Medicare's home health prospective payment system. (FEATURED CME TOPIC: THE OLDER PATIENT).

FRANCES J. HOOD

THE NOTION behind the move to Medicare's Home Health Prospective Payment System (HH PPS) was to help ensure appropriate reimbursements for quality, efficient home health care. But has the HH PPS brought about improvements since its October 1, 2000, implementation? Has it addressed the many quality improvement issues known to impede the services rendered to the home care patient? Home health care is most clearly distinguished from other segments of the health care delivery system by the location where services are provided and the inclusion of non-medical care in the scope of services provided.

The elderly are the main users of home care; Medicare is the largest single payer of home care services. The elderly are ill, but generally their health problems cannot be cured and their rehabilitation will not send them back to the work force. Today's society regards health care primarily as medical care, so a medical framework has been superimposed on home health needs and services. Not only is this medical framework unnecessarily costly, it hides the true nature of the services. Home health services are defined in the Medicare Act as "skilled, intermittent, part-time services provided under a physician's written direction and plan of care, in the residence of the homebound." Home care is chronic in nature. It is not simply or even predominately medical. The home care needs of the elderly are not medical in nature; they call for nursing services and social assistance. The elderly are provided preventive and maintenance services under the guise of medical care.

Certain problems are associated with measuring the quality of home health services. The physician directs patient care, but is not on-site to monitor or even evaluate effectiveness. The physician must rely on home health personnel for notification if orders are inappropriate. Home health agency employees do not have total control over patient outcomes. There may be significant adverse patient outcomes if the patient and/or family do not comply with the care plan between visits. Communication channels between employees and physicians, and between employees and the patient/family are critical to the success of the home care. Specific quality assurance measures from the clinical perspective are almost totally outcome-oriented because they are driven by the patient care plan. Quality of patient care is measured in terms of achievement of patient care goals and objectives. The focus is therefore based on individual outcomes as opposed to analysis of aggregate data.

Under the Medicare HH PPS, a Medicare beneficiary must be under the care of a physician who establishes the plan of care. The PPS system did not change the eligibility requirements for receiving the home health benefit. The covered home care services are reimbursed for a 60-day episode of care based on the Home Health Resource Group (HHRG) classification system. Beneficiaries may receive an unlimited number of medically necessary episodes of care. The payment represents payment in full, at a predetermined rate, for all costs. associated with furnishing home health services.

The per-episode payment covers all skilled nursing visits, home health aide visits, physical therapy, occupational therapy, speech pathology, medical social services, and non-routine medical supplies. The payment may be subject to an adjustment to reflect significant changes in a patient's condition during each Medicare-covered episode of care. Home Health Agencies (HHA) will receive less than the full 60-day episode rate, known as a low-utilization payment adjustment (LUPA), if they provide only a minimal number of visits to beneficiaries. The HH PPS allows for additional payment for unexpectedly high utilization cases through an outlier payment if the episode exceeds a threshold amount.

If the patient experiences a significant change in condition (SCIC)--either a decline or improvement--that was not envisioned in the original plan of care, the HHA must complete an Outcome and Assessment Information Set (OASIS) assessment and obtain the necessary physician change orders reflecting the significant change in the treatment approach in the patient's plan of care. Payment rates are based on relevant data from the comprehensive assessment that includes the OASIS data items. An HHA must update the comprehensive assessment by completing the appropriate OASIS schedule the last 5 days of every 60 days beginning with the start of care date unless there is a partial episode payment (PEP) or significant change in condition.

The Outcome and Assessment Information Set is a group of data elements that (1) represent core items of a comprehensive assessment for an adult home care patient, and (2) form the basis for measuring patient outcomes for purposes of outcome-based quality improvement. The home health agency's prospective payment depends on the data acquired by the OASIS system. An HHRG cannot be generated without a completed OASIS. Payments have been calculated so that they equal, on average, the amount of money paid previously under cost reimbursement.

The OASIS is a key component of Medicare's partnership with the home care industry to foster and monitor improved home health care outcomes. Most data items in the OASIS were derived in the context of an HCFA-funded national research program (co-funded by the Robert Wood Johnson Foundation) to develop a system of outcome measures for home health care. This program and the OASIS have evolved over a 10-year developmental period. The core data items were refined through several iterations of clinical and empirical research. Other items were added later by a work group of home care experts to augment the outcome data set with selected items deemed essential for patient assessment. The goal was not to produce a comprehensive assessment instrument, but to provide a set of data items that would be necessary for measuring patient outcomes and would be essential for assessment, and that HHAs in turn could augment as judged necessary.

Overall, the OASIS items have utility for outcome monitoring, clinical assessment, care planning, and other internal agency-level applications. As more precise assessments lead to improved care planning, they in turn facilitate better care because clinicians can more effectively focus on improving or maintaining current (precisely measured) health status. A description of all of the required data elements on the HCFA Form 485--Home Health Certification and Plan of Care Data Elements--is detailed in Medicare Program Memorandum A-00-71.

The Centers for Medicare and Medicaid Services (CMS) (formerly HCFA) has finalized two rules relating to HHAs. One rule revises the existing HHA Conditions of Participation by requiring that HHAs collect OASIS data. The other expands those new Conditions of Participation by requiring HHAs to electronically transmit OASIS data to their state survey agency. Another CMS goal is to provide states with enhanced ability to direct on-site HHA inspection resources through the use of OASIS data.

