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December 16, 2025 25 mins

We break down the 2026 home health final rule, from the 1.3 percent cut and sequestration impact to face-to-face, OASIS, HHCAHPS, and value-based purchasing changes. We share concrete steps to shore up documentation, data, and budgets before January 1, 2026.

• Why the final rule timing compresses preparation
• Payment impact of the 1.3 percent cut plus sequestration
• What changes in face-to-face encounter responsibility and proof
• Aligning COPs with the all-payer OASIS requirement
• How HHCAHPS and OASIS items are being revised
• What new and removed VBP measures mean operationally
• Anti-fraud signals in enrollment and oversight
• Practical actions to update policies, analytics, and training
Resources to read and where to find deeper summaries


We did present and post two very detailed summaries with the highlights of the home health content as well as the DME content on our website



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Episode Transcript

Available transcripts are automatically generated. Complete accuracy is not guaranteed.
SPEAKER_01 (00:15):
Greetings, I'm Jennifer Kennedy, the lead for
compliance and quality at CHAP,and welcome to Chapcast.
So today we're going to hashthrough uh some of the content
or the give you the highlightsrather of the calendar year 2026
home health payment update rule,but only for the home health

(00:39):
content for this particularpodcast.
And I am joined by my compadre,my colleague, my longtime friend
uh Kim Skehan.
Uh, and Kim and I are going tohopefully um hit some of the
highlights for you so that youunderstand uh what the
requirements are in this umfinal rule.

(01:02):
Kim, how are you doing today?

SPEAKER_00 (01:04):
You know, it's um it's been a whirlwind for sure
for certainly us, but as well asfor providers.
I mean, as we go through thehome health components of the
home health final rule, therecertainly are um areas that uh
specifically related to paymentthat uh that providers need to
um focus on.
Um we as also an AO also havethe responsibility for DME.

(01:29):
The demi post changes as well asthe AO changes.
So when we follow up with thewith the additional podcast on
uh that component of the finalrule, I think you know, um that
also will be extremelyinformative as well.
So it's been a bit busy, butwe're all in it together.

SPEAKER_01 (01:49):
We're in it together, and you're right.
Uh we'll we'll handle the DME ina separate podcast.
This year, you know, was kind ofunusual because we had um, dare
I use the respite, uh thehospice term respite, meaning
that you know uh the governmentwas shut down and um many uh CMS

(02:11):
staff were on furlough.
So nothing happened.
And the the time that we wouldusually be looking for this
final rule to post, end ofOctober, beginning of November,
it didn't happen.
And you know, here we are umpushing um Thanksgiving
essentially and having a rulecome out that Friday after

(02:33):
Thanksgiving.
So we have basically a month, uhwe've lost a month as home
health providers in reading therule, understanding the rule,
and unfortunately, thatimplementation date for the
provisions for home health isJanuary 1, 2026.

(02:54):
So you're um you're coming intothis, you know, a year, uh a
year, oh my gosh, a month behindthe the eight ball with not a
lot of time uh to implementwhatever you need to implement.
And I I think Kim, let's startout with um, you know, why why
should listeners be payingattention to this particular

(03:14):
topic of a final rule?

SPEAKER_00 (03:16):
Sure.
I think first of all, any finalrule provider should be looking
at, even if it is not yourservice line.
So so for example, um, you know,we're this is the home health
final rule, and as you can tell,DME and AO um oversight um was
embedded in this final rule.
We've seen the same with homehealth and hospice, right?

(03:39):
And and physician final rules.
So, you know, um it really isimportant for organizations to
keep track of any of theseproposed rules uh that are
coming out to determineapplicable applicable areas.
Um, and that's also where thestate and national associations,
the Alliance, for example, um,that really do a great job in

(04:01):
terms of culling through them,but providers really are
responsible for knowing.
Um so the final rule providesthe update to the upcoming
calendar year payment for a homehealth agency, but also serves
as a vehicle for introducingthose new regulations or
changes.
And in um the the final rule isbased on the proposed rule and

(04:24):
taking into consideration whereCMS feels it's appropriate, um,
uh the comments that aresubmitted from providers um, you
know, or from the industry umduring the con the rule, the
comment period, which if I'm ifI'm correct, Jennifer, was with
all the comments, was the finalrule around 762 or so pages?

SPEAKER_01 (04:48):
762, my friend.
Now, what wine would we pairwith that?
I'm thinking a very heavy red.
Yeah.
Uh with the other.
Because it was a very heavy rulein order to read that one
through.

