Home Health Review Choice Demonstration in Illinois, Ohio, North Carolina, Florida, Texas, and Oklahoma: State-by-State Guide

The Review Choice Demonstration for Home Health Services (RCD) has been part of daily operations for home health agencies (HHAs) in several states since 2019. Agencies in Illinois, Ohio, Texas, North Carolina, Florida, and Oklahoma that bill Medicare Administrative Contractor (MAC) Jurisdiction M, served by Palmetto GBA, must demonstrate compliance with Medicare home health requirements through one of the demonstration's review options. In May 2024, CMS extended the demonstration for an additional five years, effective June 1, 2024, and CMS has since announced an expansion to California in Jurisdiction 6.

Although the core rules are the same in every participating state, each state entered the demonstration at a different time and under different circumstances. This guide explains how RCD works across Jurisdiction M, summarizes key dates and features for each state, describes what changed in the 2024 extension, and offers compliance tips that apply in every state. It is educational and does not replace legal or professional advice.

RCD Basics Across All Participating States

Purpose

CMS describes RCD as a demonstration that provides flexibility and choice for HHAs, with risk-based changes to reduce burden for providers that demonstrate compliance with Medicare home health policies. CMS's information collection materials explain that the demonstration is intended to help develop improved procedures for identifying, investigating, and prosecuting potential Medicare fraud and to make sure home health payments are appropriate.

Who Is Included

The demonstration applies to HHAs in the participating states that bill Palmetto GBA. According to the RCD Operational Guide, certain claim types are excluded, such as Requests for Anticipated Payment and Notices of Admission, which are submitted as usual, and claims for Veterans Affairs, Indian Health Service, demand bills, and no-pay bills. HHAs under review by a Unified Program Integrity Contractor (UPIC) are excluded while that review continues. The demonstration applies only to Medicare Fee-for-Service beneficiaries.

Initial Review Choices

Under the current Operational Guide, HHAs choose from two initial options:

• Choice 1: Pre-Claim Review. The HHA submits documentation for each 30-day billing period before submitting the final claim. The MAC makes a decision within 10 business days, excluding federal holidays, for initial requests and resubmissions.

• Choice 2: Postpayment Review. The MAC pays claims and then sends an Additional Documentation Request (ADR) for each claim. The HHA has 45 days to respond, and the MAC has 60 days to decide.

HHAs that do not make a selection are placed in Choice 2.

The 90 Percent Threshold

Performance is measured in six-month cycles. An HHA that reaches a 90 percent or greater full provisional affirmation rate under pre-claim review, or claim approval rate under postpayment review, based on at least 10 requests or claims, becomes eligible for additional choices:

• Choice 1: Pre-Claim Review.

• Choice 3: Selective Postpayment Review, in which the MAC reviews a random sample of claims every six months.

• Choice 4: Spot Check Review, in which the MAC randomly selects 5 percent of claims for prepayment review, and the HHA must keep a 90 percent approval rate to remain.

Qualifying HHAs that do not make a selection are placed in Choice 3 for the remainder of the demonstration, according to the guide. HHAs that do not meet the threshold must choose again from the initial options.

Claims Without a Pre-Claim Decision

Under pre-claim review, a final claim submitted without a pre-claim review decision is stopped for prepayment review. If payable, it receives a 25 percent payment reduction that cannot be appealed or passed on to the beneficiary.

The 2024 Extension

CMS announced on May 17, 2024, that it would extend RCD for an additional five years, effective June 1, 2024, in Illinois, Ohio, Texas, North Carolina, Florida, and Oklahoma. As part of the extension, CMS removed the former Choice 3, Minimal Review with a 25 percent payment reduction, from the initial options. Providers that had been in that option had to select pre-claim review or postpayment review during a selection period from June 17 to July 1, 2024, with a cycle effective date of July 15, 2024. Providers that did not choose were placed in postpayment review. CMS's current guide renumbers the remaining choices, so Selective Postpayment Review is now Choice 3 and Spot Check Review is now Choice 4.

State-by-State Guide

Illinois

• Start date: According to CMS's Operational Guide and Palmetto GBA's RCD materials, the demonstration applies to home health periods beginning on or after June 1, 2019, in Illinois.

• Background: Illinois was the first RCD state. It was also the only state where CMS ran the earlier Pre-Claim Review Demonstration for Home Health Services, which began in 2016 and was paused on April 1, 2017. CMS has recognized June 1, 2019, as the start date of the demonstration for purposes of calculating its original five-year term.

