Due to concerns over decreased access to Medicare home health services for some populations, the Affordable Care Act mandates that CMS complete a study of the Home Health Prospective Payment System (HH PPS). The study aims to analyze payment reform options to minimize program vulnerabilities, improve system-wide reimbursement and payment accuracy, and ensure access to home health services for low-income beneficiaries, beneficiaries living in medically underserved areas, and beneficiaries with high levels of clinical severity.

CMS has contracted with L&M to execute the study with the following research objectives:

• Analyze patient characteristics and payment system incentives to ensure adequate reimbursement for vulnerable populations
• Identify methods to discourage case-mix growth unrelated to actual changes in patient characteristics
• Analyze utilization, case-mix, and outcomes to ensure that the provision of therapy is appropriately incentivized
• Review methods to improve the outlier payment system so that it adequately reimburses cases that truly require more resources than were captured in the case-mix weights
• Determine if adjustments are needed for patients entering home health through the community versus a post-acute stay