Navigating Medicare & Medicaid Billing for Home Health (2026 Updates)

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Something Changed in Your Home Health Billing on January 1st. Did Anyone Tell You? CMS does not send reminders.

Every year, the Medicare Physician Fee Schedule updates. PDGM grouper weights shift. Medicaid managed care organization contracts in Texas renew with new prior authorization requirements, new covered service lists, and new timely filing windows. The OASIS guidance gets revised. Telehealth rules for home health continue to evolve.

And on January 1st, every agency billing under the prior year's rules starts generating claims that are technically non-compliant, most of which pay initially, then get flagged in post-payment review six to eighteen months later.

Here is the question that should be keeping your billing director up at night: How many of your January 2026 claims have already been submitted under the wrong rules?

Most agencies cannot answer that. The ones that can, the ones running active compliance monitoring against current payer policies, are the ones whose revenue survives audits intact.

This guide covers the 2026 Medicare and Medicaid billing updates that home health agencies cannot afford to miss, where the compliance risks are concentrated, and what correct billing looks like in the current regulatory environment.

The PDGM Payment Rates Shifted. Again.

The Patient-Driven Groupings Model determines home health episode payment based on three variables: clinical grouping, functional impairment level, and comorbidity adjustment. Each variable is driven by OASIS data and diagnostic coding and each one has a corresponding payment weight that CMS adjusts annually.

For 2026, CMS implemented a budget-neutral recalibration of PDGM payment rates. Budget-neutral means the total aggregate payment stays the same which means some episode types pay more and some pay less. The agencies that gain are the ones with clinical populations in higher-weighted groupings. The agencies that lose are the ones whose patients should have been in higher-weighted groupings but were coded inaccurately.

The agencies not auditing PDGM grouping accuracy right now are either leaving money through undercoding or holding overpaid claims that will be recouped. The 2026 rate recalibration makes OASIS accuracy more consequential, not less.

"PDGM recalibration is CMS doing the math annually. If your OASIS coding does not reflect your patients' actual clinical complexity, you are on the wrong side of that math — and you may not know it for 18 months."

The RAP Phase-Out Is Fully Implemented — and Agencies Are Still Getting It Wrong

The Request for Anticipated Payment was replaced by the Notice of Admission (NOA) filing requirement for home health Medicare claims. This is not new, the transition began in 2022. But agencies are still making NOA errors that delay payment and, in some cases, reduce it.

NOA rules for 2026:

• Must be filed within 5 calendar days of start of care

• Late filing = 1/30 of the episode payment per day late — not a denial, a compounding penalty

• Filed on CMS-1450 (UB-04), not standard Part B claim forms

• Requires specific revenue codes and occurrence codes by episode type

A 10-day late NOA on a $2,200 episode reduces payment by approximately $733. Across an 80-patient census, systematic NOA delays are an avoidable cash flow drain measured in thousands per month.

Telehealth in Home Health — 2026 Coverage Rules

Post-PHE telehealth flexibility for home health continues to evolve. For 2026:

Covered under 2026 telehealth rules: Skilled nursing assessment and monitoring via two-way audio-visual with patient consent and clinical appropriateness documented. Therapy where in-person contact is not required. Care coordination with patient and family.

What telehealth does NOT replace: In-person LUPA threshold visits — telehealth contacts do not count. Clinical services requiring physical presence, wound care, injections, catheter management. Telehealth-only episodes are not covered under standard Medicare home health benefits.

The compliance risk: Counting telehealth contacts as skilled visits in OASIS or visit documentation. They are supplemental, not the same billing event as an in-person visit.

LUPA Thresholds: The 2026 Visit Requirements

LUPA thresholds were recalibrated with the 2026 PDGM update. LUPA occurs when a 30-day period falls below the HHRG-specific visit minimum, triggering per-visit payment instead of the full episode rate. The threshold varies by grouping, typically falling between 2 and 6 visits per period.

Agencies tracking census against LUPA thresholds mid-period and coordinating with clinical staff when minimum visits are at risk avoid per-episode revenue loss that has no recovery path once the period closes.

Medicare has one set of rules. Texas Medicaid home health billing has dozens because Medicaid managed care in Texas is administered through multiple MCOs, each operating under its own contract terms, coverage policies, and billing requirements.

The Texas Medicaid MCO Landscape for Home Health

Texas home health is delivered under STAR+PLUS and STAR Kids managed care programs, administered by Molina Healthcare, UnitedHealthcare Community Plan, Superior HealthPlan (Centene), Aetna Better Health of Texas, and AmeriHealth Caritas of Texas.

Each MCO operates independently on: prior authorization requirements for initial certification, recertification, and additional visits; service authorization limits and visit type restrictions; timely filing windows (90 to 180 days, varying by claim type); and documentation standards for physician order submission.

"The Texas Medicaid MCO environment is not one payer with variations. It is five separate billing relationships, each with its own requirements, each updated on its own schedule. An agency treating all MCO billing as one process is generating avoidable denials on every contract."

