CMS introduces new Pre-Claim Review Demonstration proposal

Yesterday, the Centers for Medicare & Medicaid Services (CMS) announced a request for public comment on a new Pre-Claim Review Demonstration proposal. The new demonstration proposal offers home health agencies in the five proposed demonstration states three different options for payment. Under the new proposal, agencies can choose either potential full payment with pre-claim or postpayment reviews, or agencies can choose to forego the review process altogether with a 25 percent reduction in payments on all home health claims submitted. Agencies that choose the third option and payment reduction may still be eligible for review by Recovery Audit Contractors (RACs). The unpublished memo is currently available here, while the published version will appear on Thursday, May 31st in the Federal Register here.

The five states included in the new proposal are: Illinois, Ohio, North Carolina, Florida, and Texas. Ohio and North Carolina are new additions to the current proposal, replacing Massachusetts and Michigan in the original demonstration. The original demonstration did begin in Illinois in 2016 but was paused on April 1, 2017 and never re-started. At the time, CMS provided a brief Q&A on the pause here.

As in the past, the Alliance will be working with our membership as well as colleagues across the industry, to formulate a comment letter to CMS. You can read the Alliance’s comments to the Office of Management and Budget (OMB) from 2016 on the original PCRD proposal here. In those comments, the Alliance highlighted concerns related to the burden on home health agencies, process consideration, and legal authority.

CMS is said to be providing further updates this week so stay tuned for more information.

Alliance members interested in joining the discussion on PCRD and other regulatory and legislative efforts, as well as clinical and quality improvement should reach out to the Alliance’s Director, Policy Communications & Research, Jen Schiller at, to join the Alliance’s monthly Quality & Innovation Work Group.

CMS Continues Advancing Alternative Payment Models

Alternative models of payment are a trending topic for the Centers for Medicare and Medicaid (CMS) as the agency hits the half-century mark. Given that the Secretary of Health and Human Services has specified a goal of moving 50 percent of Medicare payments to alternative payment models within the next two years, the health care system—and home health care as part of it—lies at a critical juncture. It is more important than ever to understand these new models, and several recent publications shed critical light.

In the November 19th issue of The New England Journal of Medicine, Paul Ginsburg and Alice Rivlin explored the challenges facing CMS in a changing healthcare delivery environment (available here). Given CMS’s commitment to alternative payment models and quality care initiatives, the health care delivery landscape of the future appears to be approaching more quickly than ever, and Ginsburg and Rivlin see this as an opportunity to improve both quality and efficiency.

Though CMS has been clear about making bundled payment arrangements a high priority alternative payment model, there are multiple programs and approaches that are testing bundled payments. The Center for Medicare and Medicaid Innovation’s (CMMI) Bundled Payment for Care Improvement (BPCI) initiative. BPCI aims to change both the delivery and payment of health care services, and consists of four different models under which the initiative operates. Models 1 and 4 refer to inpatient acute care hospital stays alone, but models 2 and 3 include either inpatient stay plus post acute or post acute care only. Health Affairs recently issued their policy brief focused on BPCI and the opportunities, concerns, and early findings from the program. The full brief is available online here.

Although BPCI is still underway, the newly finalized Comprehensive Care for Joint Replacement (CJR) Model will quickly disseminate bundled payments across the country. Starting on April 1, 2016, hospitals in 67 geographic, or metropolitan statistical areas (MSAs), will be mandated to bundle payments for all traditional Medicare MS-DRG 469 and 470 cases. The episode begins with the admission to a participating hospital and includes the 90 days of care post-discharge for all services paid under Medicare Parts A and B, with limited exceptions. The final rule for the CJR Model is available in the Federal Register here. The CJR model does not apply to those already in BPCI Models 1, 2, or 4.

Bundled payment and other alternative models of payment provide unique challenges and opportunities for home health care. The focus on higher quality, lower cost care puts home health care in a critical place in the health care delivery system. In general, home health care is least costly and patient preferred in post-acute care, and therefore of increasingly recognized importance.

As the healthcare landscape, and especially Medicare, continues to reinvent itself and push toward alternative models of payment and delivery, providers, policymakers, and those at CMS must continue to work together to ensure that quality care is not sacrificed for cost-effectiveness, and that patient-centered care remains at the forefront of this mission.