CY 2027 Home Health Prospective Payment System Proposed Rule Summary

On July 6, 2026, CMS published in the Federal Register (91 FR 41216) a proposed rule that updates the payment rates for home health agencies (HHAs) for calendar year 2027. This rule also proposes several provider enrollment provisions including retroactive revocations and adding or expanding the ground for revocation or denial of enrollment that would provide the agency with broader authority. It also includes several proposals related to Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS). These include a proposal to amend the definition of DME based on statutory requirements, that would expand coverage under the DME benefit to certain external infusion pumps and associated home infusion drugs that would be considered appropriate for home use if certain criteria are met. CMS also proposes a temporary one-year adjustment to the 2027 home health payment rate of 3.0 percent to account for the impact of the implementation of the Patient-Driven Groupings Model (PDGM). In addition, this proposed rule provides information on home health utilization trends to monitor the effect of the PDGM.

For the Home Health Quality Reporting Program (HH QRP), CMS summarizes (but does not seek comment on) potential initiatives it has identified as opportunities to improve alignment between the HH QRP and the expanded Home Health Value-Based Purchasing (HHVBP) Model. In addition, CMS proposes reducing the HH QRP assessment data submission timeframe and revising the HH QRP Outcome and Assessment Information Set and HHCAHPS Annual Payment Update reporting timeframes to report a calendar year of data. CMS also solicits comment on a request for information on future measure concepts specifically related to advanced care planning. CMS is not proposing any expanded HHVBP Model-specific policy changes in this proposed rule.

CMS estimates that the net impact of the proposed home health policies would increase Medicare payments to HHAs in 2027 by 2.4 percent (+$420 million). This increase reflects the effects of the proposed +2.1 percent home health payment update and an estimated +0.3 percent increase from the update to the fixed-dollar loss ratio used in determining outlier payments.

The deadline for public comment is August 31, 2026.