CMS has proposed to implement a HHA Value-Based Purchasing Model beginning in 2016.  But before you skip this as it doesn’t apply to 2015, think again!  Our opportunity to impact the implementation of this proposal is here and now!  Ignore this and it will happen; to the chagrin of many in this industry.  I could envision this one provision closing 25+% of all HHAs within four-years of its implementation.  This is a re-packaged, but untested form of ‘Pay-for-Performance’ for home health; that was a big idea not so many years ago.  Following are my comments for this proposal:

Value-Based Purchasing (aka Pay-for-Performance) is reasonable in concept, but as you noted in the proposed rule, the risk/reward needs to be timely applied to the agency’s reimbursement to be able to impact this demonstration.  Otherwise you’re just creating an exercise of jumping through the hoops for HHAs with no idea of how well we are doing until such a time as it might be too late to do anything about it!  If you are intending to motivate improvement and efficiencies in the industry, feedback to the industry must be timely (meaning days; not weeks or months), otherwise it’s just another regulatory nightmare heaped upon home health with no clear training or direction!  We’ve seen too many of those over the years.

Plus, there would need to be clear and concise measurements to be able to be readily identified by all demonstration participants so that all would know in a real-time approach (or very close to real-time) how they stand compared to their peers.

If you do not give the participants the opportunity to make timely decisions in their business, this demonstration is going to be flawed from the start because it’s not going to incentivize agencies to look for new and innovative ways to improve quality whilst reducing costs.  And isn’t that what this demonstration is supposed to be all about?

Additionally, Home Health is going to be entering Year 3 of Rebasing in 2016; when you intend to implement this demonstration and we feel that this is just another proverbial ‘straw in the camel’s back’ and it gets to a point where only one straw is necessary to break the camel’s back.  Well, were concerned that with all the regulatory and reimbursement changes that have been occurring over the last several years that we may be coming to that proverbial straw as an industry!  We feel that this is too much, too fast because we as an industry need a reasonable amount of time to deal with the changes that are occurring without adding new ones on top of those.  If there are agencies out there that appear problematic, why not go audit them instead of applying crushing regulations, one right after another and in groups onto home health.


As you noted in the proposed rule: “… VBP model would reduce or increase Medicare payments, in a 5–8 percent range,” …  Did you read that Home Health?  The possibility of having your reimbursement adjusted +/- 5-8%!  Yeah, if it’s positive that’s awesome; but if it’s not, could you survive?  And there’s always going to be a bottom 1/3rd or 1/4 that are being negatively impacted; and as some agencies  close in any given year they are going to cause others to fall into those categories; when they weren’t in their in prior years!  Ignore at your own peril!

But you further note: “We have already successfully implemented the Hospital Value-Based Purchasing (HVBP) program where 1.25 percent of hospital payments in FY 2014 are tied to the quality of care”.  Well, that’s quite a disparity between what you actually used for Hospitals (which appropriate the lion’s share of Medicare monies) and the 5-8% proposed for Home Health!

  • Is the Hospital VBP program applicable to all hospitals participating in Medicare? Or is it in demonstration mode also? If it’s in demonstration:
    • How many states is it in?
    • Are 100% of all hospitals in each state involved?Why is the payment adjustment range proposed for home health in the 5-8% range when the Hospital VBP program used 1.25%?
    • This seems very extreme and does not seem to agree with testing a demonstration project and more like an overt attempt to slash the number of HHAs in those 5-8 states selected to participate! This really seems to give the impression that you treat the Hospitals with ‘kid-gloves’, whereas you treat the home health industry; well, let’s just say ‘not with kid gloves’! Well, you are trying to use this proposed rule to circumvent the rules of reimbursement for the industry and the impact that you are looking to apply to home health is 4 to 6 times as significant as what was applied to hospitals!


CMS is also proposing to do this demonstration in 5 to 8 states and that ALL Certified HHAs in those 5 to 8 selected states MUST participate!  The only way to opt out is to de-certify and/or close your doors!  How comfortable are you with that?   More to come on this … see Value-Based Purchasing pt II