Home Health PPS Implementation
An Executive Checklist

Implementation Date for Home Health PPS: October 1, 2000

Developed a plan to assess your caseload during September - the one-month grace period prior to commencement of PPS on October 1?

Consider pulling a sample of your patient population and looking at the impact of payments on your agency. Don't forget to evaluate how your agency might be affected by potential outliers.

Examined the policies created by HCFA to close out IPS and start PPS?

These policies are described more fully in HCFA Program Transmittal A-00-41 (dated 7/27/00). There is a link to this HCFA Program Transmittal from the AHA web site at

Remember: Claims are not allowed to span the two systems. HCFA's policies are designed to ensure that all patients have an updated OASIS assessment for October 1 in the format designed for the new system. In response to the AHA's concerns, HCFA has provided a degree of flexibility on the timing of the updated OASIS assessments and subsequent recertification of plans of care.

Trained staff on PPS mechanics and the importance of the Outcome Assessment and Information Set (OASIS) coding rules?
  • Do all caregivers understand the 22 items from OASIS that determine a patient's classification, and ultimately payment?

    Inaccurate scoring on any of the 22 OASIS items used for payment can have a big impact on agency revenues - from several hundred dollars to more than $1,000 per episode for mistaken coding. The OASIS form also is used for analysis of outcomes. Accurate OASIS scoring is essential.

Updated your OASIS submission and home health billing software?
  • Does the UB-92 claim form use the beneficiary's home health insurance PPS (HIPPS) code (revenue code 0023) that was created exclusively for HHA PPS?

    A software program will create the HIPPS code based on the HHRG and an OASIS data validity check. The HHRG will be determined from a grouper that HCFA includes with the OASIS submission software, HAVEN.
  • Have you obtained a copy of HAVEN 4.0 from HCFA's web site at ?

    This software, which was recently released by HCFA, contains the latest versions of the OASIS instrument and data submissions software. Agencies that are developing their own software (directly or through vendors) will find OASIS data submissions specifications and the OASIS B-1 form on the site as well.

Considered how you will manage the process of recertifying plans of care and obtaining updated OASIS assessments for your agency's patients?


  • Have you provided for recertifying plans of care for established beneficiaries as of September 1 sometime during the period from September 1 through and including November 29?

Remember: The regulatory requirements governing Medicare home health benefits prior to PPS would apply to the certification period up to and including September 30.

  • Does the plan of care reflect a "statistical break" between the pre-PPS physician-ordered services (September 1 through September 30) and the post-PPS physician-ordered services (October 1 through November 29)?
  • For patients whose OASIS assessment was completed during the period of September 1 through September 30, will your agency use this most recent OASIS start-of-care or follow-up to group for case mix? Is this assessment completed using the new OASIS B-1 (8/2000) data set? and encoded using HAVEN 4.0 software (or other HAVEN-like software from your vendor)?
  • For patients whose OASIS assessment was completed during the period of August 1 through August 31, when in September will the agency complete the next scheduled assessment?

    Remember: These assessments, which will determine the patient's case mix group for PPS, will be allowed to extend beyond the normal 60-day period for up to 90 days (including, but not beyond November 29). At the conclusion of the patient's first episode of care under PPS, the agency will resume the OASIS requirements governing re-assessment during the last five days of the episode certification period.

Summary of OASIS Requirements Related to Transition to PPS

OASIS Start-of-care or Follow-up Timing

Transition to PPS Rules

OASIS completed earlier than September 1

One-time additional follow-up OASIS during September

OASIS completed after September 1

No additional follow-up OASIS required; earlier OASIS assessment (i.e., occurring between 9/1 and 9/30) can be used

Developed a financial back-up plan in case of cash flow delays?

Remember: For the first 60-day episode for a new home health care patient, the split payment ratio will be 60 percent up-front and 40 percent at follow-up or discharge, whichever is relevant. For all subsequent 60-day episodes, the split payment ratio will be 50/50.

Developed the ability to conduct patient-level cost analysis and engage in outcome-based quality improvement strategies?

Under the new system, home health payment rates are truly prospective. Your payment level is set in advance based on the HHRG score at the start of the episode. The primary exception to this general rule is the 10-therapy visits per episode threshold in the case mix methodology, which allows for significantly higher reimbursement based on the number of therapy visits provided during the episode. HCFA has clarified that physical and occupational therapy aide visits during the episode count towards the 10-visit threshold. Therefore, obtaining the outcome most efficiently is the future of home health care.

Educated local physicians on forthcoming changes, including re-examining procedures for physician development and sign off on the home health plan of care?
  • Are all verbal physician orders that the agency uses to initiate a "request for anticipated payment (RAP)" followed up by a written plan of care?

    Remember: The final rule allows for this innovation whereby an agency can submit an initial bill based on verbal orders from a physician. The verbal orders must be followed up by a written plan-of-care. It is important to submit the RAP on a timely basis because it establishes your agency as the primary HHA for the beneficiary. A RAP will be subject to medical review and considered a claim for purposes of fraud and abuse statutes and regulations.
  • Are any of your agency's beneficiary cases expected to qualify for the low utilization payment adjustment?

    Your agency can submit one final claim (with signed physician orders) for beneficiary cases that are expected to qualify for this adjustment.
  • Do all final claims have signed physician orders?

    Remember: The final claim must be submitted within 60 days of the end of the episode or 60 days from issuance of payment, whichever is longer. The final claim for each episode (at the end of 60 days) will be for the balance of the amount due, including any positive or negative adjustments based upon a reconciliation of the projected-to-final case mix group, as well as any other applicable adjustments, such as outlier or low-utilization payment adjustments. Although these changes will be automatically made in the billing process, agencies are strongly advised to have their own financial projection software.
  • Is your agency aware of HCFA's proposed changes to the Medicare Part B physician payment methodology that appears to have been designed to work in conjunction with PPS?

    This proposal was published in the July 17 Federal Register, page 44196. The proposed changes are intended to better reflect the time involved in the certification (and recertification) of a plan of care for home health patients. The proposed payment rates would be approximately $60 and $50 for certification and recertification, respectively. HCFA expects to publish the final rule in late-October as part of broader changes to physician payments and AHA will keep members up to date on developments


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