Home health payments will fall 2.3% in 2012

The pay cut for home health agencies was announced in a regulation that was issued Monday. Although this reduction is less than initially proposed and will be phased in over two years, industry voices described it as "severe."

Bloomberg: Home Health Agencies To See 2.3% Fee Cut In 2012, U.S. Says
Medicare payments to home health agencies such as Amedisys Inc. (AMED) and Gentiva Health Services Inc. (GTIV) would fall by more than $400 million, or 2.3 percent, in 2012 under a U.S. regulation issued today. Though the reduction is less than what regulators proposed in July and will be phased in over two years, it will leave half of all Medicare home-health agencies operating in the red in 2012, said William Dombi, vice president for law at the National Association for Home Care and Hospice in Washington. "The cuts are severe," said Arthur Henderson, an analyst at Jefferies & Co. Inc. in Nashville, Tennessee (Eisenberg, 10/31).

Modern Healthcare: Home Health Medicare Payments Expected To Fall
Medicare payments to home health agencies next year are expected to fall by about 2.3 percent, or roughly $430 million, the CMS announced after issuing a final rule Monday to update the home health prospective payment system rates for 2012. The changes in the regulation include a 1.4 percent payment update, as well as a wage index update and case-mix coding adjustment. According to the CMS, the marketbasket for home health agencies in 2012 is equal to 2.4 percent, and last year's Patient Protection and Affordable Care Act called for a 1 percentage point reduction to that amount-;which accounts for the 1.4 percent payment update to these agencies (Zigmond, 10/31).

CQ HealthBeat: Medicare Final Rule Cuts Home Health Payments
Home health agencies will see a 2.3 percent cut in their Medicare payments starting Jan. 1 under a final rule announced Monday by the Centers for Medicare and Medicaid Services. Overall payments next year to the industry will fall by $430 million, CMS said in a news release. The 2.3 percent cut reflects the combination of a slight increase in payments under the yearly update formula combined with reductions to account for past overpayments, CMS said. Those overpayments stemmed from inaccurate past estimates of how sick the patients were that were treated by home health agencies, agency officials said (10/31).