November 4 2024
OASIS

CY 2025 Home Health Final Rule Finalizes New OASIS Items and More

by Marian Essey, RN, BSN, COS-C

The just-published Home Health final rule confirms new OASIS items, updates to OASIS all-payer data collection, changes to Home Health Conditions of Participation, and more!

Overview of Home Health Quality Reporting Program (HH QRP) Updates

On November 1, 2024, the Centers for Medicare & Medicaid Services (CMS) issued the Calendar Year (CY) 2025 Home Health Prospective Payment System (HH PPS) final rule. In addition to updates to Medicare payment policies and rates for Home Health Agencies (HHAs), this rule also contains updates to the Home Health Quality Reporting Program (HH QRP).

The rule finalizes four new items as standardized patient assessment data elements in the social determinants of health (SDOH) category and modifies one item collected as a standardized patient assessment data element in the SDOH category, beginning with the CY 2027 HH QRP via the OASIS.

The four assessment items are one living situation item, two food items, and one utilities item. In addition, CMS is modifying the current transportation item beginning with the CY 2027 HH QRP via the OASIS instrument.

In this rule, CMS also is finalizing changing all-payer data collection to begin with the start of care OASIS data collection timepoint instead of the discharge timepoint. However, there is no change in the timeframe for all-payer data collection to begin. Voluntary data collection of all-payer OASIS data begins in less than 2 months on 1/1/2025 and mandatory collection of all-payer data begins 7/1/2025.

Home Health Conditions of Participation (CoPs) Updates

CMS is finalizing updates to the HHA CoPs to reduce avoidable care delays by helping ensure that referring entities and prospective patients can select the most appropriate HHA based on their care needs. CMS is finalizing a new standard that requires HHAs to develop, implement, and maintain, through an annual review, a patient acceptance-to-service policy that is applied consistently to each prospective patient referred for home health care.

CMS is finalizing a requirement that the policy must address, at a minimum, the following criteria related to the HHA’s capacity to provide patient care:

the anticipated needs of the referred prospective patient,
the HHA’s caseload and case mix, the HHA’s staffing levels, and
the skills and competencies of the HHA staff.

This final rule does not prevent HHAs from maintaining their existing acceptance-to-service policies; rather, it is intended to complement them. Additionally, CMS is finalizing that HHAs must make available to the public accurate information regarding the services offered by the HHA and any service limitations related to types of specialty services, service duration, or service frequency. The HHA must review this information as frequently as the services are changed, but no less often than annually.

Expanded Home Health Value-Based Purchasing (HHVBP) Model

Request for Information (RFI) on Future Performance Measure Concepts for the Expanded HHVBP Model

This final rule summarizes comments received on a summary of responses to RFI that will build on input from the Expanded Home Health Value-Based Purchasing (HHVBP) Model’s Implementation and Monitoring technical expert panel (TEP), which met in November 2023.

Discussions included potential future measure concepts that could fill measurement gaps in the expanded HHVBP Model. These include function measures complementing the existing cross-setting Discharge (DC) Function measure. These measures include care activities like bathing and dressing, which are important for home health patients and caregivers but are not included in the DC Function measures.

Based on TEP feedback, CMS may also consider adding the existing Medicare Spending per Beneficiary measure in future rulemaking. Other potential areas for measure development activities discussed with the TEP include family caregiver status and claims-based falls with major injuries.

Health Equity Update

CMS is including an update on health equity, affirming the CMS commitment to meaningfully advance health equity in the expanded HHVBP Model. CMS announced through this rule that they will continue to take input from home health stakeholders and monitor the application of proposed health equity policies across CMS initiatives, such as proposed payment adjustments in the Hospital and SNF Value-Based Purchasing Programs.

CY 2025 Payment and Policy Updates for Home Health Agencies

The rule finalizes routine, statutorily required updates to the home health payment rates for CY 2025. The CY 2025 updated rates include the final CY 2025 home health payment update of 2.7% ($445 million increase), which is offset by an estimated 1.8% decrease that reflects the permanent behavior adjustment ($295 million decrease) and an estimated 0.4% decrease that reflects the updated FDL ($65 million decrease).

