internet suppliers offer public pricing for custom garments to allow
for accurate pricing of these items, if this approach were needed.
Comment: A few commenters proposed that, in place of average
internet pricing, we use either MAP or average internet pricing plus 30
percent, in order to adequately compensate for suppliers' overhead
costs, particularly those with bricks-and-mortar locations.
Response: As noted earlier, when collecting internet retail prices
for use in any such averages, we only consider prices for items that
meet the requirements for payment under each code in question.
Furthermore, we exclude pricing that is not publicly displayed. For
this reason, we believe that our methods capture an average internet
price that is likely very close to the manufacturers' MAP.
Comment: Several commenters suggested using third party (commercial
insurance) payment amounts, as these might avoid possible variation
between payment amounts based on the other proposed methods.
Response: We thank the commenters for this suggestion. We believe
that as a large government payer, our estimate of what the VHA, another
large government payer, pays for these items is the best method for
establishing an appropriate Medicare payment basis for these items.
Furthermore, use of commercial insurance payment amounts poses a number
of practical difficulties. Commercial insurance reimbursement amounts
are not freely available, and procuring and processing the necessary
data would have jeopardized our ability to meet the January 1, 2024,
start date for this benefit.
Comment: A commenter noted support for the proposed annual
adjustment of payment amounts based on the CPI-U.
Response: We appreciate this comment.
Comment: A commenter proposed that instead of adjusting based on
the CPI-U, we base adjustment on the average change in online prices
from year to year.
Response: We thank the commenter for this proposal, but we believe
the CPI-U is an adequate approximation of the price changes these items
will experience. While we acknowledge that in any given year this
method may over- or under-adjust for price changes observed for
specific lymphedema compression treatment items, we do not believe that
the gains from an alternative methodology outweigh the costs of
introducing a new method of annual adjustment to lymphedema payment
amounts that differs from those applied to DMEPOS payment amounts.
Section 1834(z)(2) of the Act authorizes the establishment of
frequency limitations for lymphedema compression treatment items and
specifies that no payment may be made for lymphedema compression
treatment items furnished other than at a frequency established in
accordance with this provision of the Act. Gradient compression
garments are designed differently depending on whether for daytime or
nighttime use. Those meant for daytime provide a higher level of
compression while those for nighttime offer milder compression and are
less snug against the skin. We sought comment on our proposal to cover
and make payment for two garments or wraps with adjustable straps for
daytime use (one to wear while another is being washed), per affected
extremity, or part of the body, to be replaced every 6 months or when
the item is lost, stolen, or irreparably damaged, or if needed based on
a change in the beneficiary's medical or physical condition such as an
amputation, complicating injury or illness, or a significant change in
body weight. In order to maintain mobility, patients may require
separate garments or wraps above and below the joint of the affected
extremity or part of the body. As discussed later in this section of
this rule, nighttime garments are inelastic and more durable than the
elastic daytime garments and we believe it would be appropriate to
replace these garments once per year. We proposed to cover one
nighttime garment per affected extremity or part of the body to be
replaced once a year or when the garment is lost, stolen, or
irreparably damaged, or if needed based on a change in the
beneficiary's medical or physical condition such as an amputation,
complicating injury or illness, or a significant change in body weight.
Lymphedema is a chronic condition that can be stabilized if properly
treated. It may also worsen as the result of infection, radiation and
chemotherapy, or progression of comorbid conditions such as obesity. At
this point, patients may require changes in their garment prescription.
Such changes due to medical necessity will not be subject to the
frequency limitations, as previously described. In addition, as with
DMEPOS items, payment could be made for replacement of garments and
other items when they are lost, stolen, or irreparably damaged.
Examples of lost items include items left behind after evacuating due
to a disaster like a hurricane or tornado. Examples of irreparably
damaged items include items that burn in a fire, are exposed to toxic
chemicals, or are damaged by some other event and does not include
items that wear out over time.
Comment: Commenters expressed appreciation for the new Medicare
benefit that covers lymphedema compression items. However, some
[[Page 77835]]
commenters suggested that Medicare provide coverage for more than two
units of daytime garments or wraps and one nighttime garment or wrap as
stated in the proposed rule. They explained that patients may have
difficulty keeping up with the daily task of washing and drying
compression treatment items, which may prevent them from effectively
treating and managing their condition. Also, they stated that since
some compression items take a day or more to dry completely, this would
leave the patient without a compression item to wear on a daily basis.
They also described hygiene concerns associated with the environment,
such as sweating from heat in certain regions of the country, that
warranted the need to wash garments more frequently.
Response: We appreciate the comments in response to our request for
input on our proposal for the frequency limitations for lymphedema
compression treatment items and are finalizing changes based on that
input. We are making the changes based on the concerns of the
commenters related to multiple reasons for needing adequate time to
wash and dry compression treatment items, and to be responsive to the
needs of Medicare beneficiaries. Specifically, Medicare will cover and
pay for three daytime garments or wraps every six months and two
nighttime garments or wraps every 2 years. Three units of daytime
garments or wraps allows the patient to wear one, wash one, and dry
one. Also, Medicare will cover two nighttime garments or wraps every 2
years, allowing the beneficiary to wear one, while a second garment
washed during the day is allowed to completely dry and be ready for use
the following night.
Comment: Many commenters appreciate and support the provision of
the proposed regulation that provides Medicare coverage for compression
garments and wraps when these items are lost, stolen, or irreparably
damaged, or when there is a change in the patient's medical or physical
condition. A commenter believes that the allowance for patients with
respect to the number of sets of garments per year should allow for
change in style, size, fit and other features to accommodate the
patients' clinical progression, as a patient could experience rapid
physical changes that require a change in size, style or materials of
their compression garments.
Response: We thank the commenters for their support of the proposed
rule. If an item is lost, stolen, or irreparably damaged, for example a
garment is accidentally ripped by a sharp object, payment can be made
for replacement of the garment(s) that has been lost, stolen, or
irreparably damaged. Documentation explaining the circumstances of how
the garment(s) was lost, stolen, or irreparably damaged should be
maintained and may need to be furnished for Medicare claims processing
and appeals purposes. If a patient's medical condition has changed
enough to warrant the need for a new size or type of garment or wrap,
payment can be made for three new daytime garments or wraps and/or two
new nighttime garments. Replacement of both the daytime and nighttime
garments used for the same area where lymphedema treatment is needed
may be necessary in this situation. Documentation explaining the
circumstances of the change in the patient's medical or physical
condition and why new garments or wraps are needed should be maintained
and may need to be furnished for Medicare claims processing and appeals
purposes.
Comment: Some commenters support the replacement of compression
garments and wraps sooner if the items wear out due to normal wear
before the specified time stated in the proposed rule. Also, some
commenters suggest that irreparably damaged items and worn items are
the same.
Response: We do not agree. As explained in the proposed rule (88 FR
43776), irreparable damage does not include items that have worn out.
Examples of irreparably damaged items include items that burn in a
fire, are exposed to toxic chemicals, or are damaged by some other
event and does not include items that wear out over time.
Comment: A few commenters stated that patients should not have to
re-qualify each time they need to reorder supplies. A few commenters
suggested careful consideration to cover all items a patient may need
such as custom stockings or flat knit compression toe caps for the toes
and foot and should be limited to only physical items and not services
such as therapy, education or treatment. A few commenters indicated
that the number and type of bandages covered should be determined by
the treating therapist based on the body part, the severity of the
lymphedema, and the patient's body shape and size. A commenter
suggested the bandages and garments be separated into two categories
and without a cap.
Response: Thank you for sharing your concerns regarding patients'
access to lymphedema compression items. The lymphedema benefit includes
Medicare coverage of items such as compression garments, wraps,
stockings, gauntlets, bandaging and accessories. Once a patient has
been furnished a lymphedema compression item, the patient is eligible
to receive a replacement as stated in the frequency limitation section
of the rule.
With regard to replacement frequencies for compression bandaging
systems and supplies, the weekly frequency and overall length of phase
one (active) treatment is dependent on the severity of lymphedema. Some
patients may require treatment 4 to 5 days per week in phase one while
others may only need treatment 2 to 3 days per week. Bandages are used
following some form of hands-on decompression to maintain the
reduction. Therefore, we did not propose specific replacement
frequencies for the compression bandaging systems and supplies. We
proposed that the DME MACs would make determinations regarding whether
the quantities of compression bandaging supplies furnished and billed
during phase one of treatment of the beneficiary's lymphedema are
reasonable and necessary. As discussed in section VII.B.3 of this rule,
commenters expressed concerns that coverage under the lymphedema
benefit category for compression bandaging supplies or systems could
continue during the various stages of lymphedema and we clarified that
coverage is not limited to Phase 1 (acute or decongestive therapy) but
is also available under Phase 2 (maintenance therapy). As a result of
this clarification, we are making a conforming change to the regulation
text at Sec. 414.1680 to remove ``during phase one of decongestive
therapy'' so that determinations regarding the quantity of compression
bandaging supplies needed by each beneficiary would be made by the DME
MACs regardless of the lymphedema stage.
8. Final Policies
We are finalizing the amendment of 42 CFR 410.36 to add paragraph
(a)(4) for lymphedema compression treatment items as a new category of
medical supplies, appliances, and devices covered and payable under
Medicare Part B, including: standard and custom fitted gradient
compression garments; gradient compression wraps with adjustable
straps; compression bandaging systems; other items determined to be
lymphedema compression treatment items under the process established
under Sec. 414.1670; and accessories such as zippers in garments,
liners worn under garments or wraps with adjustable straps, and padding
or fillers that are necessary for the effective use of a gradient
[[Page 77836]]
compression garment or wrap with adjustable straps. In order to
maintain mobility, patients may require separate garments or wraps
above and below the joint of the affected extremity or part of the
body, and we are finalizing that payment may be made in these
circumstances. We are finalizing that payment may be made for multiple
garments used on different parts of the body when the multiple garments
are determined to be reasonable and necessary for the treatment of
lymphedema. For example, if it is determined that a beneficiary needs
three daytime garments to cover one affected area for the treatment of
lymphedema, Medicare would cover and pay for those three garments for
that specific affected area, as well as any other areas of the body
affected by lymphedema. For the purpose of establishing the scope of
the benefit for these items, we are finalizing the following
definitions by adding them to 42 CFR 410.2 as they apply to lymphedema
compression treatment items:
Gradient compression means the ability to apply a higher level of
compression or pressure to the distal (farther) end of the limb or body
part affected by lymphedema with lower, decreasing compression or
pressure at the proximal (closer) end of the limb or body part affected
by lymphedema.
Custom fitted gradient compression garment means a garment that is
uniquely sized and shaped to fit the exact dimensions of the affected
extremity or part of the body of an individual to provide accurate
gradient compression to treat lymphedema.
The definition of ``gradient compression'' would apply to all
lymphedema compression treatment items (garments, wraps, etc.) that
utilize gradient compression in treating lymphedema. The definition of
``custom fitted gradient compression garment'' would apply to custom
fitted gradient compression garments covered under the new benefit
category for lymphedema compression treatment items. We believe these
definitions are necessary for establishing the scope of this new
benefit.
Lymphedema compression treatment item means standard and custom
fitted gradient compression garments and other items specified under
Sec. 410.36(a)(4) that are--
Furnished on or after January 1, 2024, to an individual
with a diagnosis of lymphedema for treatment of such condition;
Primarily and customarily used to serve a medical purpose
and for the treatment of lymphedema; and
Prescribed by a physician (or a physician assistant, nurse
practitioner, or a clinical nurse specialist (as those terms are
defined in section 1861(aa)(5) of the Social Security Act) to the
extent authorized under State law.
After consideration of the public comments received, we are
finalizing Sec. 414.1680 with the following modifications to the
frequency limitations for lymphedema compression items established in
accordance with section 1834(z)(2) of the Act under new subpart Q:
Three daytime garments or wraps with adjustable straps for
each affected limb or area of the body, replaced every 6 months.
Two nighttime garments for each affected limb or area of
the body, replaced once every 2 years.
We are finalizing coverage of replacements of garments or wraps
that are lost, stolen, irreparably damaged. If a patient's medical
condition has changed enough to warrant the need for a new size or type
of garment or wrap, payment can be made for new garments or wraps. We
are also finalizing that determinations regarding the quantity of
compression bandaging supplies covered for each beneficiary will be
made by the DME MAC that processes the claims for the supplies with a
modification to remove proposed language referring to ``phase one of
decongestive therapy.''
We are modifying and adding to the existing HCPCS codes for
surgical dressings and lymphedema compression treatment items as
explained in section VII.B.4. of this rule. Future changes to the HCPCS
codes for these items based on external requests for changes to the
HCPCS or internal CMS changes would be made through the HCPCS public
meeting process described at: https://www.cms.gov/medicare/coding/medhcpcsgeninfo/hcpcspublicmeetings.
We are adding Sec. 414.1670 under new subpart Q to use the same
process described in Sec. 414.240 to obtain public consultation on
preliminary benefit category determinations and payment determinations
for new lymphedema compression treatment items. The preliminary
determinations will be posted on CMS.gov in advance of a public
meeting. After consideration of public input on the preliminary
determinations, CMS will post final HCPCS coding decisions, benefit
category determinations, and payment determinations on CMS.gov, and
then issue program instructions to implement the changes.
We are adding a new subpart Q under the regulations at 42 CFR part
414 titled, ``Payment for Lymphedema Compression Treatment Items'' to
implement the provisions of section 1834(z) of the Act. We are adding
Sec. 414.1600 to our regulations explaining the purpose and
definitions under the new subpart Q. We are adding Sec. 414.1650 and
paragraph (a) to establish the payment basis equal to 80 percent of the
lesser of the actual charge for the item or the payment amounts
established for the item under paragraph (b). Under Sec. 414.1650(b)
the payment amounts for lymphedema compression treatment items will be
based on the average of state Medicaid fee schedule amounts plus 20
percent. Where Medicaid rates are not available, we will use the
average of average internet retail prices and payment amounts
established by TRICARE (or, where there is no TRICARE fee schedule
rate, the average of internet retail prices alone). In accordance with
Sec. 414.1650(c), beginning January 1, 2025, and on January 1 of each
subsequent year, the Medicare payment rates established for these items
in accordance with section 1834(z)(1) of the Act and Sec. 414.1650(b)
would be increased by the percentage change in the Consumer Price Index
for All Urban Consumers (CPI-U) for the 12-month period ending June of
the preceding year. For example, effective beginning January 1, 2025,
the payment rates that were in effect on January 1, 2024 would be
increased by the percentage change in the CPI-U from June 2023 to June
2024.
We are also adding Sec. 414.1660 to address continuity of pricing
when HCPCS codes for lymphedema compression treatment items are divided
or combined. Similar to current regulations at 42 CFR 414.110 and
414.236, we are finalizing that when there is a single HCPCS code that
describes two or more distinct complete items (for example, two
different but related or similar items), and separate codes are
subsequently established for each item, the payment amounts that
applied to the single code continue to apply to each of the items
described by the new codes. When the HCPCS codes for several different
items are combined into a single code, the payment amounts for the new
code will be established using the average (arithmetic mean), weighted
by allowed services, of the payment amounts for the formerly separate
codes.
We are finalizing the revision to the regulations for competitive
bidding under subpart F at 42 CFR 414 to include lymphedema compression
treatment items under the competitive bidding program as mandated by
section 1847(a)(2)(D) of the Act. We are
[[Page 77837]]
modifying the list of items that may be included in competitive bidding
described in Sec. 414.402 to include lymphedema treatment items and
are revising Sec. 414.408 to include lymphedema treatment items in the
list of items for which payment would be made on a lump sum purchase
basis under the competitive bidding program in accordance with any
frequency limitations established under proposed subpart Q in
accordance with section 1834(z)(2) of the Act. Finally, we are adding
reference to the proposed subpart Q to the bid rules described at Sec.
414.412.
The methodologies for adjusting DMEPOS payment amounts for items
included in the DMEPOS Competitive Bidding Program (CBP) that are
furnished in non-CBAs based on the payments determined under the DMEPOS
CBP are set forth at Sec. 414.210(g). Section 4133(a)(3) of the CAA,
2023 amended section 1847(a)(2) of the Act to include lymphedema
compression treatment items under the DMEPOS CBP, and section
4133(a)(2) of the CAA, 2023 amended section 1834 of the Act to provide
authority to adjust the payment amounts established for lymphedema
compression treatment items in accordance with new subsection z based
on the payments determined for these items under the DMEPOS CBP. We
believe the methodologies for adjusting DMEPOS payment amounts at Sec.
414.210(g) should also be used to adjust the payment amounts for
lymphedema compression treatment items included in the DMEPOS CBP that
are furnished in non-CBAs. We see no reason why different methodologies
for adjusting payment amounts based on payments determined under the
DMEOPS CBP would need to be established for lymphedema compression
treatment items. We are therefore adding Sec. 414.1690 to indicate
that the payment amounts established under Sec. 414.1650(b) for
lymphedema compression treatment items may be adjusted using
information on the payment determined for lymphedema compression
treatment items as part of implementation of the DMEPOS CBP under
subpart F using the methodologies set forth at Sec. 414.210(g).
C. Definition of Brace
1. Background
The Social Security Act of 1965 (the Act) defines the scope of
benefits available to eligible Medicare beneficiaries under Medicare
Part B, the voluntary supplementary medical insurance program defined
by section 1832 of the Act. Section 1832(a)(1) of the Act establishes
the Medicare Part B benefit for ``medical and other health services.''
Section 1861(s) of the Act further defines ``medical and other health
services'' to include under paragraph (9) leg, arm, back, and neck
braces, and artificial legs, arms, and eyes. Artificial legs, arms, and
eyes are artificial replacements for missing legs, arms, and eyes and
this rule does not address the scope of the Medicare benefit for these
items. Section 1834(h)(4)(C) of the Act details the payment rules for
particular items and services including specifying that ``the term
`orthotics and prosthetics' has the meaning given to such term in
section 1861(s)(9).'' Regulations at 42 CFR 410.36(a)(3) include leg,
arm, back, and neck braces under the list of medical supplies,
appliances, and devices in the scope of items paid for under Part B of
Medicare. However, the term ``brace'' is not defined in the Act or in
regulation. Specifically, the term brace is not defined in 42 CFR 410.2
Definitions for supplementary medical insurance benefits for Medicare.
The Medicare program instruction that defines the term brace is
located at CMS Pub. 100-02, Chapter 15, Sec. 130 of the Medicare
Benefit Policy Manual for Part B coverage of ``Leg, Arm, Back, and Neck
Braces, Trusses, and Artificial Legs, Arms, and Eyes.'' Within this
instruction, braces are defined as ``rigid and semi-rigid devices which
are used for the purpose of supporting a weak or deformed body member
or restricting or eliminating motion in a diseased or injured part of
the body.'' The Medicare definition of brace in program instructions
dates back to the 1970s and was previously located in the Medicare
Carriers Manual, HCFA Pub. 14, Part III, Chapter 2, Sec. 2133. This
longstanding definition of brace in our program instructions is used
for the purpose of making benefit category determinations in accordance
with the procedures located at 42 CFR 414.240 (86 FR 73911) regarding
when a device constitutes or does not constitute a leg, arm, back, or
neck brace for Medicare program purposes.
2. Current Issues
We believe that adding the definition of brace to the regulations
at 42 CFR 410.2 is necessary for describing the scope of the Medicare
Part B benefit for leg, arm, back, and neck braces. We believe that
codifying the definition that is currently located in Medicare program
instructions would continue the efficiency of the administration of the
Medicare program by providing clarity and transparency regarding the
scope of the benefit, for example, whether a specific device is a leg,
arm, back, or neck brace as defined in section 1861(s)(9) of the Act,
and consequently, payment determinations for such items. We also
believe that adding the definition of brace to the regulations would
support our benefit category determination process described in 42 CFR
414.240 (86 FR 73911).
The orthopedic industry has long established the attributes of a
``brace.'' We believe the definition of a brace in CMS Pub 100-02,
Chapter 15, Sec. 130 adequately captures the attributes of a brace.
The words ``rigid'' and ``semi-rigid'' are used to describe the
stiffness of a material. Rigid materials are used to eliminate motion
but also to support underload. Components of a brace can use semi-rigid
materials, which intentionally allow some amount of motion as compared
to materials that completely immobilize a part of the body. Braces are
typically prescribed to patients during the process of recovery and
rehabilitation in order to stop limbs, joints, or specific body
segments from moving for a pre-determined period. Braces may also be
prescribed for ongoing medical problems that require restriction or
limitation of joint movement; removal of weight or pressure from
healing or injured joints, muscles, or body parts; or reduction of
misalignment and function to reduce pain and facilitate improved
mobility. 203 204
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\203\ Webster, J., Murphy, D., 2019, Atlas of Orthoses and
Assistive Devices, 5th Edition, Elsevier, Philadelphia, PA. (Chapter
1) https://www.sciencedirect.com/book/9780323483230/atlas-of-orthoses-and-assistive-devices.
\204\ CHAMPVA OPERATIONAL POLICY MANUAL: CHAPTER:2, SECTION:
17.4. https://www.vha.cc.va.gov/system/templates/selfservice/va_ssnew/help/customer/locale/en-US/portal/554400000001036/content/554400000008979/021704-ORTHOTICS.
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In order for a brace to properly function, it must utilize a three-
point pressure system to provide angular control over anatomical
joints.205 206 207 A three-point pressure system places a
single force at the area of the deformity, while two counter forces act
in the opposing direction. This pressure system requires that a brace
be rigid or
[[Page 77838]]
semi-rigid in structure to apply sufficient relevant force to support,
restrict, or eliminate motion of the joint or specific body part. The
rigidity level of a brace is dependent on the body part and purpose for
which the brace is used. For example, a fully rigid brace is used to
eliminate motion and support underload. We believe the definition of
brace in CMS Pub. 100-02, Chapter 15, Sec. 130, and our proposed
definition of brace, adequately captures the various attributes of a
brace.
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\205\ Webster, J., Murphy, D., 2019, Atlas of Orthoses and
Assistive Devices, 5th Edition, Elsevier, Philadelphia, PA. (Chapter
18). https://www.sciencedirect.com/book/9780323483230/atlas-of-orthoses-and-assistive-devices.
\206\ Chalmers, D.D., & Hamer, G.P. (1985). Three-point dynamic
orthosis. Prosthetics and Orthotics International, 9(2), 115-116.
https://journals.sagepub.com/doi/pdf/10.3109/03093648509164718.https://journals.sagepub.com/doi/pdf/10.3109/03093648509164718.https://journals.sagepub.com/doi/pdf/10.3109/03093648509164718.https://journals.sagepub.com/doi/pdf/10.3109/03093648509164718.
\207\ Article--Spinal Orthoses: TLSO and LSO--Policy Article
(A52500) (cms.gov).
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It is important to note that a rigid or semi-rigid device may look
like a brace in that it has metal struts, joints, and cuffs that go
over a limb, but may be used for purposes other than bracing the limb.
We believe that devices used for purposes other than supporting a weak
or deformed body member or restricting or eliminating motion of a
diseased or injured part of the body do not fall within the definition
of a brace in accordance with Pub 100-02, Chapter 15, Sec. 130
Medicare Benefit Policy Manual, and would not fall within our proposed
definition of brace. However, items that are not braces may meet the
Medicare Part B definition for durable medical equipment (DME) at 42
CFR 414.202. For example, continuous passive motion devices are covered
as DME in accordance with CMS Pub. 100-03, Chapter 1, Part 4, Sec.
280.1 of the Medicare National Coverage Determinations Manual to
rehabilitate the knee to increase range of motion following surgery.
During continuous passive motion therapy, the joint area is secured to
the device, which then moves the affected joint through a prescribed
range of motion for an extended period of time. Continuous passive
motion devices have metal struts, joints, and cuffs that go over a limb
but are not used for the purpose of restricting or eliminating motion
in a diseased or injured part of the body or to support a weak or
deformed body member. While these devices do not meet the definition of
a brace in accordance with Pub. 100-02, Chapter 15, Sec. 130 of the
Medicare Benefit Policy Manual, they are covered by Medicare as DME.
Similarly, dynamic adjustable extension/flexion devices and static
progressive stretch devices are used to stretch an arm or leg or other
part of the body to treat contractures and increase range of motion.