HHA CONSOLIDATED BILLING

Under the HHA consolidated billing statute, the HHA that establishes the home health plan of care has the Medicare billing responsibility for all of the Medicare-covered home health services that the patient receives and are ordered by the physician in the plan of care. The statute requires payment for all items and services to be made to the home health agency establishing the plan of care, regardless of whether or not the item or service was provided by the agency or by others under arrangement with the agency. With the exception of durable medical equipment (DME), the outside supplier must look to the HHA rather than to Medicare Part B for payment. DME covered as a home health service as part of the Medicare home health benefit will continue to be paid under the DME fee schedule and will be excluded from the consolidated billing requirements.

CODING CONSIDERATIONS UNIQUE TO HOME CARE

There are coding situations that are unique to home health care. The Home Health Resource Group (HHRG) classification system is a six-position alphanumeric code that represents a severity level in three domains: clinical severity, functional status, and service utilization.

According to Medicare Program Memorandum A-00-71, the principal diagnosis is the diagnosis most related to the current plan of care. The diagnosis may or may not be related to the patient's most recent hospital stay, but must relate to the services rendered by the HHA. If more than one diagnosis is treated concurrently, the diagnosis that represents the most acute condition and requires the most intensive services should be entered. The ICD-9-CM guidelines dictate that certain specific principal diagnoses are only to be used when a specific secondary diagnosis is present. The code is the full ICD-9-CM diagnosis including all digits.

Some of the rules for reporting ICD-9-CM diagnosis codes differ for Home Care. The principal diagnosis must match the diagnosis reported on the physician certified plan of care, the OASIS, and the UB-92 form. All diagnoses should be based on the available documentation, assigned according to ICD9-CM coding rules, and sequenced according to the explanation given under the reporting requirements in the July 3, 2000, Federal Register.

V-codes are not acceptable as either principal or first secondary diagnoses, even though some might argue that V-codes reflect the most appropriate codes in some circumstances in the home health setting. The OASIS instructions state that instead of V-codes, the HHA should list the relevant diagnosis. Given the goal of accurate case-mix development and ascertainment, use of V-codes to indicate aftercare services would hinder the objective of classifying patients with minimal reliance on treatments planned or received.

Codes should be reported based on the underlying condition rather than to indicate aftercare services. Two example follow for illustrative purposes:

(1) A patient is surgically treated for a subtrochanteric fracture (code 8220.22). Admission to home care is for rehabilitation services (V57.1). The HHA uses 820.22 as the primary diagnosis and may enter V57.1 as a second secondary diagnosis or in field 21.

(2) A patient is surgically treated for a malignant neoplasm of the descending colon (code 153.2) with exteriorization of the colon. Admission to home care is for instruction in care of colostomy (V55.3). Even though V55.3 is more specific to the nature of the proposed service, the HHA must use code 153.2 as the principal diagnosis and may use V55.3 as a second secondary diagnosis or in field 21.

The principal diagnosis may change on subsequent forms only if the patient develops an acute condition or an exacerbation of a secondary diagnosis requiring intensive services different than those on the established plan of care.

Codes 434 (occlusion of cerebral arteries) and 436 (acute, but ill-defined, cerebrovascular disease) are being used in home care, notwithstanding the coding guidelines. The ICD-9-CM Official Coding Guidelines suggest a code from category 438 (late effects of cerebrovascular disease) as the correct code assignment following an acute cerebrovascular accident. OASIS diagnosis reporting rejects the use of code 438 because the definition of 438 encompasses sequelae the lags of which may be of any length. Additionally, use of code 438 presents significant risks of inappropriate payment.

MEDICAL REVIEW PROCESS

For the most part, medical reviewers will continue to perform the same types of reviews that were conducted prior to implementation of PPS. For example, they will review to ensure that the beneficiary meets the requirements for Medicare home health coverage, and that services provided were reasonable and necessary and appropriately documented. One additional aspect of the review strategy will focus on the OASIS information and whether it is supported by documentation in the medical record. If it is determined that a case-mix assignment is not appropriate, it will be adjusted accordingly. HHAs will continue to have all appeal rights previously associated with home health claims. Medicare Program Memorandum A-00-71 obtains all of the required components of the plan of care, as well as helpful examples of acceptable and unacceptable physician orders for patient care.

Suggested Reading

The complete Home Care PPS Final Rule is available at www.hcfa.gov/medicare/hhppsfr4.htm.

The July 3, 2000, Federal Register is available at www.access.gpo.gov/su..Aocs/fedreg/a000703c.html.

Medicare Program Memorandum A-00-71 is available at www.hcfa.gov/pubforms/transmit/A0071.pdf.

Procedures Subject to Home Health Consolidated Billing available at www.hcfa.gov/pubforms/transmit/AB0165.pdf.

The ICD-9-CM Official Coding Guidelines are available at www.cdc.gov/nchs/data/icdguide.pdf.

Additional information on the HH PPS can be found at the CMS web site at www.hcfa.gov/medicare/hhmain.htm.