CMS estimates that Medicare payments to HHAs in CY 2025 would increase in the aggregate by 0.5%, or $85 million, compared to CY 2024, based on the finalized policies.

PDGM and Behavior Assumptions

For the CY 2025 HH PPS final rule, using CY 2023 claims and the methodology finalized in the CY 2023 HH PPS final rule, CMS determined that Medicare is still paying more under the new Patient-Driven Groupings Model (PDGM) system than it would have under the old system.

CMS determined a total permanent behavior adjustment of -3.95% is needed to be applied to the 30-day base payment rate to account for overpayments in CY 2023, as well as the remaining adjustment of 2.890% that CMS delayed finalizing in CY 2024. However, in response to commenter concerns that this would impose too large a reduction in a single year, CMS finalized only half of the adjustment (1.975%) to the CY 2025 payment rate.

The law provides CMS the discretion to make any future permanent or temporary behavior adjustments in a time and manner determined appropriate through analysis of estimated aggregate expenditures through CY 2026.

Crosswalk for Mapping OASIS-D Data Elements to The Equivalent OASIS-E Data Elements

The Outcome and Assessment Information Set (OASIS)-D was the home health assessment instrument used under the prior 153-group system and the first three years (CYs 2020-2022) of the current PDGM. However, the Office of Management and Budget (OMB) approved an updated version of the OASIS instrument, OASIS-E, on November 30, 2022, effective January 1, 2023 (OMB-control number 0938-1279).

To accurately determine payments under the 153-group system, CMS used the October 2019 3M Home Health Grouper (v8219) to assign a Health Insurance Prospective Payment System (HIPPS) code to each simulated 60-day episode of care. This older version of the Home Health Grouper requires responses from OASIS-D.

Therefore, to continue with the methodology, CMS will need to impute responses for the three items from OASIS-D that have changed in the OASIS-E. Additionally, 13 items on the OASIS-E are no longer required at the follow-up assessment. For these items, CMS can use the most recent Start of Care or Resumption of Care assessment (SOC/ROC) to determine a response, which would not require imputation.

CMS finalized a crosswalk to address this issue by mapping the OASIS-E items back to the OASIS-D in this final rule.

Final OT LUPA Add-on Factor and LUPA Add-on Factor Updates

In this rule, CMS finalized the establishment of the OT LUPA add-on factor with the same methodology used to establish the skilled nursing (SN), physical therapy (PT), and speech-language pathology (SLP) LUPA add-on factors, as described in the CY 2014 HH PPS final rule. The final OT LUPA add-on factor is 1.7238, to be used when that discipline is the first skilled visit in a LUPA episode that occurs as the only episode or an initial episode in a sequence of adjacent episodes.

Additionally, CMS finalized updates to the SN, PT, and SLP LUPA add-on factors to more accurately reflect current health care practices and costs, by using recent claims through CY 2023. The SN, PT, and SLP LUPA add-on factors are 1.7200, 1.6225, and 1.6696, respectively.

Recalibration of PDGM Case-Mix Weights

Each of the 432 payment groups under the PDGM has an associated case-mix weight and LUPA threshold. CMS’ policy is to annually recalibrate the case-mix weights and LUPA thresholds using the most complete utilization data available at the time of rulemaking.

In this final rule, CMS is finalizing the recalibrated case-mix weights — including the functional levels and comorbidity adjustment subgroups — and LUPA thresholds using CY 2023 data to more accurately pay for the types of patients HHAs are serving.

Wage Index Update

This rule finalizes an update to the home health wage index and adopts the new labor market delineations from the July 21, 2023, OMB Bulletin No. 23-01 based on data collected from the 2020 Decennial Census. The July 21, 2023, OMB Bulletin No. 23-01 contains several significant changes.

It is standard practice to adopt the latest OMB update when available, as using the most recent OMB statistical area delineations results in a more accurate and up-to-date payment system that reflects the reality of population shifts and labor market conditions.

More Information!

As promised in our October OASIS Answers, Inc. Quarterly OASIS Update webinar, OASIS Answers will be reviewing updates to the HHQRP and HHVBP on our next Quarterly OASIS Update webinar, scheduled for January 22, 2025.