Fact sheet

CMS finalizes calendar year 2019 and 2020 payment and policy changes for Home Health Agencies and Home Infusion Therapy Suppliers

CMS finalizes calendar year 2019 and 2020 payment and policy changes for Home Health Agencies and Home Infusion Therapy Suppliers

On October 26, 2018, the Centers for Medicare & Medicaid Services (CMS) issued a final rule [CMS-1689-F] setting out finalized Calendar Year (CY) 2019 Medicare payment updates, finalized quality reporting changes for home health agencies (HHAs), and finalized case-mix methodology refinements and a change in the home health unit of payment from 60 days to 30 days for CY 2020.  This final rule also discusses the implementation of temporary transitional payments for home infusion therapy services to begin on January 1, 2019 and summarizes public comments related to full implementation of the new home infusion therapy benefit in CY 2021.

The final rule includes policies that are based on three pillars: empowering patients, increasing competition, and fostering innovation.  The focus of the final rule is on patients and their needs, and not on increasing process for process sake. CMS continues a commitment to shift Medicare payments from volume to value, with continued implementation of the Home Health Value-Based Purchasing Model and the Home Health Quality Reporting Program, as well as a new case-mix adjustment methodology for the Home Health Prospective Payment System (HH PPS) that focuses on the patient’s condition and resulting care needs rather than on the amount of care provided in order to determine Medicare payment. The final rule also modernizes Medicare through innovations in home health and the new home infusion therapy benefit, meaningful quality measure reporting, reduced paperwork, and reduced administrative costs.

The final rule can be downloaded from the Federal Register at:

Payment Rate Changes under the HH PPS for CY 2019

CMS projects that Medicare payments to HHAs in CY 2019 will be increased by 2.2 percent, or $420 million, based on the finalized policies.  The increase reflects the effects of a 2.2 percent home health payment update percentage ($420 million increase); a 0.1 percent increase in payments due to decreasing the fixed-dollar-loss (FDL) ratio in order to pay no more than 2.5 percent of total payments as outlier payments (a $20 million increase); and a 0.1 percent decrease in payments due to the new rural add-on policy mandated by the Bipartisan Budget Act of 2018 for CY 2019 ($20 million decrease). The new rural add-on policy requires CMS to classify rural counties (and equivalent areas) into one of three categories based on: 1) high home health utilization; 2) low population density; and 3) all others.  Rural add-on payments for CYs 2019 through 2022 vary based on counties’ (or equivalent areas’) category classification.

Modernizing the HH PPS Case-mix Classification System and Promoting Patient-Driven Care

The Bipartisan Budget Act of 2018 requires a change in the unit of payment under the HH PPS, from 60-day episodes of care to 30-day periods of care, to be implemented in a budget neutral manner on January 1, 2020.  Also for 2020, the Bipartisan Budget Act of 2018 mandated that Medicare stop using the number of therapy visits provided to determine home health payment. Therapy thresholds encourage volume over value and do not acknowledge that all patients are not the same, with some patients having complex needs that do not involve a lot of therapy.  CMS is finalizing the implementation of these changes required by the Bipartisan Budget Act of 2018. 

CMS is finalizing the implementation of the Patient-Driven Groupings Model, or PDGM, for home health periods of care beginning on or after January 1, 2020.  The PDGM removes the current incentive to overprovide therapy, and instead, is designed to reflect CMS focus on relying more heavily on clinical characteristics and other patient information to allow payments to more closely reflect patients’ needs. Using patient characteristics to place home health periods of care into meaningful payment categories is more consistent with how home health clinicians differentiate between home health patients in order to provide needed services. The improved structure of this case-mix system would move Medicare towards a more value-based payment system that puts the unique care needs of the patient first while also reducing the administrative burden associated with the HH PPS.

To support an assessment of the effects of the PDGM, CMS will provide, upon request, a Home Health Claims-OASIS Limited Data Set (LDS) file to accompany the CY 2019 HH PPS final rule.  The Home Health Claims-OASIS LDS file can be requested by following the instructions on the following CMS website:, and a file layout will be available. 

Additionally, CMS will make available agency-level impacts, as well as an interactive Grouper Tool that will allow HHAs to determine case-mix weights for their patient populations. These materials are available on the HHA Center webpage at

Fostering Innovation

The Use of Remote Patient Monitoring under the Medicare Home Health Benefit

CMS is finalizing its proposal to define remote patient monitoring in regulation for the Medicare home health benefit and to include the cost of remote patient monitoring as an allowable cost on the HHA cost report. Studies note that remote patient monitoring has a positive impact on patients as it allows patients to share more live-time data with their providers and caregivers, which will lead to more tailored care and better health outcomes. CMS believes that defining remote patient monitoring and including such costs as allowable costs on the HHA cost report could encourage more HHAs to adopt the technology.

