CMS Home Health Final Rule Includes Another Rate Cut. Congress Must Act

CMS Home Health Final Rule Includes Another Rate Cut. Congress Must Act

The Centers for Medicare and Medicaid Services (CMS) issued the Final Rule regarding Medicare home health services payment rates for CY 2025. The final rate cut is 1.975% in contrast to the proposed cut of 4.067%. While a positive development, the continuing rate cuts raise serious concerns about the future of access to home health care services as there has been a deterioration in access since the start of the new payment model, PDGM, in 2020.

"Somehow CMS sees reduced access to home health services, the closures of hundreds of home health agencies, tens of millions fewer home health visits, and a reduction in overall Medicare spending on home health services as 'budget neutral,' said Alliance CEO Steven Landers, MD, MPH, in reaction to the CMS announcement. "While decreasing the proposed permanent rate cut and withholding the massive temporary adjustment may slow the decline of the home health benefit a bit, we need CMS to reverse course on its dismantling of this essential services through its payment model. A net increase in Medicare spending projected for 2025 does not address the several years of unwarranted rate cuts and the shortfall in recognizing the significant inflationary pressures and cost increases that have been incurred. In no way can CMS defend its actions as 'budget neutral.' Home health access is a life and death issue for vulnerable homebound beneficiaries.

"The 2025 final version of Medicare home health payment rates continues the ongoing and predictable rate reductions impacting patient access to home health since the beginning of the new payment model in 2020. The decline is due to a fatally flawed budget neutrality methodology that CMS employed to arrive at the rate adjustments, and the risk to homebound patients is compounded by the expansion of Medicare Advantage and associated financial and administrative barriers to care" Landers added.

"We need help from Congress to end this assault on the Medicare home health benefit. Home health has long demonstrated its value as a cost-effective alternative to hospitalization and institutional care and an essential service to over 3 million highly vulnerable Medicare beneficiaries. The hallmark of home health in Congress is the bipartisan and bicameral support that is has had for decades. Legislation is pending that would end these cuts. Longstanding advocates for home health care, Senators Debbie Stabenow (D-MI) and Susan Collins (R-ME) and Congressman Adrian Smith (R-NE) and Congresswoman Terri Sewell have introduced S. 2137 and H.R. 5159 to eliminate the rate cuts. We urge the Congress to enact legislation that will stabilize home health services before the end of the year," said Landers.