Developing a case-mix model for PPS.

Agencies are pinning hopes for success under PPS on an accurate case-mix adjustor. The Health Care Financing Administration (HCFA) tasked Abt Associates Inc. to develop a system to accurately predict the volume and type of home health services each patient requires, based on his or her characteristics (not the service actually received). HCFA wanted this system to be feasible, clinically logical, and valid and accurate. Authors Goldberg and Delargy explain how Abt approached this daunting task.

Prospective payment in action. The National Home Health Agency Demonstration.

After one year of the Health Care Financing Administration's per-episode prospective payment system (PPS) demonstration, participating agencies have learned valuable lessons on what it will take to implement an ongoing PPS programs. Home care providers can use these lessons to plan for the future.

Contemplating home health PPS: current patterns of Medicare service use.

Implementing a per-episode prospective payment system (PPS) for home health services is one option for Medicare policy makers facing rapid increases in service use and expenditures. Analysis of data on recent episodes of Medicare home health care identified systematic differences in service patterns across provider types; these indicate potential differences in the capacity of agencies of different types to adjust to PPS. The second phase of a national demonstration, which is about to be implemented, will provide information on the extent to which the agency practices that generate much of the observed variation (such as the number of visits provided per episode) are susceptible to management decisions; and whether managers can and do respond to the incentives of per-episode prospective payment.

A preliminary case-mix classification system for Medicare home health clients.

In this study, a hierarchical case-mix model was developed for grouping Medicare home health beneficiaries homogeneously, based on the allowed charges for their home care. Based on information from a two-page form from 2,830 clients from ten states and using the classification and regression trees method, a four-component model was developed that yielded 11 case-mix groups and explained 22% of the variance for the test sample of 1,929 clients. The four components are rehabilitation, special care, skilled-nurse monitoring, and paralysis; each are categorized as present or absent. The range of mean-allowed charges for the 11 groups in the total sample was $473 to $2,562 with a mean of $847. Of the six groups with mean charges above $1,000, none exceeded 5.2% of clients; thus, the high-cost groups are relatively rare.

Medicare home health: a description of total episodes of care.

The purpose of this study was to present descriptive information on the characteristics of 2,873 Medicare home health clients, to quantify systematically their patterns of service utilization and allowed charges during a total episode of care, and to clarify the bivariate associations between client characteristics and utilization. The model client was female, 75-84 years of age, living with a spouse, and frail based on a variety of indicators. The mean total episode was approximately 23 visits, with allowed charges of $1,238 (1986 dollars). Specific subgroups of clients, defined by their morbidities and frailties, used identifiable clusters of services. Implications for case-mix models and implications for capitation payments under health care reform are discussed.

Concordance between planned and approved visits during initial home care.

Based on little prior information and a brief interview, the Medicare home health agency intake case manager must estimate the types and amounts of services a new client will require during the first 60 days of home care. We systematically examined the concordance between types and amounts of planned services with those actually approved and reimbursed during the first 60 days of care for a sample of 2,431 clients during 1986. Overall, the mean number of planned visits during the first 60 days was 24.76, and the mean number of approved visits was 15.95. Approved visits as a percent of planned visits averaged 64.4.