NAHC gives HCFA’s proposed rule for PPS a mixed review
By MATTHEW HAY
HHBR Washington Correspondent
WASHINGTON The National Association for Home Care (NAHC; Washington) released a preliminary assessment of the Health Care Financing Administration’s (HCFA; Baltimore) proposed rule for a home health prospective payment system (PPS) last week, mainly to assist its members in drafting comments. And although it broadly characterized the proposal as fair, NAHC’s assessment highlighted numerous potential trouble spots.
While noting that more detailed work is needed before its comments become final, NAHC said that overall it believes that HCFA’s proposal is consistent with Medicare’s PPS for hospitals and nursing facilities. "The proposed home health PPS rule follows along expected lines and is structured within the Congressionally-imposed constraints of budget neutrality and requirements for case-mix, outliers, and proration," said NAHC. "The complexity of the case-mix system accounts for efforts to achieve some degree of precision in the payment rates."
But NAHC also listed numerous concerns with the proposed rule. For example, it emphasized that the payment rates in the proposed rule are based on 1996 audited cost report data and expenditures prior to the interim payment system. "Major changes in utilization have occurred since that time that could result in significant changes to HCFA’s calculation of the global budget and payment rates in the final rule," the association said.
NAHC also expressed concern that the agency’s proposal to split payments, with 50% at the start of an episode and 50% at the end, will cause severe cash flow problems for agencies. According to NAHC, submission of an initial claim may be delayed several weeks since claims cannot be submitted until the comprehensive assessment is completed and the plan of care is developed and signed by the physician. Worse yet, a payment floor is expected to remain in place and will result in an additional delay of two weeks in payment, NAHC added.
"These delays, combined with elimination of periodic interim payments and the front loading of costs, will severely impact agencies’ cash flow," NAHC said. Instead, NAHC suggested HCFA give agencies a greater percentage of the episode payment upon submission of initial claims.
NAHC also zeroed in on HCFA’s requirements for signed physician orders. According to NAHC, agencies should be allowed to submit an initial claim and receive partial payment for an episode based on documented verbal orders. "Since agencies are expected to provide services based on verbal orders in order to prevent delays in the provision of necessary medical care, they should also receive payment for services provided based on verbal orders."
The association also argued that physicians should not be required to certify that the PPS case-mix grouper is correct. "To require physicians to review 20 items that make up the case-mix grouper in order to certify that the grouper is correct would be burdensome and unnecessary," NAHC argued.
In the area of case-mix, NAHC pointed out that HCFA plans to use actual OASIS data transmitted by home health agencies during the first six months of OASIS reporting to validate the case-mix adjustment methodology in its proposed rule. But the association argued that OASIS data could be seriously flawed because it will have been collected from providers who were in the learning phase of OASIS implementation.
According to NAHC, one important point in the development of comments is that they must reflect the actual impact of the provisions of the regulation on the agency commenting.
NAHC added that the adequacy of the payment rates must be determined by each agency. "At a minimum, agencies should determine the case-mix and PPS payment rate for a representative sample of patients they have served and compare this with current reimbursement," NAHC advised.
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