This study is designed to provide information on how the shift to prospective payment has affected access to home care in rural communities. The home health prospective payment system (PPS) was implemented in October 2000 to reduce growth in Medicare home health expenditures. Under the PPS, home care agencies are reimbursed based on a 60-day episode of care, with adjustments to the base payment that reflect differences in resource needs. This case-mix adjustment classifies home health patients into Home Health Resource Groups (HHRGs) based on their clinical characteristics, functional status, and service utilization. This study is designed to provide information on how the shift to prospective payment has affected access to home care in rural communities. This study will explore the impact of the PPS on patterns of home health utilization. The following research questions will be examined:

• How do the demographic and clinical characteristics of rural and urban Medicare beneficiaries who received home care prior to the PPS compare to those who received home care following the PPS?
• Are there subgroups of rural and urban beneficiaries for whom access to home care is more limited following implementation of the PPS? For whom home care is more accessible following implementation of the PPS?
• To what extent has the PPS had an effect on patterns of home care utilization?
• Has the quality of care provided to home care users been affected by the PPS?

Data to conduct this study will be obtained from the 5 percent MedPAR file and the Home Health 5-percent Standard Analytical File.

Publications

• Utilization of Home Health Services Among Rural Medicare Beneficiaries Before and After the PPS
  NORC Walsh Center for Rural Health Analysis
  Date: 08/2005
  This report describes a study conducted on the rural effects of the PPS, including whether the PPS contributed to changes in the demographic and clinical characteristics of home care users, the likelihood of using each of six home care disciplines, and the intensity of services.