New Home Infusion Therapy Services Temporary Transitional Payment and Home Infusion Therapy Benefit

For CYs 2019 and 2020, as required by section 50401 of the Bipartisan Budget Act of 2018, CMS is implementing a temporary transitional payment for home infusion therapy services that pays eligible home infusion therapy suppliers for associated professional services for administering certain drugs and biologicals infused through a durable medical equipment pump, training and education, and remote monitoring and monitoring services.  Section 5012 of the 21st Century Cures Act creates a new permanent Medicare benefit for home infusion therapy services beginning January 1, 2021.  This rule finalizes elements of the permanent home infusion benefit including the health and safety standards for home infusion therapy, an accreditation process for qualified home infusion therapy suppliers and an approval and oversight process for the organizations that accredit qualified home infusion therapy suppliers.  Additionally, we recognize the concerns from stakeholders and members of Congress on our interpretation of “infusion drug administration calendar day”, including with respect to professional services that may be provided outside of the home and, as applicable, payment amounts for such services.  It is our intention to ensure access to home infusion therapy services in accordance with section 50401 of the BBA of 2018.  Therefore, we believe the best course of action is to monitor the effects on access to care of finalizing this definition and, if warranted and within the limits of our statutory authority, engage in additional rulemaking or guidance regarding this definition for temporary transitional payments. We seek comments on this interpretation and on its potential effects on access to care.

Home Health Quality Reporting Program (HH QRP) Provisions

In furtherance of the Meaningful Measures Initiative and to further align with the policies of other CMS quality programs, CMS is finalizing its policy for removing previously adopted HH QRP measures based on eight measure removal factors.  CMS is also finalizing the removal of seven quality measures based upon one of these eight finalized measure removal factors.  Lastly, CMS is finalizing an update to its regulations to clarify that not all OASIS data is used to determine whether an HHA has satisfied the HH QRP reporting requirements for a program year.

Home Health Value-Based Purchasing Model

In addition to providing an update on the progress towards developing public reporting of performance under the Home Health Value-Based Purchasing (HHVBP) Model, CMS is finalizing the following changes to the HHVBP Model, beginning with Performance Year 4:  removal of two Outcome and Assessment Information Set (OASIS)-based measures, Influenza Immunization Received for Current Flu Season and Pneumococcal Polysaccharide Vaccine Ever Received, from the set of applicable measures; replacement of three OASIS-based measures with two new composite measures on total change in self-care and mobility; changes to how we calculate the Total Performance Scores by changing the weighting methodology for the OASIS-based, claims-based, and HHCAHPS measures; and a change to the scoring methodology by reducing the maximum amount of improvement points and HHA can earn.

Regulatory Burden Reduction

The cost impact related to OASIS item collection as a result of the implementation of the PDGM and finalized changes to the HH QRP as outlined above, is estimated to be a net $60 million in annualized cost savings for home health agencies.

In an effort to make improvements to the health care delivery system and to reduce unnecessary burdens for physicians, CMS is eliminating the requirement that the certifying physician estimate how much longer skilled services are required when recertifying the need for continued home health care. This policy is responsive to industry concerns about regulatory burden reduction and could reduce claims denials that solely result from an estimation missing from the recertification statement.  CMS estimates that this would result in annualized cost savings to certifying physicians of $14.2 million beginning in CY 2019.

CMS is also finalizing amendments to current regulations to align them with current sub-regulatory guidance to allow medical record documentation from the HHA to be used to support the basis for certification and/or recertification of home health eligibility, consistent with the Bipartisan Budget Act of 2018. 

These burden reduction efforts would allow providers to spend more time on their chief responsibility: improving the health outcomes of their patients.

Advancing MyHealthEData: Request for Information from stakeholders

Through a Request for Information in the CY 2019 HH PPS proposed rule, CMS gathered stakeholder feedback on revising the CMS patient health and safety standards that are required for providers and suppliers participating in the Medicare and Medicaid programs to further advance electronic exchange of information that supports safe, effective transitions of care between hospitals and community providers.  CMS will carefully consider all comments received in developing future regulatory proposals or future sub-regulatory guidance.

For additional information about the Home Health Value-Based Purchasing Model, visit

For additional information about the Home Health Prospective Payment System, visit

For additional information about the Home Health Quality Reporting Program, visit 

The final rule can be viewed at


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