Visit Utilization in PDGM

From October 1, 2000 to January 1, 2020, Home Health was under a HHRG- based payment model. A big piece of this model was a structure that incentivized the use of therapy (PT, OT and ST) via a series of “visit threshold” calculations that when the agency met or exceeded a certain number of Therapy visits there was an associated reimbursement increase. The HHRG model caused the use of the word “gaming” in yearly PPS rules to escalate steadily over the years. Every time a threshold was moved, agencies quickly took advantage.

At K&K, we believe the HHRG model ushered in a time that rewarded more visits, but not necessarily better care. We audited thousands of therapy records during that time period and we cannot remember when we did not recommend a tightening of the therapy visit structure and prescription, and advocated for agencies to provide more value per visit.

Therapists became “visit machines” during this time and this created a “whiplash” kind of effect when PDGM became the payment model on January 1, 2020. Gone were any incentives for more visits by any discipline.

Known as the Patient-Driven Groupings Model it took away all thresholds and ushered in a new calculation for LUPA determination.

Payment is now based on a patient’s individual attributes, factors and data as gathered on the OASIS E instrument and through coding of the patient diagnosis’ concerning why they are receiving Home Health.

Agencies, as predicted, have responded in a way that they have tried to maximize reimbursement. As a result the term “behavioral adjustment” has become the next buzzword replacing the word “gaming” but essentially being the new iteration of the new attempt to increase profit by restricting the number of visits.

These behaviors have ushered in HHVBP (Home Health Value-Based Purchasing) becoming a country-wide initiative as a result of the success in several demonstration states. We begin HHVBP officially in 2025 and there will be payment adjustments based on what your agency did in 2023. This will continue, with data setting payments that is 2 years in old (for example, 2026 uses 2024 data, 2027 uses 2025 and so on). This time frame may tighten up over time, as the data mining and examination improves.

Today, it matters more than ever what quality of care you provide the patient.

That said, we receive 3X more questions about how to reduce visits and have better outcomes than we do questions about improving the quality of care to improve outcomes.

Our industry is in a cycle, this cycle is focusing on what impacts reimbursement foremost. Agencies cannot sustain themselves, particularly smaller and rural agencies, based on a reimbursement first focus.

Agencies behaving in this way, only fuels a RAC and ADR auditor feeding frenzy.

If you want to watch your reimbursement disappear then simply get into an ongoing audit and be prepared to increase all non- revenue producing staff FTE’s as a response.