Simione™ Healthcare Consultants

Value-Based Purchasing: What is the Impact on Home Health Operations?

Home health providers are aware that the changes noted in the CMS 2016 Home Health Wage Index Final Rule represent the beginning of a fundamental shift in service provision for the home health industry and increased alignment with other health care providers. In this “Spotlight on Value Based Purchasing”, we will outline these requirements and offer real-time strategies to help prepare providers to operate within the value-based purchasing model, whether the agency is in the nine initial states or not. To ensure readiness for these changes, Home Health Agencies (HHAs) will need to ensure OASIS accuracy, provide education and evaluate operations as a whole to determine the most efficient structure and processes to provide and demonstrate high-quality care, compliance and successful operations in an integrated, streamlined and cost-effective manner.  Over the next few months, Simione Healthcare Consultants will provide insights on these complex changes impacting the home health industry, and share realistic and measurable strategies to ensure provider readiness. 

The implementation of a Home Health Value Based Purchasing (HH-VBP) model is required by the Accountable Care Act and is a key component of CMS’s plan to achieve the IHI Triple Aim goal of better health, better care and lower costs. The HH-VBP model aligns home health with other providers to fulfill this mandate that ties quality to payment through a system of value-based purchasing to improve beneficiaries’ experience and outcomes. As a result, CMS expects payment adjustments will incentivize providers by rewarding improved quality and penalizing poor performance to achieve a more sustainable payment system. There is no net impact on Medicare payments made to HHAs over the life of the HH-VBP pilot program, but CMS estimates $380 million in total savings through reductions in unnecessary hospitalizations and the use of skilled nursing facilities.

What is the Plan for Rollout and Payment Adjustments?

In the 2016 final rule, CMS provides a detailed explanation of the HH-VBP pilot program that begins January 1, 2016 with mandatory participation from all Medicare-certified HHAs in nine selected states – Massachusetts, Maryland, North Carolina, Florida, Washington, Arizona, Iowa, Nebraska and Tennessee.Providers in these states should contact CMS ([email protected]) for instructions on how to set up the agency contact person and obtain real-time information regarding the implementation of the model. HHAs in these states were recently invited to participate in the first of several CMS webinars designed to provide instructions and guidance on the HH-VBP model as the processes are implemented.

Even though the HH-VBP pilot program rule starts in 2016 for HHAs in these selected states, agencies will not see the payment adjustments until 2018 for their 2016 performance.  The maximum payment adjustment is proposed as follows:

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

The model is designed to have Medicare-certified HHAs compete only within their state and only within their sized cohort, which will be determined based on the agency’s participation in the Home Health Consumer Assessment of Healthcare Providers and Systems Survey (Home Health CAHPS).  HHAs will be evaluated quarterly and receive reports that include performance results from the baseline and prior quarters, as well as a comparison of performance among competing HHAs within the same cohort and state boundary.  The highest performing HHAs (compared to both peer HHAs within the same state and their own baseline performance) will receive an increase in reimbursement payments. The lowest performing agencies (compared to both peer HHAs within the same state and their own baseline performance) will see their payments reduced.  CMS will use the 2015 CASPER and Home Health CAHPS survey data as a baseline.

What Will Be Measured?

The HH-VBP model utilizes data from OASIS, Medicare claims, Home Health CAHPS surveys and other directly reported data to evaluate HHAs on a specific set of 24 measures:

  •  Outcome Measures (CASPER reports):
    • Improvement in Ambulation (M1860)
    • Improvement in Bed Transferring (M1850)
    • Improvement in Bathing (M1830)
    • Improvement in Dyspnea (M1400)
    • Discharged to Community (M2420
    • Acute Care Hospitalization (Claims)
    • ER Utilization without Hospitalization (Claims)
    • Improvement in Pain with Activity (M1242)
    • Improved Management of Oral Medications (M2020)
    • Prior Functioning ADL/IADL (M1900)
      • NOTE: This measure is not currently reported
  • Process Measures (CASPER reports):
    • Care Management-Types/Sources of Assistance (M2102)
    • Influenza Data Collection Period (M1041)
    • Influenza Immunization Received for Current Flu Season (M1046)
    • Pneumococcal Vaccine Ever Received (M1051)
    • Reason Pneumococcal Not Received (M1056)
    • Drug Education on All Medications Provided to the Patient/Caregiver (M2015)
  • Home Health CAHPS Satisfaction Survey Measures:
    • Care of Patients
    • Communication between Providers and Patients
    • Specific Care Issues
    • Overall Rating of Home Health Care
    • Willingness to Recommend the Agency
  • Agency-Reported Measures (NEW):
    • Influenza Vaccination Coverage for Home Health Personnel
    • Herpes Zoster (Shingles) Vaccination Ever Received by Patient
    • Advance Care Planning

Based on these 24 measures, HHAs will receive a Total Performance Score (TPS) that will be determined using the higher of an agency’s achievement or improvement score.  An agency’s achievement and improvement scores will be based on the performance score it receives for each measure for which they report at least 20 episodes.  The achievement score will be calculated based on the performance score in relation to a selected benchmark and achievement threshold for each measure.  The improvement score will be calculated based on the performance score in relation to a selected benchmark and the baseline period score for each measure. 

For the first performance year, each of the six process and 15 outcome measures (or the total number of applicable measures that meet the 20-episode requirement) will be weighted equally and account for 90% of the TPS, while each of new measures will be weighted equally over the remaining 10%. CMS will require HHAs in the nine initial states to inform CMS of their performance on each of the individual quality measures used to calculate the TPS on a quarterly basis. 

What Does this Mean for Providers?

Now, more than ever, HHAs need to put their Quality Assessment/Performance Improvement (QAPI) programs to the forefront. OASIS accuracy is key in this effort. Equally important is the patient experience of care, which is measured through the CAHPS Home Health Survey. Agencies must closely monitor all outcome reports and the Home Health CAHPS report to identify and address trends and issues. Even agencies who are not in the HH-VBP pilot states can implement these requirements.

It is important to note that the calculation for each measure under the HH-VBP has not been fully defined, and some of the measures are not currently reported. Providers may use their current publicly available measures from Home Health Compare to establish a ballpark estimate of where they stand in relation to their state as a whole. But, agencies should bear in mind that the actual calculation will be based directly from the CASPER reports in comparison to the specific cohort within each state. Therefore, it is important to review the CASPER reports currently available and compare the differences between these reports and Home Health Compare. Immediate implementation of these strategies is extremely important for the nine states, but providers in other states can also begin to assess their readiness in the following ways:

  1. Become familiar with the HH-VBP Model measures and the source data that are currently available through CASPER, Home Health Compare and the Home Health CAHPS Survey
  2. Review your agency’s current performance in these process, outcome and CAHPS Home Health Survey data.
  3. Provide OASIS education to ensure accuracy in these data. This is a key recommendation, as OASIS data drives the majority of the measures. It is important that your agency implements a rigorous OASIS oversight program.
  4. Incorporate a plan for improving the HH-VBP measures in your agency’s QAPI Program.
  5. Stay abreast of information from CMS regarding the HH-VBP requirements.

How Can Simione Help?

As the largest consulting firm in the U.S. dedicated to home health and hospice providers, Simione Healthcare Consultants can guide you through these changes by providing real-time, concise information and realistic strategies to assist you in preparing for HH-VBP model implementation. Simione can perform a “snapshot assessment” of your HHA’s currently reported measures and status. We can work with you to develop specific strategies to prepare for the measures not currently reported, and assess your agency’s QAPI Program to ensure that these measures are incorporated in an efficient manner. In addition, Simione will provide OASIS training/validation and Home Health CAHPS training for your staff to ensure accuracy and improve their understanding of the impact of these measures on your agency’s performance for public reporting, survey readiness – and now for HH-VBP.

For more information, call 844.215.8820 or visit 

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