Medicare Home Health Care: Prospective Payment System Will Need Refinement as Data Become Available
HEHS-00-9
Published: Apr 07, 2000. Publicly Released: Apr 07, 2000.
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Highlights
Pursuant to a legislative requirement, GAO reviewed the Health Care Financing Administration's (HCFA) research on a home health prospective payment system (PPS), focusing on: (1) the objectives, findings, and costs of the research and demonstration projects HCFA has funded that were related to the design of the PPS; and (2) how these projects contributed to the proposed PPS design and which design decisions were based on incomplete information.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Health Care Financing Administration | In order to minimize unintended consequences on beneficiaries, HHAs, and Medicare, and to narrow information gaps in the PPS design, the Administrator, HCFA, should ensure that adequate resources are devoted to utilization monitoring and medical review to ensure that Medicare does not make inappropriate payments for home health services and that quality of care is not compromised. |
CMS has several programs in place to monitor utilization and quality of care in home health services. Medicare contractors/Regional Home Health Intermediaries (RHHI) process home health claims and conduct medical review. In addition, Program Safeguard Contractors are available to perform data analysis and program integrity activities, such as identification of atypical billing trends. As part of a quality improvement initiative begun in 2000, CMS requires home health agencies to submit health status information through the Outcome and Assessment Information Set (OASIS), which the agency uses to construct publicly reported quality measures. To ensure OASIS data quality, CMS has provided training for the home health industry, Medicare contractors and federal and state surveyors; contractors also review OASIS data and support provider education efforts to address problem areas. Finally as part of the Survey and Certification program, CMS and state survey agencies monitor and oversee home health agency compliance with Medicare health and safety requirements. In 2003, CMS enhanced its protocols for these surveys to help surveyors identify areas to focus on.
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| Health Care Financing Administration | In order to minimize unintended consequences on beneficiaries, HHAs, and Medicare, and to narrow information gaps in the PPS design, the Administrator, HCFA, should incorporate a risk-sharing arrangement into the PPS design, consistent with methods tested in the demonstration, until available analyses indicate that it is no longer needed to protect beneficiaries, HHAs, or the Medicare program. |
CMS notes that it is analyzing data to ensure that payments to providers are adequate and that quality of care is not compromised by examining utilization and payment levels, provider and beneficiary characteristics, quality indicators, and operational implementation.
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| Health Care Financing Administration | In order to minimize unintended consequences on beneficiaries, HHAs, and Medicare, and to narrow information gaps in the PPS design, the Administrator, HCFA, should modify the PPS design, as appropriate, on the basis of continued study of the variations in service use and patient needs and the effects of the change in payment method on service use. |
Consistent with our recommendation, CMS has been involved in an ongoing effort to refine the home health prospective payment system (HHPPS). Since the implementation of the HHPPS, CMS has maintained ongoing research and analysis to support refinement efforts. For example, in 2004, CMS awarded a contract for empirical analysis of a new payment system, and in 2005 through 2006, the agency convened three meetings of a technical advisory panel. These analytic efforts culminated in the HHPPS Refinement and Rate Update for CY2008 proposed rule, published in the Federal Register on May 4, 2007, in which CMS proposed refinements in seven major areas, including case mix coding and the low-utilization payment adjustment. CMS published the HHPPS final rule on August 29, 2007.
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Claims processingHealth care cost controlHealth care programsHealth insuranceHealth resources utilizationHome health care servicesInternal controlsMedical information systemsMedicareProspective paymentsQuality of care