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The US Centers for Medicare and Medicaid Services (CMS) plans to revive a home health agency (HHA) "pre-claim demonstration" project it shelved in 2017 due in part to criticism that the program created significant administrative burdens and reduced access to care. The reconstituted project will be implemented in 5 states and is described as "optional," though HHAs that choose not to participate would face a 25% cut in payments.

The demonstration project will be carried out in Florida, Illinois, North Carolina, Ohio, and Texas, and would offer HHAs 3 paths in seeking payment for Medicare beneficiaries: submit documentation for 100% of Medicare patients while they are receiving care (a "preclaim review"), submit 100% of all claims for a postpayment review, or opt out entirely and swallow a 25% payment cut with the possibility of review by a recovery audit contractor. The previous version of the project included only the preclaim review provisions; according to a statement from CMS administrator Seema Verma, the new plan "offers new flexibility and choice for providers."

CMS' earlier attempt at the project was implemented in Illinois but was suspended after some HHAs were forced to close their doors, pointing to the program's administrative burdens as part of the cause. Federal lawmakers requested that the program be shut down until a better plan could be developed.

Like its earlier version, the project is aimed at reducing what CMS has identified as high rates of Medicare fraud among HHAs. CMS stated that although it will limit the project to 5 states initially, it may consider expanding the project to other states in the Palmetto/JM jurisdiction—mainly southern states as well as New Mexico, Indiana, and Kentucky. CMS has not yet set a start date for the program.

APTA will provide comments to CMS within the 60-day window triggered by publication of the proposal in the Federal Register, and will share information on how individuals can provide comments at the APTA federal advocacy webpage.

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