While these devices may look similar to a brace, they are used for the
purpose of treating contractures and are not used for the purpose of
supporting a weak or deformed body member or restricting or eliminating
motion in a diseased or injured part of the body. As a result, dynamic
adjustable extension/flexion devices and static progressive stretch
devices do not fall under the definition of brace in accordance with
CMS Pub. 100-02, Chapter 15, Sec. 130, but are covered by Medicare as
DME.
It is also important to note that although braces in the past have
typically not included powered devices or devices with power features,
technology has evolved to include newer technology devices with power
features designed to assist with traditional bracing functions. For
example, effective January 1, 2020, code L2006 was added to the HCPCS
for a knee ankle foot device, any material, single or double upright,
swing and stance phase microprocessor control with adjustability,
includes all components (for example, sensors, batteries, charger), any
type of activation, with or without ankle joint(s), custom fabricated).
CMS classified this device as a brace because it supports a weak or
deformed knee by preventing it from buckling under the patient. This
brace includes a microprocessor controlled hydraulic swing and stance
control knee joint that restricts/affects knee joint kinematics during
the swing and stance phases of the gait cycle. There are also powered
brace exoskeleton devices that support a patient's weak arms or legs
and have been classified as DME in the past. We determined that these
devices should be classified as braces due to their use in stabilizing,
positioning, supporting and restoring the function of a patient's weak
limbs. In addition, upper extremity powered exoskeleton devices used by
patients with chronic arm weakness such as from complications of stroke
or other neurological/neuromuscular injury and illness to support and
assist movement of weak arms were recently introduced to the market.
HCPCS codes L8701 (Powered upper extremity range of motion assist
device, elbow, wrist, hand with single or double upright(s), includes
microprocessor, sensors, all components and accessories, custom
fabricated) and L8702 (Powered upper extremity range of motion assist
device, elbow, wrist, hand, finger, single or double upright(s),
includes microprocessor, sensors, all components and accessories,
custom fabricated)) were added to the HCPCS effective January 1, 2019
to describe two categories of these items. These devices support the
arm of the patient and allows them to use volitional, intact
electromyographic signals in weak muscles to control the device through
a normal range of motion. A lower extremity powered exoskeleton device
that supports the weak legs of a patient with spinal cord injury (SCI)
at levels T7 to L5 to enable the patient to perform ambulatory
functions was also recently introduced to the market. Code K1007
(Bilateral hip, knee, ankle, foot device, powered, includes pelvic
component, single or double upright(s), knee joints any type, with or
without ankle joints any type, includes all components and accessories,
motors, microprocessors, sensors)) was added to the HCPCS effective
October 1, 2020 to describe this category of items. The device uses
motion sensors with an exoskeleton frame and onboard computer system.
Patients using all of the devices, as previously described, are better
able to elongate and flex their limbs using the respective device,
sometimes in a braced manner and sometimes in a controlled manner of
motion, thus improving the functioning of the malformed body member and
supporting the weak limbs. Additional information on the items, as
previously discussed, can be found at: www.cms.gov/files/document/2022-hcpcs-application-summary-biannual-1-2022-non-drug-and-non-biological-items-and-services.pdf.
One additional issue related to leg braces with shoes that are an
integral part of the brace. Section 1862(a)(8) of the Act generally
excludes orthopedic shoes or other supportive devices for the feet from
coverage under the Medicare program. However, longstanding policy at
CMS Pub. 100-02, Chapter 15, Sec. 290 of the Medicare Benefit Policy
Manual indicates that this exclusion does not apply to such a shoe if
it is an integral part of a leg brace, and if that shoe or other
supportive device for the feet is an integral part of a leg brace, then
the cost of that shoe or device is included as part of the cost of the
brace. We proposed to include this exception in the proposed definition
of a brace at Sec. 410.2.
We received approximately 55 comments from individuals, health care
providers, medical technology manufacturers, patient and medical
technology advocacy organizations, academic research institutions, and
health care providers employed by the government agencies of the U.S.
Department of Veterans Affairs and U.S. Department of Defense.
Comment: Many commenters supported finalizing the definition of
brace at 42 CFR 410.2 to be consistent with section 130 of chapter 15
of the Medicare Benefit Policy Manual (CMS Pub. 100-02) which indicates
that a brace includes rigid or semi-rigid devices which are used for
the purpose of supporting a weak or deformed body member or restricting
or eliminating
[[Page 77839]]
motion in a diseased or injured part of the body. Many commenters also
agreed with our discussion in the CY 2024 HH PPS proposed rule (88 FR
43779) that adding the definition in regulations will improve the
efficiency of the administration of the Medicare program when
considering whether items meet the definition potentially providing
faster claims processing and access to these new healthcare
technologies for Medicare beneficiaries.
Response: We appreciate the commenters' support for the proposed
definition of brace at 42 CFR 410.2.
Comment: A few commenters opposed the proposed definition for brace
at 42 CFR 410.2, stating that including in regulations a definition for
brace that is many years old will deter innovation in a dynamically
changing area of medical technology. The commenters urged CMS to
consider an alternative approach and obtain input from a broad range of
stakeholders on a definition of brace that focuses on device
functionality rather than the materials used in making the brace. The
commenters stated material stiffness should not be the key indicator in
defining a brace. The commenters explained that by emphasizing
materials, the definition will box manufacturers into a corner and
limit the use of new materials that would be used if the medical
criteria were based on functionality and not rigidity and materials. In
addition, rigid materials often add weight to the brace and affect
comfort, with the effect that non-compliance with wearing the brace
becomes an unintended consequence. The commenters noted manufacturers
are trying to build a brace that uses lighter and breathable materials
resulting in a brace that patients will wear. Also, the commenters
stated with the advancements in materials science and nanotechnology,
limiting the definition of brace to items that are rigid or semi-rigid
will stifle innovation and adversely impact progress in patient
treatment options and care.
Other commenters stated from a functional standpoint, braces are
used to enhance the ability to effectively utilize affected upper and
lower limbs to better perform activities of daily living. In
contemporary practice, orthoses are externally applied devices used to
support body segments or joints which are weakened, unstable or mal-
aligned, for the purpose of enhancing function and individual
independence. These commenters urged CMS to interpret the brace benefit
through contemporary orthotic clinical practice when making coding,
coverage and payment decisions in the future.
Response: We do not agree with these comments. The proposed
definition focuses on the two key functions of a brace, which are to
support a weak or deformed body member and restrict or eliminate motion
in a diseased or injured part of the body. As discussed in the CY 2024
HH PPS proposed rule (88 FR 43654), the information we gathered during
our review supported our proposal to amend regulations at 42 CFR 410.2
to add the definition of brace to be consistent with CMS's longstanding
brace policy and information at section 130 of chapter 15 of the
Medicare Benefit Policy Manual (CMS Pub. 100- 02). This discussion
explains why a device must be rigid or semi-rigid in order to be able
to provide support or restrict or eliminate motion. Rigid refers to
material used to eliminate motion but also to support underload.
Components of a brace will use semi-rigid materials, which
intentionally allow some amount of motion (restricted motion) as
compared to materials that completely immobilize. We are not aware of
evidence that elastic or non-rigid devices are capable of supporting a
weak or deformed body member or restricting or eliminating motion in a
diseased or injured part of the body. We can consider addressing in
future rulemaking should evidence supporting the effectiveness of
elastic or non-rigid devices in performing the functions of a brace
become available.
Comment: Several commenters recommended to finalize the definition
of brace in 42 CFR 410.2 to include the words ``including powered
devices''. The commenters recommended the definition of brace should
read as follows: Brace means a rigid or semi-rigid device, including
powered devices, used for the purpose of supporting a weak or deformed
body member or restricting or eliminating motion in a diseased or
injured part of the body.
Response: We thank the commenters for their recommendation, but we
do not believe it is necessary to include the words ``including powered
devices'' in the definition of brace. As we explained in our proposal
in the CY 2024 HH PPS proposed rule (88 FR 43654), certain powered
devices perform the key bracing functions of supporting weak or
deformed body members and therefore are included in the proposed
definition. Therefore, we recognize that a powered device can be
included in the definition of a brace. Also, as discussed in the CY
2024 HH PPS proposed rule, new items including powered devices, will be
considered for classification under the definition of brace using the
processes outlined in regulations at 42 CFR 414.240. These processes
require interested parties to submit an application for review of a new
item including public consultation on proposed preliminary benefit
category and payment determinations and then a final determination can
be established on whether the new item meets the definition of brace in
accordance with in 42 CFR 410.2.
We are finalizing our definition of brace and adding it to 42 CFR
410.2 as proposed, without modifications.
Comment: Multiple commenters supported the proposal to specify at
Sec. 410.36(a)(3)(i)(A) that a brace may include a shoe if it is an
integral part of a leg brace and its expense is included as part of the
cost of the brace. A commenter requested clarification regarding
whether shoes that are integral to a brace are covered as part of the
brace and can, in fact, be separately billed under distinct HCPCS L-
codes for the shoes alone. The commenter requested clarification to
remove any confusion as to the separate reimbursement for the shoes,
themselves, that are deemed integral to the function of an orthoses.
Response: We appreciate the commenters' support for our proposal to
specify at Sec. 410.36(a)(3)(i)(A) that a brace may include a shoe if
it is an integral part of a leg brace and its expense is included as
part of the cost of the brace. HCPCS codes L3224 and L3225 are
available to submit claims for shoes that are an integral part of a
brace.
We are finalizing our proposal without modification to specify at
Sec. 410.36(a)(3)(i)(A) that a brace may include a shoe if it is an
integral part of a leg brace and its expense is included as part of the
cost of the brace.
In the CY 2024 HH PPS proposed rule (88 FR 43780), we noted three
HCPCS codes were established to permit billing of the powered upper
extremity devices and powered lower extremity exoskeleton devices. Two
HCPCS codes were established effective October 1, 2019 which are: L8701
(Powered upper extremity range of motion assist device, elbow, wrist,
hand with single or double upright(s), includes microprocessor,
sensors, all components and accessories, custom fabricated) and L8702
(Powered upper extremity range of motion assist device, elbow, wrist,
hand, finger, single or double upright(s), includes microprocessor,
sensors, all components and accessories, custom fabricated). One HCPCS
code was established effective October 1, 2020 which is K1007
(Bilateral hip, knee, ankle, foot device, powered, includes pelvic
component, single or double upright(s), knee joints any type, with or
without ankle joints
[[Page 77840]]
any type, includes all components and accessories, motors,
microprocessors, sensors). However, corresponding Medicare benefit
category and Medicare payment determinations were not finalized for
these HCPCS codes to permit more time for evaluation. We explained that
as a result of the proposal to amend the regulations at 42 CFR 410.2 to
add the definition of brace, if finalized, these codes would be
classified under the definition of brace because they are used to
support weak arms and legs. Also, we stated using the processes
outlined in regulations at 42 CFR 414.240, we intend to obtain public
consultation on the payment determinations for these codes at an
upcoming HCPCS Level II public meeting. Additional information on these
HCPCS codes can be found in the HCPCS Level II Final Coding, Benefit
Category and Payment Determinations First Biannual (B1), 2022 HCPCS
Coding Cycle at www.cms.gov/files/document/2022-hcpcs-application-summary-biannual-1-2022-non-drug-and-non-biological-items-and-services.pdf. The agenda and dates for a public meeting will be
available on the CMS HCPCS website: https://www.cms.gov/Medicare/
Coding/MedHCPCSGenInfo/HCPCSPublicMeetings.
Comment: Many commenters supported classification of devices
described by HCPCS codes K1007, L8701, and L8702 as braces. Multiple
commenters described the use of a powered upper extremity device as
supporting a patient when using the device thereby increasing the
patient's ability to be more independent resulting in less burden on
caretakers and improving participation in family, work, and community
activities. Also, many commenters described the use of a powered
exoskeleton device as supporting a patient to reduce lower-limb
spasticity and contracture of the limbs. Commenters supported the use
of powered exoskeleton devices stating improvements also occur for
patients' circulation, mental health, and quality of life.
Response: We appreciate the commenters' support for classification
of these devices as braces. We agree codifying the definition of brace
and clarifying that newer powered devices described by these HCPCS
codes will permit Medicare beneficiaries to access these newer
technology braces and particularly help those with disabilities
associated with muscular and/or neural (for example, spinal cord
injuries) conditions.
Comment: Some commenters requested classification of HCPCS codes
K1007, L8701, and L8702 under the Medicare brace benefit category
effective as of the date that the final rule is published in order to
expedite claims processing for items billed using these codes.
Response: We do not agree. These items will be classified as braces
effective on the effective date of this final rule, not the publication
date.
Comment: Some commenters requested expediting payment
determinations for HCPCS codes K1007, L8701, and L8702, including
developing and issuing preliminary payment determinations for
consideration as part of the second biannual 2023 non-drug and
nonbiological items and services HCPCS public meeting in late 2023 or
the next subsequent non-drug and nonbiological items and services HCPCS
public meeting.
Response: As discussed in the CY 2024 HH PPS proposed rule (88 FR
43654), rather than expedite payment determinations, we intend to use
the processes outlined in regulations at 42 CFR 414.240 to obtain
public consultation on the preliminary payment determinations for these
codes at an upcoming HCPCS Level II public meeting. We recognize the
importance of reviewing payment information efficiently on these items
in order to establish the payment determinations for these items. We
expect to issue a payment determination for consideration as part of
the second biannual 2023 non-drug and nonbiological items and services
HCPCS public meeting in late 2023 or in the next subsequent non-drug
and nonbiological items and services HCPCS public meeting.
3. Final Regulations
We are finalizing our proposal without modification to amend the
regulations at 42 CFR 410.2 to add the definition of brace to improve
clarity and transparency regarding coverage and payment for the term
brace as defined in section 1861(s)(9) of the Act. Also, we believe
adding the definition in regulations will improve the efficiency of the
administration of the Medicare program when considering whether a new
device is a leg, arm, back, or neck brace for benefit category and
payment determinations under our review procedures at Sec. 414.240. In
addition, we believe that adding the definition of a brace in
regulation would expedite coverage and payment for newer technology and
powered devices, potentially providing faster access to these new
healthcare technologies for Medicare beneficiaries. Also, we are
finalizing our proposal without modification to specify at Sec.
410.36(a)(3)(i)(A) that a brace may include a shoe if it is an integral
part of a leg brace and its expense is included as part of the cost of
the brace.
D. Documentation Requirements for Durable Medical Equipment,
Prosthetics, Orthotics, and Supplies Products Supplied as Refills to
the Original Order
1. Background
Durable medical equipment (DME) is covered as a benefit category
under Part B under medical or other health services as described in
section1861(s)(6) of the Act and defined under section 1861(n) of the
Act. We further defined DME in regulations at Sec. 414.202 as
equipment that can withstand repeated use, is primarily and customarily
used to serve a medical purpose, is not generally useful to a person in
the absence of an illness or injury, is appropriate for use in the
home, and effective with respect to items classified as DME after
January 1, 2012, has an expected life of at least 3 years. Certain
items of DME require supplies for effective use. Supplies include, but
are not limited to, drugs and biologicals that must be put directly
into the equipment to achieve the therapeutic benefit or to assure the
proper functioning of the equipment. Examples include oxygen, tumor
chemotherapy agents transfused via an infusion pump, or diabetic test
strips used with a home glucose monitor.
Prosthetics and orthotics are defined under section 1861(s)(9) of
the Act and include leg, arm, back, and neck braces and artificial
legs, arms, and eyes--including replacements if required because of a
change in the patient's physical condition. These items are referred to
collectively as Durable Medical Equipment, Prosthetics, Orthotics, and
Supplies (DMEPOS).
DMEPOS items and supplies may be furnished on a recurring basis to
beneficiaries with chronic or longer-term conditions. For such items,
the practitioner may be able to forecast and prescribe, at the time of
the beneficiary's initial need or during later clinical interaction,
the ongoing medical need for DMEPOS items and/or supplies. In other
words, the practitioner may be able to determine the beneficiary's
expected, ongoing medical need both at the time of the interaction and
as anticipated need for later dates of service. In such cases, the
practitioner may write an order for immediate use and refills for later
dates of service.
Section 1893(a) of the Act authorized the Secretary to promote the
program integrity of the Medicare program by entering into contracts
with eligible
[[Page 77841]]
entities to carry out activities specified in subsection (b) of such
section. Section 1893(b)(1) of the Act, authorizes ``[r]eview of
activities of providers of services or other individuals and entities
furnishing items and services for which payment may be made under this
title . . . including medical and utilization review [emphasis added] .
. .''. In response to concerns related to auto-shipments and delivery
of DMEPOS supplies that may no longer be needed or not needed at the
same level of frequency/volume (for example, stockpiling), CMS
instituted policies to require suppliers to contact the beneficiary
prior to dispensing DMEPOS refills. In CY 2004, we updated our Medicare
Program Integrity Manual to include timeframes related to refillable
DMEPOS items.\208\ This was done to ensure that the refilled item was
necessary and to confirm any changes/modifications to the order. At
that time, CMS stated that contact with the beneficiary or designee
regarding refills should take place no sooner than 7 days prior to the
delivery/shipping date. CMS further stated that subsequent deliveries
of refills of DMEPOS products should occur no sooner than 5 days prior
to the end of the usage for the current product. This change intended
to allow for shipping of refills on ``approximately'' the 25th day of
the month in the case of a month's supply, as later clarified and
emphasized in preamble discussion in the CY 2005 Physician Fee Schedule
final rule (69 FR 66235).
---------------------------------------------------------------------------
\208\ Internet Only Manual 100-08, Program Integrity Manual
(2004), available at: https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/downloads/R61PI.pdf.
---------------------------------------------------------------------------
In 2011, due to stakeholder concerns related to burden, we amended
the Medicare Program Integrity Manual to state that contact with the
beneficiary or designee regarding refills must take place no sooner
than 14 calendar days prior to the delivery/shipping date, and that
delivery of the DMEPOS product occur no sooner than 10 calendar days
prior to the end of usage for the current product.\209\ This is the
current policy on DMEPOS refills as described in the Medicare Program
Integrity Manual.\210\
---------------------------------------------------------------------------
\209\ Internet Only Manual 100-08, Program Integrity Manual
(2011), available at: https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/Downloads/R378PI.pdf
\210\ Internet Only Manual 100-08, Program Integrity Manual,
Chapter 5, Section 5.2.6--Refills of DMEPOS Items Provided on a
Recurring Basis (2022), available at: https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/Downloads/pim83c05.pdf.
---------------------------------------------------------------------------
We note that while the timeframes are applicable to all refillable
items, they are most pertinent to the mail/delivery model because those
beneficiaries could potentially be most at risk for receiving
unnecessary or unsolicited items and supplies. For beneficiaries
calling, texting, or otherwise contacting their pharmacy or retail
store and picking up their refills, we note the decreased potential for
providing supplies that may not be medically necessary or for which the
beneficiary has sufficient supply. For items that the beneficiary
obtains in-person at a retail store, the signed delivery slip or a copy
of the itemized sales receipt is sufficient documentation of a request
for refill.
Both delivery models are intended to allow for uninterrupted supply
of the necessary item(s) and allow for the processing of claims for
refills delivered/shipped prior to the beneficiary's complete
exhaustion of their supply. We note that prior guidance related to this
policy referred to this sort of permissible overlap as refills for
items ``pending exhaustion''.
Despite the long-standing programmatic safeguards, compliance with
refill procedures continues to cause concerns. As recently as 2019, the
HHS Office of Inspector General (HHS OIG) did a national study
demonstrating that suppliers did not maintain sufficient refill
documentation.\211\ In fact, one national DMEPOS supplier was recently
revoked from the Medicare program due to billing for refills for
beneficiaries that were deceased.\212\
---------------------------------------------------------------------------
\211\ Medicare Improperly Paid Suppliers an Estimated $92.5
Million for Inhalation Drugs, (October 2019), https://oig.hhs.gov/oas/reports/region9/91803018.pdf.
\212\ Press Release: Mail-Order Diabetic Testing Supplier and
Parent Company Agree to Pay $160 Million to Resolve Alleged False
Claims to Medicare (August 2, 2021), available at: https://www.justice.gov/opa/pr/mail-order-diabetic-testing-supplier-and-parent-company-agree-pay-160-million-resolve-alleged.
---------------------------------------------------------------------------
Due to ongoing compliance concerns, and in efforts to promote
transparency, we propose to codify our refill documentation
requirements. At the same time, we are continuing our efforts to reduce
administrative burden. We have worked to identify many obsolete and
burdensome regulations that could be eliminated or reformed to improve
effectiveness. We have also examined our longstanding policies and
practices that are not codified in regulations but could be changed or
streamlined to achieve better outcomes and reduce provider and supplier
burden. Additionally, we are requesting comment on whether there are
ways to reduce burden for certain beneficiary populations for future
rulemaking.
Our refill policy has primarily been maintained in the Medicare
Program Integrity Manual, Local Coverage Determinations, and related
articles. We proposed to codify and update our refill policy to
maintain program integrity controls while being mindful of supplier
burden. We are finalizing the policy as proposed.
2. Provisions of the Regulation
a. Overview
At this time, we believe it is appropriate to codify policies
related to refills of DMEPOS items; taking into consideration the need
to balance program integrity concerns (for example, stockpiling)
against supplier burden concerns. While we continue to believe it
appropriate to confirm the medical need for the refill prior to
disbursement, we have found that minor deviations in timing are not
always reflective of medical need. Therefore, we proposed to strengthen
our program integrity requirements to not only require beneficiary
contact, but to specify that such contact must result in affirmative
response from the beneficiary or designee. We proposed to eliminate the
14-day timeframe, for beneficiary contact, and to rather rely upon a
single 30-day timeframe for contact and confirmation of the need for
refill. That is, beneficiary contact and confirmation of need for the
refill must occur within the 30-day period prior to the end of the
current supply. We proposed to remove the term ``pending exhaustion'',
which may be subject to interpretation, and instead use the phrase
``the expected end of the current supply.''
We note that documentation of the need for refill, as obtained from
the Medicare beneficiary or designee, is not expected to require
specific quantities remaining--but rather to simply confirm their need
for the next refillable item. This clarification is expected to
alleviate any associated burden with the beneficiary or their designee
counting supplies. Suppliers contacting the beneficiaries to confirm
their need for the refill, shall confirm both that the beneficiary is
using the item and requires the refill, as evidenced by the supplier
documentation of an affirmative need for the refill. We believe this
type of generalized affirmation, in conjunction with our claims
processing controls, will provide sufficient program integrity
controls.
We proposed to codify our longstanding requirement that delivery of
DMEPOS items (that is, date of service) be no sooner than 10 calendar
days before the expected end of the current supply. We note that the
shipping timeframes have been relied upon for approximately 20 years--
to help both suppliers and Medicare Fee-
[[Page 77842]]
for-Service contractors prevent overlapping billings and unnecessary
refills. For example, contractors may use this timeframe to set up
claims processing edits and alert suppliers when an item is being
rendered/billed that was previously rendered and is not yet eligible
for refill. We proposed that date of service may be defined as either
the date of delivery of the DMEPOS item, or for items rendered via
delivery or shipping service, the supplier may use the shipping date as
the date of delivery. We proposed the shipping date may be defined as
either the date the delivery/shipping service label is created or the
date the item is retrieved for shipment by the mail carrier/delivering
party; however, such dates should not demonstrate significant
variation.
We believe the refill policy ensures that beneficiaries are
participating in their health care to confirm they get the DMEPOS
item(s) ordered and needed, which prevents individuals from receiving
unnecessary supplies. It also protects the Trust Fund from the
unnecessary provision of DMEPOS. We elongated the timeframe to 30-days
and clarified that the beneficiary need not provide specific remaining
quantities to comply. We believe this helps mitigate potential burden.
However, we sought comments on if, due to beneficiary burdens, there
are certain diagnosis/device combinations that a beneficiary should not
need to confirm the need for a refill or confirm the need for refill
with the same frequency. In other words, are there beneficiary
populations for which we will not expect any fluctuations in the type
or quantity of device, due to a permanent disability or health
condition, for which the supplier verification of need will prove
burdensome? Are there ways that Medicare could better balance the
beneficiary burden of responding to supplier outreach (for example,
text messaging, phone call to affirm need for recurring supply) when
contrasted with the burden of receiving potentially unnecessary items
(for example, co-insurance payments)? We will take these comments into
consideration for potential future policy changes to our DMEPOS refill
policies.
