This week’s proposal for new payment methods for Medicare by the Obama Administration has kicked off new debates in the industry. The government body’s latest move sought to ensure that the healthcare is rated according to the quality of the services offered. It seeks to set new measures and definitions of quality in the industry. The debate extended further to health care insurers and their smart ways of tricking patients with chronic diseases into paying the greater half of their bills themselves. And now the latest discussions take the elder population of the country into account.

The topic on which the article focuses is home health care services, which is especially relevant for the old. As people grow old, they tend to fall sick for longer periods and hence end up spending much of the remaining of their lives in nursing homes. An alternate way in which these people can enjoy the comfort of home as well as receive proper health requires the help of home health agencies.

In October, last year, the Centers for Medicare and Medicaid services cut down payments to such agencies by almost 30%. This accounted for almost $60 million in the year. The move was in line with the Obama administration’s Affordable Care Act. At the same time, the ruling also mandated multiple audits for the agencies. Eventually, the agencies started feeling the threat from reduced profit margins.

As a result of all the new moves, hospital operators started showing increased interests in home health agencies. Large healthcare providers believe that the best way to deal with the changing reimbursement environment and regulatory practices is expansion. The strategy was adopted by multiple players in the market, including big names such as HealthSouth Corp.

HealthSouth expanded its home health business unit last year and invested a huge sum of $750 in the business. The investment came as an acquisition deal with Cressey & Co. and involved the purchase of Encompass Home Health, as well as Hospice.

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