The Centers for Medicare & Medicaid Services (CMS) released a proposed rule on June 30, 2025, suggesting updates to Medicare payment policies and rates for home health agencies under the Home Health Prospective Payment System for calendar year 2026. This proposal aligns with legal requirements to annually update Medicare payment policies.
A significant aspect of the proposed rule is a permanent prospective adjustment of -4.059% to the CY 2026 home health payment rate, as mandated by the Bipartisan Budget Act of 2018. This adjustment accounts for discrepancies between assumed and actual behavior changes following the implementation of the Patient-Driven Groupings Model (PDGM) in 2020. Additionally, CMS proposes a temporary -5.0% adjustment to recoup retrospective overpayments.
CMS plans to recalibrate PDGM case-mix weights and update various thresholds and levels related to payments. Changes are also proposed for face-to-face encounter policies, aligning them with the CARES Act by broadening practitioner eligibility.
Routine updates include a proposed CY 2026 home health payment increase of 2.4%, countered by estimated decreases due to behavior adjustments and other factors, leading to an overall projected decrease in Medicare payments by 6.4% compared to CY 2025.
CMS continues its efforts against fraud with new provider enrollment provisions, proposing retroactive revocations and bases for revocation or deactivation in specific situations.
The agency also seeks public input on various topics, including well-being measures and ways to streamline regulations within Medicare.
Information from this article can be found here.
