Estimated Impacts of Multiple Payment Policies on Rural-Serving Home Health Agencies


Three payment policy changes have recently gone into effect that have the potential to drastically change payments to home health agencies (HHAs) for providing home health services to Medicare fee-for-service beneficiaries: (1) implementation of the Patient Driven Groupings Model (PDGM), (2) revised targeting and gradual sunsetting of rural add-on payments, and (3) demonstration and nationwide expansion of the Home Health Value Based Purchasing (HHVBP) model. In this policy brief, researchers estimated the potential impacts of these three payment policy changes on HHAs by rural-serving status.

Key Findings:

  • As a result of the PDGM, 58.0% of rural HHAs and 47.1% of urban HHAs that serve rural beneficiaries were estimated to receive payment increases.
  • Compared to the estimated impact of the PDGM only, the impact of rural add-on payment revisions plus the PDGM resulted in a greater percentage of rural HHAs with estimated payment decreases.
  • The cumulative impact of all three payment policy changes has the potential to vary greatly based on performance in the HHVBP model due to the magnitude of the possible HHVBP payment adjustments.
  • The impact of these payment policy changes on estimated payments to HHAs also varied across Census Divisions, profit status, quality ratings, and episode volume.
WWAMI Rural Health Research Center
Tracy Mroz, Lisa Garberson, Holly Andrilla, Davis Patterson