SGR 2013: Home Health Rebasing Amendment

Providing a Fully-Offset Period for Evaluation of the Home Health Rebasing Adjustment

Proposed Amendment – Description

Section 1895(b)(3)(A)(iii) of the Social Security Act, 42 USC 1395fff(b)(3)(A)(iii), would be amended as follows:

  1. Establish a one-year postponement of the first year of the rebasing adjustment under 1895(b)(3)(A)(iii). This would serve to postpone but not otherwise alter the implementation of the rebasing adjustment. In 2015, the 2014 and 2015 portion of the adjustment would take effect, as per current law. As a result, the cost of this amendment would be limited to solely a one-year postponement.
  2. The postponement would allow for a detailed evaluation of the rebasing adjustment established in the Home Health Prospective Payment System (HHPPS) Final Rule for CY 2014. The evaluation would focus on the projected impact of and alternatives to rebasing adjustment to ensure continued access to care. A report on the evaluation’s findings would be submitted to Congress by June 30.
  3. The cost of the one-year postponement would be covered by modifying the outlier payment budget from 2.5% to 2.0% for such period as needed to fully cover the cost of the postponement plus $100 million.

Proposed Amendment – Language

MODIFICATION FOR MEDICARE RULE on HOME HEALTH SERVICES

(a) TEMPORARY POSTPONEMENT OF REBASING CUT - “Notwithstanding any other provisions of Title XVIII, the Secretary shall calculate the Home Health PPS base rate for CY 2014 as if the rebasing adjustment under Section 1895(b)(3)(A)(iii) had not been enacted for that calendar year.

(i) For payment year CY 2015, the Secretary shall reduce the base rate to the same amount as if the 2014 adjustment had been in effect under Section 1895(b)(3)(iii) before making any other adjustments to the 2015 base rate. The CY 2015 base rate shall then be adjusted in accordance with Section 1895(b)(3)(A)(iii) as discussed on pages 72,258, 72,259, 72,276, 72,315, and 72,316 of the Federal Register published on December 2, 2013, as amended by the report in subsection (b).

(ii) For payment years CY 2016 and 2017, the Secretary shall reduce the base rate in accordance with Section 1895(b)(3)(A)(iii) as discussed on pages 72,258, 72,259, 72,276, 72,315, and 72,316 of the Federal Register published on December 2, 2013, as amended by the report in subsection (b).

(b) REPORT TO CONGRESS - The [Secretary, MedPAC, GAO] shall, upon consultation with representatives of Medicare home health beneficiaries and agencies, evaluate and consider all alternative methods for determining the appropriate adjustment under Section 1895(b)(3)(A)(iii) of the Social Security Act (42 USC 1395(b)(3)(A)(iii)) in addition to the method set out in the CY 2014 Home Health PPS Final Rule. The [Secretary, MedPAC, GAO] shall submit a report to Congress not later than June 30, 2014 on such alternative methods. These alternative methods must calculate the cumulative impact of the rebasing adjustment specified in the Final Rule in conjunction with other reimbursement reductions established by statute and regulation since January 1, 2010 and in each of the years in which the rebasing adjustment is to be implemented. The alternative methods must also evaluate the Final Rule’s impact on beneficiary access to care and its impact on small business home health agencies. In conducting the analysis on beneficiary access to care, the [Secretary, MedPAC, GAO] shall determine the number and share of home health agencies that are projected to experience negative Medicare margins by 2017, the location, size and type of such agencies, the total number, average age, average income, and average number of Activities of Daily Living of the Medicare beneficiaries such agencies currently serve, the number of staff such agencies currently employ, the number and location of counties in which such agencies serve as the sole provider of Medicare home health services, and the payer mix of such agencies. In considering alternative methods of rebasing, the [Secretary, MedPAC, GAO] shall evaluate and report on all methods within the scope of the authority provided the Secretary under this Part including, but not limited to, methods presented by representatives of Medicare home health beneficiaries and agencies.”

Section 1895(b)(5)(A) of the Social Security Act is amended by adding at the end thereof---

“For calendar years 2014 through 2019, the adjustment herein may not exceed 2.0 percent of the total payments projected or estimated to be made and any unspent funds shall be returned to the Trust Funds.”