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MedPAC Considers Hospice, Home Health Payment Changes for 2020

Posted on Saturday, December 15, 2018 3:44 PM

Last week, The Medicare Payment Advisory Committee (MedPAC) met to discuss Medicare hospice and home health payments.  They were presented with information on current payment adequacy based on previous years and suggestions from MedPAC staff for recommendations the committee to make to Congress for 2020.

“MedPAC staff reported that in 2017, approximately 1.5 million Medicare beneficiaries received hospice care, accounting for over 50% of decedents. There were nearly 4,500 Medicare certified providers receiving a total of $17.9 billion in reimbursements. The average length of stay (ALOS) varied depending on condition. Neurological diagnoses had an ALOS of 149 days, while those with a cancer diagnoses had a 52-day ALOS.  Average profit margins in 2016 were 10.9 percent, up from 9.9 percent in 2015.”

MedPAC staff stated that payment rates by level of care are out of line with costs.  The meeting ended with a recommendation of a two percent base payment reduction for FY2020.

“MedPAC staff reported that in 2017, Medicare home health expenditures totaled $17.7 billion to approximately 11,800 certified home health agencies. 6.3 million episodes were provided to 3.4 million fee-for-service beneficiaries. Staff found the supply of providers to be high, as 84 percent of beneficiaries have access to at least five home health providers, and 97 percent have access to at least one provider.  Average profit margins came in at 15.2 percent in 2017. This is consistent with 15.5 percent in 2016, and 15.6 percent in 2015.”

Their recommendation was a five percent rate cut for FY2020. 

These suggestions have been made to Congress for numerous years, but Congress has yet to act on them. 

Click here to access the Hospice Presentation.

Click here to access the Home Health Presentation.

Source: NAHC Report

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