(1) Reimbursement fees for home health services are as provided for in this rule.

(2) The interim reimbursement for a category of service submitted for reimbursement as provided in (4) or (5) is the most current medicare percent of billed charges for each provider.

(3) The provider's final reimbursement as provided for in (4) and (5) is calculated when the actual reimbursement fees based on the medicare cost settlements are determined for the period. The medicare cost settlements are derived from an audit of allowable costs conducted for medicare purposes.

(4) For home health agencies located within the borders of the state that began providing services before July 1, 1989, the reimbursement fee for a category of service after January 1, 1990 and prior to July 1, 1995 is the lowest of:

(a) the provider's billed charges;

(b) the average medicare cost for the category of service;

(c) the upper medicare limit for the category of service; or

(d) the adjusted indexed fee for the category of service for state fiscal year ending June 30, 1990.

(i) The state fiscal year 1990 adjusted indexed fee for a category of service is the sum of:

(A) the lowest fee for the category of service reported in the provider's medicaid cost settlement report ending calendar year 1989, indexed to a common fiscal year ending December 30, 1989 by the most recent home health DRI market basket index percentage of the health care financing administration of the department of health and human services (HCFA) ; and

(B) 2% of the indexed lowest fee. The department hereby adopts and incorporates by reference the HCFA home health DRI market basket rate which is a forecast model of market basket increase factors. The rate and a description of the general methodology and variables used in formulating this model is available from HCFA, Office of the Actuary, 6325 Security Blvd., Baltimore, MD 21209.

(ii) The state fiscal year 1991 indexed fee for a category of service is the 1990 indexed fee for a category of service increased by 2%.

(5) For home health agencies which are located within the borders of the state that began providing services on or after July 1, 1989, the medicaid reimbursement fee for a category of service delivered prior to July 1, 1995 is the lowest of:

(a) the provider's billed charges;

(b) the average medicare cost for the category of service;

(c) the upper medicare cost limit for the category of service; or

(d) the adjusted averaged medicaid fee for the category of service for that state fiscal year.

(i) The adjusted averaged medicaid fee for a category of service is the sum of:

(A) costs for the category derived from the most recent medicaid cost settlements finalized before June 30, of that state fiscal year from all participating in-state home health providers divided by the total number of delivered services; and

(B) 2% of the averaged medicaid fee.

(6) For home health agencies located within the borders of the state for services provided on or after July 1, 1995 and prior to July 1, 1997, the reimbursement fee for a home health service, except for a home health aide service, is 60% of the average of the provider's medicare cost limits for skilled nursing, physical therapy, speech therapy and occupational therapy services.

(a) The reimbursement fee for home health aide services is 60% of the provider's medicare cost limit for that service.

(7) For home health services provided on or after July 1, 1997, the reimbursement is the following:

(a) for a nursing or therapy service - $59.54 per visit;

(b) for a home health aide visit - $26.60;

(c) for medical supplies and equipment suitable for use in the home - 90% of the amount allowable for the specific item under medicare.