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Home Health Value Based Purchasing: What You Need to Know


On November 5, 2015, the Centers for Medicare & Medicaid Services (CMS) published the final rule for Home Health Value Based Purchasing program (HHVBP). The inconveniently long 250-page document outlines a fundamental shift in the way home care is delivered, marking the beginning of the migration from a fee-for-service model to a new model that intends to build a more efficient healthcare system based on better care delivery, and better patient outcomes.

Considering home care providers are busy caring for their patients, we thought we would give you a glance at what this change will mean for home care and which states will be initially affected.

What is the HHVBP Model?

At a high level, the HHVBP program is a model required by the Accountable Care Act that CMS is hoping will result in better delivery of care, better outcomes and reduced costs; it is anticipated to be the most significant change to Medicare since 2000. The model requires home health providers in nine states to fulfill a mandate that intertwines quality and payment. Based on performance, experience and outcomes, payment adjustments will incentivize providers by financially rewarding those who meet and beat the quality standards, while those who fail to meet the standards are left with lower payment revenues. These standards are based off information gathered from 10 process measures, 15 outcome measures, and four new measures coming from OASIS, Medicare claims data, and HHCAHPS. The CMS estimates that the model will result in $380 million in savings with the reduction of unnecessary hospital readmissions.

Who is currently participating in the program?

On January 1, 2016, the following nine states (randomly chosen) began mandatory participation in the HHVBP pilot program from all Medicare-certified home health associations:

  • Massachusetts
  • Maryland
  • North Carolina
  • Florida
  • Washington
  • Arizona
  • Iowa
  • Nebraska
  • Tennessee

What outcomes will be measured and how?

Program performance scores are calculated based on quality measures that are determined by your process and outcome measures. A formula is used that considers both an agency’s achievement and improvement scores, while also considering baselines and benchmarks using data from OASIS, Medicare claims, HHCAHPS surveys and other reported data on a specific set of 24 measures. Agencies will be evaluated quarterly receiving reports on their own performance compared to their own baseline in previous quarters, as well as a comparison of their performance against competing agencies within the same state.

How does this program effect payment adjustments?

While the pilot programs started January 1, 2016 for the home health associations in these nine states, the agencies will not see payment adjustments for their 2016 performance until 2018. The proposed payment adjustment model is as follows:

  • 3% in 2018
  • 5% in 2019
  • 6% in 2020
  • 7% in 2021
  • 8% in 2022

Agencies with the highest performance results in comparison to their own baseline as well as against the competition in the same state will receive an increase in reimbursement. Those with the lowest performance results will see a decrease in their payments.

What does this mean for providers? 

Whether the final rule currently effects your state or not, agencies in the home health care industry should all expect and prepare for the migration of payment structures. In a value-based payment model, home care providers need to be able to understand and manage patient risk and clinical documentation verification more than ever before; EHRs and telehealth tools will become crucial for survival in the home care space. The addition of advanced analytics will also become a must-have in order to help care workers be more predictive and proactive in their decision making processes. Here are some things you can do in the meantime to help prepare your agency for the shift:

  1. Become more familiar with the HHVBP model and measures.
  2. Consider hiring a consultant to assess your agency’s current performance in your value-based processes and outcomes.
  3. Start considering new plans and strategies for improving your agencies HHVBP measures.
  4. Keep an eye out for new information from CMS regarding the pilot program and HHVBP requirements.
  5. Make sure your agency software solution is up-to-date and has the necessary capabilities to perform reliable clinical documentation, in depth analytics and reporting, and can carry consistent high quality OASIS data.

How can AlayaCare help?

As a leading provider of an end-to-end home care software platform, AlayaCare offers a mix of real-time telehealth and face-to-face visit solutions, including robust clinical documentation, exceptional back office solutions, and next-generation technology such as integrated Portals, Virtual Care, Remote Patient Monitoring and Machine Learning. Through our research wing, AlayaLabs, we constantly strive to not only build the best solution for home care but to contribute to the overall evolution of post-acute care.

Our strong relationships with VBP consultants combined with using our Machine Learning, possible because of our integrated telehealth solution, makes us uniquely well-suited for VBP.