The Centers for Medicare and Medicaid Services (CMS) issued the final rule this month for the Calendar Year (CY) 2025 Home Health Prospective Payment System (HH PPS) Rate Update. This rule brings several significant changes to Medicare home health payment rates and policies, aligning with ongoing statutory and regulatory requirements. Here’s a summary of the key changes and their implications for home health providers and patients. Axxess Senior Vice President of Clinical Services Arlene Maxim, RN, HCS-C, offered important takeaways from each change.

Home Health Prospective Payment System (HH PPS) Rate Update

For CY 2025, the home health payment update percentage is set at 2.7%, resulting in an estimated net increase in home health payments of 0.5%, or $85 million. The national standardized 30-day period payment rate will be $2,057.35, with national per-visit payment amounts adjusted by the same percentage.

Arlene’s Key Takeaway: “It’s crucial for home health organizations to understand the financial adjustments outlined in the final rule and prepare accordingly. While this update offers a modest increase that can support the enhancement of home health services, it’s disappointing that additional funding was not allocated here, given the escalating costs and challenges facing the sector. This underscores the importance of continued advocacy by home health organizations to ensure future funding better addresses the needs of both providers and patients.”

Acceptance-to-Service Policy

A new standard outlined in the final rule as part of the Conditions of Participation (CoPs) requires home health organizations to develop, implement and maintain an acceptance-to-service policy that is applied consistently to each prospective patient referred for home healthcare. The policy must address the following criteria related to the organization’s capacity to provide patient care:

• The anticipated needs of the referred prospective patient
• The organization’s caseload and case-mix
• The organization’s staffing levels
• The skills and competencies of the organization’s staff

Arlene’s Key Takeaway: “Developing a robust acceptance-to-service policy is essential for organizations to ensure they are equipped to provide the necessary care for each patient they accept; however, they need to be very careful about how they write it. Remember not to make this policy so specific that surveyors are able to find deficiencies in what you’re doing. It’s important to have generalizations in some areas here.”

Home Health Quality Reporting Program (HH QRP)

Starting in CY 2027, the HH QRP will include four new assessment items and one modified assessment item focused on social determinants of health:

• One living situation item (R0310)
• One utilities item (R0330)
• Two food items (R0320)
• Modified transportation item (R0340)

Organizations failing to submit this data will face a 2% reduction in their home health market basket percentage increase.

Arlene’s Key Takeaway: “The inclusion of social determinants of health in the HH QRP highlights the importance of a holistic approach to patient care. Organizations should start integrating these elements into their assessments as soon as possible.”

Provider Enrollment and Oversight

The final rule introduces a provisional period of enhanced oversight for providers and suppliers that are new or reactivating their Medicare enrollment and billing privileges. This period, ranging from 30 days to a year, is designed to ensure compliance and prevent fraud by subjecting these entities to measures like prepayment review and payment caps.

Arlene’s Key Takeaway: “Home health organizations that are new or reactivating their Medicare enrollment and billing privileges must prepare for a provisional period of enhanced oversight. To successfully navigate this period, organizations should rigorously review and strengthen their operational and billing compliance to meet the heightened Medicare standards.”

Axxess’ professional services team is working on additional analysis and insights on these changes. Follow Axxess on LinkedIn and subscribe to our blog and emails to receive the latest updates.

Axxess Home Health, a cloud-based home health software, includes clinical guidance and innovative tools designed to help organizations thrive under regulatory challenges.