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What to Watch for on the Home Health Regulatory Landscape in 2018

The past year could accurately be described as turbulent when it comes to the regulatory environment for home health care providers. While some regulations were put on hold, like the pre-claim review demonstration (PCRD), the industry was faced with numerous proposals that could have disrupted the current payment system. In addition, new requirements are set to take effect in January 2018.

With 2017 in the rear-view mirror, home health care providers are looking forward at what is coming down the road in the new year ahead. Here are a few regulatory issues agencies should keep their eyes on as 2018 unfolds:


The home health Conditions of Participation are top of mind for providers, taking effect on January 13, 2018. The CoPs dictate what agencies need to do in order to provide Medicare-qualified services. Prior to the new changes, the CoPs hadn’t been updated in decades. The industry consensus is that the changes collectively are not terribly burdensome, but the Centers for Medicare & Medicaid Services (CMS) estimates the cost of compliance of implementing the new CoPs will be about $30,000 per agency, or $293.3 million in the first year alone.


CMS delayed the implementation date of the CoPs once already by six months, giving providers some reprieve to catch up to the new requirements, but the federal agency made it clear that it wasn’t likely to delay the date again. As of December, agencies were also still waiting on the finalized interpretive guidelines from CMS, though a draft form was released in October 2017. CMS has since told industry associations the finalized IGs will not be substantially different from the draft. The National Association for Home Care & Hospice (NAHC) also stated that it believes CMS and surveyors will take a more flexible approach to the new regulations in the early stages.

In addition, in an abundance of caution, CMS did agree to defer the imposition of Civil Monetary Penalties (CMPs) for one year, from Jan. 13, 2018, to Jan. 13, 2019. However, immediate jeopardy situations do not apply and all other HHA alternative sanctions will be imposed.

OASIS and measure changes

OASIS — the outcome and assessment information set -— changes are also in store, though most of these are eliminated data set items. The changes were outlined in the home health care prospective payment system (PPS) 2018 update, which CMS released on Nov. 1, 2017.

In the update, CMS eliminated 235 data elements in 33 OASIS items, effective for all home health agencies on Jan. 1, 2019. Other proposed data elements in three categories — Cognitive Function and Mental Status; Special Services, Treatments and Interventions; and Impairments — were not finalized in the 2018 update. Additionally, in 2019, the OASIS submission threshold increases to 90% for reporting period July 1 2017 through June 30, 2019. Agencies will need to prepare for the data changes in 2018.

Three new measures were also adopted for 2020 data collection that agencies should prepare for in 2019, including: changes in skin integrity post-acute care, pressure/ulcer injury; application of the percent of residents experiencing one or more falls with major injury; and percent of long-term care hospital patients with an admission and discharge functional assessment and a care plan that addresses function.

On Nov. 30, 2017, CMS announced its final decision to remove the influenza measure from the home health star ratings, following an Oct. 10 webinar that described the proposed change and a 30-day comment period that ended Nov. 11. Although the measure is to be removed from the home health star ratings algorithm, the measure will still be reported on Home Health Compare to continue to encourage agencies to offer the vaccine.


Electronic Visit Verification (EVV) is another area providers should keep on the radar in 2018. EVV, as mandated in the 21st Century Cures Act, requires agencies to comply with statewide electronic systems, with individual states being in charge of the specific systems.

While many providers already have some form of EVV, as the requirements go into effect over the next few years, agencies will have to comply with their specific regions. For personal care providers, EVV requirements become effective Jan. 1, 2019, while home health agencies have until Jan. 1, 2023, to meet the federal changes. However, some states have already started enacting the rules. Others may similarly implement the EVV earlier than the 21St Century Cures Act requires, so providers need to monitor their local regulations. A percentage reduction schedule also means states risk certain percentages of their Federal Medical Assistance Percentage (FMAP) funding over a span of years.

To stay informed with the upcoming changes, agencies need to monitor communication from their state on their intent to comply with Section 12006 of the 21st Century Cures Act. Agencies can also provide stakeholder input via public forum meetings that become available, and then work to prepare and implement the finalized solution by the state implementation date.

Home Health Value-Based Purchasing (HHVBP)

Home health care providers mandated to take part in value-based purchasing will begin to see payment incentives go into effect in 2018. The model, which ties payments to value, began in 2016 for agencies operating in nine states: Massachusetts, Maryland, North Carolina, Florida, Washington, Arizona, Iowa, Nebraska, and Tennessee.

Depending upon past performance/data agencies in these states will have their payments adjusted by up to 3% — upward or downward — in 2018. The payment adjustments will continue to increase annually, up to 8% by 2022. While the payment adjustments are based on past data, agencies will have opportunities to work on performance and quality improvement as the adjustment rates increase over time.

Targeted Probe and Educate

The Centers for Medicare & Medicaid Services (CMS) expanded its targeted probe and educate (TPE) program on October 1, 2017. TPE only targets providers with high improper payment rates, data analysis or billing patterns that vary significantly from their peers.

Providers that are subject to TPE will be selected by their Medicare Administrative Contractor (MAC) and asked to submit between 20 and 40 claims for review. If these claims are found to have errors or improper billing and payments, the provider will have the opportunity to correct those issues with the next round of new claims selected for targeted probe and review. Each round of review is called a probe, and providers can be probed up to three times before CMS may take other action, including the potential for 100% prepay review.

The process allows providers to receive one-on-one education with their MACs to understand what may be causing high error rates in claims. For providers with low rates of improper payments, the risks are low, and providers that are selected for TPE have opportunities to make corrections for new claims targeted in future rounds.

“MACs also educate providers throughout the probe review process, when easily resolved errors are identified, helping the provider to avoid additional similar errors later in the process,” according to CMS.

Organizations should implement processes to keep their error rates low by ensuring they respond to all ADR requests in an accurate and timely manner, monitor MAC sites for TPE topics, and review agency billing patterns on the CMS PEPPER reports to ensure they are not outliers.

Medicare Beneficiary ID

Beginning April 1, 2018, all new and existing Medicare beneficiaries will start to receive new Medicare Beneficiary Identifiers (MBI), which replace old Medicare cards. All new Medicare beneficiaries will only receive cards with the new MBIs. The change is meant to help fight medical identity theft for people with Medicare, as the old cards used to display Social Security Numbers (SSNs), CMS stated. The move was announced May 30, 2017, and replaces the Health Insurance Claim Number (HICN) that current Medicare beneficiaries use.

Once the changeover process begins, providers have a transition period that runs through December 31, 2019. After Jan. 1, 2020, providers will need to use MBIs on claims with a few exceptions, according to CMS. Providers and staff should be prepared to ask patients for their new cards at the start of care. The new numbers are assigned at random and contain 11 digits, including letters and numbers. Providers should also be ready to use the new MBIs in their current software systems, including, but not limited to claims, financial and clinical documents and patient eligibility verification.

Legislative watch

Beyond new regulations, there are several pieces of legislation under consideration in Congress in 2018 that could impact home health care providers:

-The Home Health Care Planning Improvement S. 445/H.R. 1825

– Preserve Access to Medicare Rural Home Health Services Act (AKA: Rural Add-on) S. 353

– Face to Face/Physician Documentation H.R. 2663

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