Addus HomeCare Comments on New Department of Health and Human Services Proposed Rule

Addus HomeCare Corporation (Nasdaq: ADUS), a provider of home care services, commented on the proposed new rule announced last week by the Biden Administration’s Department of Health and Human Services (HHS) known as “Assuring Access to Medicaid Services.” The proposed rule is in addition to those adopted under the Obama Administration in 2016 and incorporates new requirements covering additional Medicaid Services, including Home and Community-Based Services (HCBS). The proposed rule is not final and is subject to a sixty-day public comment period.

The proposed rule has a stated goal of improving access to services for Medicaid beneficiaries. However, one part of the rule proposes that state Medicaid agencies be required to provide assurances that a minimum of 80% of Medicaid payments for personal care and similar services be spent on compensation to direct care workers. We believe the specific approach and the proposed minimum threshold would be contradictory to the goal of assuring access to Medicaid services, which we fully support, due to the wide variance in state waiver programs which directly impacts the administrative burden in individual states. We also believe it may adversely affect many smaller providers. Those operating in states with larger rural populations may be unable to continue providing care due to the significant administrative burden required to provide quality, regulatory compliant HCBS services.

Dirk Allison, Chairman and Chief Executive Officer of Addus HomeCare, stated, “As a provider of home care services, we share the goals of expanding access to more services like ours for Medicaid beneficiaries while providing for a stable ongoing workforce, and we are encouraged that HHS recognizes the complexity of implementing any such provision by proposing a four-year timeframe before implementation is required. We note the express willingness of HHS, stated in the proposed rule, to entertain comments regarding both the appropriate minimum percentage and the related components in calculating such percentage.

For over a decade, Addus and other HCBS providers have advocated for higher rates of reimbursement to increase wages and benefits for the direct caregivers who provide these essential services. We welcome the opportunity to share our thoughts on these challenges and the appropriate means to improve access to quality care for our vulnerable population of Medicaid beneficiaries from a stable workforce of caregivers.”