CMS is planning another payment cut for home health providers in 2027, though they stress this will be a temporary adjustment as opposed to permanent rate cuts seen in past years. 
 
Details of the payment update were released late Wednesday in the 2027 Home Health Prospective Payment System (HHPPS) Proposed Rule. The rule also includes new fraud enforcement measures.  
 
While the rule calls for an aggregate payment increase of 2.4%, or $420 million, it also includes a -3.0% temporary adjustment to the 2027 base payment rate to account for what CMS sees as overpayments in the early years of PDGM. 
 
The rule also:  
  • Recalibrates case-mix weights and updates the low-utilization payment adjustment (LUPA) thresholds, functional impairment levels and comorbidity adjustment subgroups; 
  • Proposes revisions to the home health wage index and includes a request for information on the construction of a home health specific wage index; and  
  • Introduces potential changes to submission and reporting timelines for the Home Health Quality Reporting Program and Home Health CAHPS survey. 

Fraud enforcement 

Through this rule, CMS is also proposing to expand current programs used to recover improper payments across provider types.   
This includes provisions to allow CMS to claw back all payments retroactive to the date of noncompliance, regardless of the reason for the provider’s enrollment revocation.  
 
CMS also hopes to expand the reasons for taking action against providers. Under the proposal, CMS could revoke a provider’s Medicare enrollment if it “presents a high risk of fraud, waste and abuse because the provider is located within a limited geographic area that has an excessive number of providers and suppliers.”  
 
Officials could also deny or revoke a provider’s Medicare enrollment if they have been convicted of a misdemeanor related to sexual assault or financial misconduct within the past 10 years.
Look for more expert analysis and industry reactions in an upcoming issue of Home Health Line.