We received 15 comments for our review, as submitted from DMEPOS
suppliers, DMEPOS industry groups, and providers treating beneficiaries
through the use of DMEPOS. Of those submitted, 10 were responsive to
our solicitation questions. The feedback we received is summarized in
the following:
Comment: Commenters provided certain chronic conditions, in
response to CMS solicitation for consideration for potential future
rulemaking, ``. . . for which we would not expect any fluctuations in
the type or quantity of device, due to a permanent disability or health
condition, for which the supplier verification of need would prove
burdensome'' (88 FR 43781). Specifically, commenters shared their
belief that certain conditions, such as type I and type II diabetics,
beneficiaries with obstructive sleep apnea, and those in need of
permanent urinary or ostomy supplies, are the types of beneficiaries
which may benefit from additional regulatory consideration. Commenters
suggested that the identification of such items would benefit from
contractor/stakeholder communications and public posting. Commenters
suggested that such persons should not require beneficiary contact
prior to refill and should be permitted to ``opt-in'' on an annual
basis to authorize continual refills. Commenters suggested that
suppliers could help control program integrity concerns by maintaining
their responsibility for ensuring that supplies continue to be
medically necessary and that there has been no interruption in medical
need. Conversely, a commenter shared their concern that the creation of
differing refill requirements, absent a universal electronic system,
would prove confusing and difficult to effectuate.
Response: CMS thanks commenters for their thoughtful input. We will
consider the beneficiary populations for which commenters would not
expect any fluctuations in the type or quantity of supplies due to a
permanent disability or health condition. We will look at the
associated access and burden issues raised, in conjunction with program
integrity concerns and the ability to operationalize programmatic
instruction, for potential future rulemaking.
Comment: Commenters were generally supportive of our proposal to
codify our existing refill requirements, with amendments. The proposed
policy extends the timeframe for the supplier to contact the
beneficiary and clarifies that such contact: (1) must affirm the need
for refill; but (2) does not require beneficiaries to ``count'' their
remaining supplies. Commenters were appreciative of our burden
reduction efforts for both suppliers and beneficiaries.
Response: We thank commenters for their feedback. This rule
finalizes the documentation requirements for DMEPOS products supplied
as refills as proposed.
Comment: Commenters were supportive of our proposal to remove the
phrase ``pending exhaustion'' and replace it with ``expected end of the
current supply'' to ensure clarity.
Response: We appreciate the feedback. This rule finalizes the new
terminology as proposed.
Comment: Commenters encouraged CMS to permit, or even require,
suppliers to use multiple modes of communication to contact the
beneficiaries, such as via phone, text message, or email. Several
commenters noted that regardless of the type of communication a DME
supplier uses, the DME supplier is still responsible for compliance
with any applicable Medicare requirements--including the production of
documentation upon request.
Response: We thank commenters for their feedback and clarify that
we do not prescribe the mode of communication for contacting the
beneficiary to affirm the need for refill. Suppliers are permitted to
use any mode of communication so long as the beneficiary affirmation is
received, and documentation of the contact is captured and can be
provided upon request.
Comment: Commenters requested that suppliers be permitted to bill a
single time for a 90-day supply of CGM sensors, as opposed to every 30
days.
Response: CGM billing is outside the scope of the proposed
regulation. However, we will take the commenters feedback under
advisement.
Comment: Some commenters suggested the adoption of electronic
ordering or communication systems, as well as DMEPOS templates. A
commenter suggested that CMS establish standards for DMEPOS electronic
ordering systems.
Response: We thank commenters for their feedback for our
consideration. We note that this is outside the scope of the proposed
regulation.
Comment: A commenter suggested that the documentation to support
the DMEPOS item supplied as a refill be signed off by the ordering
provider. We understood the commenter's request to seek additional,
more frequent practitioner verification, in addition to the initial
order prescribing the item and refills.
Response: We thank the commenter for their feedback. At this time,
we respectfully decline to adopt the suggestion. The suggestion does
not align with current clinical practice, and we do not wish to impose
additional burden on beneficiaries, providers, and suppliers.
Comment: Commenters suggested we minimize any conflict between
Medicare and other payer's documentation requirements to support
[[Page 77843]]
DMEPOS products supplied as refills, such as those required of Medicaid
and for beneficiaries in Medicare Advantage plans.
Response: While Medicaid and Medicare Advantage requirements are
outside the scope of our proposed policy, we agree with reducing burden
whenever possible.
Final Rule Action: We are finalizing the documentation requirements
for DMEPOS products supplied as refills to the original order, as
proposed.
b. Documentation to Support Refill
We proposed to revise Sec. 410.38, paragraph (d), by adding
paragraph (d)(4) which outlines the documentation needed to support
refill requirements. In paragraph (d)(4)(i), we define refills, date of
service, and shipping date for purposes of this section. In paragraph
(d)(4)(ii), we proposed that documentation must include the following:
Evidence of the beneficiary or their representative's
affirmative response of the need for supplies, which should be obtained
as close to the expected end of the current supply as possible; Contact
and affirmative response shall be within 30 calendar days from the
expected end of the current supply.
For shipped items, the beneficiary name, date of contact,
the item requested, and an affirmative response from the beneficiary,
indicative of the need for refill, prior to dispensing the product.
For items obtained in-person from a retail store, the
delivery slip signed by the beneficiary or their representative or a
copy of the itemized sales receipt is sufficient documentation of a
request for refill.
In paragraph (d)(4)(iii), we proposed the date of service for
DMEPOS items provided on a recurring basis be no sooner than 10
calendar days prior to the expected end of the current supply.
VIII. Changes to the Provider and Supplier Enrollment Requirements
A. Background
1. Overview of Medicare Provider Enrollment
Section 1866(j)(1)(A) of the Act requires the Secretary to
establish a process for the enrollment of providers and suppliers into
the Medicare program. The overarching purpose of the enrollment process
is to help confirm that providers and suppliers seeking to bill
Medicare for services and items furnished to Medicare beneficiaries
meet all applicable federal and state requirements to do so. The
process is, to an extent, a ``gatekeeper'' that prevents unqualified
and potentially fraudulent individuals and entities from entering and
inappropriately billing Medicare. Since 2006, we have undertaken
rulemaking efforts to outline our enrollment procedures. These
regulations are generally codified in 42 CFR part 424, subpart P
(currently Sec. Sec. 424.500 through 424.575 and hereafter
occasionally referenced as subpart P). They address, among other
things, requirements that providers and suppliers must meet to obtain
and maintain Medicare billing privileges.
As outlined in Sec. 424.510, one such requirement is that the
provider or supplier must complete, sign, and submit to its assigned
Medicare Administrative Contractor (MAC) the appropriate enrollment
form, typically the Form CMS-855 (OMB Control No. 0938-0685). The Form
CMS-855, which can be submitted via paper or electronically through the
internet-based Provider Enrollment, Chain, and Ownership System (PECOS)
process (SORN: 09-70-0532, PECOS), collects important information about
the provider or supplier. Such data includes, but is not limited to,
general identifying information (for example, legal business name),
licensure and/or certification data, and practice locations. The
application is used for a variety of provider enrollment transactions,
including the following:
Initial enrollment--The provider or supplier is--(1)
enrolling in Medicare for the first time; (2) enrolling in another
Medicare contractor's jurisdiction; or (3) seeking to enroll in
Medicare after having previously been enrolled.
Change of ownership--The provider or supplier is reporting
a change in its ownership.
Revalidation--The provider or supplier is revalidating its
Medicare enrollment information in accordance with Sec. 424.515.
(Suppliers of durable medical equipment, prosthetics, orthotics, and
supplies (DMEPOS) must revalidate their enrollment every 3 years; all
other providers and suppliers must do so every 5 years.)
Reactivation--The provider or supplier is seeking to
reactivate its Medicare billing privileges after it was deactivated in
accordance with Sec. 424.540.
Change of information--The provider or supplier is
reporting a change in its existing enrollment information in accordance
with Sec. 424.516.
After receiving the provider's or supplier's initial enrollment
application, CMS or the MAC reviews and confirms the information
thereon and determines whether the provider or supplier meets all
applicable Medicare requirements. We believe this screening process has
greatly assisted CMS in executing its responsibility to prevent
Medicare fraud, waste, and abuse.
As previously discussed, over the years we have issued various
final rules pertaining to provider enrollment. These rules were
intended not only to clarify or strengthen certain components of the
enrollment process but also to enable us to take action against
providers and suppliers: (1) engaging (or potentially engaging) in
fraudulent or abusive behavior; (2) presenting a risk of harm to
Medicare beneficiaries or the Medicare Trust Funds; or (3) that are
otherwise unqualified to furnish Medicare services or items. Consistent
with this, and as we discuss in section VIII.B. of this final rule, we
proposed several changes to our existing Medicare provider enrollment
regulations.
2. Legal Authorities
There are two principal categories of legal authorities for our
proposed Medicare provider enrollment provisions:
Section 1866(j) of the Act furnishes specific authority
regarding the enrollment process for providers and suppliers.
Sections 1102 and 1871 of the Act provide general
authority for the Secretary to prescribe regulations for the efficient
administration of the Medicare program.
B. Proposed Provisions
1. Provisional Period of Enhanced Oversight
a. Background
Section 1866(j)(3)(A) of the Act states that the Secretary shall
establish procedures to provide for a provisional period of between 30
days and 1 year during which new providers and suppliers--as the
Secretary determines appropriate, including categories of providers or
suppliers--will be subject to enhanced oversight. (Per section
1866(j)(3)(A) of the Act, such oversight can include, but is not
limited to, prepayment review and payment caps.) As authorized by
section 1866(j)(3)(B) of the Act, CMS previously implemented such
procedures through subregulatory guidance with respect to newly
enrolling HHAs' requests for anticipated payments (RAP).\213\ More
recently, in July 2023 we began placing newly enrolling hospices
located in Arizona,
[[Page 77844]]
California, Nevada, and Texas in a PPEO. (See https://www.cms.gov/files/document/mln7867599-period-enhanced-oversight-new-hospices-arizona-california-nevada-texas.pdf for more information.)
---------------------------------------------------------------------------
\213\ CMS eliminated the use of RAPs for HHAs; beginning January
1, 2022, CMS replaced RAP submissions with a Notice of Admission.
---------------------------------------------------------------------------
During the PPEO involving HHA RAPs, CMS received inquiries
regarding (1) the scope of the term ``new'' HHA for purposes of
applying a PPEO and (2) when the provisional period commenced. While
section 1866(j)(3)(B) of the Act states that we may implement
procedures by program instruction, we proposed in the July 10, 2023,
proposed rule (88 FR 43654) to clarify these two issues.
First, we proposed in new Sec. 424.527(a) to define a ``new''
provider or supplier (again, exclusively for purposes of our PPEO
authority under section 1866(j)(3) of the Act) as any of the following:
++ A newly enrolling Medicare provider or supplier. (This includes
providers that must enroll as a new provider per the change in majority
ownership provisions in Sec. 424.550(b).)
++ A certified provider or certified supplier undergoing a change
of ownership consistent with the principles of 42 CFR 489.18. (This
includes providers that qualify under Sec. 424.550(b)(2) for an
exception from the change in majority ownership requirements in Sec.
424.550(b)(1) but which are undergoing a change of ownership under 42
CFR 489.18).
++ A provider or supplier (including an HHA or hospice) undergoing
a 100 percent change of ownership via a change of information request
under Sec. 424.516.
We included these transactions within our proposed definition
because they have historically and generally involved the effective
establishment of a new provider or supplier for purposes of Medicare
enrollment. We stated that CMS would rely on the codified version of
this policy once it becomes effective.
Second, we proposed in Sec. 424.527(b) that the effective date of
the PPEO's commencement is the date on which the new provider or
supplier submits its first claim (rather than, for example, the date
the first service was performed or the effective date of the ownership
change). A core reason for this proposal was that we found during the
previously referenced HHA PPEO that certain affected HHAs refrained
from billing after their placement in the PPEO to circumvent the
enhanced oversight mechanism; then, once their PPEO lapsed, the HHA
engaged in improper billing without the intended oversight. We believed
that proposed Sec. 424.527(b) would help stem this practice because
the provider or supplier would be unable to avoid the PPEO by delaying
billing until the PPEO's expiration, as was the case with the HHA PPEO.
Although we elected to address the issues in proposed Sec. 424.527
via rulemaking, we noted in the proposed rule that we retained the
authority under section 1866(j)(3)(B) of the Act to establish and
implement PPEO procedures via sub-regulatory guidance.
b. Comments Received and Final Provisions
Comment: Several commenters supported our proposed PPEO
clarifications in new Sec. 424.527.
Response: We appreciate the commenters' support.
Comment: A commenter questioned: (1) how CMS determines the exact
length of time within the PPEO's 30-day to 1-year period (for example,
6 months) that a particular provider or supplier remains under a PPEO;
and (2) whether CMS uses any specific criteria in this determination.
The commenter also suggested a maximum 60-day PPEO timeframe for
providers and suppliers with a long history of accreditation; the
commenter believed this would reduce the burden on affected providers
and suppliers.
Response: While we appreciate these comments, they do not directly
pertain to the topics covered in our PPEO proposals. Therefore, we
respectfully believe they are outside the scope of this final rule.
Comment: A commenter expressed support for our previously mentioned
hospice PPEO for Arizona, California, Nevada, and Texas.
Response: While we appreciate the commenter's support, we
respectfully believe this comment is outside the scope of this final
rule.
Comment: A commenter sought clarification on all of the following
issues:
Whether the determination as to which providers and
suppliers are subject to a PPEO is based on the provider's or
supplier's individual circumstances or on whether they meet the new
definition of ``new provider or supplier''.
Whether CMS or, instead, the MAC determines: (1) the
providers and/or suppliers to which a PPEO will apply; (2) the length
of a PPEO; and (3) whether a PPEO will include prepayment review.
Whether providers and suppliers have appeal or
administrative review rights regarding the application and specifics of
a PPEO.
The criteria that are used in determining the length and
other components of a PPEO.
Response: Concerning the first issue, the PPEO applies to new
providers and suppliers (as we proposed to define in Sec. 424.527) in
the provider or supplier category (for example, hospices in a certain
geographic area) that the PPEO encompasses.
We respectfully believe the remaining three issues are outside the
scope of this rule.
After reviewing the comments received, we are finalizing our PPEO
proposals without modification.
2. Retroactive Provider Agreement Terminations
Under section 1866(a)(1) of the Act, all Medicare providers (as
that term is defined in section 1866(e) of the Act) must enter into a
provider agreement with the Secretary. Subparts A, B, and E of 42 CFR
part 489 contain regulations concerning provider agreements. In
accordance with Sec. 489.52, a provider may voluntarily terminate its
provider agreement and thus depart the Medicare program. In doing so,
and under existing sub-regulatory policy, the provider may request a
retroactive termination effective date (for example, retroactive to the
date the provider's facility closed). To incorporate this practice into
regulation, we proposed in new Sec. 489.52(b)(4) that a provider may
request a retroactive termination date, but only if no Medicare
beneficiary received services from the facility on or after the
requested termination date. This latter caveat would financially
protect beneficiaries by helping to ensure that Medicare may still
cover the services furnished to them near the end of the provider's
operations.
Comment: Several commenters supported our proposed change.
Response: We appreciate the commenters' support.
After reviewing the comments received, we are finalizing new Sec.
489.52(b)(4) without modification.
3. Hospice Screening Category
a. Categorical Risk Screening
Under the authority granted to us by section 6401(a) of the
Affordable Care Act (which amended section 1866(j) to the Act), Sec.
424.518 outlines levels of screening by which CMS and its MACs review
initial applications, revalidation applications, applications to add a
practice location, and applications to report any new owner. These
screening categories and requirements are based on a CMS assessment of
the level of risk of fraud, waste, and abuse posed by a
[[Page 77845]]
particular type of provider or supplier. In general, the higher the
level of risk a certain provider or supplier type poses, the greater
the level of scrutiny with which CMS will screen and review providers
or suppliers within that category.
There are three levels of screening in Sec. 424.518: high,
moderate, and limited. Irrespective of which level a provider or
supplier type falls within, the MAC performs the following screening
functions upon receipt of an initial enrollment application, a
revalidation application, an application to add a new location, or an
application to report a new owner:
Verifies that the provider or supplier meets all
applicable federal regulations and state requirements for their
provider or supplier type.
Conducts state license verifications.
Conducts database checks on a pre- and post-enrollment
basis to ensure that providers and suppliers continue to meet the
enrollment criteria for their provider or supplier type.
Providers and suppliers at the moderate and high categorical risk
levels must also undergo a site visit. Furthermore, for those at the
high screening level, the MAC performs two additional functions under
Sec. 424.518(c)(2). First, the MAC requires the submission of a set of
fingerprints for a national background check from all individuals who
have a 5 percent or greater direct or indirect ownership interest in
the provider or supplier. Second, it conducts a fingerprint-based
criminal history record check of the Federal Bureau of Investigation's
Integrated Automated Fingerprint Identification System on these 5
percent or greater owners. These additional verification activities are
meant to correspond to the heightened risk involved.
There currently are only five provider and supplier types that fall
within the high categorical risk level under Sec. 424.518(c)(1):
newly/initially enrolling opioid treatment programs that have not been
fully and continuously certified by SAMHSA since October 23, 2018
(hereafter collectively referenced as simply ``OTPs'' unless specified
otherwise); newly/initially enrolling HHAs; newly/initially enrolling
DMEPOS suppliers; newly/initially enrolling Medicare diabetes
prevention program (MDPP) suppliers; and newly/initially enrolling
skilled nursing facilities (SNFs).
Hospices are presently in the moderate-risk screening category
under Sec. 424.518. However, CMS in recent years has become
increasingly concerned about program integrity issues within the
hospice community, particularly (though not exclusively) potential and
actual criminal behavior, fraud schemes, and improper billing. We
outlined in the July 10, 2023, proposed rule numerous criminal and
False Claims Act cases involving hospice owners and overseers that have
arisen since our initial designation of hospices as moderate risk in
2011. A recent and especially disturbing case we referenced involved
the sentencing in January 2022 of the CEO of a Texas hospice agency to
over 13 years in prison after pleading guilty to conspiracy to commit
Medicare and Medicaid fraud. The CEO admitted that he: (1) billed
Medicare and Medicaid for hospice services that were not provided, not
directed by a medical professional, or provided to patients who were
ineligible for hospice care; and (2) used blank, pre-signed controlled
substance prescriptions to prescribe potent drugs even though the CEO
was not a medical professional.\214\ The CEO's scheme involved other
individuals, thirteen of whom (including physicians) also pled guilty
to crimes such as conspiracy to commit health care fraud.\215\ The
Federal Bureau of Investigation special agent in charge stated: ``In
addition to causing fraudulent billing for tens of millions of dollars,
[the CEO] preyed upon patients and families that did not have a true
understanding of [the company] and hospice services. The core of the
company was rooted in deception, and the lack of physician oversight
allowed [the defendant] to make medical decisions for his own financial
benefit.'' \216\
---------------------------------------------------------------------------
\214\ https://www.justice.gov/usao-ndtx/pr/novus-hospice-ceo-sentenced-13-years-healthcare-fraud.
\215\ https://www.justice.gov/usao-ndtx/pr/13-novus-healthcare-
fraud-defendants-sentenced-combined-84-years-
prison#:~:text=Bradley%20Harris%2C%20Novus%20CEO%2C%20pleaded,Dr.
\216\ Ibid.
---------------------------------------------------------------------------
We also noted in the proposed rule the OIG's July 2018 study titled
``Vulnerabilities in the Medicare Hospice Program Affect Quality Care
and Program Integrity'' (OEI-02-16-00570). According to this report,
Medicare in 2016 spent about $16.7 billion for hospice care for 1.4
million beneficiaries, an increase from $9.2 billion for less than 1
million beneficiaries in 2006; with this growth, the OIG stated that
``significant vulnerabilities'' have arisen, one of which involves
improper activity.\217\ The report noted that some such schemes
involved: (1) paying recruiters to target beneficiaries who were
ineligible for hospice services; and (2) physicians falsely certifying
beneficiaries as terminally ill when they were not. The OIG cited
several of the cases we outlined in the July 10, 2023, proposed rule as
examples of this behavior.\218\
---------------------------------------------------------------------------
\217\ https://oig.hhs.gov/oei/reports/oei-02-16-00570.pdf, p. 1.
\218\ Ibid.
---------------------------------------------------------------------------
Given the foregoing, we believed that closer screening of hospice
owners was necessary. Although not every case of hospice fraud involves
or can be attributable to the hospice's owner, we noted that the owner
can set the tone for the hospice's operations as a whole. If,
accordingly, an owner has a criminal background involving fraud or
patient abuse, this could lead to similar activity within the hospice.
We also stated in the proposed rule that the increasing number of fraud
cases warrants a revisiting of our original assignment of hospices to
the moderate risk category. With our obligation to protect the Trust
Funds and vulnerable Medicare beneficiaries, we believe more thorough
scrutiny of hospice owners is required.
Therefore,we proposed to revise Sec. 424.518 to move initially
enrolling hospices and those submitting applications to report any new
owner (as described in Sec. 424.518's opening paragraph) into the
``high'' level of categorical screening; revalidating hospices would be
subject to moderate risk-level screening. Requiring all hospice owners
with 5 percent or greater direct or indirect ownership to submit
fingerprints for a criminal background check would help us detect
parties potentially posing a risk of fraud, waste, or abuse before it
begins. Indeed, we have found our fingerprint-based criminal background
checks to be of great assistance in detecting felonious behavior by the
owners of high-risk providers and suppliers.
Under our proposal, initially enrolling hospices would be
incorporated within revised paragraph (c)(1)(vi). The current language
in paragraph (c)(1)(vi) would be included within new proposed paragraph
(c)(1)(vii), to which would be added hospices disclosing a new owner.
b. Comments Received and Final Provisions
Comment: Several commenters supported our proposed elevation of
hospices to the high-risk screening category.
Response: We appreciate the commenters' support.
After reviewing the comments received, we are finalizing our
hospice high-risk screening proposal without modification.
[[Page 77846]]
4. 36-Month Rule for Changes in Majority Ownership--Hospices
a. Background
The general purpose of a state survey or accreditation review for
any Medicare provider or supplier type subject thereto is to determine
whether the provider or supplier is in compliance with its regulatorily
prescribed conditions of participation or conditions of coverage
(hereafter collectively referenced as CoPs). CoPs are federal
requirements that a provider or supplier must meet to participate in
the Medicare program, and they generally focus on health and safety
protections.
Though it is a provider enrollment provision, Sec. 424.550(b)(1)
recognizes the importance of the HHA survey and accreditation processes
(hereafter sometimes jointly referenced as the ``survey process''),
which help confirm the HHA's compliance with the CoPs and the quality
and safety requirements they entail. Section 424.550(b)(1) states that
if an HHA undergoes a change in majority ownership (occasionally
referenced as a ``CIMO'') by sale within 36 months after the effective
date of the HHA's initial enrollment in Medicare or within 36 months
after the HHA's most recent CIMO, the provider agreement and Medicare
billing privileges do not convey to the HHA's new owner. The
prospective provider/owner of the HHA must instead: (1) enroll in
Medicare as a new (initial) HHA; and (2) obtain a state survey or an
accreditation from an approved accreditation organization. As defined
in 42 CFR 424.502, a ``change in majority ownership'' occurs when an
individual or organization acquires more than a 50 percent direct
ownership interest in an HHA during the 36 months following the HHA's
initial enrollment or most recent CIMO; this includes an acquisition of
majority ownership through the cumulative effect of asset sales, stock
transfers, consolidations, or mergers. Under Sec. 424.550(b)(1), a 42
CFR 489.18-level change of ownership and/or 100 percent ownership
transfer is not necessary to trigger this ``36-month rule.'' Only
crossing the 50 percent ownership threshold is required.
Section 424.550(b)(1) was promulgated in 2009 and modified in 2010.
There were two principal objectives behind its establishment.
First, there was a trend in the HHA community whereby an HHA
applied for Medicare certification, underwent a survey, and became
enrolled in Medicare, but then immediately sold the HHA without having
seen a Medicare beneficiary or hired an employee. These brokers, in
other words, enrolled in Medicare exclusively to sell the HHA rather
than to provide services to beneficiaries. This practice enabled a
purchaser of an HHA from the broker to enter Medicare with no survey,
which, in turn, sometimes led that owner to soon sell the business to
another party. The ``flipping'' or ``turn-key'' mechanism, in short,
was used to circumvent the survey process.
