Why A Fee-For-Service Payment Structure Could Be Holding HCBS Back

Posted Wednesday, September 6, 2023

Home- and community-based services’ (HCBS) fee-for-service (FFS) payment structure could be having adverse effects on beneficiaries.

According to a report from Health Affairs, too much in-home care could be a detriment to a beneficiaries’ independence and long-term outlooks.

Unlike value-based payment models, FFS can prioritize quantity over quality. The added volume that comes with HCBS visits can lead to that dependence for beneficiaries, according to CareBridge Chief Strategy Officer Patti Killingsworth, who was the report’s author.  “While Medicaid has successfully helped millions of Americans who need LTSS avoid institutions and remain at home, it has become clear over the past several years that this is not enough,” Killingsworth wrote in the report. “Policymakers must advance HCBS that go beyond simply keeping people at home and out of institutions.”

The HCBS payment structure is set up in a way that disincentivizes independence, Killingsworth argued. The more hours spent in a client’s home, the less independence that client is able to experience.

Payment for HCBS is almost exclusively FFS and volume-driven currently.

That structure rewards providers who deliver more hours of personal care services.

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