H.R. 2573 and S. 433 Introduced to Address PDGM Concerns

The house and senate bills specifically address reforms made in the Patient Driven Groupings Model (PDGM), a payment model proposed by the Centers for Medicare & Medicaid Services (CMS) last year and slated for implementation in 2020. If implemented as designed, PDGM will make payment adjustments based on behavioral assumptions as opposed to observed evidence or actual provider billing behaviors. The new payment structure could result in a 6.42 percent payment reduction in the first year alone – equaling an estimated $1 billion. 

If passed, H.R. 2573 and S. 433 will require Medicare to implement adjustments to reimbursement rates only after behavioral changes by home health agencies (HHAs) actually occur instead of assuming billing changes might happen. By requiring the payment model to utilize observed evidence of behavioral changes, the bill would ensure a smoother transition to the new payment system. The bill also provides a phase-in of payment changes, limiting losses or gains to two percent per year, while still ensuring budget neutrality is maintained.   ​