Second, we were more broadly concerned about the lack of scrutiny
of new owners as a whole, not merely in cases of flipping. If an HHA
undergoes a change of ownership, CMS--at the current time--generally
does not perform a survey pursuant thereto. Consequently, CMS has no
sure way of knowing whether the HHA, under its new ownership and
management, is in compliance with the HHA CoPs. Unless CMS can make
this determination, there is a risk that the newly purchased HHA,
without having been appropriately vetted, will bill for services when
it is non-compliant with the CoPs.\219\
---------------------------------------------------------------------------
\219\ Ibid.
---------------------------------------------------------------------------
We previously outlined in this final rule our growing concerns
about improper behavior within the hospice community. Yet, as we
explained in the proposed rule and restate here, we are equally
concerned about the quality of care furnished in some of these
facilities. Indeed, we have seen an increase in the number of hospice
changes of ownership (including the types of CIMOs described in 42 CFR
424.550(b)(1)) in recent years, and a number of these ownership changes
have occurred within the applicable 36-month timeframe. In fact, some
such changes have taken place within only a few months after enrollment
or the previous CIMO, akin to what we saw with the ``flipping''
practice outlined in the CY 2010 HH PPS proposed and final rules;
specifically, we have received reports that hospices are being sold
quickly after enrollment or purchase so that the new owner can avoid
any survey. This is because, as had been our concern with HHAs, hospice
ownership changes generally do not result in a state survey or
accreditation review.
Without knowing whether the facility under its new ownership and
leadership is compliant with the hospice CoPs, we cannot determine
whether the hospice will furnish proper care to its patients.
Beneficiary lives can be endangered if the newly purchased hospice is
not committed to furnishing quality services.
For all these reasons, we proposed to expand the scope of Sec.
424.550(b)(1) to include hospice CIMOs within its purview. (We also
proposed to expand the aforementioned definition of ``change in
majority ownership'' in Sec. 424.502 to include hospices.) We believed
that our previously detailed concerns about hospices, such as fraud
schemes, patient abuse, improper billing, and potential substandard
care require the level of scrutiny that a survey can furnish.
We noted in the proposed rule that Sec. 424.550(b)(2) contains
four exceptions to the 36-month rule. Specifically, even if an HHA
undergoes a CIMO, the requirement in Sec. 424.550(b)(1) that the HHA
enroll as a new HHA and undergo a survey or accreditation is
inapplicable if one of the exceptions applies. (For example, Sec.
424.550(b)(2)(iv) exempts an HHA from Sec. 424.550(b)(1)'s
requirements if the HHA's CIMO was due to the owner's death.) We
promulgated these exceptions because the HHA community had expressed
concerns that the 36-month rule could inhibit bona fide HHA ownership
transactions; for example, prospective new owners may not wish to have
to enroll as a new HHA and will therefore decline to purchase the
entity. We believed that our exceptions struck a solid balance between
the need for more scrutiny of new owners via the survey process while
not inadvertently obstructing legitimate transactions involving
legitimate parties. Thus, we deemed it appropriate to also apply these
exceptions to hospices.
b. Comments Received and Final Provisions
Comment: Several commenters supported our proposal to expand Sec.
424.550(b)(1) to include hospices.
Response: We appreciate the commenters' support.
Comment: While expressing support for our proposal, a commenter
suggested that CMS strengthen it by requiring the hospice to maintain
an active census during the 36-month period in question. The commenter
believed this would help facilitate ongoing monitoring of the care the
hospice furnishes.
Response: We appreciate this comment, will consider the suggestion
in the future, and always welcome recommendations from concerned
stakeholders regarding means of strengthening Medicare program
integrity and improve patient care.
Comment: A commenter referenced existing Sec. 424.550(b)(2)(i),
which contains an exception to the 36-month rule if the provider
submitted 2 consecutive years of full cost reports since initial
enrollment or the last CIMO, whichever is later. (For purposes of this
exception, low utilization or no utilization cost reports do not
qualify as
[[Page 77847]]
full cost reports.) The commenter asked whether: (1) a full cost report
can cover a period of less than 12 months if the cost report is not low
utilization or no utilization; and (2) if the provider receives less
than $200,000 and files a full cost report instead of a low utilization
cost report, that cost report is considered a full cost report under
Sec. 424.550(b)(2)(i).
Response: We appreciate this comment but believe it is outside the
scope of this rule.
After reviewing the comments received, we are finalizing our
hospice 36-month rule proposal without modification.
5. Deactivation for 12-Months of Non-Billing
a. Background
Regulatory policies regarding the provider enrollment concept of
deactivation are addressed in Sec. 424.540. Deactivation means that
the provider's or supplier's billing privileges are stopped but can be
restored (or ``reactivated'') upon the submission of information
required under Sec. 424.540. A deactivated provider or supplier is not
revoked from Medicare and remains enrolled. Per Sec. 424.540(c),
deactivation does not impact the provider's or supplier's existing
provider or supplier agreement; the deactivated provider or supplier
may also file a rebuttal to the action in accordance with Sec.
424.546. Nonetheless, the provider's or supplier's ability to bill
Medicare is halted pending its compliance with Sec. 424.540's
requirements for reactivation.
One of the grounds for deactivating a provider or supplier
(outlined in Sec. 424.540(a)(1)) is that the provider or supplier has
not submitted any Medicare claims for 12 consecutive months. This
provision is designed to help prevent, for instance: (1) questionable
businesses from deliberately obtaining multiple numbers so they could
keep one `in reserve' [for future use] if their active billing number
is revoked or subject to a payment suspension; and (2) fraudulent
entities from obtaining information about discontinued providers or
suppliers and then, for example, using the Medicare billing number of a
deceased physician.\220\
---------------------------------------------------------------------------
\220\ Ibid. (68 FR 22072).
---------------------------------------------------------------------------
In the July 10, 2023 proposed rule, we proposed to reduce the 12-
month timeframe currently in Sec. 424.540(a)(1) to 6 months. We noted
that we have recently detected fraud schemes involving extended periods
of non-billing. A common situation involves a provider that: (1)
establishes multiple enrollments with multiple billing numbers; (2)
abusively or inappropriately bills under one billing number; (3)
receives an overpayment demand letter or becomes the subject of
investigation; (4) voluntarily terminates the billing number in
question; and then (5) begins to bill via another of its billing
numbers that is dormant (for example, 6 consecutive months without
billing) but nevertheless active, repeating the same improper conduct
as before. The problem in this case is that we cannot deactivate the
dormant billing number (hence rendering it unusable and inaccessible
pending a reactivation) under Sec. 424.540(a)(1) because the
applicable 12-month period has not yet expired. We do not believe we
can or should wait for a year to elapse before taking deactivation
action against these providers and suppliers. To protect the Trust
Funds against improper payments, we must be able to move more promptly
to deactivate these ``spare'' billing numbers so the latter cannot be
inappropriately used or accessed.
However, our concerns in the proposed rule were not limited to
these fraud schemes. A lack of billing for an extended period can
indicate that the provider or supplier has ceased operations without
notifying CMS. Deactivating the number enables us to not only prevent
it from being accessed by other parties but also confirm via the
deactivation process whether the provider or supplier is in fact
operational--specifically, whether the provider or supplier responds
with a Form CMS-855 application to reactivate their enrollment. In
other words, action under Sec. 424.540(a)(1) helps protect the
Medicare program by deactivating the number while verifying whether the
provider or supplier remains in existence; if it does, and it
subsequently submits a reactivation application, CMS can validate the
data thereon to ensure the provider's or supplier's continued
credentials and compliance with Medicare requirements. This protective
process, we believe, should be available to us upon the expiration of a
6-month non-billing timeframe, for our earlier-referenced concerns
exist whenever any extensive period of non-billing occurs. The sooner
we can address these non-billing cases, the better we can protect the
Trust Funds. For these reasons, we proposed to revise Sec.
424.540(a)(1) to change the 12-month timeframe to 6 months.
We recognized in the proposed rule that certain lengthy periods of
non-billing do not involve any improper provider activity. To
illustrate, some providers must be enrolled in Medicare to enroll in
another health care program; as the provider does not intend to bill
Medicare but only the other program, an extended period of Medicare
non-billing can result. While CMS retains the discretion, as it always
has, to deactivate a provider or supplier if the contingency in Sec.
424.540(a)(1) is triggered, providers and suppliers that are not
typically deactivated for 12 months of non-billing should not assume
they are more likely to be deactivated under our proposed change to 6
months.
b. Comments Received and Final Provisions
Comment: Several commenters supported our proposed reduction in
Sec. 424.540(a)(1) of the non-billing period from 12 months to 6
months. A commenter stated that the impact of the reduction on good-
faith providers will be limited because they are very unlikely to go 6
months without billing Medicare.
Response: We appreciate the commenters' support.
Comment: A commenter did not believe Sec. 424.540(a)(1)'s concept
of deactivating providers for non-billing enhances program integrity;
rather, it merely penalizes legitimate providers. Using HHAs as an
example, the commenter explained that many state Medicaid programs
require HHAs to be enrolled in Medicare in order to enroll in and bill
Medicaid, even though the HHA does not intend to bill Medicare. This
means the Medicare enrollment is often deactivated for 12 consecutive
months of non-billing, which requires the HHA to reactivate its
Medicare enrollment. The commenter believes: (1) this change unfairly
burdens good-faith HHAs without reducing fraud; and (2) HHAs will be
further burdened by our proposed reduction from 12 to 6 months. (These
two concerns were shared by another commenter.) The commenter
recommended that CMS, in lieu of deactivation, take other steps to
confirm that the non-billing HHA is operational, such as confirming the
HHA's licensure and ensuring that the HHA is actively billing Medicaid.
In a similar vein, another commenter encouraged CMS to establish
provisions that allow a provider or supplier to explain why it has not
submitted claims to Medicare for an extended period before CMS
deactivates the provider or supplier for non-billing.
Response: We appreciate these concerns and address them as follows:
First, we respectfully disagree that Sec. 424.540(a)(1) does not
strengthen program integrity. As we explained in
[[Page 77848]]
the proposed rule, deactivating dormant billing numbers helps prevent
unscrupulous parties from: (1) improperly accessing and utilizing
another provider's billing number to bill Medicare; and (2) utilizing a
``spare'' (though previously unused) billing number to effectively
circumvent a CMS-imposed adverse action applied to the provider's
principal billing number. This latter consideration is especially
critical given, as previously mentioned, the increase in fraud schemes
involving providers acquiring multiple billing numbers for such
nefarious purposes.
Second, we acknowledged in the proposed and this final rule that
some providers must enroll in Medicare (without intending to bill
Medicare) as a prerequisite for enrolling in another federal program,
such as Medicaid. Yet any deactivation of a provider's billing number
is in no manner intended to burden the provider. It is to instead
protect the provider and Medicare from the parties described previously
that may seek to access the provider's unused billing number and
inappropriately bill on the provider's behalf.
Third, we thank the commenters for their recommendations concerning
alternative forms of verifying the active status of a non-billing
Medicare provider, including affording the provider an opportunity to
explain why it has not billed Medicare before deactivation occurs.
However, the purposes of Sec. 424.540(a)(1) go well beyond the need to
confirm that the provider is operational and compliant with Medicare
requirements. We have to ensure that inactive billing numbers cannot be
utilized by parties intent on committing fraud and, principally for
this reason, we cannot delay action pending the completion of, as the
final commenter appears to recommend, a type of pre-deactivation
appeals process. We must move as swiftly as possible to protect the
Trust Funds from such parties.
After reviewing the comments received, we are finalizing our
proposed change to Sec. 424.540(a)(1) without modification.
6. Definition of ``Managing Employee''
a. Background
Consistent with sections 1124 and 1124A of the Act, providers and
suppliers are required to report their managing employees via the
applicable Medicare enrollment application to enroll in Medicare. We
currently define a ``managing employee'' in Sec. 424.502 as a
``general manager, business manager, administrator, director, or other
individual that exercises operational or managerial control over, or
who directly or indirectly conducts, the day-to-day operation of the
provider or supplier (either under contract or through some other
arrangement), whether or not the individual is a W-2 employee of the
provider or supplier.'' In a proposed rule published in the February
15, 2023 Federal Register titled ``Medicare and Medicaid Programs;
Disclosures of Ownership and Additional Disclosable Parties Information
for Skilled Nursing Facilities and Nursing Facilities'' (88 FR 9820),
we proposed to revise this definition under our proposed implementation
via that rule of section 1124(c) of the Act. We specifically proposed
that, for purposes of 42 CFR 424.516(g) and with respect to a SNF, a
managing employee also includes a general manager, business manager,
administrator, director, or consultant, who directly or indirectly
manages, advises, or supervises any element of the practices, finances,
or operations of the facility. As proposed, this SNF-exclusive
definition would be in a new paragraph (2) of the managing employee
definition in Sec. 424.502; the existing version of the definition
would be included within new paragraph (1).
We proposed to further revise this definition in the July 10, 2023
proposed rule. We noted that we have received questions from the
hospice and SNF communities regarding whether hospice and SNF facility
administrators and medical directors must be disclosed as managing
employees on the enrollment application. It has been our experience in
overseeing the Medicare provider enrollment process that such
individuals indeed exercise managing control over the hospice or SNF.
We have long required that they be reported as managing employees.
Accordingly, we proposed adding the following language immediately
after (and in the same paragraph as) the current managing employee
definition: ``For purposes of this definition, this includes, but is
not limited to, a hospice or skilled nursing facility administrator and
a hospice or skilled nursing facility medical director.'' We proposed
that this change would be reflected in the first paragraph of the
revised definition of this term as proposed in the February 15, 2023,
proposed rule. That is, the revision described in this section
VIII.B.6. of this rule would be added to the end of new paragraph (1)
as the latter was proposed in the February 15, 2023 proposed rule.
We stressed that this clarification regarding hospice and SNF
facility administrators and medical directors should not be construed
as CMS' establishment of a minimum threshold for reporting managing
employees of hospices, SNFs, or any other provider or supplier type.
Put otherwise, simply because an individual has less managing control
within a particular organization than a facility administrator or
medical director does not mean that the person need not be disclosed.
Any individual who meets the definition of managing employee in Sec.
424.502 must be reported irrespective of the precise amount of managing
control the person has. The exclusive purpose of our proposed
elucidation was to address specific questions raised by hospices and
SNFs concerning whether the individuals at issue must be reported. It
was not meant to change existing reporting requirements regarding
managing employees and who must be disclosed as such.
b. Comments Received and Final Provisions
Comment: Several commenters supported our proposed revision of the
``managing employee'' definition.
Response: We appreciate the commenters' support.
After reviewing the comments received, we are finalizing our change
to this definition as proposed with one exception. Because the
previously mentioned February 15, 2023, proposed rule has not been
finalized, the revision to this definition we proposed in the July 10,
2023, proposed rule will be applied to the current definition of
managing employee in Sec. 424.502. Should our proposed revision to the
managing employee definition in the February 15, 2023, be finalized,
said revision will be applied to the managing employee definition we
are finalizing in the present rule.
7. Previously Waived Fingerprinting of High-Risk Providers and
Suppliers
a. Background
During the recent COVID-19 public health emergency (PHE), CMS
temporarily waived the requirement for fingerprint-based criminal
background checks (FBCBCs) for 5 percent or greater owners of newly
enrolling providers and suppliers falling within the high-risk
screening category in Sec. 424.518(c). The principal purpose was to
facilitate beneficiary access to services by potentially increasing the
number of health care providers and suppliers. Given the scope of the
emergency, we believed this had to take priority. Nevertheless, we
remained concerned during the waiver period about the lack of FBCBCs
being performed, since we believe FBCBCs are the surest means of
[[Page 77849]]
detecting felonious behavior by the owners of high-risk providers and
suppliers. With this in mind, we noted our desire in the July 10, 2023,
proposed rule to perform FBCBCs for high-risk providers and suppliers
that initially enrolled during the PHE upon their revalidation once the
PHE ends. Yet we explained that this was not possible under our
existing regulations because the revalidation applications will only be
screened at the moderate-risk level. To remedy this, we proposed to add
new Sec. 424.518(c)(1)(viii) that would incorporate within the high-
screening category revalidating DMEPOS suppliers, HHAs, OTPs, MDPPs,
and SNFs for which CMS waived the FBCBC requirement when they initially
enrolled in Medicare. However, considering the potential for future
emergencies for which CMS might waive FBCBCs under applicable legal
authority (such as that for the PHE), we more specifically proposed in
new Sec. 424.518(c)(1)(viii) that this high-risk category (which would
include hospices with respect to future waivers) would apply to
situations where CMS waived FBCBCs, in accordance with applicable legal
authority, due to a national, state, or local emergency declared under
existing law. We emphasized that our proposal would not obligate CMS to
waive the FBCBC requirement in any such emergency.
Along with adding new Sec. 424.518(c)(1)(viii), we proposed to
delete current Sec. 424.518(b)(1)(iv), (ix), (x), (xi), (xiii), and
(xiv), which individually identify the six previously discussed
provider and supplier types (including hospices) as moderate-risk if
they are revalidating their enrollment. We would redesignate existing
paragraphs (b)(1)(v) through (b)(1)(viii) as revised paragraphs
(b)(1)(iv) through (b)(1)(vii). We would also redesignate existing
paragraph (b)(1)(xii) as revised (b)(1)(viii), with the former
paragraph being deleted.
Revised paragraph (b)(1)(viii) would include both prospective and
revalidating OTPs that have been fully and continuously certified by
SAMHSA since October 23, 2018. Furthermore, we would establish a
revised paragraph (b)(1)(ix) that would include within the moderate-
risk category revalidating DMEPOS suppliers, HHAs, OTPs, MDPPs, SNFs,
and hospices that underwent FBCBCs: (1) when they initially enrolled in
Medicare; or (2) upon revalidation after CMS waived the FBCBC
requirement (under the circumstances described in paragraph
(c)(1)(viii)) when the provider or supplier initially enrolled in
Medicare.
We noted in the proposed rule that CMS under Sec. 424.515(d) can
perform off-cycle revalidations; that is, we can revalidate a provider
or supplier at any time and need not wait until the arrival of their
applicable periodic revalidation cycle. We emphasized that if our
proposals regarding fingerprinting waivers were finalized, CMS would
reserve the right to conduct off-cycle revalidations of the waived
high-risk providers and suppliers.
b. Comments Received and Final Provisions
Comment: Several commenters supported our proposed revisions
regarding the fingerprinting of previously waived providers and
suppliers in the ``high'' screening category.
Response: We appreciate the commenters' support.
After reviewing the comments received, we are finalizing our
proposed changes without modification.
8. Expansion of Reapplication Bar
Section 424.530(f) permits CMS to prohibit a prospective provider
or supplier from enrolling in Medicare for up to 3 years if its
enrollment application is denied because the provider or supplier
submitted false or misleading information on or with (or omitted
information from) its application in order to enroll. The purpose of
Sec. 424.530(f) is to prevent dishonest providers and suppliers from
submitting false information on their initial application and, after
being denied enrollment on this ground under Sec. 424.530(a)(4),
simply submitting a new application with correct data.
The existing maximum length of a reapplication bar under Sec.
424.530(f) is 3 years. In the proposed rule, we proposed to expand this
to 10 years to account for provider or supplier conduct of particular
severity. We explained that we must be able to prevent such problematic
parties from repeatedly submitting applications over many years with
the goal of somehow getting into the program.
Comment: Several commenters supported our proposed reapplication
bar expansion.
Response: We appreciate the commenters' support.
Comment: Although supportive of our proposed change, a commenter
expressed concern that a 10-year reapplication bar would be imposed
against honest providers and suppliers that inadvertently submitted
incorrect information.
Response: We note two things. First, a 10-year reapplication bar
would only be used when an analysis using the factors described in
Sec. 424.530(f)(2) indicates that it is warranted. Second, we do not
apply Sec. 424.530(f) and an associated reapplication bar as a matter
of course. Only after a very careful review of the facts and
circumstances of the case in question would CMS take this step.
After reviewing the comments received, we are finalizing our
reapplication bar proposal without modification.
9. Ordering, Referring, Certifying, and Prescribing Restrictions
a. Background
We discussed previously: (1) the need to increase the maximum
reapplication bar to keep dishonest providers and suppliers out of
Medicare for longer than 3 years; and (2) our concerns about felonious
provider and supplier activity. We believe such provider and supplier
behavior should result in restrictions regarding the ordering,
referring, certifying, or prescribing of Medicare services, items, and
drugs, too. Indeed, such ordering, referring, certifying, or
prescribing can involve improper conduct that is as harmful to Medicare
beneficiaries as the actual furnishing of services; this includes, for
example, the over-prescribing of opioids and the unnecessary ordering
of potentially dangerous tests. Consequently, and using our general
rulemaking authority under sections 1102 and 1871 of the Act, in the
proposed rule we proposed the following two provisions.
First, we proposed to add a new paragraph (3) to Sec. 424.530(f)
stating that a provider or supplier that is currently subject to a
reapplication bar under paragraph (f) may not order, refer, certify, or
prescribe Medicare-covered services, items, or drugs. To enforce this
policy, we further proposed in new Sec. 424.530(f)(3) that Medicare
does not pay for any otherwise covered service, item, or drug that is
ordered, referred, certified, or prescribed by a provider or supplier
that is currently under a reapplication bar.
Second, we proposed in paragraph (a) of new Sec. 424.542 that a
physician or other eligible professional (regardless of whether he or
she is or was enrolled in Medicare) who has had a felony conviction
within the previous 10 years that CMS determines is detrimental to the
best interests of the Medicare program and its beneficiaries may not
order, refer, certify, or prescribe Medicare-covered services, items,
or drugs. Akin to Sec. 424.530(f)(3), we proposed in new Sec.
424.542(b) that Medicare does not pay for any otherwise
[[Page 77850]]
covered service, item, or drug that is ordered, referred, certified, or
prescribed by a physician or other eligible professional (as that term
is defined in section 1848(k)(3)(B) of the Act) who has had a felony
conviction within the previous 10 years that CMS determines is
detrimental to the best interests of the Medicare program and its
beneficiaries.
We stated in the proposed rule that these provisions would apply
regardless of whether the provider or supplier has opted-out of
Medicare. This is because the conduct associated with a reapplication
bar and a felony conviction presents risks irrespective of the
provider's or supplier's opt-out status.
b. Comments Received and Final Provisions
Comment: Several commenters supported our proposals regarding
prohibitions against ordering, referring, certifying, and prescribing.
Response: We appreciate the commenters' support.
Comment: A commenter stated that in potentially applying proposed
Sec. 424.542, CMS should: (1) use a consistent, defined list of felony
convictions that CMS has deemed detrimental to Medicare; or (2) defer
to the states' professional licensure boards for convictions that would
bar an individual from practicing medicine. The commenter believed this
would reduce subjectivity in CMS' determinations.
Response: We list certain federal and state felony convictions in
42 CFR 424.530(a)(3) and 424.535(a)(3) for which CMS may, respectively,
deny or revoke a provider's or supplier's enrollment under those two
provisions. Yet this list is not exhaustive because of the hundreds of
additional and more specific types of felonies under federal and state
law of which individuals can be convicted. Hence, we must retain our
flexibility to consider each felony case on its own facts and
circumstances rather than restrict ourselves to a small list of felony
offenses. Insofar as the commenter's second suggestion, CMS is
ultimately responsible for overseeing the Medicare program and
protecting its beneficiaries and the Trust Funds.
After reviewing the comments received, we are finalizing new Sec.
424.542 without modification.
10. Miscellaneous Comments
We also received the following miscellaneous comments.
Comment: A commenter expressed support for CMS' proposed revision
to the Form CMS-855A (Medicare Enrollment Application--Institutional
Providers; OMB Control No.: 0938-0685) to require providers and
suppliers completing that application to disclose whether any of their
owning or managing organizations are private equity companies or real
estate investment trusts.\221\
---------------------------------------------------------------------------
\221\ 87 FR 76626
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Response: While we appreciate the commenter's support, we believe
this comment is outside the scope of this final rule.
Comment: A commenter referenced our February 15, 2023, proposed
rule that would require Medicare and Medicaid nursing homes to report
the data outlined in section 1124(c) of the Act regarding their owners,
operators, and associated parties. The commenter recommended that CMS
apply the policies in the February 15, 2023, proposed rule to hospices.
This could include, for example, requiring hospices to disclose similar
data, auditing this data for accuracy (to which the hospice should
attest), and analyzing hospice ownership trends to ascertain
correlations to the quality of hospice patient care. Other hospice
program integrity suggestions the commenter raised included: (1)
imposing a temporary moratorium on the enrollment of new hospices in
areas where there is an overabundance of hospices compared to
established needs; (2) greater frequency of state surveys of high-risk
hospices; (3) tighter restrictions on non-operational hospices; and (4)
a greater CMS focus on the quality of hospice services and program
integrity and less on innocuous technical errors, which the commenter
stated risks alienating high-performing hospices.
