Home health agencies are getting ready for a hit to their bottom line due to recent rule changes released by the federal government. The Centers for Medicare and Medicaid Services have released the language of proposed rules that may drastically change how and if certain services are paid for by the government healthcare agencies. In particular, rural home health organizations will be hit hard if the proposed changes go into effect.
In the past, home health agencies operating in rural areas received extra allocations of money to allow them to continue working with underserved populations outside of city centers. Seniors in those areas do not have as many options as those in urban areas and often struggle to age in place as a result. These seniors are even more disadvantaged than their city-dwelling counterparts as fewer nursing homes and assisted or independent living facilities can be found in rural areas. Bumps in pay from the federal government, called “rural add-on payments,” helped equalize access for all residents regardless of locale to necessary home health services and organizations offering necessary medical equipment.
Under the proposed rule changes, home health agencies may begin seeing fewer and lower payments as early as 2019 and those payments may phase out entirely by 2022. This can mean the difference of thousands of dollars per year to each agency. According to current policies, rural agencies receive about 3 percent extra per payment. The government has released that they will be considering other payment schemes moving forward, evaluating agencies by the population densities of their area as well as utilization of services. This may negatively impact those organizations who fall between the cracks in how they qualify for extra support.
Changes like the current proposal have been brought up before by the Centers for Medicare and Medicaid but haven’t previously gotten enough support to move forward. Lobbyists representing large collections of home health companies tried to persuade Congress to make different changes or designations going forward but were unsuccessful in doing so. For now, agencies are hoping that their geographic location and local demographics will be enough to help them maintain their financial health and the ability to serve patients in harder to reach areas. Even with the announcement of the final rule, industry leaders are pledging to continue lobbying Congress for relief.