By Kristin Rowan, Editor

On November 1, CMS issued its Home Health Final Rule for CY 2024. As expected, the final rule includes drastic pay cuts to Medicare home health services payments. The original proposed rule issued earlier this year included a 5.653% rate reduction, the remainder of the 7.85% reduction from 2020-2021 and an additional 1.636% for 2022, for a total rate reduction of 9.36% overall from the start of PDGM. In a surprising turn, CMS has not implemented the full 5.779% rate cut from the initial proposal, opting instead to introduce the rate cuts over two years. The 2024 rate cut will be 2.890%, half of the full adjustment CMS alleges is still needed. The CMS final rule does not attempt to collect any of the alleged overpayments from 2020-2022, totaling $3,439,284,729.00.

NAHC President Bill Dombi offered this response:


“We continue to strenuously disagree with CMS’s rate setting actions, including the budget neutrality methodology that CMS employed to arrive at the rate adjustments. We recognize that CMS has reduced the proposed 2024 rate cut. However, overall spending on Medicare home health is down, 500,000 fewer patients are receiving care annually since 2018, patient referrals are being rejected more than 50% of the time because providers cannot afford to provide the care needed within the payment rates, and providers have closed their doors or restricted service territory to reduce care costs. If the payment rate was truly excessive, we would not see these actions occurring. The fatally flawed payment methodology that CMS continues to insist on applying is having a direct and permanent effect on access to care. When you add in the impact of shortchanging home health agencies on an accurate cost inflation update of 5.2% over the last two years, the loss of care access is natural and foreseeable.

We now implore Congress to correct what CMS has done and prevent the impending harm to the millions of highly vulnerable home health patients that depend and will depend in the future on this essential Medicare benefit. Fortunately, longstanding advocates for home health care, Senator Debbie Stabenow (D-MI) and Senator Susan Collins (R-ME) have introduced S. 2137 to eliminate the rate cuts. We urge the Congress to support this legislation and enact it into law before the end of the year. The 2024 rate cuts must not take effect.”

The final rule includes the following:

  • A net 3.0% inflation update
  • A 2.890% Budget Neutrality permanent adjustment
  • A $3,489,523,364 alleged overpayment in 2020-2022. CMS has not scheduled a collection of the alleged overpayment in 2024 or any other year yet.
  • Recalibration of the 432 case mix weights with a separate budget neutrality adjustment in the payment rates of +1.0124%
  • CMS estimates an increase in CY2024 Medicare spending of $140 million ($525 million inflation increase minus the $455 million rate adjustment plus a $70 million outlier FDL change)

HHAs that fail to provide required quality data will have these rates reduced by two percent.

Non-payment-related changes

In addition to the inflation increase and payment adjustments, the CMS Final Rule includes a number of other changes. These changes include amendments for the payment of Disposable Negative Pressure Wound Therapy, removing and replacing OASIS measures in HHVBP, new coverages and payments in IVIG services, the adoption of two new measures and the removal of one existing measure in HHQRP, coverage for lymphedema therapy items under a new Medicare Part B benefit, and revisions to Medicare provider enrollment requirements.

Hospice Provisions

Hospice Special Focus Program (SFP)

CMS is pushing forward with the Hospice SFP. Despite the commonsense suggested changes requested by NAHC and multiple others, CMS is using a flawed algorithm in the structure and implementation of SFP. This flawed algorithm will fail to identify hospices most appropriate for additional oversight and support. This creates the risk of reducing access to higher quality care and directing patients and families to hospices that perform most poorly relative to health and safety requirements. The official stance from NAHC is strong support of the SFPs goal to improve poor performing hospices, but are emphatically against the method in which SFP is being implemented and will continue to advocate for changes to the structure of the program.

Hospice Informal Dispute Resolution (IDR)

The IDR process for hospice is for condition-level survey findings which may trigger an enforcement action. The finalized IDR process allows hospice programs an opportunity to resolve disputes during recertification or reaccreditation for continued participation in Medicare. this allows for settlement agreement prior to a formal hearing, which will save time and money for the hospice agency. NAHC has additional recommendations for the Hospice IDR process that have not been implemented in the final rule.

Hospice 36-month rule

CMS is extending the “36-month” rule that currently applies to home health agencies and hospices, which is designed to prevent the flipping of Medicare certifications to non-vetted hospice owners. There are several exceptions to the rule for hospices. Even if a hospice undergoes a CIMO, a new owner must enroll as a new hospice and undergo a survey or accreditation unless:

  • The hospice submitted 2 consecutive years of full cost reports since initial enrollment or the last CIMO, whichever is later.
  • A hospice’s parent company is undergoing an internal corporate restructuring, such as a merger or consolidation.
  • The owners of an existing HHA are changing the hospice’s existing business structure (for example, from a corporation to a partnership (general or limited)), and the owners remain the same.
  • An individual owner of an hospice dies

New hospice owners will immediately be placed into the “high-risk” category for screening requirements and will have to submit fingerprints for a national background check from all owners with a 5% or greater direct or indirect ownership interest.

CMS Final Rule Synopsis and NAHC Response

We reached out to NAHC President Bill Dombi after the release of the Final Rule for CY2024. He provided us with a full breakdown of each provision in the final rule and the NAHC stance on each topic.

You can read all of these changes and how NAHC will continue to advocate for changes to the final rule here.

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Kristin Rowan has been working at Healthcare at Home: The Rowan Report since 2008. She has a master’s degree in business administration and marketing and runs Girard Marketing Group, a multi-faceted boutique marketing firm specializing in event planning, sales, and marketing strategy. She has recently started writing for The Rowan Report and will add her voice to current Home Care topics as well as marketing tips for home care agencies. Connect with Kristin directly or

©2023 by The Rowan Report, Peoria, AZ. All rights reserved. This article originally appeared in Healthcare at Home: The Rowan Report. One copy may be printed for personal use: further reproduction by permission only.