Response: We appreciate these recommendations and share the
commenter's concerns regarding hospice program integrity and quality of
care. We will continue to closely monitor the hospice sector, as well
as the progress of our new hospice provisions once implemented, and
may, as needed, consider additional measures as the commenter suggests.
Comment: A commenter believed that our proposals merely add
administrative burden without truly addressing program integrity. The
commenter recommended a more targeted approach and for CMS to
reconsider its proposals.
Response: We respectfully disagree with the commenter. In both the
proposed rule and this final rule, we outlined the reasons for each of
our proposals and how they will strengthen program integrity. To
illustrate, in our discussion of the 36-month rule, we explained that
requiring hospices under new majority ownership to undergo a state
survey and enroll as new applicant will help ensure that the hospice is
compliant with the CoPs and all enrollment requirements. Moreover, we
believe that our provisions are targeted to address specific problems
in a manner that will not unduly burden the provider community at
large. Consider the following examples:
Our ``high'' screening level proposals were restricted to:
(1) initially enrolling hospices and those submitting applications to
report any new owner; and (2) those high-risk providers and suppliers
that were previously waived from fingerprinting. We did not, for
instance, propose to move all provider and supplier types currently in
the ``moderate'' screening category--such as community mental health
centers, ambulance suppliers, and independent diagnostic testing
facilities--into the ``high'' screening category.
We limited our expansion of the 36-month rule to hospices.
No other provider or supplier type is affected by this change.
We believe that the regulations at Sec. 424.542 that
pertain to ordering, referring, certifying, and prescribing
restrictions would only apply to the very limited number of persons and
entities: (1) subject to a reapplication bar; or (2) that have
committed a felony that CMS deems detrimental to the best interests of
Medicare and its beneficiaries.
In short, we are confident that our provisions strike a proper
equilibrium between the need to address certain payment safeguard
issues with the need to avoid, to the maximum extent possible, overly
burdening the many legitimate Medicare providers and suppliers. This
has always been, and always will be, a fundamental aim of our provider
enrollment rulemaking efforts.
IX. Collection of Information Requirements
A. Statutory Requirement for Solicitation of Comments
Under the Paperwork Reduction Act of 1995, we are required to
provide a 60-day notice in the Federal Register and solicit public
comment before a collection of information requirement is submitted to
the Office of Management and Budget (OMB) for review and approval. In
order to fairly evaluate whether an information collection should be
approved by OMB, section 3506(c)(2)(A) of the Paperwork Reduction Act
of 1995 requires that we solicit comment on the following issues:
[[Page 77851]]
The need for the information collection and its usefulness
in carrying out the proper functions of our agency.
The accuracy of our estimate of the information collection
burden.
The quality, utility, and clarity of the information to be
collected.
Recommendations to minimize the information collection
burden on the affected public, including automated collection
techniques.
B. Information Collection Requirements (ICRs)
In the CY 2024 HH PPS rule, we solicited public comment on each of
these issues for the following sections of this document that contain
information collection requirements (ICRs).
1. ICRs for HH QRP
As discussed in section III. of this final rule, we are finalizing
our proposal that HHAs will collect data for one new quality measure,
the Discharge Function Score (DC Function) measure, beginning with
assessments completed on April 1, 2024 used for public reporting.
However, the DC Function measure utilizes data items that HHAs already
report to CMS for quality reporting purposes, and therefore, the burden
is accounted for in the PRA package approved under OMB control number
0938-1279 (expiration November 30, 2025).
As discussed in section III.C.2. of this final rule, we proposed to
remove a measure from the HH QRP, the Application of Percent of Long-
Term Care Hospital Patients with an Admission and Discharge Functional
Assessment and a Care Plan That Addresses Function (Application of
Functional Assessment/Care Plan) measure, beginning with admission
assessments completed on January 1, 2025. We also proposed to remove
OASIS items for Self-Care Discharge Goals (that is, GG0130, Column 2)
and Mobility Discharge Goals (that is, GG0170, Column 2) at the start
of care and resumption of care timepoints with the next release of the
OASIS in 2025. This amounts to a net reduction in 2 data elements. We
assumed that each data element requires 0.3 minutes of clinician time
to complete. Therefore, we estimated that there will be a reduction in
clinician burden per OASIS assessment of 0.3 minutes at start of care
and 0.3 minutes at resumption of care.
As stated in section III.C.3. of this final rule, we will adopt the
COVID-19 Vaccine: Percent of Patients/Residents Who Are Up to Date
(Patient/Resident COVID-19 Vaccine) measure beginning with the CY 2025
HH QRP. This proposed assessment-based quality measure will be
collected using the OASIS. The OASIS-E is currently approved under OMB
control number 0938-1279 (CMS-10387). One data element will need to be
added to the OASIS at the transfer of care, death at home, and
discharge time points in order to allow for the collection of the
Patient/Resident COVID-19 Vaccine measure. We assume this will result
in an increase 0.3 minutes of clinician staff time at the transfer of
care, death at home, and discharge time points starting with the CY
2025 HH QRP.
As stated in section III.E.3. of this final rule, will remove the
M0110--Episode Timing and M2200--Therapy Need OASIS items, effective
January 1, 2025. These items are no longer used by the HH QRP, nor are
they intended for use by CMS payment, survey or the expanded HHVBP
model. The removal of these two items will result in the removal of two
data elements at start of care, two at resumption of care, and one data
element at follow-up for a total reduction of five data elements.
The net effect of the proposals outlined in this final rule is a
reduction in four data elements collected across all time points for
the OASIS implemented on January 1, 2025. Table G1 outlines the net
change in data elements.
[GRAPHIC] [TIFF OMITTED] TR13NO23.072
The OASIS is completed by RNs or PTs, or very occasionally by
occupational therapists (OT) or speech language pathologists (SLP/ST).
Data from 2021 show that the SOC/ROC OASIS is completed by RNs
(approximately 77.14 percent of the time), PTs (approximately 22.16
percent of the time), and other therapists, including OTs and SLP/STs
(approximately 0.7 percent of the time). Based on this analysis, we
estimated a weighted clinician average hourly wage of $87.52, inclusive
of fringe benefits, using the hourly wage data in Table G2. Individual
providers determine the staffing resources necessary.
For purposes of calculating the costs associated with the
information collection requirements, we obtained mean hourly wages for
these from the U.S. Bureau of Labor Statistics' May 2022 National
Occupational Employment and Wage Estimates (https://www.bls.gov/oes/current/oes_nat.htm). To account for other indirect costs such as
overhead and fringe benefits (100 percent), we have doubled the hourly
wage. These amounts are detailed in Table G2.
BILLING CODE 4120-01-P
[[Page 77852]]
[GRAPHIC] [TIFF OMITTED] TR13NO23.073
For purposes of estimating burden, we utilize item-level burden
estimates for OASIS-E that will be released on January 1, 2025 compared
to the OASIS-E as currently implemented as of January 1, 2023. Table G3
shows the total number of OASIS assessments that HHAs actually
completed in CY 2021, as well as how those numbers will have decreased
if non-Medicare and non-Medicaid OASIS assessments had been required at
that time.
[GRAPHIC] [TIFF OMITTED] TR13NO23.074
Table G4 summarizes the estimated clinician hourly burden for the
current OASIS and the OASIS in 2025 with the net removal of four data
elements for each OASIS assessment type using CY 2021 assessment
totals. We estimated a net reduction of 58,540.1 hours of clinician
burden across all HHAs or 5 hours for each of the 11,700 active HHAs.
[GRAPHIC] [TIFF OMITTED] TR13NO23.075
BILLING CODE 4120-01-C
Table G5 summarizes the estimated clinician costs for the current
OASIS and the OASIS in 2025 with the net removal of four data elements
for each OASIS assessment type using CY 2021 assessment totals. We
estimated a reduction in costs of $5,123,430 related to the
implementation of the proposals outlined in this final rule across all
HHAs or a $438 reduction for each of the 11,700 active HHAs. This
reduction in burden will begin with January 1, 2025 HHA discharges.
[[Page 77853]]
[GRAPHIC] [TIFF OMITTED] TR13NO23.076
We received no comments on the burden calculations related to the
HH QRP proposals and therefore are finalizing this provision without
modification.
2. ICRs for HHVBP
The provisions for the expanded HHVBP Model included in this final
rule do not result in an increase in costs to HHAs. Section 1115A(d)(3)
of the Act exempts Innovation Center model tests and expansions, which
include the expanded HHVBP Model, from the provisions of the PRA.
Specifically, this section provides that the provisions of the PRA do
not apply to the testing and evaluation of Innovation Center models or
to the expansion of such models.
We received no comments on these statements and therefore are
finalizing without modification.
3. ICRs for Hospice Information Dispute Resolution (IDR) and Hospice
Special Focus Program (SFP)
In accordance with 5 CFR 1320.4(a)(2) and (c), the following
information collection activities are exempt from the requirements of
the Paperwork Reduction Act since they are associated with
administrative actions: (1) proposed Sec. 488.1130 Hospice IDR; and
(2) proposed Sec. 488.1135 Hospice SFP.
We did not receive any comments on these statements regarding the
information collection requirements and therefore are finalizing
without modification.
4. ICRs for DMEPOS Refills
In section VII.E. of this final rule, we are finalizing our
proposal to codify our refill policy, with some changes. The policy
originally arose in response to concerns related to auto-shipments and
delivery of DMEPOS products that may no longer be needed or not needed
at the same level of frequency/volume. The policy has been historically
maintained in the Medicare Program Integrity Manual, sporadically
mentioned in certain Local Coverage Determinations (LCDs) and detailed
in articles. We proposed to require documentation indicating that the
beneficiary confirmed the need for the refill within the 30-day period
prior to the end of the current supply. We proposed to codify our
requirement that delivery of DMEPOS items (that is, date of service)
must be no sooner than 10 calendar days before the expected end of the
current supply.
We did not receive any comments on the information collection
requirements.
5. ICRs for Provider Enrollment Provisions
Except as explained in this section IX. of this final rule, none of
our proposed provider enrollment provisions implicate an ICR burden.
a. High-Risk Screening and Fingerprinting
We proposed to revise Sec. 424.518 to: (1) move initially
enrolling hospices (and those undergoing an ownership change as
described in Sec. 424.518) into the high-risk screening category; and
(2) include within the high-risk screening category revalidating DMEPOS
suppliers, HHAs, OTPs, MDPPs, and SNFs for whom CMS legally waived the
fingerprint-based criminal background check requirement in Sec.
424.518 when they initially enrolled in Medicare. These changes will
result in an increase in the annual number of providers and suppliers
that must submit the fingerprints for a national criminal background
check (via FBI Applicant Fingerprint Card FD-258) of all individuals
with a 5 percent or greater direct or indirect ownership interest in
the provider or supplier. The burden is currently approved by OMB under
control number 1110-0046. We are not scoring the burden under this ICR
section since the fingerprint card is not owned by CMS. However, an
analysis of the impact of this requirement can be found in the RIA
section of this final rule.
b. Hospice 36-Month Rule
We proposed to expand Sec. 424.550(b) to apply the 36-month rule
provisions therein to hospices. This will require a hospice undergoing
a change in majority ownership (as defined in Sec. 424.502 and
assuming no exceptions apply) to: (1) enroll in Medicare as a new
hospice; and (2) undergo a state survey or accreditation. The principal
ICR burden of this requirement will involve the completion of an
initial Form CMS-855A (OMB control number: 0938-0685) application
rather than a Form CMS-855A change of ownership (CHOW) application or a
Form CMS-855A change of information application. Consistent with the
general time estimates for these three categories of applications, it
typically takes a provider approximately 4 hours to complete an initial
Form CMS-855A, 4 hours for a CHOW application, and 1 hour for a change
of information application. The key ICR burden difference, therefore,
will be between submitting an initial application and submitting a
change of information (since there is no burden difference between an
initial application and a CHOW application).
Based on internal CMS data, we estimate that each year
approximately 50 hospices will be required to initially enroll in
Medicare due to a change in majority ownership as opposed to simply
reporting the sale via a change of information. This will result in an
additional Form CMS-855A hour burden of 150 hours (50 x 3 hours), with
the 3-hour figure reflecting the difference between initial
applications and changes of information. In terms of cost, it has been
our experience that Form CMS-855A applications are completed by the
provider's office staff. Consequently, we will use the following wage
category and hourly rate from the U.S. Bureau of Labor Statistics'
(BLS) May 2022 National Occupational Employment and Wage Estimates for
all salary estimates (http://www.bls.gov/oes/current/oes_nat.htm):
[[Page 77854]]
[GRAPHIC] [TIFF OMITTED] TR13NO23.077
This results in an additional Form CMS-855A annual cost burden of
$6,225 (150 hours x $41.50).
We anticipate the following additional costs associated with our
36-month rule expansion:
Fingerprinting: As we proposed that hospices will be
subject to high-risk level screening under Sec. 424.518, hospices that
must initially enroll under Sec. 424.550(b) will have to submit a set
of fingerprints for a national criminal background check (via FBI
Applicant Fingerprint Card FD-258) from each individual with a 5
percent or greater direct or indirect ownership interest in the
hospice. An analysis of the impact of this requirement can be found in
section X.C.8.of this final rule.
Application Fee: Under Sec. 424.514, an institutional
provider (as that term is defined in Sec. 424.502) that is initially
enrolling in Medicare must pay the required application fee. Hospices
that are initially enrolling in accordance with the 36-month rule will
accordingly have to pay this fee. The application fee does not meet the
definition of a ``collection of information'' and, as such, is not
subject to the requirements of the PRA. However, the cost is scored
under section X.C.8. of this final rule.
Provider Agreement: A hospice that is initially enrolling
in Medicare (which will include those doing so in accordance with Sec.
424.550(b)) must also sign a provider agreement per 42 CFR part 489
(Health Insurance Benefits Agreement--CMS Form 1561 (OMB control number
0938-0832)). The applicable May 2022 BLS categories and hourly wage
rates for completing this form are as follows:
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We anticipated that 100 hospices per year will have to sign this
provider agreement due to our revision to Sec. 424.550(b): the 50
previously referenced hospices that will otherwise have reported the
ownership change via a Form CMS-855A change of information and another
50 that will have done so via a Form CMS-855A CHOW application. We
anticipate that it will take the hospice 5 minutes at $236.96/hr for a
chief executive to review and sign the Form CMS-1561 and an additional
5 minutes at $39.68/hr for a medical secretary to file the document
when fully executed. This results in an annual hour burden of 17 hours
(100 x 0.166 hours) and a cost of $2,305 (or (($236.96 x 0.0833) +
($39.68 x 0.0833)) x 100).
Combining these initial enrollment application and provider
agreement ICR costs associated with a hospice's change in majority
ownership results in an annual burden of 167 hours (150 + 17) and a
cost of $8,530 ($6,225 + $2,305).
We solicited comments from stakeholders, including hospices,
regarding any other ICR costs that may be associated with our proposed
expansion of the 36-month rule to incorporate hospices. This could
include ICR costs incurred during the survey, accreditation, or
certification processes.
c. Remaining Provider Enrollment Provisions
With one exception, we do not believe our other provider enrollment
provisions will result in an information collection burden. Concerning
the proposal in revised Sec. 424.540(a)(1) to reduce the timeframe in
which CMS can deactivate a provider or supplier for non-billing from 12
months to 6 months, an increase in the number of deactivations on this
basis could result. However, we are unable to establish an estimate of
this number or any associated burden for two reasons. First, fraud
schemes and patterns of non-compliance can change and fluctuate,
meaning that CMS cannot predict the number of instances in which it
will apply Sec. 424.540(a)(1) to address such situations. Second, a
deactivation is a purely discretionary action by CMS; that is, CMS can,
but is not required to, impose a deactivation if a basis for doing so
exists. Accordingly, we are unable to quantify the increase, if any, of
cases where we will invoke revised Sec. 424.540(a)(1).
We did not receive comments on our proposed ICR estimates and are
accordingly finalizing them without modification.
C. Submission of PRA-Related Comments
We have submitted a copy of this final rule to OMB for its review
of the rule's information collection requirements. The requirements are
not effective until they have been approved by OMB.
To obtain copies of the supporting statement and any related forms
for the proposed collections, as previously discussed, please visit the
CMS website
[[Page 77855]]
at https://www.cms.hhs.gov/PaperworkReductionActof1995, or call the
Reports Clearance Office at 410-786-1326.
We invited public comments on these potential information
collection requirements.
We did not receive any comments on the information collection
requirements.
X. Regulatory Impact Analysis
A. Statement of Need
1. HH PPS
Section 1895(b)(1) of the Act requires the Secretary to establish a
HH PPS for all costs of home health services paid under Medicare. In
addition, section 1895(b) of the Act requires: (1) the computation of a
standard prospective payment amount include all costs for home health
services covered and paid for on a reasonable cost basis and that such
amounts be initially based on the most recent audited cost report data
available to the Secretary; (2) the prospective payment amount under
the HH PPS to be an appropriate unit of service based on the number,
type, and duration of visits provided within that unit; and (3) the
standardized prospective payment amount be adjusted to account for the
effects of case-mix and wage levels among HHAs. Section 1895(b)(3)(B)
of the Act addresses the annual update to the standard prospective
payment amounts by the home health applicable percentage increase.
Section 1895(b)(4) of the Act governs the payment computation. Sections
1895(b)(4)(A)(i) and (b)(4)(A)(ii) of the Act requires the standard
prospective payment amount be adjusted for case-mix and geographic
differences in wage levels. Section 1895(b)(4)(B) of the Act requires
the establishment of appropriate case-mix adjustment factors for
significant variation in costs among different units of services.
Lastly, section 1895(b)(4)(C) of the Act requires the establishment of
wage adjustment factors that reflect the relative level of wages, and
wage-related costs applicable to home health services furnished in a
geographic area compared to the applicable national average level.
Section 1895(b)(3)(B)(iv) of the Act provides the Secretary with
the authority to implement adjustments to the standard prospective
payment amount (or amounts) for subsequent years to eliminate the
effect of changes in aggregate payments during a previous year or years
that were the result of changes in the coding or classification of
different units of services that do not reflect real changes in case-
mix. Section 1895(b)(5) of the Act provides the Secretary with the
option to make changes to the payment amount otherwise paid in the case
of outliers because of unusual variations in the type or amount of
medically necessary care. Section 1895(b)(3)(B)(v) of the Act requires
HHAs to submit data for purposes of measuring health care quality and
links the quality data submission to the annual applicable percentage
increase.
Sections 1895(b)(2) and 1895(b)(3)(A) of the Act, as amended by
section 51001(a)(1) and 51001(a)(2) of the BBA of 2018 respectively,
required the Secretary to implement a 30-day unit of service, for 30-
day periods beginning on and after January 1, 2020. Section
1895(b)(3)(D)(i) of the Act, as added by section 51001(a)(2)(B) of the
BBA of 2018, requires the Secretary to annually determine the impact of
differences between assumed behavior changes, as described in section
1895(b)(3)(A)(iv) of the Act, and actual behavior changes on estimated
aggregate expenditures under the HH PPS with respect to years beginning
with 2020 and ending with 2026. Section 1895(b)(3)(D)(ii) of the Act
requires the Secretary, at a time and in a manner determined
appropriate, through notice and comment rulemaking, to provide for one
or more permanent increases or decreases to the standard prospective
payment amount (or amounts) for applicable years, on a prospective
basis, to offset for such increases or decreases in estimated aggregate
expenditures, as determined under section 1895(b)(3)(D)(i) of the Act.
Additionally, 1895(b)(3)(D)(iii) of the Act requires the Secretary, at
a time and in a manner determined appropriate, through notice and
comment rulemaking, to provide for one or more temporary increases or
decreases to the payment amount for a unit of home health services for
applicable years, on a prospective basis, to offset for such increases
or decreases in estimated aggregate expenditures, as determined under
section 1895(b)(3)(D)(i) of the Act. The HH PPS wage index utilizes the
wage adjustment factors used by the Secretary for purposes of sections
1895(b)(4)(A)(ii) and (b)(4)(C) of the Act for hospital wage
adjustments.
2. HH QRP
Section 1895(b)(3)(B)(v) of the Act authorizes the HH QRP, which
requires HHAs to submit data in accordance with the requirements
specified by CMS. Failure to submit data required under section
1895(b)(3)(B)(v) of the Act with respect to a program year would result
in the reduction of the annual home health market basket percentage
increase otherwise applicable to an HHA for the corresponding calendar
year by 2 percentage points.
3. Expanded HHVBP Model
In the CY 2022 HH PPS final rule (86 FR 62292 through 62336) and
codified at 42 CFR part 484 subpart F, we finalized our policy to
expand the HHVBP Model to all Medicare certified HHAs in the 50 States,
territories, and District of Columbia beginning January 1, 2022. CY
2022 was a pre-implementation year. CY 2023 is the first performance
year in which HHAs individual performance on the applicable measures
would affect their Medicare payments in CY 2025. In this final rule, we
will remove five quality measures from the current applicable measure
set and add three quality measures to the applicable measure set. Along
with the final revisions to the current measure set, we will revise the
weights of the individual measures within the OASIS-based measure
category and within the claims-based measure category starting in the
CY 2025 performance year. In addition, we will update the Model
baseline year from CY 2022 to CY 2023 starting in the CY 2025
performance year to enable CMS to measure competing HHAs performance on
benchmarks and achievement thresholds that are more current for the
final applicable measure set. Additionally, we will amend the appeals
process such that reconsideration decisions may be reviewed by the
Administrator. We are including an update to the RFI, Future Approaches
to Health Equity in the Expanded HHVBP Model, that was published in the
CY 2023 HH PPS rule. We also include an update that reminds interested
parties that we will begin public reporting of HHVBP performance data
on or after December 1, 2024.
4. Home IVIG Items and Services
Division FF, section 4134 of the CAA, 2023 (CAA, 2023) (Pub. L.
117-328) mandated that CMS establish a permanent, bundled payment for
items and services related to administration of IVIG in a patient's
home. The permanent, bundled home IVIG items and services payment is
effective for home IVIG infusions furnished on or after January 1,
2024. Payment for these items and services is required to be a separate
bundled payment made to a supplier for all items and services furnished
in the home during a calendar day. This payment amount may be based on
the amount established under the Demonstration. The standard Part B
coinsurance and the Part B deductible apply. The separate bundled
payment does not apply for individuals receiving
[[Page 77856]]
services under the Medicare home health benefit. The CAA, 2023
provision clarifies that a supplier who furnishes these services meet
the requirements of a supplier of medical equipment and supplies.
5. Informal Dispute Resolution (IDR) and Hospice Special Focus Program
(SFP)
The hospice IDR will be an administrative process offered to
hospice programs that is conducted by CMS, the SAs, or the accrediting
organizations (AOs) as applicable, as part of their survey activities
to provide an informal opportunity to address survey findings. The
Hospice SFP will be implementing a part of the hospice provisions
required under the CAA, 2021 codified in section 1822(b) of the Act,
directing the Secretary to create an SFP for poor-performing hospice
programs.
6. DMEPOS CAA, 2023-Related Requirements
a. Conforming Changes to Regulations To Codify Change Mandated by
Section 4139 of the Consolidated Appropriations Act, 2023
The purpose of the provision related to adjusted fees is to extend
the 75/25 blend in non-rural, non-CBAs as described in 42 CFR
414.210(g)(9)(v). The statutory language for this provision is found in
section 4139 of the CAA, 2023.
b. Scope of the Benefit and Payment for Lymphedema Compression
Treatment Items
The purpose of the provision related to lymphedema compression
treatment items is to define in regulation section 4133 of the CAA,
2023 that adds section 1861(s)(2)(JJ) to the Act establishing a
Medicare Part B benefit for lymphedema compression treatment items.
This provision addresses the scope of the new benefit by defining what
constitutes a standard or custom fitted gradient compression garment
and determining what other compression items may exist that are used
for the treatment of lymphedema and would fall under the new benefit.
This rule also implements section 1834(z) of the Act in establishing
payment amounts for items covered under the new benefit and frequency
limitations for lymphedema compression treatment items.
c. Definition of Brace
The purpose of the provision related to the definition of a brace
is to codify in regulations the longstanding definition of brace that
exists in Medicare program instructions.
