MMAPA and community organizations ask CMS to maintain floor values for the geographic wage index in the home health payment formula for FFS Medicare
San Juan, Puerto Rico – the CMS proposed rule for the 2025 Home Health Prospective Payment System (HHPPS) lowers the wage index factor significantly for providers in Puerto Rico, adding to the anomalies in payment formulas and worsening the disparity in comparison to the Medicare program everywhere else in the US. The Medicaid and Medicare Advantage Products Association (MMAPA) and other organizations have urged the Centers for Medicare & Medicaid Services (CMS) to maintain payment floors designed to mitigate payment disparities applicable to the poorest geographic areas in the nation.
The proposed rule introduces several significant changes, most notably a new methodology for calculating wage index values for rural municipalities in Puerto Rico. Specifically, wage index would be reduced by 25% on average, from 0.40 to 0.30, once fully phased in. “This is another reflection of the anomalies in the operation of Traditional FFS Medicare in Puerto Rico. The wage index for Part A payments, and the Medicare Advantage average geographic adjustment are also significantly lower than the factors applicable to the program payments in any other place in the US, including the US Virgin Islands. MMAPA has worked on several proposals to address the issue multiple times, but so far, the federal government has not implemented them. Failing to implement a reasonable minimum wage index for home healthcare services will further widen the healthcare disparities between Puerto Rico and the mainland United States. Residents of Puerto Rico already deal with significant health challenges, including higher rates of conditions such as diabetes and heart disease” stated MMAPA President, Ricardo Rivera Cardona.
Isuanet Castillo, Executive Director of Operations for San Lucas Hospice and Home Care San Lucas, stated that “The proposed rule aims to reduce the salary index values that impact the reimbursement of services in a large part of the municipalities of Puerto Rico, despite local legislation of the last three years that has significantly increased salaries in the health care sector. These reductions in reimbursement will have an impact disproportionately in our older adult population, who rely heavily on home health agencies for their care and are likely to accelerate the migration of health care workers from Puerto Rico.”
Judith Mark, Executive Director of Best Option Healthcare, explained that “Seniors in Puerto Rico are more reliant on home health services compared to other states and territories in the U.S. Due to a lack of stepdown services, patients are often discharged directly from hospitals to home health agencies. Primary care physicians, working under capitated payment models, refer patients to home health services to prevent unnecessary hospitalizations. The home health sector in Puerto Rico played a vital role in caring for patients after Hurricane Maria and during the COVID-19 pandemic, administering over 5,000 doses of monoclonal antibodies in patients' homes. These proposed cuts will significantly impact the ability of these services to continue providing essential care.”
Only 2% of seniors in Puerto Rico reside in municipal-run senior housing or community centers. Most are aging in their own homes, primarily in urban areas near San Juan, which have not been adapted to meet evolving climate and health needs. Socio-economic factors further constrain beneficiaries' ability to access or adhere to care outside their homes. Seniors depend significantly on Medicare Advantage (MA) transportation programs and home services provided by local agencies. If these cuts are implemented, vulnerable populations, including the elderly and those with limited mobility, will face severe difficulties in accessing essential health services.
The president of MMAPA, emphasized that “Another aggravating factor is that Puerto Rico is also excluded from Long Term Services and Supports (LTSS) in Medicaid. This fact makes the Medicare home health care benefit more relevant. LTSS is 30% of the Medicaid budget nationwide, but citizens residing in Puerto Rico get 0%, nothing, in this benefit category, just like in several other components of the program.
Medicare Advantage program, which serves over 84% of Medicare eligible beneficiaries in Puerto Rico and 95% of those with both Medicare Part A and Part B, is funded significantly less than the national average. Puerto Rico provides care for more than 660,000 seniors through MA, including over 300,000 who are dually eligible for Medicare and Medicaid. Historically, MA rates in Puerto Rico have been inequitable and insufficient due to various statutory anomalies, creating a growing disparity between Puerto Rico’s MA rates and the national average. In 2011, Puerto Rico’s MA rates were 24% below the national average; today, in 2024, this gap has widened up to 41%.
“MMAPA continues to collaborate with the health sector on the island to advocate for the benefits of the hundreds of thousands of American citizens living in Puerto Rico who do not receive the full advantages of Medicare Advantage. We have successfully secured increased funding for ESRD patients and hope that our current appeal to prevent further cuts will be heard and addressed,” concluded MMAPA President, Ricardo Rivera Cardona.
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The Puerto Rico Medicaid and Medicare Advantage Products Association (MMAPA) is a non-profit organization that brings together the major Medicaid and Medicare Advantage entities in Puerto Rico. Our mission is to develop public policy proposals that sustain and improve funding for Medicaid, Medicare Advantage beneficiaries, and Puerto Rico's healthcare system overall.