November 6, 2024  – The Centers for Medicare & Medicaid Services (CMS) released the final rule for home health payments in the 2025 calendar year. On the surface there is an aggregate increase of approximately 0.5%, or $85 million, in home health payments compared to the previous year. This adjustment, however, is coupled with a permanent prospective adjustment of -1.975. This marks the third consecutive year of permanent reductions to the home health payment framework, an approach that continues to impact the operational stability of home health agencies.

The continuous implementation of cuts has been met with stark criticism from industry leaders. Steven Landers, CEO of the National Alliance for Care at Home, expressed concerns over the reductions, citing that they pose severe risks to patient access to essential home health services. AccentCare, echoed similar sentiments. A spokesperson highlighted the discrepancies between the administration’s professed support for home care and the actual fiscal policies that undermine the Medicare home health benefit. This scenario underscores a growing dissonance between federal health policy objectives and the operational realities faced by home health providers.

Alongside financial adjustments, CMS has introduced several regulatory changes aimed at refining the delivery of home health care. One notable change is the enhancement of Conditions of Participation (CoPs) to prevent avoidable care delays. Home health providers are now required to develop and annually review a “patient acceptance-to-service policy,” ensuring that the care needs of referred patients are adequately met based on the agency’s capacity and resources.

The rule also addresses issues with service acceptance, mandating that home health agencies (HHAs) provide clear, public information about their services and any limitations. This is particularly crucial in an era where referral rejection rates have surged, often due to staffing challenges exacerbated by financial constraints imposed by both traditional Medicare and inadequate Medicare Advantage reimbursements.

While the 2025 payment rule for home health presents a mixed landscape of minor increases and more substantial cuts, it reflects ongoing efforts by CMS to streamline healthcare delivery while managing fiscal pressures. As these changes unfold, the dialogue between CMS and home health stakeholders is likely to intensify, focusing on finding a sustainable path forward that ensures high-quality, accessible care for Medicare beneficiaries.

 To read the final rule in its entirety, click here.