7. Requirements for Refillable DMEPOS
This rule finalizes the documentation requirements to indicate that
the beneficiary has confirmed their need for the refill within the 30-
day period prior to the end of the current supply. It also codifies our
requirement that the delivery of DMEPOS items (that is, date of
service) must be no sooner than 10 calendar days before the expected
end of the current supply.
8. Provider Enrollment Provisions
Our provider enrollment provisions are needed to strengthen
Medicare program integrity. These provisions focus on but are not
limited to: (1) subjecting a greater number of providers and suppliers,
such as hospices, to the highest level of screening, which includes
fingerprinting all 5 percent or greater owners of these providers and
suppliers; and (2) applying the change in majority ownership (CIMO)
provisions in 42 CFR 424.550(b) to hospices. These changes will help
ensure that payments are made only to qualified providers and suppliers
and that owners of these entities are carefully screened. As explained
in section VIII. of this final rule, we believe that fulfilling these
objectives would assist in protecting the Trust Funds and Medicare
beneficiaries.
B. Overall Impact
We have examined the impacts of this rule as required by Executive
Order 12866 on Regulatory Planning and Review (September 30, 1993),
Executive Order 13563 on Improving Regulation and Regulatory Review
(January 18, 2011), Executive Order 14094 on Modernizing Regulatory
Review (April 6, 2023), the Regulatory Flexibility Act (RFA) (September
19, 1980, Pub. L. 96-354), section 1102(b) of the Act, section 202 of
the Unfunded Mandates Reform Act of 1995 (March 22, 1995; Pub. L. 104-
4), Executive Order 13132 on Federalism (August 4, 1999), and the
Congressional Review Act (5 U.S.C. 804(2)).
Executive Orders 12866 (as amended by E.O. 14094) and 13563 direct
agencies to assess all costs and benefits of available regulatory
alternatives and, if regulation is necessary, to select regulatory
approaches that maximize net benefits (including potential economic,
environmental, public health and safety effects, distributive impacts,
and equity). Executive Order 14094 amends section 3(f) of Executive
Order 12866 to define a ``significant regulatory action'' as an action
that is likely to result in a rule: (1) having an annual effect on the
economy of $200 million or more in any 1 year, or adversely affect in a
material way the economy, productivity, competition, jobs, the
environment, public health or safety, or State, local or tribal
governments or communities; (2) creating a serious inconsistency or
otherwise interfering with an action taken or planned by another
agency; (3) materially altering the budgetary impacts of entitlement
grants, user fees, or loan programs or the rights and obligations of
recipients thereof; or (4) raising legal or policy issues for which
centralized review would meaningfully further the President's
priorities or the principles set forth in this Executive Order.
A regulatory impact analysis (RIA) must be prepared for major rules
with significant regulatory action/s and/or with significant effects as
per section 3(f)(1) of $200 million or more in any 1 year. Based on our
estimates, OMB'S Office of Information and Regulatory Affairs has
determined this rulemaking significant under section 3(f)(1) of E.O.
12866. Accordingly, we have prepared an RIA that to the best of our
ability presents the costs and benefits of the rulemaking.
C. Detailed Economic Analysis
1. Effects of the Changes for the CY 2024 HH PPS
This rule finalizes our proposals to update Medicare payments under
the HH PPS for CY 2024. The net transfer impact related to the changes
in payments under the HH PPS for CY 2024 is estimated to be $140
million (0.8 percent). The $140 million increase in estimated payments
for CY 2024 reflects the effects of the final CY 2024 home health
payment update percentage of 3.0 percent ($525 million increase), an
estimated 2.6 percent decrease that reflects the effects of the
permanent behavior adjustment ($455 million decrease), and an estimated
0.4 percent increase that reflects the effects of an updated FDL ($70
million increase).
We use the latest data and analysis available. However, we do not
adjust for future changes in such variables as number of visits or
case-mix. This analysis incorporates the latest estimates of growth in
service use and payments under the Medicare home health benefit, based
primarily on Medicare claims data for periods that ended on or before
December 31, 2022. We note that certain events may combine to limit the
scope or accuracy of our impact analysis, because such an analysis is
future-oriented and, thus, susceptible to errors resulting from
[[Page 77857]]
other changes in the impact time period assessed. Some examples of such
possible events are newly-legislated general Medicare program funding
changes made by the Congress or changes specifically related to HHAs.
In addition, changes to the Medicare program may continue to be made as
a result of new statutory provisions. Although these changes may not be
specific to the HH PPS, the nature of the Medicare program is such that
the changes may interact, and the complexity of the interaction of
these changes could make it difficult to predict accurately the full
scope of the impact upon HHAs.
Table GG 1 represents how HHA revenues are likely to be affected by
the finalized policy changes for CY 2024. For this analysis, we used an
analytic file with linked CY 2022 OASIS assessments and home health
claims data for dates of service that ended on or before December 31,
2022. The first column of Table GG 1 classifies HHAs according to a
number of characteristics including provider type, geographic region,
and urban and rural locations. The second column shows the number of
agencies in the impact analysis. The third column shows the payment
effects of the permanent behavior assumption adjustment on all
payments. The aggregate impact of the CY 2024 permanent BA adjustment
reflected in the third column does not equal the final -2.890 percent
permanent BA adjustment because the adjustment only applies to the
national, standardized 30-day period payments and does not impact
payments for 30-day periods which are LUPAs. The fourth column shows
the payment effects of the recalibration of the case-mix weights offset
by the case-mix weights budget neutrality factor. The fifth column
shows the payment effects of updating the CY 2024 wage index with a 5-
percent cap on wage index decreases. The sixth column shows the effect
of the final CY 2024 labor-related share. The aggregate impact of the
changes in the fifth and sixth columns is zero percent, due to the wage
index budget neutrality factor and the labor-related share budget
neutrality factor. The seventh column shows the payment effects of the
final CY 2024 home health payment update percentage. The eighth column
shows the payment effects of the revised FDL, and the last column shows
the combined effects of all the final provisions.
Overall, it is projected that aggregate payments in CY 2024 would
increase by 0.8 percent which reflects the 2.6 percent decrease from
the permanent behavior adjustment, the 3.0 payment update percentage
increase, and the 0.4 percent increase from decreasing the FDL. As
illustrated in Table GG 1, the combined effects of all of the changes
vary by specific types of providers and by location. We note that some
individual HHAs within the same group may experience different impacts
on payments than others due to the distributional impact of the CY 2024
wage index, the percentage of total HH PPS payments that were subject
to the LUPA or paid as outlier payments, and the degree of Medicare
utilization.
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2. Effects of the Changes for the HH QRP for CY 2024
Failure to submit HH QRP data required under section
1895(b)(3)(B)(v) of the Act with respect to a program year results in
the reduction of the annual home health market basket percentage
increase otherwise applicable to an HHA for the corresponding calendar
year by 2 percentage points. For the CY 2023 program year, 820 of the
11,549 active Medicare-certified HHAs, or approximately 7.1 percent,
did not receive the full annual percentage increase because they did
not meet assessment submission requirements. The 820 HHAs that did not
satisfy the reporting requirements of the HH QRP for the CY 2023
program year represent $149 million in home health claims payment
dollars during the reporting period out of a total $16.4 billion for
all HHAs.
This final rule finalizes the adoption of the ``COVID-19 Vaccine:
Percent of Patients/Residents Who Are Up to Date'' (Patient/Resident
COVID-19 Vaccine) measure to the HH QRP beginning with the CY 2025 HH
QRP. CMS also proposed to adopt the ``Functional Discharge Score'' (DC
Function) measure for the HH QRP beginning with the CY 2025 HH QRP.
Along with the addition of the Discharge Function measure, we proposed
to remove the ``Application of Percent of Long-Term Care Hospital
(LTCH) Patients with an Admission and Discharge Functional Assessment
and a Care Plan That Addresses Function'' (Application of Functional
Assessment/Care Plan) measure from the HH QRP beginning with the CY
2025 HH QRP. We additionally proposed the removal of two OASIS items no
longer necessary for collection, the M0110--``Episode Timing'' and
M2200--``Therapy Need'' items. The net effect of the finalization these
proposals is a reduction of four data elements across all OASIS data
collection time points and a net reduction in burden.
Section IX.B.1. of this final rule provides a detailed description
of the net decrease in burdens associated with the final changes. We
proposed that additions and removal of data elements associated with
the HH QRP proposals would begin with January 1, 2025 discharges. The
cost impact of these proposed changes was estimated to be a net
decrease of $5,123,430 in annualized cost to HHAs, discounted at 7
percent relative to year 2021, over a perpetual time horizon beginning
in CY 2025. We described the estimated burden and cost reductions for
these measures in section IX of this final rule. In summary, the
implementation of the proposals outlined in this final rule for the HH
QRP is estimated to decrease the burden on HHAs by $437 per HHA
annually, or $5,123,430 for all HHAs annually.
We received no comments on the burden calculations related to the
HH QRP proposals and therefore are finalizing this provision without
modification.
3. Effects of the Changes for the Expanded HHVBP Model
In the CY 2023 HH PPS final rule (87 FR 66883), we estimated that
the expanded HHVBP Model would generate a total projected 5-year gross
FFS savings for CYs 2023 through 2027 of $3,376,000,000. Finalization
of the changes to the applicable measure set and the Model baseline
year in this rule will not change those estimates because they do not
change the number of HHAs in the Model or the payment methodology.
Based on policies discussed in this final rule, Tables GG 2A and GG
2B display the distribution of possible payment adjustments using CY
2021 data as the performance year and CY 2019 for the baseline year.
Note that due to limited data availability, this impact analysis does
not account for improvement points for the PPH measure because this
measure is not available based on CY 2022 data at the time of the
release of this final rule.
Table GG 2A and GG 2B shows the value-based incentive payment
adjustments for the estimated 6,750 HHAs that would qualify to compete
in the expanded Model based on CY 2021 performance data stratified by
volume-based cohort, as defined in section III.F. of the CY 2022 HH PPS
final rule (86 FR 62312). This impact analysis used CY 2019 to
determine HHA size instead of the calendar year prior to the
performance year (that is, CY 2020) to avoid using data impacted by the
Public Health Emergency (PHE). Using CY 2021 performance year data and
the finalized payment adjustment of 5 percent, based on the 10 final
quality measures, the 6,504 HHAs in the larger-volume cohort would have
an average payment adjustment of positive 0.164 percent (+0.164
percent). Furthermore, 246 HHAs have fewer than 60 unique beneficiaries
in CY 2019 and are, therefore, included in the smaller-volume cohort.
Overall, smaller-volume HHAs would have an average payment adjustment
of negative 0.114 percent (-0.114 percent). Twenty-four states/
territories do not have any HHAs in the smaller-volume cohort,
including Alabama, District of Columbia, and Georgia. The remaining
states/territories have HHAs in both volume-based cohorts. Florida, for
example, has 622 HHAs in the larger-volume cohort with an average
payment adjustment of positive 1.154 percent (+1.154 percent) and 17
HHAs in the smaller-volume cohort with an average payment adjustment of
positive 0.102 percent (+0.102 percent). The next columns provide the
distribution of payment adjustment by percentile. Specifically, 10
percent of HHAs in the larger-volume cohort would receive payment
adjustments of more than negative 3.851 percent (-3.851 percent). Among
smaller-volume HHAs, 10 percent of HHAs would receive payment
adjustments of more than negative 4.120 percent (-4.120 percent). For
larger-volume HHAs in Florida, the payment adjustments range from
negative 3.161 percent (-3.161 percent) at the 10th percentile to
positive 5.000 percent (+5.000 percent) at the 90th percentile, while
the median (50th percentile) payment adjustment is positive 1.160
percent (+1.160 percent).
Table GG 3 provides the payment adjustment distribution based on
the proportion of dual-eligible beneficiaries, average case mix using
Hierarchical Condition Category (HCC) scores, proportion of
beneficiaries that reside in rural areas, and HHA organizational
status. To define cutoffs for the ``percentage of dual eligible
beneficiaries,'' low through high percentage dual-eligible are based on
the 20th, 40th, 60th, and 80th percentiles of percent dual eligible
beneficiaries, respectively, across HHAs in CY 2021. To define case mix
cutoffs, low, medium, or high acuity are based on less than the 25th
percentile, between the 25th and 75th percentiles, and greater than the
75th percentile of average HCC scores, respectively, across HHAs in CY
2021. To define cutoffs for percentage of rural beneficiaries, all non-
rural, up to 50 percent rural, and over 50 percent rural are based on
the home health beneficiaries' core-based statistical area (CBSA) urban
versus rural designation. Based on CY 2021 data, HHAs with the highest
proportion of dual-eligible beneficiaries served have a positive
average payment adjustment (+0.035 percent). In addition, a higher
proportion of rural beneficiaries served is associated with better
performance. Specifically, HHAs serving over 50 percent rural
beneficiaries have an average payment adjustment of positive 0.728
percent (+0.728 percent), compared to HHAs
[[Page 77861]]
serving only rural beneficiaries or HHAs serving up to 50 percent rural
beneficiaries. Among organizational type, proprietary HHAs have a
slightly negative average payment adjustment of 0.092, whereas HHAs in
other organizational type categories have a positive average payment
adjustment.
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We did received comments on this impact analysis and therefore are
finalizing this without modification.
4. Impacts of Home IVIG Items and Services
The following analysis applies to the home IVIG items and services
payment rate as set forth in section V.D.1. of this rule as added by
section 4134 of the CAA, 2023 and accordingly, describes the impact for
CY 2024 only. Table GG 4 represents the estimated costs of home IVIG
users for CY 2024. We used CY 2022 data to identify beneficiaries
actively enrolled in the IVIG demonstration (that is, beneficiaries
with Part B claims that contain the Q2052 HCPCS code) to estimate the
number of potential CY 2024 active enrollees in the new benefit, which
are shown in column 2. In column 3, CY 2022 claims for IVIG visits
under the Demonstration were again used to estimate potential
utilization under the new benefit in CY 2024. Column 4 shows the final
CY 2024 home IVIG items and services rate. The fifth column estimates
the cost to Medicare for CY 2024 ($8,661,888). The estimated cost for
CY 2023 under the Demonstration is $8,409,538 (not shown in chart)
resulting in an increase of $252,350 in payments to providers under the
permanent benefit. Table GG 5 represents the estimated impacts of the
home IVIG items and services payment for CY 2024 by census region.
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5. Effects of the Changes for Hospice IDR and SFP
The hospice IDR is an administrative process to be conducted by
CMS, SAs, or AOs as part of their survey activities, and is separate
from the SFP. SAs and AOs may already have existing IDR processes in
place for the HHA IDR requirements. The hospice IDR requirements will
align with HHA. the IDR process currently in place for HHAs. The
Congress has already allocated $10 million annually to CMS to implement
the CAA, 2021 hospice survey and enforcement provisions, which includes
the SFP. Additionally, CMS obligates monies to the SAs to carry out
survey and certification responsibilities under their agreement with
the Secretary under section 1864 of the Act. Therefore, no additional
burden will be incurred by CMS, SAs, or AOs.
We did not receive comments on our burden estimate and are
therefore finalizing without this without modification.
6. Effects of the Changes for DMEPOS CAA, 2023-Related Provisions
a. Conforming Changes to Regulations To Codify Change Mandated by
Section 4139 of the Consolidated Appropriations Act, 2023
One benefit of this provision is that it provides additional
revenue to DMEPOS suppliers. One cost of this provision is that it
increases the copayments of the Medicare beneficiaries. The transfer
from the Medicare program to the DMEPOS suppliers of $100 million for
CY 2023 will be paid in CY 2023 and CY 2024. The amount of copayments
from Medicare beneficiaries over the same period is expected to be $30
million. The Federal share of Medicaid for the copayments for dual
eligibles is expected to be $5 million and the State share of the
Medicare payments for this populations is expected to be $4 million.
We received no comments on the impact analysis of this provision.
b. Scope of the Benefit and Payment for Lymphedema Compression
Treatment Items
The benefits of this provision are that Medicare enrollees
suffering from lymphedema will have Medicare pay 80 percent of the cost
of the lymphedema compression treatment items. This
[[Page 77868]]
Medicare payment should enable more Medicare enrollees suffering from
lymphedema to access treatment items in the home, reducing both the
financial burden of lymphedema and, by encouraging earlier treatment,
the frequency of institutional care for infections or other
complications of lymphedema. The transfer from the Medicare program to
the lymphedema compression treatment suppliers is estimated to be $150
million from CY 2024 to CY 2028. The amount of copayments from Medicare
beneficiaries over the same period is expected to be $30 million. The
Federal share of Medicaid expenditures for the copayments of dual
eligibles is expected to be $5 million and the State share for this
population is expected to be $4 million.
We received no comments on the impact analysis of this provision.
c. Definition of Brace
The benefit of this provision is to add the definition of brace in
regulation to clearly identify what is included in the definition of a
brace. This is purely an administrative effort with no impact on
Medicare coverage or expenditure, and, for this reason, has no cost or
transfer associated with it.
We did not received any comments on the impact analysis of this
provision.
7. Effects of the Changes to the Requirements for Refillable DMEPOS
This rule codifies and clarifies our requirements for refillable
DMEPOS items. The fiscal impact of these requirements cannot be
estimated as claims often deny for multiple reasons, which may include
non-compliance with our refill requirements; creating an inability for
us to accurately demonstrate a causal relationship. In addition, to
demonstrate impacts we would have to be able to predict behaviors and
anticipated non-compliance in future claim submissions, which are
unknown variables to us.
We did not receive any public comments regarding the financial
impact of our proposals.
8. Effects of the Changes Regarding for Provider Enrollment
Requirements
There are four principal impacts of the provider enrollment
provisions outlined in section VIII. of this final rule.
The first was addressed in section IX. of this final rule. It
involves the ICR burden associated with a hospice's completion of an
initial Form CMS-855A application and Form CMS-1561 provider agreement
per a Sec. 424.550(b) change in majority ownership for which an
exception does not apply. The combined annual burden was estimated to
be 167 hours at a cost of $8,530.
The second involves moving hospices from the ``moderate'' screening
category to the ``high'' screening level.
The third involves incorporating within the high screening category
revalidating DMEPOS suppliers, HHAs, OTPs, MDPP suppliers, and SNFs for
which CMS waived the fingerprint-based criminal background check
requirement when they initially enrolled in Medicare.
The fourth pertains to the fingerprinting and application fee
requirements (referenced in section IX. of this final rule) associated
with a Sec. 424.550(b) change in majority ownership.
We address the second, third, and fourth impacts as follows:
a. Moving Hospices to High-Risk
With this change to Sec. 424.518, hospices that are initially
enrolling in Medicare or reporting any new owner would have to submit
the fingerprints of their 5 percent or greater direct or indirect
owners for a Federal Bureau of Investigation criminal background check.
Based on enrollment statistics and our experience, we projected in the
proposed rule that 1,782 hospices per year (425 initially enrolling +
1,357 reporting a new 5 percent or greater owner) would be required to
submit these fingerprints. (This figure does not include hospices
initially enrolling pursuant to Sec. 424.550(b); this matter is
addressed in section X.C.8.c. of this final rule). Using an estimate of
one owner per hospice (which aligns with previous fingerprinting
projections we have made), 1,782 sets of fingerprints per year would be
submitted.
Consistent with prior burden estimates, we projected that it would
take each owner approximately 2 hours to be fingerprinted. According to
the most recent BLS wage data for May 2022, the mean hourly wage for
the general category of ``Top Executives'' (the most appropriate BLS
category for owners) is $62.04. With fringe benefits and overhead, the
figure is $124.08. This would result in an estimated annual burden of
this final change of 3,564 hours (1,782 x 2) at a cost of $442,221
(3,564 x $124.08).
b. Providers and Suppliers Previously Waived From Fingerprinting
Approximately 6,388 high-risk level providers and suppliers were
waived from fingerprinting when they initially enrolled in Medicare
during the PHE. We proposed that these providers and suppliers, upon
their revalidation, would be subject to the ``high'' level of screening
and, consequently, fingerprinting. Using the fingerprinting burden
estimates from section X.C.8.a. of this final rule, we project the
total burden of this proposal to be 12,776 hours (6,388 x 2 hr) and
$1,585,246 (12,776 x $124.08). Calculated as annual figures over a 3-
year period, this results in a burden of 4,259 hours and $528,415.
c. Hospice Changes in Majority Ownership
Hospices that are initially enrolling in Medicare due to a change
in majority ownership under Sec. 424.550(b) will be subject to
fingerprinting and must pay an application fee in accordance with Sec.
424.514. Using the fingerprinting estimates already referenced in
section X.C.8. of this final rule, we estimate an annual fingerprinting
burden to hospices per Sec. 424.550(b) of 200 hours (100 x 2 hr) at a
cost of $24,816 (200 hr x $124.08).
The application fees for each of the past 3 calendar years were or
are $599 (CY 2021), $631 (CY 2022), and $688 (CY 2023). Consistent with
Sec. 424.514, the differing fee amounts were predicated on changes/
increases in the CPI for all urban consumers (all items; United States
city average, CPI-U) for the 12-month period ending on June 30 of the
previous year. While we cannot predict future changes to the CPI, the
fee amounts between 2021 and 2023 increased by an average of $45 per
year. As stated in the proposed rule, we believe this is a reasonable
barometer with which to establish estimates (strictly for purposes of
this final rule) of the fee amounts in the first 3 calendar years of
the final provision (that is, 2024, 2025, and 2026). Thus, we project a
fee amount of $733 in 2024, $778 for 2025, and $823 for 2026.
Applying these prospective fee amounts to the annual number of
projected hospices impacted by our change in majority ownership
proposal, this results in a cost of $73,300 (or 100 x $733) in the
first year, $77,800 in the second year, and $82,300 in the third year.
d. Totals
The following table outlines the total annual costs associated with
our enrollment provisions addressed in section X.C.8. of this final
rule for each of the first 3 years.
[[Page 77869]]
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We solicited comment from stakeholders, including hospices,
regarding any other RIA costs that may be associated with our proposed
expansion of the 36-month rule to incorporate hospices. This could
include costs incurred during the survey, accreditation, and/or
certification processes.
e. Comments Received
We did not receive comments on our RIA estimates and are
accordingly finalizing them as proposed.
D. Regulatory Review Cost Estimation
If regulations impose administrative costs on private entities,
such as the time needed to read and interpret this final rule, we
should estimate the cost associated with the regulatory review. Due to
the uncertainty involved with accurately quantifying the number of
entities that will review the rule, we assume that the total number of
unique commenters on this year's proposed rule will be the number of
reviewers of this final rule. We acknowledge that this assumption may
understate or overstate the costs of reviewing this rule. It is
possible that not all commenters reviewed this year's proposed rule in
detail, and it is also possible that some reviewers chose not to
comment on the proposed rule. For these reasons we thought that the
number of commenters would be a fair estimate of the number of
reviewers of this rule. We also recognize that different types of
entities are in many cases affected by mutually exclusive sections of
this rule, and therefore for the purposes of our estimate we assume
that each reviewer reads approximately 50 percent of the rule.
Using the wage information from the BLS for medical and health
service managers (Code 11-9111), we estimate that the cost of reviewing
this rule is $123.06 per hour, including overhead and fringe benefits
https://www.bls.gov/oes/current/oes_nat.htm. Assuming an average
reading speed, we estimate that it would take approximately 5.76 hours
for the staff to review half of this final rule. For each entity that
reviews the rule, the estimated cost is $708.83 (5.76 hours x $123.06).
Therefore, we estimate that the total cost of reviewing this regulation
is $671,971 ($708.83 x 948) [948 is the number of estimated reviewers,
which is based on the total number of unique commenters from this
year's proposed rule].
E. Alternatives Considered
1. HH PPS
For the CY 2024 HH PPS final rule, we considered alternatives to
the provisions articulated in section II.C.1. of this final rule. As
described in section II.C.1. of this rule, to help prevent future over
or underpayments, we calculated a permanent prospective adjustment by
determining what the 30-day base payment amount should have been in CYs
2020, 2021, and 2022 in order to achieve the same estimated aggregate
expenditures as obtained from the simulated 60-day episodes. One
alternative to the final -2.890 percent permanent payment adjustment
included taking the full adjustment of -5.779. Another alternative
would be to take the remaining permanent adjustment not taken in the CY
2023 HH PPS final rule, which resulted in -4.085 percent. Another
alternative would be a phase-in approach, where we could reduce the
permanent adjustment, by spreading out the CY 2024 permanent adjustment
over a specified period of years, rather than halving the adjustment in
CY 2024 and adjusting the CY 2025 rate by the rest of that amount.
