2026 Home Health Payment Update

Kathleen welcomes Yesenia Banks to break down Medicare’s 2026 Final Rule for Home Health Agencies and DME suppliers, rounding out the series on year-ahead payment policy. Yesenia explains the Patient-Driven Groupings Model (PDGM)—how 30-day periods, admission source/timing, clinical groupings (including wounds), functional status, and comorbidity adjustments combine into case-mix weights and payment. She also clarifies LUPA thresholds, outlier scenarios, and why accurate, specific diagnosis coding remains essential to payment integrity. Turning to 2026 updates, Yesenia notes an overall 1.3% home health payment decrease—smaller than the larger cut originally proposed—and underscores that wound clinical groupings remain among the highest-paid. She details key exclusions from the 30-day PDGM bundle: DME NPWT devices and supplies are billed directly by the DME supplier, while disposable NPWT can be billed separately by the HHA on the same claim under the Better Wound Care at Home Act. Practical guidance helps teams hit visit thresholds, manage labor and supply costs, and protect margins despite recent year-over-year pressure on rates. Finally, Yesenia previews CMS’s move to restart the DMEPOS Competitive Bidding Program, including calculating winning bids at the 75th percentile, streamlined financial documentation, new product categories (CGM and insulin pumps; urological, ostomy, and tracheotomy supplies), and more frequent surveys/re-accreditations (at least every 12 months). The episode closes with links to CMS resources and learning materials so leaders can brief their teams, align documentation, and prepare workflows for January 2026.