SPEAKER_00 (05:01):
Absolutely.
Um, so for this final rule, um,there is the the rate cut that's
um there is still a rate cut,much lower than proposed, and
overall minor changes to umother uh payment you know
components such as LUPAthresholds, case mixed weights,
and value-based purchasing, andthen also some regulatory

(05:24):
changes that really areessentially unchanged from the
um the proposed rules.
So um I think you know, we'llwe'll I think just going through
them um, you know, I think willbe extremely important.
I would also say that there areuh other resources for
expertise, um, such as theNational Alliance for Care at

(05:44):
Home, um, many um consult expertconsultants in the industry that
also are providing um and EMRs,I believe, and other state and
and national associationsproviding some additional um uh
information as well.
So from my perspective, we arewe can speak to the um

(06:05):
components of the rule, but theeach organization needs to
evaluate internally themselves,you know, how does how do these
um how does the final ruleimpact um you as a provider and
what other resources can Iutilize to be able to really um
you know ensure appropriateimplementation or analysis?

SPEAKER_01 (06:27):
Yeah, definitely.
And I agree um with your um yourshout out to the alliance
because I think they do a reallygreat job in the in the payment
area.
And while you know 1.3 uhpercent is better than that
proposed 6.4%, it's still a cut.
And um, you're right, providersneed to figure out um how

(06:48):
they're gonna operate incalendar year 2026 on a 1.3%
deficit.
Now remember, sequestration isstill in place as well.
So 2% comes right off everyclaim as soon as it's submitted.
So, you know, we're reallytalking about a uh uh 3.3% um

(07:08):
when all is said and done.
Yeah.
So um I know that there were umsome other uh changes uh or
finalizations of um languagefrom proposed to final uh that
are outside of that paymentarea.

(07:29):
And um even though it's kind ofin the coverage uh regulations,
Kim, that face-to-face encounterpolicy, um, CMS did finalize
that language, and I'm hopingyou could uh walk our listeners
through that.

SPEAKER_00 (07:44):
Um, sure, absolutely.
So um CMS did finalize thechange or really codify the
change to the face-to-faceregulation to uh allow
physicians, in addition to nursepractitioners, CNSs, and PAs, to
perform the face-to-faceencounter, regardless of whether
they are the certifyingpractitioner or whether they

(08:05):
cared for the patient in theacute or post-acute facility
from which the patient wasdirectly admitted to home health
and who is different from thecertifying practitioner.
This is important because um,from a payment perspective and
denial perspective, um, over theyears there had been um, you
know, um denials, and I thinkoccasionally still denials, um,

(08:30):
if uh if the provide thepractitioner that has a law uh
that has signed the face-to-facewas either, you know, not um,
you know, uh was not thatcertifying practitioner.
So that took a long time fororganizations to get processes
in place and for CMS and theMACs to get that clarified, this

(08:50):
is finalizing that requirement.
Um I do want to shout out toKatie Weary at the Alliance
because when she did her umprovision, she did remind
everyone of the original intentof the face-to-face encounter,
which is determining eligibilityfor the home health benefit.
And one of the comments or oneof the requirements that that is

(09:12):
in the final rule, and it's alsoin the face-to-face requirement,
is that the physician or allowedpractitioner conducting the
face-to-face encounter is themost knowledgeable practitioner
and has firsthand information ofthe patient's current clinical
condition, and that all otherface-to-face encounter and
certification requirementsremain the same remain in place

(09:34):
and are conditions of payment.
Why this is important is becauseeven though the language in the
um in the final rule saysregardless of whether they're
the certifying practitioner orthey care for the patient, um,
and uh, you know, CMS at somepoint will be looking to um uh

(09:54):
likely to determine if thepractitioner signing that
face-to-face encounter did havecontact, not current
knowledgeable relationship, youknow, with that particular
patient.
So not sure how that will playout, but you know, just keeping
that in mind when um whenorganizations are um receiving

(10:16):
and obtaining the face-to-faceencounter.

SPEAKER_01 (10:20):
Yeah, I think everything, you know, everything
could be up for grabs when youhave a change in regulation.
You know, it could be an editthat the Mac sets, it could be a
target for any of the umCMS-related auditors, you know,
smirks and UPICs and um racks,all of those things.

(10:41):
Uh, you know, I I think once wesee changes like this, those
could be um actual targets, youknow, as we move forward to look
at compliance and and possiblydeny claims if it's in the
coverage area.

SPEAKER_00 (10:57):
Absolutely.
Um Jennifer, do you want to uhso that's the face-to-face
encounter?
Um, I I do want to I'll I'llmention this, and then if you
don't mind, um um to hear moreabout uh the home health quality
reporting and value-basedpurchasing, you know, um um uh
changes specifically as itrelates to quality reporting,

(11:20):
um, I think that that will beimportant.
Um but I do want to just mentionregarding the um the the
all-payer requirement for um foruh the alignment of the COPs um
with the OASIS all payersubmission requirements and the
language to reflect all payers,so from patient to beneficiary.

