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CMS to launch home health P4P demonstration

WASHINGTON – The Centers for Medicare & Medicaid Services announced in October that it will conduct a home health pay-for-performance (P4P) demonstration that will be a precursor to a permanent nationwide home health P4P program.

CMS will begin soliciting home health agencies for the project this fall, with the demonstration to begin Jan. 1. The demonstration will operate for two years in the following seven states: Alabama, California, Connecticut, Georgia, Illinois, Massachusetts and Tennessee.

The National Association for Home Care & Hospice “strongly believes that the demo is one of the best advances in the Medicare program in years,” said Bill Dombi, the association’s vice president for law.

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The new CMS program “is an exciting opportunity for home health care to further establish the value of high quality services,” Dombi said. “By rewarding home health agencies based on the overall savings achieved in the Medicare program resulting from exceptional home health services, CMS is recognizing the dynamic impact that home care has on spending throughout Medicare.”

Kerry Weems, acting administrator of CMS, said the demonstration is another example of the agency’s commitment to provide value-based purchasing initiatives for Medicare beneficiaries in all healthcare settings. “It will support our key goal of achieving better quality of care by rewarding providers on the basis of patient outcomes and efficiency,” she said.

Weems said that under the demonstration program CMS will reward some home health agencies with incentives if their quality improvement efforts result in the highest performance levels or significant improvements in patient outcomes. “The availability of incentive payments will depend on whether or not the demonstration results in improvements in the quality of care and the actual savings to the Medicare program overall – not just for home health services provided to the patients served under the demonstration,” she said.

According to CMS, system-wide savings can be achieved when a home health agency prevents a Medicare beneficiary from re-hospitalization or further complication stemming from an illness. None of the participating organizations will face payment reductions as a result of their participation in the demonstration, CMS said. 

Seven quality measures from the existing Outcome-Based Quality Improvement set will be used to evaluate home health agency performance:

  • Incidence of acute care hospitalization;
  • Incidence of any emergent care;
  • Improvement in bathing;
  • Improvement in ambulation/locomotion;
  • Improvement in transferring;
  • Improvement in status of surgical wounds; and
  • Improvement in management of oral medications