HOME HEALTH PAY FOR PEREFORMANCE

1. HOME HEALTH PAY FOR PEREFORMANCE A CMS Demonstration Project As you heard this morning one of the CMS strategies on the quality roadmap is to link payment to quality. Or, more specifically, to pay in a way that expresses our commitment to quality and in a way that helps providers and patients to take steps to improve health and avoid unnecessary costs. This is the basis for the CMS Home Health Pay for Performance Demonstration.As you heard this morning one of the CMS strategies on the quality roadmap is to link payment to quality. Or, more specifically, to pay in a way that expresses our commitment to quality and in a way that helps providers and patients to take steps to improve health and avoid unnecessary costs. This is the basis for the CMS Home Health Pay for Performance Demonstration.

2. HOME HEALTH P4P DEMONSTRATION 2 Year Demonstration Voluntary Participation No Risk Using Existing Data and Quality Measures Must be Budget Neutral Selected States We expect to conduct the demonstration for 2 years beginning in October 2007 Participation will be voluntary and without financial risk to participants Existing quality measures will be used Incentive payments will be funded with savings generated from reductions in Medicare home care health costs or from reductions in other Medicare service costs. The demonstration will occur in selected states to be determined later. We are considering several options for demonstration locations: CMS may issue a solicitation to national home health chains and state associations with interested agencies assigned to either the demonstration or a comparison group. CMS may select particular states to participate and all agencies in the state would automatically be participants. We may also consider allowing nationwide enrollment in the demonstration, allowing interested agencies to apply to participate. We expect to conduct the demonstration for 2 years beginning in October 2007 Participation will be voluntary and without financial risk to participants Existing quality measures will be used Incentive payments will be funded with savings generated from reductions in Medicare home care health costs or from reductions in other Medicare service costs. The demonstration will occur in selected states to be determined later. We are considering several options for demonstration locations: CMS may issue a solicitation to national home health chains and state associations with interested agencies assigned to either the demonstration or a comparison group. CMS may select particular states to participate and all agencies in the state would automatically be participants. We may also consider allowing nationwide enrollment in the demonstration, allowing interested agencies to apply to participate.

3. HOME HEALTH P4P DEMONSTRATION Demonstration will test whether a performance-based system can improve the quality of care of Medicare beneficiaries while not increasing Medicare expenditures. Demonstration will offer financial incentives based on providing high quality care and for improvements in the level of care Improving quality of care should reduce hospitalizations and reduce overall Medicare expenditures. For each measure, agencies in the top 20% in terms of performance level and the top 20% in terms of improvement qualify for an incentive payment: Improving quality of care should reduce hospitalizations and reduce overall Medicare expenditures. For each measure, agencies in the top 20% in terms of performance level and the top 20% in terms of improvement qualify for an incentive payment:

4. Proposed Performance Measures Incidence of Acute Care Hospitalization Incidence of Any Emergent Care Improvement in Bathing Improvement in Ambulation / Locomotion Improvement in Transferring Improvement in Urinary Incontinence Improvement in Management of Oral Medications Improvement in Status of Surgical Wounds These are the measures that best fit our criteria. Following comments we received as a result of the special open door forum on Dec. 13th we are still discussing these measures.These are the measures that best fit our criteria. Following comments we received as a result of the special open door forum on Dec. 13th we are still discussing these measures.

5. ENROLLMENT & DISTRIBUTION 567 Agencies Enrolled Midwest = 131 Northeast = 100 South = 201 West = 135 Intervention Group = 280 Control Group = 287

6. Allocating Payments Performance payments will be allocated both to top performers and to agencies that had the largest improvement over time. Encourage participation and improvement for agencies with all types of quality at baseline. Reward agencies that had already achieved high quality levels before the demonstration started and maintain their high performance levels. Reward agencies that may not have high performance levels but that show substantial improvement.

7. YEAR 1 WINNERS & PAYMENTS 166 Agencies are Winners (58%) Approximately $15.4 million was shared w/Winners Assessment of additional results is underway and will be available at a later date

8. For More Demonstration Information WWW.HHP4P.INFO We want to commend you on your commitment to this campaign and to your mission. We hope that you will be willing to participate in the HH P4P demo and we wish you continued sussess in the future.We want to commend you on your commitment to this campaign and to your mission. We hope that you will be willing to participate in the HH P4P demo and we wish you continued sussess in the future.