(11:44):
Um this is you know, this is atechnical requirement, right,
that needs to change to alignthe COP with the all payer
requirement.
But I do want to um take thistime to just remind everybody of
that requirement.
If you are a Medicare certifiedhome health agency, you must

(12:04):
submit um an OASIS, uh, submit acomplete and submit oasis for um
uh or complete oasis for allpayers for those those patients
receiving services unless theyare otherwise exempt.
In other words, under 18receiving maternity care only or

(12:26):
personal care services only.
So um, so that's been a sourceof confusion, I think, for some
organizations that may haveprivate duty, for example, um,
you know, um under their homehealth umbrella.
So they really you really needto make sure that that you're
clear on those processes andthat I'm sorry, the data
collection requirement andsubmission.

(12:48):
Um, Jennifer, um do you do whatwhat is our plan at CHAP for
updates to our standards relatedto this area?

SPEAKER_01 (12:58):
You're just reading my mind, Kim.
And thank you for bringing thatall pair, all Oasis um point to
the table.
So um what we usually do uh andwhat we're doing right now is
once a rule is finalized, we goahead and look at our standards
to see where we need to do theupdates.
And um, that's what we'recompleting as we speak.

(13:22):
And um, before we can put themout to our home health
providers, our CHAP providers,they have to go to CMS to be
reviewed and approved.
And then once they're approved,then we can um uh update our
providers uh with that newest umcopy of the standards.

(13:43):
So a little bit of time uh thatit takes um in order for us to
make sure that we're doing it inthe compliant way, uh, but
please be looking out in the newyear for uh the updated
standards as it relates to thisfinal rule.

SPEAKER_00 (14:00):
No, that's that's yeah, that's great, Jennifer.
Um, do you do you want to talkjust a little bit going back to
um the quality reporting?
Um, any key points related toquality reporting and caps as it
relates to VVP?

SPEAKER_01 (14:16):
Yeah, I'll I'll just go ahead and point out a few
highlights.
Uh CMS did finalize a few thingsin this area.
Uh they are removing the uhCOVID-19 vaccine measure um uh
out of the as a out from theOASIS uh as a data element.

(14:36):
They're also removing fourassessment items in that
standardized assessment, and thefour are the living situation
item, two food items, and oneutilities item.
So um CMS uh is also revising umtheir home health caps survey,

(15:02):
and uh that new survey willimplement um beginning April
2026 in that sample month.
And that revised survey uh alsoremoves several items in the
multi-item specific care issuesmeasure, and three of the items
used in the specific care issuesmeasure will remain um uh in the

(15:26):
HHCAP survey instrument.
So they're they're doing alittle bit of a shuffling
around.
Also, um the rule uh is not thatthis is well, I guess it's
technically um attached toquality, but if you find um that
you get the dreadit letter uhthat says you're not compliant

(15:49):
and you're um eligible for a 2%reduction uh in a payment rate
because you didn't submit yourquality um information, CMS did
update their considerreconsideration policy uh so
that it's essentially codifiedfor any kind of extraordinary

(16:09):
circumstance.
So if you um had a flood fire,tornado, hurricane that
interrupted your ability tosubmit timely quality
information, uh, and you wantedto, and you got the letter and
you wanted to appeal it or umsend in a reconsideration, you
would have to just outlight thecircumstances, time frame, etc.

(16:32):
So CMS did um update that aswell.
And you did talk about theall-payer.
Um, there were some um updatesto the home health value-based
purchasing model beginning April2026.
Um, I mentioned that we will umhave those uh changes to the HH

(16:55):
CAPS, uh, CMS will remove thecare of patients, communications
between providers and patients,and specific care issues.
Um, they also finalize theaddition of four measures to the
applicable measure set.
Um this includes threeOASIS-based measures related to

(17:17):
bathing and dressing, and oneclaims-based measure, which is
the Medicare spending perbeneficiary for post-acute care
um setting measures.
Wow, that's a big long mouthfulthere.
But the removal of um these dataelements, Kim, is associated um
with the HHQRP um assessment asof April 1, 2026.

SPEAKER_00 (17:43):
Yeah, thanks, Jennifer.
And again, um any changes to thevalue-based purchasing model,
including these measures, um,also will um impact an
organization's reimbursement orin the impact of value-based
purchasing.
Um, so as as well as any um anyother you know, data changes

(18:04):
that also are included.
So value-based purchasing, um,both the caps changes, certainly
as well as quality reportingchanges, um, potentially, you
know, they impact uh reportingand quality, but also payment
once they are um you know umintegrated into the value-based
purchasing model.

