Federal Rulemaking Brief · CMS-1844-P · Issued July 2026

The answer first: in the CY 2027 Home Health Prospective Payment System proposed rule (CMS-1844-P, issued July 2026), CMS proposes no new permanent PDGM behavioral adjustment, the first time in five rulemaking cycles the agency has not proposed a fresh permanent cut. The projected result is a net +2.4% update, about $420 million, for home health agencies in CY2027. One caution keeps this from being a clean win: a -3.0% temporary adjustment to the 30-day base rate continues, so the recoupment stream is not finished.

+2.4%

Proposed net CY2027 update

$420M

Approx. aggregate impact

0.000%

New permanent PDGM cut proposed

-3.0%

Temporary adjustment, 30-day base rate

Five rulemaking cycles on one dated timeline

The story of PDGM behavioral adjustments is best read as a sequence. Four consecutive final rules carried four consecutive permanent cuts. CMS-1844-P breaks the pattern. Bar length shows the size of each permanent adjustment.

CY2023 HH PPS Final Rule

CY2023-3.925%

The largest permanent PDGM behavioral adjustment of the series lands.

CY2024 HH PPS Final Rule

CY2024-2.890%

Second straight permanent cut.

CY2025 HH PPS Final Rule

CY2025-1.975%

Third straight permanent cut, smaller but still compounding on the prior two.

CY2026 HH PPS Final Rule

CY2026-1.023%

Fourth straight permanent cut. The four adjustments sum to 9.813 percentage points across CY2023 through CY2026.

July 2026 · CMS-1844-P Proposed Rule

CY2027 (proposed)No new permanent cut · net +2.4%

The pattern breaks. No new permanent PDGM behavioral adjustment is proposed, but the -3.0% temporary adjustment to the 30-day base rate continues.

How the +2.4% nets out

0.000%New permanent PDGM behavioral adjustment proposed for CY2027. First zero in five cycles.

-3.0%Temporary adjustment applied to the 30-day base rate. It continues in this proposal. It is recoupment, not a rounding footnote.

+2.4%Projected net CY2027 payment update after all proposed factors, roughly $420 million in aggregate, per the CMS fact sheet for CMS-1844-P.

Read those three numbers together and the strategic picture is clear. Agencies that budgeted for a fifth consecutive permanent cut can re-baseline CY2027 Medicare revenue upward. Agencies that treated the temporary adjustment as finished cannot. CMS retains the temporary recoupment mechanism, and it is embedded in the proposed 30-day base rate math, so any model that ignores it will overstate rate.

What else is in the rule: enrollment safeguards

CMS-1844-P also proposes Medicare-wide provider enrollment safeguards. For home health agencies this is worth reading closely and worth commenting on. Enrollment provisions tend to get less attention than rate provisions during comment periods, then arrive in operations as revalidation demands, screening changes, and enrollment-status risk. If your enrollment file, ownership disclosures, or revalidation calendar has drift, the comment window is the time to say so and the run-up to the final rule is the time to fix it.

The dated path from here

July 2026

Proposed rule issued

CMS-1844-P published with the CY2027 payment proposal and enrollment safeguard provisions.

Comment period

Comments open

File on the permanent and temporary adjustment methodology and the enrollment proposals. See CMS-1844-P for the submission deadline.

Late 2026

Final rule

Proposed is not final. Prior cycles have finalized figures that differed from the proposal, so keep two scenarios live.

Jan 1, 2027

CY2027 rates effective

New 30-day period payment rates apply to calendar year 2027 claims.

Operator to-do list

Re-baseline the CY2027 budget. Replace any assumed fifth permanent PDGM cut with the proposed net +2.4% update, and mark the line as proposed, not final.
Keep the -3.0% temporary adjustment in the base-rate model. It continues under CMS-1844-P and the temporary recoupment stream is explicitly not finished.
Run a two-scenario forecast to the final rule. One at the proposed figures, one stress case in which the final rule reintroduces a permanent adjustment. Fund decisions off the stress case.
File comments. The methodology behind permanent versus temporary behavioral adjustments and the Medicare-wide enrollment safeguards are both squarely open for comment in this cycle.
Audit PDGM revenue integrity now. A rate increase is only worth what your intake, OASIS, clinical grouping, LUPA management, and timely-filing discipline let you keep. Do not let a +2.4% update leak out through preventable denials.
Pre-clean the enrollment file. Revalidate PECOS data, ownership disclosures, and address records before the proposed enrollment safeguards harden into final requirements.

Sources

CMS fact sheet, Calendar Year (CY) 2027 Home Health Prospective Payment System Proposed Rule (CMS-1844-P), issued July 2026: proposed net +2.4% (about $420 million), no new permanent PDGM behavioral adjustment, continuing -3.0% temporary adjustment to the 30-day base rate, and proposed Medicare-wide provider enrollment safeguards.
CY2023 HH PPS final rule: -3.925% permanent PDGM behavioral adjustment.
CY2024 HH PPS final rule: -2.890% permanent PDGM behavioral adjustment.
CY2025 HH PPS final rule: -1.975% permanent PDGM behavioral adjustment.
CY2026 HH PPS final rule: -1.023% permanent PDGM behavioral adjustment.

Turn a proposed increase into collected cash

ASP-RCM Solutions runs home health revenue cycle end to end: PDGM 30-day period management, OASIS-aligned coding at 95%+ accuracy, LUPA and denial prevention, enrollment and revalidation upkeep, and rulemaking-cycle financial modeling so your CY2027 budget tracks the final rule, not the headline. If you budgeted for a fifth cut, let us rebuild the model with you before the final rule lands.

Talk to ASP-RCM about your CY2027 plan