Another alternative would be to delay the permanent adjustment to a
future year. However, we believe that the full permanent reduction in a
single year may be too burdensome for certain HHA providers at this
time. Additionally, we believe that a phase-in approach or delay in the
permanent adjustment would not be appropriate as it would further
impact budget neutrality and likely lead to a compounding effect
creating the need for a larger permanent reduction to the payment rate
in future years. Therefore, we are finalizing a -2.890 percent (half of
the permanent -5.779 adjustment) permanent adjustment to the CY 2024
30-day payment rate.
Additionally, we considered alternatives to rebasing and revising
the home health market basket to reflect a 2021 base year. We
considered continuing to use the 2016-based home health market basket
without rebasing to determine the market basket increase factor for CY
2024. However, we typically rebase and revise the market baskets for
the various PPS every 4 to 5 years so that the cost weights and price
proxies reflect more recent data. Therefore, we believe it is more
technically appropriate to use a 2021-based home health market basket
and labor-related share since it allows for the CY 2024 market basket
increase factor to reflect a more up-to-date cost structure experienced
by HHAs.
Division FF, section 4136 of the CAA, 2023 (Pub. L. 117-328)
amended section 1834 of the Act (42 U.S.C. 1395m(s)) and mandates
several amendments to the Medicare separate payment for dNPWT devices
beginning in CY 2024. Therefore, we do not have the discretion to delay
or eliminate the implementation of the changes to the separate payment
amount for dNPWT and thus we did not consider any alternatives
regarding this policy.
2. HH QRP
We considered alternative measures to the Discharge Function
measure and determined this measure was the strongest. No appropriate
alternative was available for the COVID-19 Patient Vaccination measure.
3. Expanded HHVBP Model
We discuss the alternatives we considered to the final weights of
the individual measures within the OASIS-based measure category and
within the claims-based measure category starting in the CY 2025
performance year for the expanded HHVBP Model in section IV.B.2. of
this final rule.
[[Page 77870]]
4. Home IVIG Items and Services
For the CY 2024 HH PPS final rule, we did not consider alternatives
to implementing the home IVIG items and services payment for CY 2024
because section 1842(o)(8) of the Act requires the Secretary to
establish a separate bundled payment to the supplier for all items and
services related to the administration of intravenous immune globulin
to an individual in the patient's home during a calendar day effective
January 1, 2024. We did consider alternatives to annually updating this
payment rate, as articulated in section II.V.D. of this final rule. We
considered updating the annual rate using the LUPA rate for skilled
nursing in accordance with the demonstration program update. However,
as the IVIG services payment is not geographically wage adjusted, and
the LUPA rate incorporates a wage index budget neutrality factor, we
believe it is more appropriate to annually adjust the IVIG items and
services payment rate only by the home health payment update
percentage. We also considered annually updating the rate by the CPI-U
percentage increase in accordance with the annual update to the home
infusion therapy services payment rate. However, the Demonstration has
never used the CPI-U percentage increase to update the payment rate,
and we believe it is more beneficial to keep the permanent payment as
closely aligned with the Demonstration rate as possible. Therefore, we
are finalizing these policies as proposed.
5. IDR and Hospice SFP
We did not consider any alternatives in this final rule for either
proposal. An initial alternative proposal was published in CY 22 Home
Health PPS final rule (86 FR 35874) but was not finalized due to public
comments and requests that CMS establish a Technical Expert Panel (TEP)
to inform the development of the SFP. We believe the new final
methodology, based on feedback provided by the TEP, is the best way to
identify and remedy the issue of poor -performing hospices. We received
no comments on the consideration of no alternatives proposed.
6. DMEPOS CAA, 2023-Related Provisions
a. Scope of the Benefit and Payment for Lymphedema Compression
Treatment Items
As this provision is statutorily mandated, CMS needed to consider
no alternatives for implementation. Similarly, the statutory language
provided a definition for the lymphedema compression treatment items to
be covered by this benefit, so CMS did not consider any alternative to
coverage of a list of items meeting the statutory requirements.
Regarding the payment methodology, CMS considered numerous sources for
prices as suggested in statute. Different combinations of internet and
insurer prices were alternatives considered. Ultimately, CMS decided on
a payment methodology that CMS considered reasonable given the market
for these items.
We received no comments on the consideration of no alternatives to
regulatory action to implement the Lymphedema Compression Treatment
Item benefit required by the CAA, 2023.
b. Conforming Changes to Regulations To Codify Change Mandated by
Section 4139 of the Consolidated Appropriations Act, 2023
This is a conforming change to a statutory mandate and therefore
required no alternatives be considered.
We did not receive comments about this provision's impact. We are
finalizing our proposed conforming changes to Sec. 414.210(g)(9),
consistent with requirements in section 4139(a) and 4139(b) of the CAA,
2023.
c. Definition of Brace
This is a codification of an existing definition and therefore
required no alternatives be considered.
We received no comments on the consideration of no alternatives to
codifying the definition in regulation.
7. Refillable DMEPOS
We did not consider alternatives as this is existing policy that is
being codified with additional leniencies based on prior experiences.
We welcomed but did not receive any comments.
8. Provider Enrollment Provisions
We considered several alternatives for addressing our provider
enrollment-related concerns regarding hospice program integrity and
quality of care. We concluded that moving hospices to the high-risk
screening category and expanding Sec. 424.550(b) to include hospices
were the most appropriate provider enrollment regulatory means of
addressing these issues.
Except as discussed in section VIII. of this final rule, we
received no comments on possible alternatives to our hospice
provisions.
F. Accounting Statements and Tables
1. HH PPS
As required by OMB Circular A-4 (available at https://www.whitehouse.gov/wp-content/uploads/legacy_drupal_files/omb/circulars/A4/a-4.pdf, in Table GG 8, we have prepared an accounting
statement showing the classification of the transfers and benefits
associated with the CY 2024 HH PPS provisions of this rule.
[GRAPHIC] [TIFF OMITTED] TR13NO23.090
2. HH QRP
As required by OMB Circular A-4 (available at https://www.whitehouse.gov/sites/whitehouse.gov/files/omb/circulars/A4/a-4.pdf), in Table GG 9, we have prepared an accounting statement showing
the classification of the expenditures associated with this final rule
as they relate to HHAs. Table GG 9 provides our best estimate of the
increase in burden for OASIS submission.
[[Page 77871]]
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3. Expanded HHVBP Model
As required by OMB Circular A-4 (available at https://www.whitehouse.gov/sites/whitehouse.gov/files/omb/circulars/A4/a-4.pdf), in Table GG 10 we have prepared an accounting statement Table
GG 10 provides our best estimate of the decrease in Medicare payments
under the expanded HHVBP Model.
[GRAPHIC] [TIFF OMITTED] TR13NO23.092
4. Home IVIG Items and Services
As required by OMB Circular A-4 (available at https://www.whitehouse.gov/wp-content/uploads/legacy_drupal_files/omb/circulars/A4/a-4.pdf, in Table GG 11, we have prepared an accounting
statement showing the classification of the transfers and benefits
associated with the CY 2024 IVIG provisions of this rule.
[GRAPHIC] [TIFF OMITTED] TR13NO23.093
5. DMEPOS
a. Conforming Changes to Regulations To Codify Change Mandated by
Section 4139 of the Consolidated Appropriations Act, 2023
As required by OMB Circular A-4 (available at https://www.whitehouse.gov/sites/whitehouse.gov/files/omb/circulars/A4/a-4.pdf), in Table GG 12, we have prepared an accounting statement
showing the classification of the expenditures associated with this
provision. Table GG 12 provides our best estimate of the transfers.
[[Page 77872]]
[GRAPHIC] [TIFF OMITTED] TR13NO23.094
b. Scope of the Benefit and Payment for Lymphedema Compression
Treatment Items
As required by OMB Circular A-4 (available at https://www.whitehouse.gov/sites/whitehouse.gov/files/omb/circulars/A4/a-4.pdf), in Table GG 13, we have prepared an accounting statement
showing the classification of the expenditures associated with this
provision. Table GG 13 provides our best estimate of the transfers.
[GRAPHIC] [TIFF OMITTED] TR13NO23.095
G. Regulatory Flexibility Act (RFA)
The RFA requires agencies to analyze options for regulatory relief
of small entities, if a rule has a significant impact on a substantial
number of small entities. For purposes of the RFA, small entities
include small businesses, nonprofit organizations, and small
governmental jurisdictions. In addition, HHAs are small entities, as
that is the term used in the RFA. Individuals and States are not
included in the definition of a small entity.
The NAICS was adopted in 1997 and is the current standard used by
the Federal statistical agencies related to the U.S. business economy.
We utilized the NAICS U.S. industry title ``Home Health Care Services''
and corresponding NAICS code 621610 in determining impacts for small
entities. The NAICS code 621610 has a size standard of $19 million
\222\ and approximately 96 percent of HHAs are considered small
entities. Table GG 14 shows the number of firms, revenue, and estimated
impact per home health care service category.
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\222\ https://www.sba.gov/sites/sbagov/files/2023-03/Table%20of%20Size%20Standards_Effective%20March%2017%2C%202023.xlsx.
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[[Page 77873]]
[GRAPHIC] [TIFF OMITTED] TR13NO23.096
The economic impact assessment is based on estimated Medicare
payments (revenues) and HHS's practice in interpreting the RFA is to
consider effects economically ``significant'' only if greater than 5
percent of providers reach a threshold of 3 to 5 percent or more of
total revenue or total costs. The majority of HHAs' visits are Medicare
paid visits and therefore the majority of HHAs' revenue consists of
Medicare payments. Based on our analysis, we conclude that the policies
finalized in this rule would result in an estimated total impact of 3
to 5 percent or more on Medicare revenue for greater than 5 percent of
HHAs. Therefore, the Secretary has determined that this HH PPS final
rule would have significant economic impact on a substantial number of
small entities. We estimate that the net impact of the policies in this
rule is approximately $140 million in increased payments to HHAs in CY
2024. The $140 million in increased payments are reflected in the last
column of the first row in Table GG 14 as a 0.8 percent increase in
expenditures when comparing CY 2024 payments to estimated CY 2023
payments. The 0.8 percent increase is mostly driven by the impact of
the permanent behavior assumption adjustment reflected in the third
column of Table GG 1. Further detail is presented in Table GG 1, by HHA
type and location.
With regards to options for regulatory relief, we note that section
1895(b)(3)(D)(i) of the Act requires CMS to annually determine the
impact of differences between the assumed behavior changes finalized in
the CY 2019 HH PPS final rule with comment period (83 FR 56455) and
actual behavior changes on estimated aggregate expenditures under the
HH PPS with respect to years beginning with 2020 and ending with 2026.
Additionally, section 1895(b)(3)(D)(ii) and (iii) of the Act requires
us to make permanent and temporary adjustments to the payment rate to
offset for such increases or decreases in estimated aggregate
expenditures through notice and comment rulemaking. While we find that
the -2.890 percent permanent payment adjustment, described in section
II.C.1.g. of this final rule, is necessary to offset the increase in
estimated aggregate expenditures for CYs 2020 through 2022 based on the
impact of the differences between assumed behavior changes and actual
behavior changes, we would also continue to reprice claims, per the
finalized methodology, and make any additional adjustments at a time
and manner deemed appropriate in future rulemaking. We solicited
comments on the overall HH PPS RFA analysis and received no comments.
Guidance issued by HHS interpreting the Regulatory Flexibility Act
considers the effects economically `significant' only if greater than 5
percent of providers reach a threshold of 3 to 5 percent or more of
total revenue or total costs. Among the over 7,500 HHAs that are
estimated to qualify to compete in the expanded HHVBP Model, we
estimate that the percent payment adjustment resulting from this rule
would be larger than 3 percent, in magnitude, for about 28 percent of
competing HHAs (estimated by applying the final 5-percent maximum
payment adjustment under the expanded Model to CY 2019 data). As a
result, more than the RFA threshold of 5-percent of HHA providers
nationally would be significantly impacted. We refer readers to Tables
43 and 44 in the CY 2022 HH PPS final rule (86 FR 62407 through 62410)
for our analysis of payment adjustment distributions by State, HHA
characteristics, HHA size, and percentiles.
Thus, the Secretary has certified that this final rule would have a
significant economic impact on a substantial number of small entities.
Though the RFA requires consideration of alternatives to avoid economic
impacts on small entities, the intent of the rule, itself, is to
encourage quality improvement by HHAs through the use of economic
incentives. As a result, alternatives to mitigate the payment
reductions would be contrary to the intent of the rule, which is to
test the effect on quality and costs of care of applying payment
adjustments based on HHAs' performance on quality measures.
In addition, section 1102(b) of the Act requires us to prepare an
RIA if a rule may have a significant impact on the operations of a
substantial number of small rural hospitals. This analysis must conform
to the provisions of section 603 of RFA. For purposes of section
1102(b) of the Act, we define a small rural hospital as a hospital that
is located outside of a metropolitan statistical area and has fewer
than 100 beds. This rule is not applicable to hospitals. Therefore, the
Secretary has certified that this final rule would not have a
significant
[[Page 77874]]
economic impact on the operations of small rural hospitals.
H. Unfunded Mandates Reform Act (UMRA)
Section 202 of UMRA of 1995 UMRA also requires that agencies assess
anticipated costs and benefits before issuing any rule whose mandates
require spending in any 1 year of $100 million in 1995 dollars, updated
annually for inflation. In 2023, that threshold is approximately $177
million. This final rule would not impose a mandate that would result
in the expenditure by State, local, and Tribal Governments, in the
aggregate, or by the private sector, of more than $177 million in any
one year.
I. Federalism
Executive Order 13132 establishes certain requirements that an
agency must meet when it promulgates a final rule (and subsequent final
rule) that imposes substantial direct requirement costs on State and
local governments, preempts State law, or otherwise has Federalism
implications. We have reviewed this final rule under these criteria of
Executive Order 13132 and have determined that it would not impose
substantial direct costs on State or local governments.
J. Conclusion
In conclusion, we estimate that the provisions in this final rule
would result in an estimated net increase in home health payments of
0.8 percent for CY 2024 ($140 million). The $140 million increase in
estimated payments for CY 2024 reflects the effects of the CY 2024 home
health payment update percentage increase of 3.0 percent ($525 million
increase), a 0.4 percent increase in payments due to the new lower FDL
ratio, which would increase outlier payments in order to target to pay
no more than 2.5 percent of total payments as outlier payments ($70
million increase) and an estimated 2.6 percent decrease in payments
that reflects the effects of the permanent behavior adjustment ($455
million decrease).
K. Waiver Fiscal Responsibility Act Requirements
The Director of OMB has waived the requirements of section 263 of
the Fiscal Responsibility Act of 2023 (Pub. L. 118-5) pursuant to
sections 265(a)(1) and (a)(2) of Public Law 118-5.
Chiquita Brooks-LaSure, Administrator of the Centers for Medicare &
Medicaid Services, approved this document on October 25, 2023.
List of Subjects
42 CFR Part 409
Health facilities, Medicare.
42 CFR Part 410
Diseases, Health facilities, Health professions, Laboratories,
Medicare, Reporting and recordkeeping requirements, Rural areas, X-
rays.
42 CFR Part 414
Administrative practice and procedure, Health facilities, Health
professions, Kidney diseases, Medicare, Reporting and recordkeeping
requirements.
42 CFR Part 424
Emergency medical services, Health facilities, Health professions,
Medicare, Reporting and recordkeeping requirements.
42 CFR Part 484
Administrative practice and procedure, Grant programs-health,
Health facilities, Health professions, Home health care, Medicare,
Reporting and recordkeeping requirements.
42 CFR Part 488
Administrative practice and procedure, Health facilities, Health
professions, Medicare, Reporting and recordkeeping requirements.
42 CFR Part 489
Health facilities, Medicare, Reporting and recordkeeping
requirements.
For the reasons stated in the preamble, the Centers for Medicare &
Medicaid Services amends 42 CFR Chapter IV as follows:
PART 409--HOSPITAL INSURANCE BENEFITS
0
1. The authority citation for part 409 continues to read as follows:
Authority: 42 U.S.C. 1302 and 1395hh.
Sec. 409.50 [Amended]
0
2. In Sec. 409.50 amend paragraph (b) by removing the phrase ``for
furnishing the Negative Pressure Wound Therapy (NPWT) using a
disposable device'' and adding in its place the phrase ``for the
disposable Negative Pressure Wound Therapy (NPWT) device''.
PART 410--SUPPLEMENTARY MEDICAL INSURANCE (SMI) BENEFITS
0
3. The authority citation for part 410 continues to read as follows:
Authority: 42 U.S.C. 1302, 1395m, 1395hh, 1395rr, and 1395ddd.
0
4. Amend Sec. 410.2 by adding the definitions of ``Brace'', ``Custom
fitted gradient compression garment'', ``Gradient compression'', and
``Lymphedema compression treatment item'' in alphabetical order to read
as follows:
Sec. 410.2 Definitions.
* * * * *
Brace means a rigid or semi-rigid device used for the purpose of
supporting a weak or deformed body member or restricting or eliminating
motion in a diseased or injured part of the body.
* * * * *
Custom fitted gradient compression garment means a garment that is
uniquely sized and shaped to fit the exact dimensions of the affected
extremity or part of the body, of an individual to provide accurate
gradient compression to treat lymphedema.
* * * * *
Gradient compression means the ability to apply a higher level of
compression or pressure to the distal (farther) end of the limb or body
part affected by lymphedema with lower, decreasing compression or
pressure at the proximal (closer) end of the limb or body part affected
by lymphedema.
Lymphedema compression treatment item means standard and custom
fitted gradient compression garments and other items specified under
Sec. 410.36(a)(4) that are--
(1) Furnished on or after January 1, 2024, to an individual with a
diagnosis of lymphedema for treatment of such condition;
(2) Primarily and customarily used to serve a medical purpose and
for the treatment of lymphedema; and
(3) Prescribed by a physician (or a physician assistant, nurse
practitioner, or a clinical nurse specialist (as those terms are
defined in section 1861(aa)(5) of the Act)) to the extent authorized
under State law.
* * * * *
Sec. 410.10 [Amended]
0
5. In Sec. 410.10 amend paragraph (y) by removing the phrase
``globulin administered'' and adding in its place the phrase
``globulin, including items and services, administered''.
0
6. Amend Sec. 410.36 by revising paragraph (a)(3) and adding paragraph
(a)(4) to read as follows:
Sec. 410.36 Medical supplies, appliances, and devices: Scope.
* * * * *
(a) * * *
(3)(i) Leg, arm, back, and neck braces.
[[Page 77875]]
(A) A leg brace may include a shoe if it is an integral part of the
brace (necessary for the leg brace to function properly) and its
expense is included as part of the cost of the brace.
(ii) Artificial legs, arms, and eyes; and
(iii) Replacements for the devices specified in paragraphs
(a)(3)(i) and (ii) if required because of a change in the individual's
physical condition.
(4) Lymphedema compression treatment items, including the
following:
(i) Standard and custom fitted gradient compression garments.
(ii) Gradient compression wraps with adjustable straps.
(iii) Compression bandaging systems.
(iv) Other items determined to be lymphedema compression treatment
items under the process established under Sec. 414.1670.
(v) For the purposes of paragraphs (i) and (ii) of this paragraph,
the scope of the benefit for lymphedema compression treatment items
includes accessories such as zippers in garments, liners worn under
garments or wraps with adjustable straps, and padding or fillers that
are necessary for the effective use of a gradient compression garment
or wrap with adjustable straps.
* * * * *
0
7. Section 410.38 is amended by adding paragraph (d)(4) to read as
follows:
Sec. 410.38 Durable medical equipment, prosthetics, orthotics and
supplies (DMEPOS): Scope and conditions.
* * * * *
(d) * * *
(4) Refills--(i) Definitions. As used in this paragraph (d):
Date of service (for refilled items) means either--
(1) The date of delivery for the DMEPOS item; or
(2) For items rendered via delivery or shipping service, the
shipping date.
Refills mean DMEPOS products that are provided on a recurring basis
secondary to a medically necessary DMEPOS order.
Shipping date means--
(1) The date the delivery/shipping service label is created; or
(2) The date that the item is retrieved for delivery. These dates
must not demonstrate significant variation.
(ii) Documentation. The DMEPOS supplier must document contact with
the beneficiary or their representative to verify the refill is needed.
This documentation must include both of the following:
(A) Evidence of the beneficiary or their representative's
affirmative response of the need for supplies, which should be obtained
as close to the expected end of the current supply as possible. Contact
and affirmative response must be within 30 calendar days from the
expected end of the current supply.
(B)(1) For shipped items, the beneficiary name, date of contact,
the item requested, and an affirmative response from the beneficiary,
indicative of the need for refill, prior to dispensing the product; or
(2) For items obtained in-person from a retail store, the delivery
slip signed by the beneficiary or their representative or a copy of the
itemized sales receipt is sufficient documentation of a request for
refill.
(iii) Delivery of DMEPOS items provided on a recurring basis. The
date of service for DMEPOS items provided on a recurring basis must be
no earlier than 10 calendar days before the expected end of the current
supply.
* * * * *
PART 414--PAYMENT FOR PART B MEDICAL AND OTHER HEALTH SERVICES
0
8. The authority citation for part 414 continues to read as follows:
Authority: 42 U.S.C. 1302, 1395hh, and 1395rr(b)(l).
0
9. Section 414.210 is amended by--
0
a. In paragraph (g)(2)(ii) introductory text, removing the phrase ``(42
U.S.C. 1320b-5(g)(1)(B)), whichever is later'' and adding in its place
the phrase ``(42 U.S.C. 1320b-5(g)(1)(B)), or December 31, 2023,
whichever is later'';
0
b. In paragraph (g)(2)(iii) introductory text, removing the phrase
``(42 U.S.C. 1320b-5(g)(1)(B)), whichever is later'' and adding in its
place the phrase ``(42 U.S.C. 1320b-5(g)(1)(B)), or December 31, 2023,
whichever is later'';
0
c. In paragraph (g)(9)(iii) removing the phrase ``from June 1, 2018
through December 31, 2020 or through the duration'' and adding in its
place the phrase ``from June 1, 2018 through the duration of the
emergency period described in section 1135(g)(1)(B) of the Act (42
U.S.C. 1320b-5(g)(1)(B)) or December 31, 2023'';
0
d. Revising paragraph (g)(9)(v); and
0
e. In paragraph (g)(9)(vi), removing the date ``February 28, 2022'' and
adding in its place the date ``January 1, 2024''.
The revision reads as follows:
Sec. 414.210 General payment rules.
* * * * *
(g) * * *
(9) * * *
(v) For items and services furnished in areas other than rural or
noncontiguous areas with dates of service from March 6, 2020, through
the remainder of the duration of the emergency period described in
section 1135(g)(1)(B) of the Act (42 U.S.C. 1320b-5(g)(1)(B)) or
December 31, 2023, whichever is later, based on the fee schedule amount
for the area is equal to 75 percent of the adjusted payment amount
established under this section and 25 percent of the unadjusted fee
schedule amount.
* * * * *
0
10. Amend Sec. 414.402 by revising the definition of ``Item'' to read
as follows:
Sec. 414.402 Definitions.
* * * * *
Item means a product included in a competitive bidding program that
is identified by a HCPCS code, which may be specified for competitive
bidding (for example, a product when it is furnished through mail
order), or a combination of codes with or without modifiers, and
includes the services directly related to the furnishing of that
product to the beneficiary. Items that may be included in a competitive
bidding program are as follows:
(1) DME other than class III devices under the Federal Food, Drug
and Cosmetic Act, as defined in Sec. 414.402, group 3 complex
rehabilitative power wheelchairs, complex rehabilitative manual
wheelchairs, manual wheelchairs described by HCPCS codes E1235, E1236,
E1237, E1238, and K0008, and related accessories when furnished in
connection with such wheelchairs, and further classified into the
following categories:
(i) Inexpensive or routinely purchased items, as specified in Sec.
414.220(a).
(ii) Items requiring frequent and substantial servicing, as
specified in Sec. 414.222(a).
(iii) Oxygen and oxygen equipment, as specified in Sec.
414.226(c)(1).
(iv) Other DME (capped rental items), as specified in Sec.
414.229.
(2) Supplies necessary for the effective use of DME other than
inhalation and infusion drugs.
