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center73324500August 26, 2016Andrew Slavitt, Acting AdministratorCenters for Medicare & Medicaid Services7500 Security BoulevardBaltimore MD 21244Via RE: CMS-1648-PDear Acting Administrator Slavitt:I am writing on behalf of the Home Care Alliance of Massachusetts to comment on the Proposed Rule: Medicare and Medicaid Programs; CY 2017 Home Health Prospective Payment System Rate Update; Home Health Value-Based Purchasing Model; and Home Health Quality Reporting Requirements. The Home Care Alliance of Massachusetts is the trade association that represents approximately 100 Medicare certified home health care agencies in Massachusetts, including VNAs, hospital-based agencies, and for-profit agencies. Thank you for your consideration of our comments, submitted on behalf of these agencies, on the above referenced proposed rule. Our comments on the provisions of the proposed rule are organized in the order in which they are presented in the Federal Register notice. Affordable Care Act Rebasing AdjustmentsWe take strong exception to CMS’ proposal to continue the maximum allowable rebasing cut of $80.95. We believe that payment reductions of this magnitude fail to take into account significant new cost burdens on agencies since 2012 – including the cost to agencies of the physician Face-to-Face requirement and the Therapy reassessment requirement – and the significant costs in 2015 to implement ICD-10-CM and the OASIS-C1. The ACA language gave CMS wide discretion in considering a broad spectrum of factors in the rebasing project, yet CMS seems to have focused exclusively on number of visits and payment per visit in the rebasing process. We urge CMS to update its analysis to include data from 2015 cost reports to capture costs associated with the implementation of the physician Face-to-Face and therapy reassessment requirements and the implementation of ICD-10 in projecting profit margins, and to reduce or eliminate the rebasing adjustment for 2017. HH PPS Case-Mix WeightsWe are pleased that CMS has used updated claims and cost data to recalibrate all of the case-mix weights. We are confused, though, that CMS has not proposed modifications to the current 4-equation case mix model to incorporate the findings of last year’s review of costs associated with providing ongoing access to home health care for low-income beneficiaries, those in medically underserved areas, and those with varying levels of severity of illness, as required by Section 3131(d) of the Affordable Care Act. That report found that “particular beneficiary characteristics appear to be strongly associated with margin,” including need for parenteral nutrition, traumatic wounds, poorly-controlled pulmonary disorders, and Medicare/Medicaid dual eligibility status. Yet CMS has only addressed the findings of this report in its proposed modifications to the outlier methodology, not to the case mix weights that are the core of the PPS system.To ensure vulnerable Medicare patients maintain access to needed home health care and equitable reimbursement to agencies that serve these patients, we urge CMS to incorporate findings from that access study into the case mix weights for Calendar Year 2017.If the current 4-equation case mix model cannot be adapted to account for these beneficiary characteristics, we strongly urge CMS to expedite replacing the current model with one that can more accurately account for variations in patient characteristics and needs. CY 2017 Home Health Wage IndexOver the years, we have repeatedly expressed concerns to CMS about inequities in how the wage index is calculated and implemented for home health agencies as compared to hospitals within the same Core-Based Statistical Area (CBSA). The wage index for home health agencies is based on pre-floor, pre-reclassified hospital wage data, but hospitals in the same geographic regions have the ability to apply for re-classification to another CBSA and may be eligible for the rural floor wage index. This inequity has for many years created a competitive advantage for hospitals in recruiting and retaining increasingly scarce nurses and therapists. Contrary to CMS’ repeated assertions, we believe that the statute DOES give CMS authority to address and correct some of these inequities.Faced with these wage index inequities, home health agencies across Massachusetts – already at a serious competitive disadvantage – struggle to compete with their local hospitals for increasingly scarce nurses and therapists. We have in the past, and now once again, recommend that CMS include wage data from Critical Access Hospitals in calculating the wage index for home health agencies and other non-hospital provider types, in order to make this wage index more reflective of actual local wage practices.In 2015, CMS indicated that the entire wage index system was under review, and a move to a Commuting-Based Wage Index was being considered. We urge CMS to expedite that review and implement a system that not only recognizes variations between localities, but also treats all provider types within a local market equitably. Until such a system is in place, we urge CMS to adjust the 2017 home health agency wage index to reflect a policy to limit the wage index disparity between provider types within a given CBSA to no more than 10%.Rate Calculation Error Regarding the Rebasing AdjustmentWe note an error in CMS’s calculation of the Proposed CY 2017 national, standardized 60-day episode payment rate that inappropriately inflates the Rebasing Adjustment. The ACA provision regarding the four-year phased in rebasing adjustment strictly limits CMS’s authority to impose no more than $80.95 in annual rebasing adjustments from 2014 through 2017. However, by subtracting the $80.95 from the rate calculation before adjusting for inflation, CMS has inflated the impact of the Rebasing Adjustment for CY 2017 from $80.95 to $82.81. CMS has, in fact, made this same calculation error for each of the four years that the Rebasing Adjustment has been in place. For each year, CMS has over-calculated the Rebasing Adjustment as follows:2014: $80.95 x 1.023 = $82.81 actual impact2015: $80.95 x 1.021 = $82.65 actual impact2016: $80.95 x 1.019 = $82.49 actual impact2017: $80.95 x 1.023 = $82.81 actual impactCompounding the cumulative impact over the four years, the Proposed CY 2017 national, standardized 60-day episode payment rate is $7.19 less than if CMS had subtracted the rebasing adjustment after adjusting for inflation.We recommend that CMS correct the calculation methodology, increase the proposed CY 2017 national, standardized 60-day episode payment rate by $7.19, and retroactively adjust the national, standardized 60-day episode payment rates for years 2014 – 2016 to comply with the Congressional limitation on the rebasing adjustment. Nominal Case-Mix Growth AdjustmentWe strongly object to CMS’ proposed 0.97% nominal case-mix growth adjustment. The ACA provision regarding the four-year phased in