CY 2027 Home Health Final Rule: Payment Rises, Scrutiny Stays. How Accurate Is Your OASIS?

Learn from the experts! Home Health Final Rule 2027: Expert Reactions and Real-World Strategies. November 12, 2026, 1:00 to 2:00 p.m. ET, with John Rabbia and Mike Simione of SimiTree and Anna Zimmerman of Medbridge. CE credit available. Register for the webinar. 

Agencies that care for seriously ill patients have long worried about two things: an auditor asking why a patient who isn’t improving still needs skilled care, and quality scores that drop when a patient declines as expected. In the CY 2027 Home Health Prospective Payment System final rule, released November 4, CMS addresses both.

The rule also brings a modest raise, a much shorter OASIS deadline, and enrollment rules that raise the stakes on paperwork. Most payment and quality changes take effect January 1, 2027. 

Payment increase for 2027

After four straight years of permanent cuts, Medicare home health payments will increase by an estimated 2.4 percent, or $415 million, in 2027. CMS kept its 3 percent temporary cut, which recovers what it considers past overpayments, but added no new permanent cut. Agencies that miss quality reporting requirements lose 2 percentage points from their update.

Reactions were mixed from home health advocates. The National Alliance for Care at Home called the rule a welcome relief but said the continued cut “doesn’t reflect the true cost of care.” LeadingAge CEO Katie Smith Sloan said the rule reflects an agency “out of touch with the realities providers must navigate today.”

New timelines for OASIS submission

OASIS-E2 has been the current version since April 1, 2026, and the final rule doesn’t introduce a new version. But, it does reduce the timeline for changes. Starting with January through March 2027 data, agencies must submit and correct assessments within 45 days of each quarter’s end instead of roughly four and a half months, with the first deadline on May 17, 2027. CMS expects the change to get quality data to the public up to three months sooner.

A shorter window raises the stakes on getting each assessment right the first time, because the 45 days cover corrections as well as submissions. An error that once could be caught months later now has to be found and fixed within weeks of the quarter closing. And far more than quality reporting rides on that data. 

Under PDGM, a patient’s functional impairment level comes directly from the responses to OASIS items M1800 through M1860 and M1033, and the final rule updates the points attached to those responses for 2027. OASIS-based measures also account for 40 percent of the Total Performance Score for larger-volume agencies under the expanded HHVBP Model, and 50 percent for smaller-volume agencies. The same assessment that describes a patient’s condition at the start of care shapes what the agency is paid, how it is scored, and what families see when they compare agencies.

Palliative care: what CMS said and what’s changed

CMS clarified that agencies can provide palliative care under the existing home health benefit. CMS believes “the home is an ideal environment for individuals to receive palliative care services,” and that home health can be an important step for patients during serious illness or near the end of life, before they opt into hospice care.

What the service looks like. CMS points to Medicare’s definition of palliative care: care that “optimizes quality of life by anticipating, preventing, and treating suffering.” Patients don’t have to be terminally ill or give up life-prolonging treatment, and their potential to recover doesn’t decide whether they need skilled care. 

CMS describes a role for every discipline:

• Nurses: managing pain, nausea, depression and anxiety, shortness of breath, and reviewing medications with the ordering practitioner.

• Medical social workers: advance care planning, including conversations about the hospice benefit and support for families and caregivers.

• Therapists: physical therapists for mobility, pain management, and safe transfers; occupational therapists for daily activities; and speech-language pathologists for safe eating and drinking, as well as communication and decision making.

How the process works. Nothing about eligibility changes. Patients still need to be homebound, have a qualifying skilled need, and have a practitioner’s order, a plan of care, and a face-to-face encounter. Nurse practitioners, physician assistants, and clinical nurse specialists can certify patients and establish the plan of care. Patients who leave home for treatment may still be considered homebound. Documentation has to show the need for skilled care and tie each visit to goals in the plan of care. 

CMS describes a typical palliative plan as including “symptom management with expected responses, caregiver education, assessment of caregiver burden and emotional distress, and therapy for non-drug pain management.”

Competency is coming. Commenters warned that palliative care takes specialized skills, and CMS acknowledged that it involves “advanced symptom assessment, goals-of-care communication, and interdisciplinary coordination.” CMS believes agencies are “well-positioned” to provide it, and said it “will explore the development of minimum competency expectations for HHA staff providing palliative care services, in consultation with relevant clinical and professional organizations.” 

No specific standard exists yet, but agencies that want to offer these services will need to understand the skills needed to provide appropriate care to their patient. This is where partnering with the premier education provider in home health can drive additional value to your agency by helping you to develop the skills your staff need to offer new services to patients that are in demand from your referral partners. 

Quality and audits. CMS agreed that decline in seriously ill patients “would not indicate poor quality of care,” and said its quality measures will move toward expected outcomes rather than improvement. It will add palliative care examples to the Medicare Benefit Policy Manual and instruct Medicare contractors to ensure medical review aligns with the new guidance.

What it isn’t. There is no new benefit and no separate payment, add-on, or billing code. CMS said it does not intend “to blur the distinction between home health and hospice care.”

Advocates see the opportunity and are positive on the change. When the rule was proposed, the Coalition to Transform Advanced Care noted that “much of the interdisciplinary team already exists within the home health benefit,” while the Center to Advance Palliative Care pointed out that the benefit doesn’t require home health teams to work with a palliative care specialist. HealthView Home Healthcare Services CEO Steven Gonzalez told Home Health Care News the clarification is what excites him most because it gives physicians more confidence to order palliative care.

Enrollment has much bigger consequences

The rule tightens Medicare enrollment requirements for all provider types. Revocations can now reach back to the date a problem began. Directors of nursing, clinical directors, medical directors, and alternate administrators are now designated as managing employees and must be reported within 30 days. Agencies also get 15 days (down from 60) to submit claims after a revocation.

For more information on the changes in the home health final rule for 2027, please refer to these links:

• Press release 

• Factsheet

• Final rule

How can your agency get ready for 2027? Who needs training now?

• Clinicians and care planners: palliative care skills, including symptom assessment, goals-of-care conversations, and documentation tied to plan-of-care goals.

• OASIS and quality staff: the 45-day submit-and-correct cycle and all-payer collection.

• Leaders, HR, and compliance: who counts as a managing employee, and the 30-day reporting clock.