Home Health Agency (HHA) Center


December 27, 2022: CY 2023 Rural Add-on Policy

Section 4137 of the Consolidated Appropriations Act, 2023 extends the 1% rural add-on payment for home health periods and visits that end in CY 2023 for counties classified as ‘‘low population density.’’ CMS will increase the 30-day base payment rates by the 1% rural add-on before applying any case-mix and wage index adjustments. There are no changes to the fixed-dollar loss ratio, budget neutrality factors, or final base payment rates.

Learn What’s New for CY 2023

CMS issued a CY 2023 Home Health Prospective Payment System Rate Update and Home Infusion Therapy Services Requirements final rule to update Medicare payment policies and rates for home health agencies. See the fact sheet for provisions effective January 1, 2023.

Report to Congress: Unified Payment for Medicare-Covered Post-Acute Care

Section 2(b)(2)(A) of the Improving Post-Acute Care Transformation (IMPACT) Act of 2014 requires a report to Congress (PDF) on unified payment for Medicare post-acute care (PAC).  Medicare PAC services are provided to beneficiaries by PAC providers defined as skilled nursing facilities (SNFs), inpatient rehabilitation facilities (IRFs), long-term care hospitals (LTCHs), and home health agencies (HHAs).  Each PAC provider setting has a separate Medicare fee-for-service (FFS) prospective payment system (PPS). A goal of unified PAC payment is to base the payment on patient characteristics instead of the PAC setting. 

The Centers for Medicare and Medicaid Services (CMS) and the Office of the Assistant Secretary for Planning and Evaluation (ASPE) contracted with Research Triangle Institute (RTI) to provide analysis for this study and report.  RTI convened external technical expert panel meetings to obtain input on the study and report.  In the report, the framework applies a uniform approach to case-mix adjustment across Medicare beneficiaries receiving PAC services for different types of PAC providers while accounting for factors independent of patient need that are important drivers of cost across PAC providers.  The unified approach to case-mix adjustment includes standardized patient assessment data collected by the four PAC providers.  The report does not include legislative recommendations, as additional analyses would need to be done prior to testing or universal implementation of a unified PAC payment system.  See Unified PAC Report to Congress Appendices (ZIP).

Implementation of New International Classification of Diseases, Tenth Revision, Clinical Modification (ICD-10-CM) Diagnosis Codes, Effective April 1, 2020:

The Center for Disease Control and Prevention’s (CDC) National Center for Health Statistics (NCHS) has implemented two new ICD-10-CM diagnosis codes, effective April 1, 2020:

CMS finalized a new case-mix classification model, the Patient-Driven Groupings Model (PDGM), effective beginning January 1, 2020. The PDGM relies more heavily on clinical characteristics, and other patient information to place home health periods of care into meaningful payment categories. One case-mix variable is the assignment of the principal diagnosis to one of 12 clinical groups to explain the primary reason for home health services.

Both U07.1, COVID-19 and U07.0, Vaping-related disorder will be assigned to the Medication Management, Teaching and Assessment-Respiratory (MMTA-Respiratory) clinical group for purposes of case-mix adjustment under the HH PPS. Additionally, U07.1, COVID-19, will be added to a new comorbidity subgroup, Respiratory 10, and will receive the Low Comorbidity adjustment under the HH PPS case-mix system. The clinical group assignment for U07.1, COVID-19, and Vaping-related Disorder, U07.0, and the Low Comorbidity adjustment for COVID-19, U07.1 will be included in the Home Health Patient-Driven Groupings Model (HH PDGM) Grouper software package, v01.1.20, available for download on the HH Grouper Software webpage. It is effective for home health claims with From Dates on or after April 1, 2020.

  1. In response to the national emergency that was declared concerning the COVID-19 outbreak, NCHS is implementing a new diagnosis code, U07.1, COVID-19, into the International Classification of Diseases, Tenth Revision, Clinical Modification (ICD-10-CM) and;
  2. In response to recent occurrences of vaping related disorders, the NCHS is implementing a new diagnosis code, U07.0, Vaping-related disorder, into the International Classification of Diseases, Tenth Revision, Clinical Modification (ICD-10-CM), for reporting vaping-related disorders.

Home Health, Hospice and DME Open Door Forum

For questions about home health payment policy, send your inquiry via email to: HomehealthPolicy@cms.hhs.gov.

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Page Last Modified:
11/07/2022 12:08 PM