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Home health agencies could see a 5% Medicare decrease in reimbursement in fiscal year 2023, if Congress follows a draft recommendation from the Medicare Payment Advisory Commission (MedPAC).

MedPAC made the recommendation during its public meeting Friday to assess payment adequacy and payment updates. It found that home health payment adequacy indicators, which factor into the update recommendation, are positive. Among these: Access to capital remains strong; access to care is high, with 88% of beneficiaries living in a county served by five or more home health agencies. And Medicare payment and home health agency costs are on solid footing. The median Medicare margin for an efficient provider is 24.3%, which “indicates the level of Medicare payments is too high” MedPAC senior analyst Evan Christman noted.  

Still, MedPAC pointed out that the fourth area for determining updates — quality of care — is difficult to know. The performance on quality measures in 2020 was mixed, Christman said. Results may reflect the impact of the public health emergency (PHE). The unique circumstances of PHE “confound the [organization’s] measurement and assessment of quality,” he noted.

The PHE caused some challenges in 2020, he pointed out. A decrease in home healthcare occurred then, mostly at the onset of the PHE. A decline in services was concentrated in April and May 2020, with a recovery in later months.  

And in-person visits fell in 2020, mostly due to therapy. But this decline likely was offset by an increase in telehealth services. (No detailed information on telehealth services is reported to Medicare, Christman noted.)

MedPAC will provide a report to Congress about the update in March.