• What this means: Illinois agencies have the longest experience with RCD. Many have mature workflows, but turnover, new referral sources, and new agencies entering the market mean ongoing training is still needed.

Compliance tips for Illinois:

• Revisit workflows built years ago to make sure they reflect current rules, including changes to allowed practitioners and the 30-day billing period under the Patient-Driven Groupings Model.

• Review cycle results over time to spot slipping performance before a cycle is lost.

Ohio

• Start date: The demonstration applies to home health periods beginning on or after September 30, 2019, in Ohio.

• Background: Ohio was the second state to enter RCD. CMS opened the Ohio selection period in August 2019, about four months after Illinois began.

• What this means: Like Illinois, Ohio agencies have years of experience. Ohio's market includes both large systems and smaller agencies, and smaller agencies may find it harder to staff RCD functions.

Compliance tips for Ohio:

• Smaller agencies should cross-train staff so that pre-claim submissions or ADR responses do not stop when one person is out.

• Track performance by referral source, because many non-affirmations trace back to practitioner documentation.

Texas

• Start date: The demonstration applies to home health periods beginning on or after March 2, 2020, in Texas.

• Background: CMS originally planned to begin RCD in Texas in December 2019 but delayed the start to allow for the January 2020 transition to the Patient-Driven Groupings Model. Texas began shortly before the COVID-19 public health emergency.

• What this means: Texas has a large number of HHAs and a large geographic area. Agencies serve urban, suburban, and rural patients, and documentation from rural referral sources may be harder to obtain quickly.

Compliance tips for Texas:

• Build referral source outreach plans for rural practitioners, including clear instructions for face-to-face documentation.

• Monitor pre-claim review timing closely in areas where obtaining signatures takes longer.

North Carolina

• Start date: Palmetto GBA lists an implementation date of August 31, 2020, for North Carolina. Because of the COVID-19 public health emergency, CMS phased in participation for a limited time, allowing providers to continue submitting pre-claim review requests on a voluntary basis. CMS's Operational Guide lists full implementation on September 1, 2021.

• What this means: North Carolina agencies entered RCD during the public health emergency and transitioned from phased-in to full participation in 2021.

Compliance tips for North Carolina:

• Make sure practices adopted during the phased-in period have been replaced with full RCD workflows.

• Confirm documentation practices reflect current rules on allowed practitioners and telehealth encounters.

Florida

• Start date: Like North Carolina, Palmetto GBA lists an implementation date of August 31, 2020, for Florida, with phased-in participation during the public health emergency and full implementation on September 1, 2021, according to CMS's Operational Guide.

• Background: Florida has a large Medicare population and has long been an area of concern for home health program integrity, which helps explain its inclusion in the demonstration.

• What this means: Florida agencies face scrutiny not only through RCD but also through other program integrity efforts. Strong compliance programs are especially important.

Compliance tips for Florida:

• Pair RCD workflows with a broader compliance program, including internal audits and monitoring.

• Be alert for UPIC activity, which excludes the agency from RCD while the UPIC review continues and generally signals higher risk.

Oklahoma

• Start date: CMS announced in September 2023 that it would implement RCD in Oklahoma effective December 1, 2023. The selection period ran from October 16 to November 15, 2023. CMS later announced an Oklahoma Cycle 2 selection period of July 1 to July 15, 2024, with Cycle 2 beginning August 1, 2024.

• Background: Oklahoma was the first state added beyond the original five. CMS's original demonstration design allowed expansion to other states in the Palmetto GBA jurisdiction if there was evidence of increased fraud, waste, or abuse.

• What this means: Oklahoma agencies are newer to RCD and may still be building processes and relationships with referral sources.

Compliance tips for Oklahoma:

• Use the experience of agencies in other RCD states and Palmetto GBA education to accelerate learning.

• Focus on face-to-face encounter documentation and homebound status, which are common sources of non-affirmations in all states.

Looking Ahead: California and Jurisdiction 6

CMS has announced that RCD will expand to California for billing periods beginning on or after January 18, 2027, with a selection period from November 16 to December 16, 2026, for HHAs that bill Jurisdiction 6 (Wellpoint Federal). CMS has stated that implementation depends on approval of revisions to the demonstration's information collection. The California expansion shows that CMS continues to view RCD as a tool for addressing program integrity concerns, and agencies in other states should be aware that further expansion is possible.

What Reviewers Look For in Every State

The requirements reviewed under RCD are the same in every state because they come from Medicare's national home health rules:

• Homebound status under Sections 1814(a) and 1835(a) of the Social Security Act.

• The patient is under the care of a physician or allowed practitioner.

