The Medicare Payment Advisory Commission, which advises Congress on Medicare issues, recently voted in favor of recommendations to reduce the 2021 Medicare base payment rates for hospice and home health agencies. The driving motivation for their decision was the belief that COVID-19 will not financially harm such agencies in the long term.
Home health agencies would see a 5% reduction from their 2021 Medicare base payment rate. MedPAC estimates that Medicare spending in this area would decrease by $750 million to $2 billion next year, while over five years it would decrease between $5 billion and $10 billion.
For hospice, the draft recommendation would reduce the aggregate cap by 20%. This shouldn’t come as a surprise as MedPAC staff in previous meetings told commissioners some providers were abusing the high-paying hospice program. The National Hospice and Palliative Care Organization and its members immediately opposed MedPAC’s draft recommendation, expressing concern over the likelihood of it decreasing hospice access for patients and families, especially in rural and underserved areas.