(3) Enteral nutrients, equipment, and supplies.
(4) Off-the-shelf orthotics, which are orthotics described in
section 1861(s)(9) of the Act that require minimal self-adjustment for
appropriate use and do not require expertise in trimming, bending,
molding, assembling or customizing to fit a beneficiary.
(5) Lymphedema compression treatment items.
* * * * *
0
11. Amend Sec. 414.408 by adding paragraph (g)(5) to read as follows:
[[Page 77876]]
Sec. 414.408 Payment rules.
* * * * *
(g) * * *
(5) Lymphedema compression treatment items.
* * * * *
0
12. Amend Sec. 414.412 by revising paragraph (b)(2) to read as
follows:
Sec. 414.412 Submission of bids under a competitive bidding program.
* * * * *
(b) * * *
(2) The bid submitted for each lead item and product category
cannot exceed the payment amount that would otherwise apply to the lead
item under--
(i) Subpart C of this part, without the application of Sec.
414.210(g);
(ii) Subpart D of this part, without the application of Sec.
414.105; or
(iii) Subpart Q of this part, without the application of Sec.
414.1690.
* * * * *
0
13. Add subpart Q, consisting of Sec. Sec. 414.1600 through 414.1690,
to read as follows:
Subpart Q--Payment for Lymphedema Compression Treatment Items
Sec.
414.1600 Purpose and definitions.
414.1650 Payment basis for lymphedema compression treatment items.
414.1660 Continuity of pricing when HCPCS codes are divided or
combined.
414.1670 Procedures for making benefit category determinations and
payment determinations for new lymphedema compression treatment
items.
414.1680 Frequency limitations.
414.1690 Application of competitive bidding information.
Subpart Q--Payment for Lymphedema Compression Treatment Items
Sec. 414.1600 Purpose and definitions.
(a) Purpose. This subpart implements section 1834(z) of the Act and
establishes procedures for making benefit category determinations and
payment determinations for lymphedema compression treatment items.
(b) Definitions. For purposes of this subpart the following
definitions apply:
Benefit category determination means a national determination
regarding whether an item or service meets the Medicare definition of
lymphedema compression treatment item at section 1861(mmm) of the Act
and the rules of this subpart and is not otherwise excluded from
coverage by statute.
Lymphedema compression treatment item means an item as described in
Sec. 410.2.
Sec. 414.1650 Payment basis for lymphedema compression treatment
items.
(a) General payment rule. For items furnished on or after January
1, 2024, Medicare pays for lymphedema compression treatment items on
the basis of 80 percent of the lesser of--
(1) The actual charge for the item; or
(2) The payment amount for the item, as determined in accordance
with paragraph (b) of this section.
(b) Payment amounts. The payment amounts for covered lymphedema
compression treatment items paid for under this subpart are established
based on one of the following:
(1) If payment amounts are available from Medicaid state plans,
then 120 percent of the average of the Medicaid payment amounts.
(2) If payment amounts are not available from Medicaid state plans,
then 100 percent of the average of average internet retail prices and
payment amounts from TRICARE (Department of Defense).
(3) If payment amounts are not available from Medicaid state plans
or TRICARE, then 100 percent of average internet retail prices.
(c) Updates to payment amounts. The payment amounts for covered
lymphedema compression treatment items established in accordance with
paragraph (b) of this section are increased on an annual basis
beginning on January 1 of the year subsequent to the year in which the
payment amounts are initially established based on the percent change
in the Consumer Price Index for all Urban Consumers (CPI-U) for the 12-
month period ending with June of the previous year.
Sec. 414.1660 Continuity of pricing when HCPCS codes are divided or
combined.
(a) General rule. If HCPCS codes for lymphedema compression
treatment items are divided or combined, the payment amounts for the
old codes are mapped to the new codes to ensure continuity of pricing.
(b) Mapping of payment amounts. (1) If there is a single code that
describes two or more distinct complete items (for example, two
different but related or similar items), and separate codes are
subsequently established for each item, then the payment amounts that
applied to the single code continue to apply to each of the items
described by the new codes.
(2) If the codes for several different items are combined into a
single code, then the payment amounts for the new code are established
using the average (arithmetic mean), weighted by allowed services, of
the payment amounts for the formerly separate codes.
Sec. 414.1670 Procedures for making benefit category determinations
and payment determinations for new lymphedema compression treatment
items.
The procedures for determining whether new items and services
addressed in a request for a HCPCS Level II code(s) or by other means
meet the definition of items and services paid for in accordance with
this subpart are as follows:
(a) At the start of a HCPCS coding cycle, CMS performs an analysis
to determine if the item is statutorily excluded from coverage under
Medicare under section 1862 of the Act.
(1) If not excluded by statute, then CMS determines whether the
item is a lymphedema compression treatment item as defined under
section 1861(mmm) of the Act.
(2) If excluded by statute, the analysis is concluded.
(b) If a preliminary determination is made that the item is a
lymphedema compression treatment item, CMS makes a preliminary payment
determination for the item or service.
(c) CMS posts preliminary benefit category determinations and
payment determinations on CMS.gov approximately 2 weeks prior to a
public meeting.
(d) After consideration of public consultation provided at a public
meeting on preliminary benefit category determinations and payment
determinations for items, CMS establishes the benefit category
determinations and payment determinations for items through program
instructions.
Sec. 414.1680 Frequency limitations.
(a) General rule. With the exception of replacements of items that
are lost, stolen, or irreparably damaged, or if needed due to a change
in the patient's medical or physical condition, no payment may be made
for gradient compression garments or wraps with adjustable straps
furnished other than at the frequencies established in paragraphs (b)
and (c) of this section.
(b) Initial furnishing of lymphedema compression treatment items.
The following frequency limitations apply to items initially furnished
to the beneficiary if determined to be reasonable and necessary for the
treatment of lymphedema:
(1) Three units of daytime gradient compression garments or wraps
with adjustable straps per affected extremity or part of the body.
(2) Two garments for nighttime use per affected extremity or part
of the body.
(c) Replacements of lymphedema compression treatment items. The
[[Page 77877]]
following frequency limitations apply to replacements of lymphedema
compression treatment items if determined to be reasonable and
necessary for the treatment of lymphedema:
(1) Payment for the replacement of gradient compression garments or
wraps with adjustable straps per each affected extremity or part of the
body can be made once every 6 months.
(2) Payment for the replacement of nighttime garments per each
affected extremity or part of the body can be made once every 2 years.
(d) Replacements of lymphedema compression bandaging systems or
supplies. Specific frequency limitations are not established for these
items. Determinations regarding the quantity of compression bandaging
supplies needed by each beneficiary are made by the DME MAC that
processes the claims for the supplies.
Sec. 414.1690 Application of competitive bidding information.
The payment amounts for lymphedema compression treatment items
under Sec. 414.1650(b) may be adjusted using information on the
payment determined as part of implementation of the programs under
subpart F using the methodologies set forth at Sec. 414.210(g).
0
14. Add subpart R, consisting of Sec. 414.1700, to read as follows:
Subpart R--Home Intravenous Immunoglobulin (IVIG) Items and
Services Payment
Sec. 414.1700 Basis of payment.
(a) General rule. For home intravenous immunoglobulin (IVIG) items
or services furnished on or after January 1, 2024, Medicare payment is
made on the basis of 80 percent of the lesser of the following:
(1) The actual charge for the item or service.
(2) The fee schedule amount for the items and services, as
determined in accordance with the provisions of this section.
(b) Per visit amount. A single payment amount is made for items and
services furnished by a DME supplier per visit.
(c) Initial establishment of the payment amount. In establishing
the initial per visit IVIG items and services payment amount for CY
2024, CMS used the CY 2023 bundled payment rate under the IVIG
Demonstration updated by the home health payment percentage update for
CY 2024.
(d) Annual payment adjustment. The per visit payment amount
represents payment in full for all costs associated with the furnishing
of home IVIG items and services and is subject to the following
adjustment:
(1) Beginning in 2025, an annual increase in the per-visit payment
amount from the prior year by the home health update percentage
increase for the current calendar year.
(2) [Reserved]
PART 424--CONDITIONS FOR MEDICARE PAYMENT
0
15. The authority for part 424 continues to read as follows:
Authority: 42 U.S.C. 1302 and 1395hh.
Subpart P--Requirements for Establishing and Maintaining Medicare
Billing Privileges
0
16. Amend Sec. 424.502 by--
0
a. In the definition of ``Change in majority ownership''--
0
(i) Removing the term ``HHA'' and in its place adding the phrase ``HHA
or hospice'' wherever it appears; and
0
(ii) Removing the term ``HHA's'' and in its place adding the phrase
``HHA's or hospice's'' wherever it appears.
0
b. Revising the definition of ``Managing employee''.
The revision reads as follows:
Sec. 424.502 Definitions.
* * * * *
Managing employee means a general manager, business manager,
administrator, director, or other individual that exercises operational
or managerial control over, or who directly or indirectly conducts, the
day-to-day operation of the provider or supplier, either under contract
or through some other arrangement, whether or not the individual is a
W-2 employee of the provider or supplier. For purposes of this
definition, this includes, but is not limited to, a hospice or skilled
nursing facility administrator and a hospice or skilled nursing
facility medical director.
* * * * *
0
17. Amend Sec. 424.518 by--
0
a. Removing paragraph (b)(1)(iv);
0
b. Redesignating paragraphs (b)(1)(v) through (b)(1)(viii) as
paragraphs (b)(1)(iv) through (b)(1)(vii);
0
c. Redesignating paragraph (b)(1)(xii) as paragraph (b)(1)(viii);
0
d. Revising newly redesignated paragraphs (b)(1)(viii) and (b)(1)(ix);
0
e. Removing paragraphs (b)(1)(x) through (b)(1)(xiv);
0
f. Revising (c)(1)(vi); and
0
g. Adding paragraphs (c)(1)(vii) and (viii).
The revisions and additions read as follows:
Sec. 424.518 Screening levels for Medicare providers and suppliers.
* * * * *
(b) * * *
(1) * * *
(viii) Prospective (newly enrolling) and revalidating opioid
treatment programs that have been fully and continuously certified by
the Substance Abuse and Mental Health Services Administration (SAMHSA)
since October 23, 2018.
(ix) Revalidating opioid treatment programs that have not been
fully and continuously certified by SAMHSA since October 23, 2018,
revalidating DMEPOS suppliers, revalidating MDPP suppliers,
revalidating HHAs, revalidating SNFs, and revalidating hospices to
which CMS applied the fingerprinting requirements outlined in paragraph
(c)(2)(ii) of this section upon the provider's or supplier's--
(A) New/initial enrollment; or
(B) Revalidation after CMS waived the fingerprinting requirements,
under the circumstances described in paragraph (c)(1)(viii) of this
section, when the provider or supplier initially enrolled in Medicare.
* * * * *
(c) * * *
(1) * * *
(vi) Prospective (newly enrolling) hospices.
(vii) Enrolled opioid treatment programs that have not been fully
and continuously certified by SAMHSA since October 23, 2018, DMEPOS
suppliers, MDPP suppliers, HHAs, SNFs, and hospices that are submitting
a change of ownership application pursuant to 42 CFR 489.18 or
reporting any new owner (regardless of ownership percentage) pursuant
to a change of information or other enrollment transaction under title
42.
(viii) Except as stated in paragraph (b)(1)(ix) of this section,
revalidating opioid treatment programs that have not been fully and
continuously certified by SAMHSA since October 23, 2018, revalidating
DMEPOS suppliers, revalidating MDPP suppliers, revalidating HHAs,
revalidating SNFs, and revalidating hospices for which, upon their new/
initial enrollment, CMS waived the fingerprinting requirements outlined
in paragraph (c)(2)(ii) of this section in accordance with applicable
legal authority due to a national, state, or local emergency declared
under existing law.
* * * * *
0
18. Add Sec. 424.527 to read as follows:
[[Page 77878]]
Sec. 424.527 Provisional period of enhanced oversight.
(a) New provider or supplier. Exclusively for purposes of both
section 1866(j)(3) of the Act and this Sec. 424.527, the term ``new
provider or supplier'' is defined as any of the following:
(1) A newly enrolling Medicare provider or supplier. (This includes
providers that are required to enroll as a new provider in accordance
with the change in majority ownership provisions in Sec. 424.550(b).)
(2) A certified provider or certified supplier undergoing a change
of ownership consistent with the principles of 42 CFR 489.18. (This
includes providers that qualify under Sec. 424.550(b)(2) for an
exception from the change in majority ownership requirements in Sec.
424.550(b)(1) but which are undergoing a change of ownership under 42
CFR 489.18).
(3) A provider or supplier (including an HHA or hospice) undergoing
a 100 percent change of ownership via a change of information request
under Sec. 424.516.
(b) Effective date. The effective date of a provisional period of
enhanced oversight that is commenced under section 1866(j)(3) of the
Act is the date on which the new provider or supplier submits its first
claim.
0
19. Amend Sec. 424.530 by--
0
a. In paragraph (f) introductory text removing the phrase ``3 years''
and adding in its place ``10 years''.
0
b. Adding paragraph (f)(3).
The revision and additions read as follows:
Sec. 424.530 Denial of enrollment in the Medicare program.
* * * * *
(f) * * *
(3)(i) A provider or supplier that is currently subject to a
reapplication bar under paragraph (f) of this section may not order,
refer, certify, or prescribe Medicare-covered services, items, or
drugs.
(ii) Medicare does not pay for any otherwise covered service, item,
or drug that is ordered, referred, certified, or prescribed by a
provider or supplier that is currently under a reapplication bar.
Sec. 424.540 [Amended]
0
20. Section 424.540(a)(1) is amended by removing the number ``12'' and
adding in its place the number ``6'' wherever it appears.
0
21. Add Sec. 424.542 to read as follows:
Sec. 424.542 Prohibition on ordering, certifying, referring, or
prescribing based on felony conviction.
(a) General prohibition. A physician or other eligible professional
(regardless of whether he or she is or was enrolled in Medicare) who
has had a felony conviction within the previous 10 years that CMS
determines is detrimental to the best interests of the Medicare program
and its beneficiaries may not order, refer, certify, or prescribe
Medicare-covered services, items, or drugs.
(b) Payment. Medicare does not pay for any otherwise covered
service, item, or drug that is ordered, referred, certified, or
prescribed by a physician or other eligible professional (as that term
is defined in section 1848(k)(3)(B) of the Act) who has had a felony
conviction within the previous 10 years that CMS determines is
detrimental to the best interests of the Medicare program and its
beneficiaries.
0
22. Amend Sec. 424.550 by--
0
a. Revising paragraph (b)(1) introductory text;
0
b. In paragraph (b)(1)(i) removing the term ``HHA'' and adding in its
place the phrase ``HHA or hospice'';
0
c. In paragraph (b)(2)(i) removing the phrase ``The HHA submitted two
consecutive years'' and adding in its place the phrase ``The HHA or
hospice submitted 2 consecutive years'';
0
d. In paragraph (b)(2)(ii), removing the term ``HHA's'' and adding in
its place the phrase ``HHA's or hospice's'';
0
e. In paragraph (b)(2)(iii), removing the phrase ``The owners of an
existing HHA are changing the HHA's'' and adding in its place the
phrase ``The owners of an existing HHA or hospice are changing the
HHA's or hospice's'';
0
f. In paragraph (b)(2)(iv) removing the term ``HHA'' and adding in its
place the phrase ``HHA or hospice''.
The revision reads as follows:
Sec. 424.550 Prohibitions on the sale or transfer of billing
privileges.
* * * * *
(b) * * *
(1) Unless an exception in paragraph (b)(2) of this section
applies, if there is a change in majority ownership of a home health
agency (HHA) or hospice by sale (including asset sales, stock
transfers, mergers, and consolidations) within 36 months after the
effective date of the HHA's or hospice's initial enrollment in Medicare
or within 36 months after the HHA's or hospice's most recent change in
majority ownership, the provider agreement and Medicare billing
privileges do not convey to the new owner. The prospective provider/
owner of the HHA or hospice must instead do both of the following:
* * * * *
PART 484--HOME HEALTH SERVICES
0
23. The authority citation for part 484 continues to read as follows:
Authority: 42 U.S.C. 1302 and 1395hh.
0
24. Section 484.202 is amended by revising the definition of
``Furnishing Negative Pressure Wound Therapy (NPWT) using a disposable
device'' to read as follows:
Sec. 484.202 Definitions.
* * * * *
Furnishing Negative Pressure Wound Therapy (NPWT) using a
disposable device means the device is paid separately (specified by the
assigned CPT[supreg] code) and does not include payment for the
professional services. The nursing and therapy services are to be
included as part of the payment under the home health prospective
payment system.
* * * * *
0
25. Section 484.245 is amended by--
0
a. Redesignating paragraph (b)(2) as paragraph (b)(2)(i);
0
b. In newly redesignated paragraph (b)(2)(i), removing the phrase ``The
data submitted'' and adding in its place the phrase ``Data submission
requirements. The data submitted''; and
0
c. Adding paragraph (b)(2)(ii).
The addition reads as follows:
Sec. 484.245 Data submission requirements under the home health
quality reporting program
* * * * *
(b) * * *
(2) * * *
(ii) Data completion thresholds. (A) A home health agency must meet
or exceed the data submission threshold for each submission year (July
1 through June 30) set at 90 percent of all required OASIS or successor
instrument records submitted through the CMS designated data submission
systems.
(B) A home health agency must meet or exceed the data submission
compliance threshold described in paragraph (b)(2)(ii)(A) of this
section to avoid receiving a 2-percentage point reduction to its annual
payment update for a given fiscal year described under Sec.
484.225(b).
* * * * *
0
26. Add Sec. 484.358 to read as follows:
Sec. 484.358 HHVBP Measure removal factors.
CMS may remove a quality measure from the expanded HHVBP Model
based on one or more of the following factors:
(a) Measure performance among HHAs is so high and unvarying that
meaningful distinctions in
[[Page 77879]]
improvements in performance can no longer be made (that is, topped
out).
(b) Performance or improvement on a measure does not result in
better patient outcomes.
(c) A measure does not align with current clinical guidelines or
practice.
(d) A more broadly applicable measure (across settings,
populations, or conditions) for the particular topic is available.
(e) A measure that is more proximal in time to desired patient
outcomes for the particular topic is available.
(f) A measure that is more strongly associated with desired patient
outcomes for the particular topic is available.
(g) Collection or public reporting of a measure leads to negative
unintended consequences other than patient harm.
(h) The costs associated with a measure outweigh the benefit of its
continued use in the program.
0
27. Amend Sec. 484.375 by revising paragraph (b)(5) to read as
follows:
Sec. 484.375 Appeals process for the Expanded Home Health Value-Based
Purchasing (HHVBP) Model.
* * * * *
(b) * * *
(5) Reconsideration decision. (i) CMS reconsideration officials
issue a written decision that is final and binding upon issuance unless
the CMS Administrator--
(A) Renders a final determination reversing or modifying the
reconsideration decision; or
(B) Does not review the reconsideration decision within 14 days of
the request.
(ii) An HHA may request that the CMS Administrator review the
reconsideration decision within 7 calendar days of the decision.
(iii) If the CMS Administrator receives a request to review, the
CMS Administrator must do one of the following:
(A) Render a final determination based on his or her review of the
reconsideration decision.
(B) Decline to review a reconsideration decision made by CMS.
(C) Choose to take no action.
(iv) If the CMS Administrator does not review an HHA's request
within 14 days (as described in paragraph (b)(5)(iii)(B) or (C) of this
section), the reconsideration official's written reconsideration
decision is final.
PART 488--SURVEY, CERTIFICATION, AND ENFORCEMENT PROCEDURES
0
28. The authority citation for part 488 continues to read as follows:
Authority: 42 U.S.C. 1302 and 1395hh.
Subpart M--Survey and Certification of Hospice Programs
0
29. Amend Sec. 488.1105 by adding the definitions of ``Hospice Special
Focus Program (SFP)'', ``IDR'', ``SFP status'', and ``SFP survey'' in
alphabetical order to read as follows:
Sec. 488.1105 Definitions.
* * * * *
Hospice Special Focus Program (SFP) means a program conducted by
CMS to identify hospices as poor performers, based on defined quality
indicators, in which CMS selects hospices for increased oversight to
ensure that they meet Medicare requirements. Selected hospices either
successfully complete the SFP program or are terminated from the
Medicare program.
IDR stands for informal dispute resolution.
* * * * *
SFP status means the status of a hospice provider in the SFP with
respect to the provider's progress in the SFP, which is indicated by
one of the following status levels:
(1) Level 1--in progress.
(2) Level 2--completed successfully.
(3) Level 3--terminated from the Medicare program.
SFP survey means a standard survey as defined in this section and
is performed after a hospice is selected for the SFP and is conducted
every 6 months, up to 3 occurrences.
* * * * *
0
30. Add Sec. 488.1130 to read as follows:
Sec. 488.1130 Informal dispute resolution (IDR).
(a) Opportunity to refute survey findings. Upon the provider's
receipt of an official statement of deficiencies, hospice programs can
request an informal opportunity to dispute condition-level survey
findings.
(b) Failure to conduct IDR timely. Failure of CMS, the State, or
the AO, as appropriate, to complete IDR must not delay the effective
date of any enforcement action.
(c) Revised statement of deficiencies as a result of IDR. If any
findings are revised or removed by CMS, the State, or the AO based on
IDR, the official statement of deficiencies is revised accordingly, and
any enforcement actions imposed solely as a result of those cited
deficiencies are adjusted accordingly.
(d) Notification. (1) If the survey findings indicate a condition-
level deficiency, the hospice program is notified in writing of its
opportunity for participating in an IDR process at the time the
official statement of deficiencies is issued.
(2) The request for IDR must--
(i) Be submitted in writing;
(ii) Include the specific deficiencies that are disputed; and
(iii) Be made within the same 10 calendar day period that the
hospice program has for submitting an acceptable plan of correction.
0
31. Add Sec. 488.1135 to read as follows:
Sec. 488.1135 Hospice Special Focus Program (SFP).
(a) Applicability. (1) The provisions of this section are effective
on or after January 1, 2024. ; and
(2) SFP selection begins in CY 2024.
(b) Selection criteria. (1) Selection of hospices for the SFP is
made based on the highest aggregate scores based on the algorithm used
by CMS.
(2) Hospice programs with accrediting organization deemed status
placed in the SFP--
(i) Do not retain deemed status; and
(ii) Are placed under CMS or State survey agency jurisdiction until
completion of the SFP or termination.
(c) Survey and enforcement criteria. A hospice in the SFP--
(1) Is surveyed not less than once every 6 months by CMS or the
State agency; and
(2) With condition level deficiencies on any survey is subject to
standard enforcement actions and may be subject to progressive
enforcement remedies at the discretion of CMS.
(d) Completion criteria. A hospice in the SFP that has two SFP
surveys within 18 months with no condition-level deficiencies, and that
has no pending complaint survey triaged at an immediate jeopardy or
condition level, or that has returned to substantial compliance with
all requirements may complete the SFP.
(e) Termination criteria. (1) A hospice in the SFP that does not
meet the SFP completion requirements in paragraph (d) of this section
is considered for termination from the Medicare program in accordance
with 42 CFR 489.53.
(2) CMS may consider termination from the Medicare program in
accordance with Sec. 488.1225 if any survey results in an immediate
jeopardy citation while the hospice is in the SFP.
(f) Public reporting. CMS posts all of the following at least
annually on a CMS public-facing website:
(1) A subset of 10 percent of hospice programs based on the highest
aggregate scores as determined by the algorithm used by CMS.
(2) Hospice SFP selection from the list in paragraph (f)(1) of this
section as determined by CMS.
[[Page 77880]]
(3) SFP status as defined in Sec. 488.1105.
PART 489--PROVIDER AGREEMENTS AND SUPPLIER APPROVAL
0
32. The authority citation for part 489 continues to read as follows:
Authority: 42 U.S.C. 1302, 1395i-3, 1395x, 1395aa(m), 1395cc,
1395ff, and 1395(hh).
0
33. Section 489.52 is amended by adding paragraph (b)(4) to read as
follows:
Sec. 489.52 Termination by the provider.
* * * * *
(b) * * *
(4) A provider may request a retroactive termination date if no
Medicare beneficiary received services from the facility on or after
the requested termination date.
* * * * *
Xavier Becerra,
Secretary, Department of Health and Human Services.
[FR Doc. 2023-24455 Filed 11-1-23; 4:15 pm]
BILLING CODE 4120-01-P