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Proposed Medicare home health payment rule: 10 issues to watch

Jul 30, 2023

The proposed rule for Medicare home health services payment rates in calendar year 2024 has raised important issues and opportunities for home health and hospice agencies. The actions are intended to improve patient care and protect the Medicare program’s sustainability for future generations. How will they affect your organization?  

These insights will help you stay on top of the changes introduced by the Centers for Medicare & Medicaid Services (CMS) and consider the value of a third-party firm in navigating the challenges and taking advantage of resulting opportunities.

Issues facing home health agencies

  1. Proposed rate reductions: The proposed rule includes significant rate reductions for Medicare home health services payment rates in calendar year 2024. A third-party firm can help agencies analyze the financial impact and develop strategies to mitigate the effects.
  2. Budget neutrality methodology: The budget neutrality methodology used by CMS in rate adjustments is a point of disagreement. A third-party firm can provide insights and assist in evaluating how this methodology impacts reimbursement.
  3. Overpayment allegations: CMS alleges an overpayment of $2.1 billion in 2020-2022 but proposes to continue holding on to the collection. A third-party firm can support agencies in reviewing financial records and advocating for financial relief and reevaluations.
  4. Recalibration of case mix weights: CMS plans to recalibrate case mix weights, affecting payment rates. A third-party firm can assist agencies in understanding the impact and adapting to the changes.
  5. Decrease in expected Medicare expenditures: The proposed rule is expected to result in a decrease in expected Medicare expenditures. A third-party firm can help agencies identify opportunities for cost savings, revenue optimization and efficiency improvements.
  6. Negative impact on access to care: Rate adjustments and the budget neutrality methodology may impact access to care. A third-party firm can assist agencies in evaluating operations and developing strategies to maintain access while adapting to changes.
  7. Legislative action: Home health advocates are urging Congress to support a bill to eliminate rate cuts. A third-party firm can provide advocacy support through data analysis and assistance in engaging with policymakers.
  8. Inflation update discrepancy: CMS refuses to recognize its forecasting error in inflation updates. A third-party firm can assist agencies in reviewing discrepancies and providing analysis for addressing the issue with CMS.
  9. Impact on quality reporting: Changes in the Home Health Quality Reporting Program (HHQRP) require adjustments. A third-party firm can guide agencies in understanding and implementing new measures and optimizing reporting processes.
  10. Provider enrollment changes: CMS proposes changes to Medicare provider enrollment regulations. A third-party firm can provide guidance to ensure compliance and effective program integrity measures.

Navigating opportunities

  1. Increased focus on home health services: The proposed rule highlights the importance of home health services. A third-party firm can provide strategic guidance and support to agencies in optimizing services and positioning for growth.
  2. Advocacy for home health care: The proposed rule provides an opportunity for advocacy. A third-party firm can help agencies develop data-driven strategies, conduct research and engage with policymakers effectively.
  3. Collaboration among stakeholders: Collaboration among agencies, associations and policymakers can address challenges. A third-party firm can facilitate collaboration and develop innovative solutions.
  4. Technological advancements: The home health industry can leverage technology to improve efficiency and enhance care. A third-party firm can provide technology consulting services to identify and implement solutions.
  5. Innovation in payment models: The rate adjustments can spark discussions on alternative payment models. A third-party firm can assist agencies in exploring and implementing innovative payment arrangements.
  6. Quality improvement initiatives: The changes in HHQRP present an opportunity for quality improvement. Wipfli can help agencies establish improvement programs and monitor quality effectively.
  7. Research and data analysis: The proposed rule encourages research and analysis. A third-party firm can conduct studies to evaluate the effectiveness and efficiency of home health services, informing policy decisions.
  8. Patient-centered care models: Adoption of patient-centered care models can improve outcomes. A third-party firm can support agencies in implementing care coordination, engagement strategies and outcome measurement.
  9. Integration with other healthcare settings: Collaboration with other providers can improve care transitions. A third-party firm can guide agencies in building partnerships and facilitating coordinated care.
  10. Public awareness and education: The discussion around the proposed rule raises awareness. A third-party firm can assist agencies in developing public awareness campaigns and highlighting the value of home health services.

How Wipfli can help

Wipfli advisors are ready to help you navigate the complex changes in the proposed home health and hospice services payment rates. We’ll help you assess how they affect your agency’s resource management and delivery of services and offer a road map for your organization. Learn more about how we can help position your agency for success in the evolving home health landscape. Contact us to get started.

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Brian Lebanion, MBA, CPC, RNC
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