(Updated at 4:30pm on July 9)

Correction: This story previously stated that the NPP would be able to communicate face-to-face encounter findings directly to the certifying physician. In fact, CMS proposes that the facility physician would communicate with the certifying physician.

The proposed 2013 PPS rule for home health contains a net 0.1% payment cut, intermediate sanctions for CMS surveys and additional flexibility for the face-to-face encounter and therapy reassessment requirements.

The proposed cut would result in an approximately $20 million payment reduction to home health next year, CMS states in its June 6 press release.

CMS also proposes to revise the market basket. “The CY 2013 home health market basket would result in a labor-related share of 78.535 percent and a non labor-related share of 21.465 percent,” according to the press release. The proposed 2013 market basket update is +1.5%.

The proposal also contains a -1.32% case-mix creep adjustment. The reduction would mark the second part of a phased-in adjustment, which began with a 3.79% cut in 2012.

For face-to-face encounters, CMS proposes to allow non-physician practitioners (NPPs) to conduct encounters under the supervision of a treating physician when patients are coming to home health from an acute or post-acute facility. The treating physician would inform the certifying physician of the NPP's findings.

Update: CMS also would no longer require the certifying physician to be the one who titles face-to-face encounter documentation.

On therapy reassessments, CMS proposes to allow coverage to resume on the visit during which a late reassessment is performed, as opposed to the next visit afterwards. For multi-therapy cases, CMS proposes to continue covering visits by other disciplines when one discipline misses a reassessment.

Alternative survey sanctions proposed by CMS include civil money penalties, suspension of payment for new admissions and temporary management. Those alternative sanctions could remain in place for up to six months, until the agency achieves compliance or until its provider agreement is terminated, according to the proposal.

Update: The civil money penalties proposed by CMS could range from $500 to $10,000, based on the severity of the condition-level or repeat deficiency. CMS proposes to define a repeat deficiency as one that reoccurs in the same or a similar form within 365 days.

Update: CMS also proposes an informal dispute resolution (IDR) process that would allow agencies to dispute condition-level findings during their survey.

Currently, the only sanction for agencies that fail to satisfy surveyors of their compliance with the Medicare conditions of participation is termination from the program.

The proposed rule also extends hospice quality reporting requirements for subsequent years.

In the 2013 physician fee schedule proposed rule, which also was issued today, CMS establishes requirements for DME face-to-face encounters. That rule is available here. 

For more news updates in the coming days, stay tuned to this page.