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2026 Home Health Proposed Rule: The Largest Cut Ever Proposed

On June 30th, the Centers for Medicare & Medicaid Services (CMS) released its CY 2026 Home Health Proposed Rule, which included updates to reimbursement and policy changes affecting home health agencies starting January 1st, 2026. Here’s what that means for you:

July 30, 2025

3 min. read

A medbridge clinician reviews paperwork and medication with an elderly woman and a younger woman in a living room.

On June 30th, the Centers for Medicare & Medicaid Services (CMS) released its CY 2026 Home Health Proposed Rule, which included updates to reimbursement and policy changes affecting home health agencies starting January 1st, 2026. Here’s a quick summary of the rule:

The Largest Cut Ever Proposed

For the fourth year in a row, CMS has targeted home health organizations for a reimbursement reduction. Last year, CMS proposed a reduction, which was partially mitigated in the final rule after extensive public outreach and a legislative campaign. This year, a 6.4 percent reduction is proposed—a decrease of $1.135 billion in payments compared with CY 2025.  

Industry advocates have signaled that the proposed cuts hurt patients and put services at risk as agencies struggle with diminishing reimbursement:

“The 6.4 percent cut to the current rate that the Centers for Medicare and Medicaid Services  proposes for home health providers will, if implemented, be a death knell for many quality agencies. [...] the administration’s announcement is essentially pushing them to exit the business, close, or severely limit services.” - Katie Smith Sloan, President and CEO, LeadingAge

“We are alarmed by the negligent proposed payment update, which deepens a heartless pattern of insufficient adjustments that have already led providers to close their doors and reduce services, and now threatens to further diminish care access by compelling more HHAs to take similar actions.” - Dr. Steve Landers, CEO for National Alliance for Care at Home

Senators Marsha Blackburn (R-Tennessee) and Susan Collins (R-Maine) sent a letter to CMS Administrator Dr. Mehmet Oz to express concern about the home health benefit and the future of home health agencies providing care to patients. The letter requests a reply from the agency by July 7th. 

We recommend that home health providers and organizations reach out to their lawmakers and leave comments on the proposed rule at the federal register on how cuts will impact your organization's ability to provide patient care and serve your community. Comments are accepted until August 29th.

Proposed Changes Beyond Reimbursement

The rule proposes changes to the face-to-face encounter policy (provider flexibility as allowed in PHE), updates to the Home Health Quality Reporting Program (HHQRP), updates to the Home Health Value-Based Purchasing Model (HHVBP), and updates to the home health Conditions of Participation (CoPs) . Case-mix weights were recalibrated (annually), and Low Utilization Payment Adjustment (LUPA) thresholds (LUPA) were also adjusted. 

Proposed Changes to Quality Reporting & Value-Based Purchasing

For HH Quality Reporting, CMS is proposing to remove the COVID-19 Vaccine Measure (Percentage of Patients Who Are Up to Date) and the corresponding element in OASIS. CMS also proposes to remove four assessment questions on living situation, food, and utilities. For HH Value-Based Purchasing, CMS is proposing to add three measures on bathing and dressing, and one claims-based measure (Medicare Spending per Beneficiary for Post-Acute Care Settings).

Request for Information

CMS also seeks public input “on measures that assess overall health, happiness, and life satisfaction that could include aspects of emotional well-being, social connections, purpose, and fulfillment.” The Request for Information (RFI) also seeks public input on tools and measures that promote healthy eating habits, exercise, nutrition, or physical activity.”


Read more about changes in the rule at the 2026 Home Health Final Rule and Fact Sheet at the federal register, and follow Medbridge on Facebook and LinkedIn for more regulatory updates.

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