• A plan of care established and periodically reviewed by a physician or allowed practitioner, under 42 CFR 409.43.

• A need for skilled services.

• A face-to-face encounter that meets the timing, provider, and content requirements of 42 CFR 424.22.

• Valid certification and recertification.

• Valid signatures and dates.

Chapter 7 of the Medicare Benefit Policy Manual provides detailed guidance on each requirement.

Common Reasons for Non-Affirmations and Denials

Across states, frequent problems include:

• Face-to-face encounter documentation that is missing, outside the required window, or not related to the primary reason for home health.

• Homebound status described in general terms without specific supporting detail.

• Plans of care that are unsigned, undated, or missing required elements.

• Skilled need that is not clearly documented.

• Certifying practitioner records that do not support eligibility.

• Missing or invalid signatures.

• Requests rejected for technical reasons, such as invalid identifiers or another agency already holding a Unique Tracking Number for the same period.

Compliance Tips for Every RCD State

• Assign an RCD coordinator and a backup.

• Use pre-submission checklists for every pre-claim request or ADR response.

• Track affirmation or approval rates weekly, not just at the end of the cycle.

• Analyze each non-affirmation or denial for root causes.

• Build relationships with high-volume referral sources and share CMS's RCD letter for physicians and practitioners.

• Audit internally to find problems early.

• Keep correspondence addresses current in PECOS so ADRs reach the right place.

• Use Palmetto GBA's education, checklists, and portal resources.

• Appeal incorrect denials on time.

• Plan for cash flow under your chosen option.

Operating in More Than One RCD State

Some home health organizations operate branches in more than one RCD state. These organizations face extra coordination challenges.

• Each agency makes its own review choice. Different branches may be in different review options at the same time.

• Cycle dates may differ by state, because each state began the demonstration on a different date. Track each agency's cycle separately.

• Referral sources and practitioner habits vary by market. Results from one state may not predict results in another.

• Centralized RCD teams can create consistency, but they must understand local referral patterns and state scope-of-practice rules for allowed practitioners.

• Organizations entering California in 2027 will deal with a different MAC, Wellpoint Federal, with its own portal and processes.

A shared dashboard that shows each agency's review option, cycle dates, affirmation or approval rate, and top denial reasons helps leadership see where support is needed.

New Agencies and Changes of Ownership

New agencies and agencies that change ownership should pay close attention to RCD.

• A new agency in an RCD state must participate in the demonstration and make a review choice according to the MAC's instructions.

• New agencies may have limited claim volume. Because the threshold requires at least 10 requests or claims in a cycle, low-volume agencies may not qualify for subsequent choices until volume increases.

• Agencies that change ownership should confirm with the MAC how the change affects their review option and cycle.

• Medicare enrollment rules for home health, including capitalization requirements and limits on changes in majority ownership within a period after enrollment, also apply and should be reviewed with counsel.

Interaction With Other Oversight in RCD States

RCD is only one part of Medicare oversight in these states.

• The Comprehensive Error Rate Testing program continues to review a random sample of claims nationwide.

• OIG audits and evaluations may include home health agencies in RCD states.

• UPIC investigations remove an agency from RCD while the UPIC review continues but bring their own risks.

• Medicaid programs in each state have their own home health rules and audits.

• The 60-day overpayment rule applies regardless of RCD participation. If RCD results reveal problems that may affect earlier claims, agencies must evaluate whether a look-back investigation is needed.

Using CMS Statistics

CMS has published RCD statistics on its demonstration page, including reports covering recent fiscal years. Agencies can use these reports to understand how the demonstration is performing overall, how agencies are distributed among review options, and how affirmation rates have changed over time. Comparing your agency's results with these published figures can help set realistic goals.

How to Stay Current

RCD rules and dates change over time. Agencies should:

• Check CMS's RCD page regularly for updates and statistics. CMS has periodically released RCD results, including statistics for recent fiscal years.

• Review the current Operational Guide and FAQs.

• Monitor Palmetto GBA announcements.

• Watch for Federal Register notices about the demonstration's information collection.

A Quick Readiness Check for Agencies in Any RCD State

• Do we know our current review option and cycle dates?

• Do we know our affirmation or approval rate so far this cycle?

• Do we know our top three non-affirmation or denial reasons?

• Have we educated our top referral sources in the past year?

• Do we have a backup for every key RCD role?

• Are our Palmetto GBA portal users current?

• Do our billing edits prevent claims without required UTNs?

• Are we tracking ADR due dates daily under postpayment review?

• Have we audited our documentation internally in the past six months?

