Homecare Providers Celebrate Significant Rate Increases

PROVIDENCE, Rhode Island—Rhode Island’s homecare providers are celebrating this evening’s passage of the state’s fiscal year 2025 (SFY25) budget set to begin on July 1, 2024. Within Article 9 of the budget, the Rhode Island General Assembly (state legislature) approved significant Medicaid fee-for-service rate increases for contracted homecare provider companies. These rate increases include some that are higher than 75% effective Oct. 1, 2024.

Two years ago, the General Assembly approved a rate study for all social and human services programs funded by state dollars. The Rhode Island Office of the Health Insurance Commissioner (OHIC) reviewed many of the over 430 billable codes to the state’s Medicaid Administrative Contractor, Gainwell Technologies and other contracted entities for state services to identify a composite rate or average of the five other New England states’ comparable rates against the current Rhode Island rates. For Medicaid homecare services, those rates needed significant increases beyond 75%, according to the OHIC report issued on Sept. 1, 2023.

On Jan. 17, 2024, Governor Daniel McKee (D-RI) submitted his SFY25 proposal to the General Assembly following his “State of the State” Address. Within his proposal, he proposed funding the OHIC report up to one-third of its recommendations citing state funding constraints. However, under the leadership of House Speaker K. Joseph Shekarchi (D-23 Warwick) and Senate President Dominick Ruggerio (D-4 North Providence, Providence), they were able to identify revenue to sustain long-term funding for these proposed increases in full. Additionally, the General Assembly approved a 30% increase in skilled homecare services, which was excluded from the study that led to the OHIC report, reportedly due to time constraints.

“Decades of advocacy at the State House, educating our lawmakers and their staff on the need for significant rate increases to counter the workforce crisis and the long waitlists for services, have finally paid off for our industry”, said Cheryl Levesque, president of the Board of Directors for the Rhode Island Partnership for Home Care, the trade association representing Rhode Island’s homecare, home health and hospice providers. Levesque is also the executive director of HomeCare Advantage, a multi-generational homecare, home health and pediatric nursing company based in Cranston, Rhode Island, founded by her parents. “We will now have the resources needed to expand service hours to our patients and clients and raise wages to be more competitive in the labor market to attract direct care and operations staff.”

“Any plan by our state’s elected officials to attract new businesses and revolutionize the local economy by 2030 will not be successful without ensuring that the infrastructure for home care is stable with a workforce ready to care for vulnerable and increasingly complex patients and clients in their home”, said Nicholas Oliver, MPA, CAE, executive director of the Rhode Island Partnership for Home Care. “Every day, there are workers or their family members that get sick, suffer workplace injuries or become diagnosed with chronic and terminal illnesses. Companies are not attracted to bring their talent and their families to a state without adequate resources to provide health care services in their time of need. This much-needed rate increase coming to Medicaid-contracted homecare providers is not just about caring for our state’s current vulnerable homebound population, it is also about investing into modernizing and supporting our local economy into the future. Rhode Island’s home care industry is appreciative that the General Assembly finally understood why our advocacy over the years was so important to providers, workers and the future of Rhode Island’s economy.”

Since July 1, 2019, Rhode Island’s Medicaid-contracted homecare providers have received an annual cost inflation increase based on a year-over-year comparison in the New England consumer price index for health care services. This year’s increase was determined by the General Assembly’s May 2024 Caseload and Revenue Estimating Conference at 0.12% as reported by Medicaid Program Director Kristin Sousa on April 26, 2024. To date, Rhode Island is the only state in the nation with a mandatory annual inflation increase to Medicaid homecare rates in statute. The inflationary rate increase will take effect July 1, 2024 ahead of the Oct. 1, 2024 rate increases approved by the General Assembly this legislative session.