Cost Report Blog

HHA Medicare payments in 2010 will have outliers computed based upon a Fixed Dollar Loss (“FDL”) of .67, compared to an FDL of .89 in 2009. The FDL is adjusted for the wage index of the HHA’s location.

HHA 2010 Medicare payment update has a 2.0 inflation update, but 2.75% reduction for ‘unwarranted’ case mix increase, and changes in outlier payments (10% cap per agency). The Federal Register shows an increase of the base rate for 60-day episodes from $2271.92 to $2312.94 (1.8% increase).

It can be found in the Federal Register by clicking here

Updated November 9, 2009:

For CY 2010, CMS will cap home health outlier payments at 10 percent per HHA and target total aggregate outlier payments at 2.5 percent of all HH PPS payments.

Reports by the Center for Medicare and Medicaid Services (CMS) and the National Association of Home Care and Hospice (NAHC) both revealed that more than 20% of Home Health Agencies nationally are submitting erroneous Medicare cost report data.  These cost reports have been used to influence payment decisions for all HHAs.

This is a critical issue for the industry as the cost report is the only source of cost, charge, profit, and visit information that government agencies have available for the home health industry.  In addition, the cost report not only influences payment rates, it can be a source of valuable industry benchmarking data when properly prepared.

The NAHC and the Home Care and Hospice Financial Managers Association (HHFMA) have launched a campaign and established a task force that will identify areas in the cost reporting process that need improvement and recommend changes that will help the industry in preparing accurate cost reports.