SPEAKER_01 (18:26):
Yeah, and you know, I think it's fair to say, Kim,
that um we've seen um as eventhough we're not talking about
the DME part today, um, there isthe overall uh theme and tone in
that rule about combating fraudand abuse.
And we still have fraud andabuse happening in home health

(18:48):
as well as DME, but um CMS is umreally serious.
They have uh a war, what theycall their fraud and abuse war
room up at CMS in Baltimore, um,that is um looking at all
provider types for decreasingfraud and abuse.
So um it's something that CMS isserious about, and we're gonna

(19:11):
keep seeing um this type oflanguage infused in these
provider rules because um thatis one of their initiatives up
at CMS for um this fiscal year.

SPEAKER_00 (19:25):
Yes, absolutely.
And and even in this um finalrule, there are, you know, um
there are some changes orupdates to Medicare provider
enrollment.
So and and that just againspeaks to that focus of
anti-fraud, not just in DME orhospice, you know, or other
settings.
It's definitely across theacross all settings that CMS is,

(19:47):
you know, taking notice andimplementing, I think, you know,
changes and likely aligning someof these enrollment requirements
across settings whenever theycan.
And most definitely.
We have seen, and I think theindustry has seen a really
significant focus on initials ororganizations that are starting

(20:10):
home health or hospice, as wellas chow change of ownership, you
know, but also if you have to doif you have to conduct
revalidation.
So it's it's extremely importantthat agencies stay attuned to
you know ensure compliance, butalso stay attuned to the you
know what's going on in terms ofum of uh compliance um efforts

(20:35):
from CMS.

SPEAKER_01 (20:38):
Absolutely, Kim.
And um are there any othertakeaways that you'd like our
listeners to bundle up and takeback to their organizations?

SPEAKER_00 (20:48):
Absolutely.
I mean, you know, as we say uhprobably with each podcast, um,
you know, analyze your financialand operational impact related
to these payment updates, notjust in the rates, but also
impact for value-basedpurchasing, outliers, the LUPA
changes, as well as any case mixuh weight changes.

(21:08):
And again, utilize expert,external experts in consulting
this analysis if you don't havethat ability internally.
Um, and update your policies andprocesses specifically regarding
any regulatory changes andprocess changes to and ensure
compliance with face-to-faceencounter and OASIS uh data

(21:29):
collection and submissionrequirements.
And then I would just say as weas we also also remind everyone,
stay tuned for updates,certainly from us at CHAPTER,
but um really importantly fromyour state and national
associations and um you know andother expert um you know experts
in the field for ongoingeducation and stay vigilant

(21:53):
regarding any changes because umyou know as you had pointed, we
talked before, Jennifer, aboutyou know, this is the home
health final rule.
Um and there may be a um youknow a way to sort of breathe a
little easy because we went froma potential 6.4% to 1.3 percent,
but MedPAC is um, you know, isalso you know um recommending

(22:18):
you know higher percentages,percentage decreases or rate
cuts, you know, which is again aseparate a separate entity from
CMS, but they're advisory.
And so we don't, you know, wereally have to stay vigilant um
to regulatory um and paymentproposed changes, but also

(22:39):
ensuring that our operations areum are as you know as refined um
as as possible, streamlined tobe able to ensure that you're
able to uh meet thosechallenges.

SPEAKER_01 (22:54):
Yeah, absolutely.
It's always the hope for thebest, plan for the worst every
year when we're in rulemaking,essentially.
Um, I just wanted to add to yourtakeaways, you know, we did
present and post uh two uh veryum detailed summaries with the
highlights um of the home healthcontent as well as the DME

(23:15):
content on our website.
And um, even though it's nice tolisten to Kim and I talk about
some of those highlights, youhave to read.
I know it's a bummer, but youhave to read, um, whether it be
our summaries, whether it be theCMS wrap-up summary, or if you
want to choose a nice heavy redwine and dive into 762 pages of

(23:38):
a final rule, um, there's nogetting around uh at least
reading something uh in terms ofuh relatedness to the um
provisions in this rule.
So hopefully uh we have helpedyou uh by doing the cutout
summaries and um hopefullygetting you on your way uh to

(24:00):
being compliant by January 1,2026.
Anything else before we bid ourlisteners adieu, Kim?

SPEAKER_00 (24:10):
Um no, I I think that there certainly is plenty
um for the uh for for providersto be looking at um specifically
as it relates to home health,not just from the final rule,
but also our industry changesand challenges.
Um so you know, certainly youknow, we we appreciate everyone

(24:30):
taking the time to uh listen tous and um and we're happy to
support you um, you know, withum additional information um as
specifically as it relates toregulatory requirements, um, you
know, as as we uh are alsoupdated.
So thank you.
Um thanks, Jennifer, for asalways, for you know, inviting

(24:51):
me to join you, and um, youknow, and it's my pleasure.
Well, thanks so much, Kim.

SPEAKER_01 (24:58):
So from Kim, me, and the entire CHAP staff, keep your
quality needles surging forward,stay safe and well, and thanks
for all you do.
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