rebasing adjustment strictly limits CMS’s authority to impose no more than $80.95 in annual rebasing adjustments from 2014 through 2017. We believe the proposed “nominal case-mix growth adjustment” is nothing more than a rebasing adjustment by a different name, and an unauthorized attempt by CMS to circumvent the payment reduction limitations imposed by Congress in the ACA.Second, we believe that the methodology used to calculate the nominal case-mix growth is highly questionable. CMS extrapolates results of an analysis of data from 2000 through 2010, and assumes that the nominal case-mix growth rate from that period of time continued through 2013 and 2014. CMS’s own analysis of case mix changes from three distinct periods -- 1999-2005; 2005-2007; and 2007-2009 – found wide variations in “real” case mix change during those periods as 15.12%; 23.23%; and 13.77% respectively. Third, any analysis of case mix in home care must be put in the context of the current post-Affordable Care Act environment. The ACA included a range of initiatives that have had a rapid and profound impact on the profile of Medicare home health care patients and case mix. In response to readmission penalties and bundled payment demonstrations designed by CMS, hospitals have changed their discharge patterns, using clinical screening to bypass post-acute SNF stays in favor of more direct discharges to home care, especially for higher acuity orthopedic surgery patients. In addition, the growth of Medicare Advantage plans, which appeal to the younger cohort of Medicare beneficiaries, has resulted in an older, sicker cohort of patients in the traditional Medicare fee-for-service program. For CMS to assume “business as usual” in terms of the home health care case mix is to negate the impact of, and ask home health care agencies to absorb the costs associated with, the very reform initiatives Medicare is asking providers to embrace. We urge CMS to remove the nominal case-mix adjustment from the proposed regulation, as it is based on faulty data and contravenes Congressional mandates limiting such adjustments.Payments for High-Cost Outliers Under the HH PPSWe are cautiously supportive of CMS’ proposal to address some of the disparities uncovered in the ACA study by changing the outlier system to incorporate visit length into the outlier methodology. We agree that this change will more accurately reflect agency costs of serving medically complex beneficiaries who require longer visits. We note, however, that adjusting payment according to visit length may encourage overutilization. We encourage CMS to put into place appropriate screens and checks to prevent any gaming of the system. However, we are concerned about the increase in the Fixed Dollar Loss Ratio from 0.45 to 0.56, especially given CMS’ history of overly conservative outlier projections. Outlier payments have consistently fallen well below the 2.5% target for the last several years, which has deprived HHAs that take on the high cost cases of an appropriate level of payment. We urge CMS to recalculate the Fixed Dollar Loss Ratio using less conservative projections to ensure that outlier payment levels get closer to the 2.5% target.HHA Value-Based Purchasing ModelWe support each of the proposed changes to the HHVBP pilot program that are discussed at length in the rule: 1). calculate the benchmarks and achievement thresholds at the state level rather than at the cohort level, 2). remove the following four quality measures: Care Management: Types and Sources of Assistance; Prior Functioning ADL/IADL; Influenza Vaccine Data Collection Period; Reason Pneumococcal Vaccine Not Received 3). Adjust the reporting period and submission date for the Influenza Vaccination Coverage for Home Health Personnel measure from a quarterly submission to an annual submission; and 4). Add an appeals process that includes the existing recalculation process and adds a reconsideration process.As part of the VBP changes, CMS also requested preliminary feedback on how it might report agencies’ performance in the pilot through a public forum such as Home Health Compare or the Center for Medicare and Medicaid Innovation (CMMI) website. The HCA recommends using the CMMI website as the vehicle for this reporting rather than Home Health Compare, as the VBP program is still an innovation initiative and the reporting of both VBP and general quality measures on Home Health Compare at this time might cause confusion among consumers when comparing agencies. Proposal to Address the IMPACT Act Domain of Medication ReconciliationHCA recommends more guidance on the new medication reconciliation quality measure. CMS is proposing to add a new quality measure under the IMPACT Act that examines an agency’s response when a medication reconciliation indicates a potential clinically significant issue. The measure would report whether the agency had a “timely follow-up” with a physician each time a potential issue is identified following drug regimen review. In the past with other OASIS-based items, timeliness has been measured not by how quickly the agency notifies the physician but by how quickly the physician responds.Feedback from the technical expert panel that reviewed this measure shows that PAC providers are concerned about being measured on how quickly the physician responds when alerted by the agency of a potential issue. A majority of the panel agreed that 24 hours is sufficient to collect and report medication issues to the physician; however, most also agreed that it is not feasible for the physician to respond to the provider within 24 hours. We request more guidance from CMS as to whether home health agencies will be held accountable for the physician’s own timely response. General CommentsWe are dismayed that CMS continues to enact broadly punitive payment and regulatory policies that impact the entire home health industry because of the questionable clinical and billing practices of a small minority of agencies who are abusing the Medicare home health benefit. We are encouraged that the targeted moratorium on approving new agencies in selected parts of the country seems to be working in slowing the growth in the number of new agencies. The Home Care Alliance of MA strongly urges CMS to do more in the area of targeted fraud enforcement and prevention:Utilize the existing medical review and fraud and abuse prevention processes to identify and target specific agencies that have excessive utilization rates rather than cut payment rates for all agencies;Conduct a thorough review of the deemed-status process that bypasses state oversight in allowing new agencies to enter the Medicare market;Expand the targeted moratorium on new agencies from selected areas in Texas, Florida, and Illinois to be nationwide until the deemed status review is completed.Thank you for your consideration of our comments and recommendations.Sincerely,Patricia M. KelleherExecutive Director ................
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