CMS' final 2014 PPS rule, which was released today, contains a net reduction of 1.05%, slightly lower than the 1.5% in the proposed rule.
 
That reduction reflects the combined effects of an increase in the home health payment update of $440 million, a decrease of
$520 million due to rebasing the adjustments required by the Affordable Care Act and a $120 million decrease due to a refinement of the HH PPS Grouper. Rebasing adjustments decrease the national standardized 60-day episode payment amount each year from CY 2014 to 2017 by $80.95. That is 3.5% of the national standardized amount.
 
The final rule removes 170 ICD-9 diagnosis codes from the list of case-mix codes and resets case-mix weights to get to an average of 1.00. That includes ICD-9 codes considered too acute, meaning they wouldn't be appropriate for home health care. Other codes are being removed based upon clinical judgment that the condition would not require home health intervention.
 
As part of the final rule, resetting case-mix weights could further cut into the profitability of episodes with 20 or more therapy visits, experts contend. An early episode with zero to five therapy visits and a HHRG of C1F1S1 will see a reduction from 0.8186 to 0.6080, while all episodes with 20 or more therapy visits and a HHRG of C3F3S1 will see weights reduced from 3.0014 to 2.2292.
 
CMS also will add two claims-based measures to Home Health Compare for public reporting in CY 2015. Those measures are one on hospital readmissions within the first 30 days of receiving home health services and the other on visits to a hospital's emergency department without readmission within the first 30 days of home health services.
 
Final rule provides glimpse into ICD-10
 
The final rule includes the same draft list of ICD-10-CM case-mix codes that was published in the proposed rule with the exception of two changes. The ICD-10 case-mix draft list no longer includes codes with "initial encounter" extensions, and CMS has eliminated unspecified codes when a more specific diagnosis can be identified via clinical assessment.
 
CMS also is holding to its July 1, 2014, date for posting the draft ICD-10-CM home health grouper although several stakeholders commented that this doesn't provide enough time for software vendors and agencies to test and make the systems changes necessary to submit ICD-10 claims on Oct. 1, 2014.
 
Finally, with the implementation of ICD-10-CM, there will no longer be a need for any conditions to be reported in the payment diagnosis field, and so CMS says it will retire Appendix D (also referred to as Attachment D), and that all necessary guidance can be found in the ICD-10-CM Coding Guidelines.
 
CMS had delayed releasing the CY 2014 Home Health Prospective Payment System Final Rule (CMS-1450-F) for nearly a month. CMS said it couldn't meet the announced publication date of Nov. 1 due to the partial federal government shutdown.
 
Editor's note: The final rule is available at:
https://www.federalregister.gov/public-inspection. For continued coverage of the PPS final rule and its impact on home health agencies, check out future issues of Home Health Line at: