Understanding the Home Health PPH Measure and Observation Stays 

by Lori Marmon PT, MBA, COS-C

With its recent addition to Care Compare and the upcoming addition to the Home Health Value-Based Purchasing (HHVBP) Model beginning with calendar year 2025, understanding the Home Health Within Stay Potentially Preventable Hospitalization (PPH) measure is taking on more importance for home health agencies.

There is a “new” consideration with the PPH measure as agencies account for and look to manage their hospitalization rates. With this claims-based measure, observation stays are now included in the measure.

Observation stays for patients often result in health care service use that mimics that of an inpatient stay but are billed under an outpatient claims code. These observation stays can have a significant impact on utilization of medical services and healthcare expenditures.

By understanding this new PPH quality measure, agencies equip themselves to provide better patient care with improved outcomes for a measure soon to be associated with Medicare fee-for-service payments under the expanded HHVBP model.

Beyond the potential payment implications, agencies that can address more of their patient’s healthcare needs in the home may have greater opportunities to improve patient satisfaction when the patient’s goal is to remain in the home. With the CMS focus on both quality of care and fiscal management, including observation stays as a part of this quality measure aligns with the value-based direction of healthcare services.

For the PPH measure, it is both the unplanned admission and observation stays that impact the agency’s outcome for this measure. The measure considers common conditions for hospitalization that may be considered potentially preventable. In developing the list of potentially preventable conditions, the conditions were grouped based on clinical rationale including criteria such as inadequate management of chronic conditions, inadequate management of infections, inadequate management of other unplanned events and inadequate injury prevention.

For the PPH measure, a home health stay is included in the measure numerator when a potentially preventable condition results in an observation stay or inpatient admission. Planned admissions are not counted in the numerator. Potentially preventable stays are only counted in the numerator if the inpatient admission or observation stay is considered unplanned.

Planned inpatient admissions and observation stays are defined largely by the definition used for the Hospital Wide Readmission and Potentially Preventable Within Stay Readmission Measure for Inpatient Rehabilitation Facilities measures. Additional information on the calculation of this measure is found in the measure specifications on the Home Health Quality Reporting Program website.

The ability of agencies to reduce the overall rate of inpatient admissions and observations stays will support the agency’s proficiency in management of potentially complex medical conditions in the home.


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