What Every Texas MCO Requires Before the First Home Health Visit

Billing without meeting pre-visit requirements produces denials that are rarely recoverable:

• Prior authorization — every MCO requires it; the auth number must appear on every claim

• Physician orders — signed, service-specific, received before the first visit

• Eligibility verification on the date of service — not at authorization; Medicaid eligibility changes daily

• Correct provider taxonomy — Texas MCOs route claims by taxonomy; wrong code sends the claim to the wrong adjudication pathway

The Prior Authorization Trap in Texas Medicaid

Texas Medicaid MCO prior authorizations for home health are issued for specific service types, visit counts, and date ranges. When any parameter changes, when the physician orders a visit type not in the authorization, when the patient requires more visits than authorized, when the authorization period expires, the claims for non-authorized services are denied.

The trap is in what is not tracked: authorizations expiring mid-episode without concurrent review submitted; visit counts reaching the limit without additional visit requests filed before the limit hits; service type changes ordered by the physician not added to the authorization.

An authorization tracking system with alerts tied to visit count and expiration date is not optional. It is the baseline requirement for avoiding denials that should not exist.

Some documentation and billing requirements apply consistently across Medicare and Texas Medicaid home health and failing them creates simultaneous exposure on both payer populations.

Face-to-Face Documentation

Medicare requires face-to-face physician documentation establishing homebound status and the need for skilled care. Texas Medicaid MCOs require physician orders and certifications meeting their own standards. Both require the documentation to be received and reviewed by the agency before billing, not filed away for future reference.

The agency that bills before confirming face-to-face documentation compliance is building a retroactive liability with every claim submitted. On Medicare, deficient F2F documentation is one of the most common post-payment audit findings. On Medicaid MCOs, it produces claim denials that are often non-recoverable past the original timely filing window.

OASIS Accuracy as a Dual-Payer Issue

OASIS accuracy affects both payer populations. Texas Medicaid MCOs using OASIS data in authorization decisions or outcomes measurement are exposed to the same documentation gaps that cost agencies Medicare revenue. A consistent OASIS accuracy audit, verifying primary diagnosis selection, comorbidity completeness, and performance-level functional status, creates a documentation record that holds under review from both payers.

Discharge and Claim Submission Timing

Medicare allows 365 days from last covered service for the final claim. Texas Medicaid MCOs allow 90 to 180 days, significantly shorter. Missing the Medicaid window is a permanent write-off with no appeal pathway. Agencies without payer-specific timely filing tracking are writing off delivered, authorized care simply by missing a deadline.

These are not annual compliance items. These are ongoing operational requirements that determine whether revenue is collected or written off on every claim submitted this year:

• NOA filed within 5 days of start of care — with correct revenue codes and occurrence codes; penalty calculation for any late filing

• PDGM grouper accuracy audit — OASIS primary diagnosis, comorbidity coding, and functional status items verified against 2026 PDGM weights

• Telehealth documentation separation — telehealth contacts documented separately from skilled visits; not counted toward LUPA threshold

• LUPA monitoring — census tracked against HHRG-specific visit thresholds mid-period, with clinical coordination flagged when minimum visit count is at risk

• MCO prior authorization tracking — visit count and expiration date alerts active for every Texas Medicaid authorization

• Eligibility verification on date of service — not at authorization; on the actual service date

• Timely filing calendar by payer — separate tracking for Medicare, each MCO, and commercial payers with alert windows before deadlines

• Face-to-face documentation review before billing, not after; not on audit; before the claim submits

The billing operations navigating Medicare and Medicaid correctly in 2026 have systems that enforce compliance at every stage, not because staff is especially vigilant, but because the workflow makes the correct action automatic and the incorrect action visible before it becomes a claim.

Most Texas home health agencies are running adapted general billing workflows with tools not designed for home health payer complexity. The revenue gap between those two operations shows in denial rates, AR days, write-off percentages, and the ability to survive a post-payment audit without a recoupment crisis.

At Sirius Solutions Global, home health Medicare and Medicaid billing is built on working knowledge of PDGM, NOA requirements, LUPA thresholds, Texas MCO contract terms, and the 2026 regulatory updates most billing vendors have not fully implemented.

We run the compliance checklist above as operational workflow, not an annual review. We track MCO authorization expiration and visit counts in real time. NOA filing timing is verified on every start of care. OASIS grouper accuracy is audited before the episode claim submits.

Agencies working with Sirius Solutions Global typically see:

• NOA compliance rate above 98%

• LUPA rate below 7%

• MCO prior auth denial rate below 4%

• AR days under 42 for Medicare; under 55 for Medicaid MCOs

The 2026 regulatory environment is not more forgiving than 2025. It is more specific which means the margin for error in billing is narrower, and the agencies without the right infrastructure will feel that in their collections.

👉 Request a Free Home Health Medicare & Medicaid Billing Review

We review your current billing against 2026 CMS and MCO standards, identify the specific compliance gaps, and show you exactly where revenue is at risk before the payer finds it first.

See how Sirius Solutions Global supports home health agencies across Texas with billing, compliance, and revenue cycle management.

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