Any "no" answer points to a gap worth addressing before the cycle ends.

A Hypothetical Example

A Texas HHA in its fourth year of RCD has stayed in pre-claim review because it has repeatedly fallen just short of the 90 percent threshold. An internal review of non-affirmations shows that most come from two referral sources whose face-to-face notes do not address the primary reason for home health. The agency meets with both practices, shares CMS's RCD physician letter, and provides a simple checklist. It also adds a step at intake to review face-to-face notes before start of care. In the next cycle, its affirmation rate rises above 90 percent, and it selects Spot Check Review.

Frequently Asked Questions

Which states are in the Home Health RCD?

Illinois, Ohio, Texas, North Carolina, Florida, and Oklahoma in Jurisdiction M, with California scheduled to begin in Jurisdiction 6 for billing periods beginning on or after January 18, 2027.

When did RCD start in each state?

Illinois on June 1, 2019; Ohio on September 30, 2019; Texas on March 2, 2020; North Carolina and Florida with phased-in participation beginning August 31, 2020, and full implementation September 1, 2021; and Oklahoma on December 1, 2023.

How long will RCD last?

CMS extended the demonstration for five years effective June 1, 2024.

Are the rules different in each state?

The core rules are the same. Differences are mainly in start dates and cycle timing.

Is the minimal review option still available?

No. CMS removed Minimal Review with a 25 percent payment reduction from the initial choices in the 2024 extension.

Conclusion

RCD is a long-term reality for home health agencies in Illinois, Ohio, Texas, North Carolina, Florida, and Oklahoma, and it is coming to California in 2027. While each state entered the demonstration at a different time, the requirements are the same everywhere: document homebound status, skilled need, the plan of care, the face-to-face encounter, and certification clearly and on time. Agencies that track their performance closely, address root causes, engage referral sources, and stay current with CMS and Palmetto GBA updates can reach the 90 percent threshold and reduce their review burden.

How HealthBridge Can Help

HealthBridge is a healthcare management consulting firm that helps home health agencies in RCD states improve documentation, build pre-claim review and ADR workflows, analyze non-affirmations, engage referral sources, and track progress toward the 90 percent threshold. If your agency operates in an RCD state, please get in touch with us. We will be happy to help you with this topic.

References

• Centers for Medicare & Medicaid Services. Review Choice Demonstration for Home Health Services. https://www.cms.gov/research-statistics-data-and-systems/monitoring-programs/medicare-ffs-compliance-programs/review-choice-demonstration/review-choice-demonstration-for-home-health-services

• Centers for Medicare & Medicaid Services. Review Choice Demonstration for Home Health Services Operational Guide. https://www.cms.gov/research-statistics-data-and-systems/monitoring-programs/medicare-ffs-compliance-programs/review-choice-demonstration/downloads/rcd-operational-guide.pdf

• Centers for Medicare & Medicaid Services. Review Choice Demonstration for Home Health Services Frequently Asked Questions. https://www.cms.gov/research-statistics-data-and-systems/monitoring-programs/medicare-ffs-compliance-programs/review-choice-demonstration/downloads/rcd-faqs.pdf

• U.S. Department of Health and Human Services. Guidance Portal: Review Choice Demonstration for Home Health Services. https://www.hhs.gov/guidance/document/review-choice-demonstration-home-health-services

• U.S. Department of Health and Human Services. Guidance Portal: Review Choice Demonstration for Home Health Services Operational Guide (Updated May 25, 2022). https://www.hhs.gov/guidance/sites/default/files/hhs-guidance-documents/RCD%20Operational%20Guide.pdf

• Federal Register Public Inspection. Agency Information Collection Activities: Review Choice Demonstration for Home Health Services, CMS-10599 (Document 2026-22297). https://public-inspection.federalregister.gov/2026-22297.pdf

• Centers for Medicare & Medicaid Services. Medicare Benefit Policy Manual, Chapter 7, Home Health Services. https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/downloads/bp102c07.pdf

• Electronic Code of Federal Regulations. 42 CFR 424.22, Requirements for Home Health Services. https://www.ecfr.gov/current/title-42/chapter-IV/subchapter-B/part-424/subpart-B/section-424.22

• Electronic Code of Federal Regulations. 42 CFR 409.43, Plan of Care Requirements. https://www.ecfr.gov/current/title-42/chapter-IV/subchapter-B/part-409/subpart-E/section-409.43

• U.S. Social Security Administration. Social Security Act, Section 1814. https://www.ssa.gov/OP_Home/ssact/title18/1814.htm