The Centers for Medicare and Medicaid Services (CMS) has announced that Medicare payments to home health agencies will increase by 2.8 percent next year. Home health care providers, paid through a prospective payment system, can expect $370 million in payments in 2006.
How are payment rates calculated? From the CMS web site:
Home health payment rates are updated annually by either the full home health market basket percentage, or by the home health market basket percentage as adjusted by Congress. CMS establishes the home health market basket index, which measures inflation in the prices of an appropriate mix of goods and services included in home health services. For CY 2006, the home health market basket percentage is 3.6. Section 701(b)(4) of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 provided that updates for CY 2005 and CY 2006 will equal the applicable home health market basket percentage increase minus 0.8 percentage point.