News: CMS 2025 proposed home health rule reduces payments by $280M

On June 26, CMS issued its calendar year 2025 proposed rule for the Home Health Prospective Payment System, according to the American Hospital Association (AHA).

There are a number of adjustments included in the 2025 proposed rule, including:

• A reduction in net home health payments by an estimated $280 million (-1.7% relative to 2024)
• A reduction in the base payment rate by 4.1% (partially due to “the implementation of the Patient-driven Groupings Model, which reduce[d] total payments by 3.6%)
• An adjustment to the fixed-dollar loss amount for “high-cost outliers,” which is estimated to reduce payments by an additional 0.6%, or $100 million
• An update to the Home Health Agency conditions of participation, requiring HHAs to “develop, consistently apply, and maintain a policy for accepting patients to service.” Under this requirement, HHAs would be required to collect and report "specific data elements” regarding “living situation, food[,] and utilities beginning with the CY 2027”

According to the AHA, the new adjustments have raised “serious concerns” as they “come on top of multiple years of similar downward adjustments.”

CMS stated that it will accept comments on the proposed rule through August 26, 2024.

Editor’s note: To read the AHA’s coverage, click here. To read CMS’ home health proposed rule, click here.