On November 2, 2026, CMS announced plans to bring the Review Choice Demonstration for Home Health Services (RCD) to California. If the change gets final approval, every California home health agency billing Medicare’s Jurisdiction 6 contractor will need to choose how its claims are reviewed. The choice window is short, and the decision affects cash flow, staffing, and documentation work for the next several years.
This guide covers what RCD is, how the review choices work, what a pre-claim review packet has to include, and what California agencies should do before the selection window closes on December 16, 2026.
Status note: CMS says California implementation “is dependent on approval of revisions to PRA package CMS-10599/OMB 0938-1311.” Until OMB approves it, California is an announced but pending RCD state. (CMS RCD page)
What is the Review Choice Demonstration, and why does CMS run it?
RCD is a Medicare fee-for-service demonstration that has home health agencies (HHAs) prove compliance with Medicare home health coverage rules through a review process they select. CMS runs it under Section 402(a)(1)(J) of the Social Security Amendments of 1967, which lets the Secretary test better ways to investigate and prosecute fraud.
According to CMS, the demonstration aims to cut Medicare appeals and improve provider compliance. CMS also says it “should not delay care to Medicare beneficiaries, and does not alter the Medicare home health benefit.” The coverage rules stay the same. What changes is how and when your documentation gets checked.
In its November 2 emergency paperwork notice, CMS said the California expansion is meant to address “significant fraud found in the traditional Medicare home health benefit in California.” (91 FR 68960)
Which states are in RCD?
Currently active (Jurisdiction M, Palmetto GBA): Illinois, Ohio, Texas, North Carolina, Florida, and Oklahoma. Oklahoma joined on December 1, 2023, and in 2024 CMS extended the demonstration for another five years, starting June 1, 2024.
Pending: California, covering all HHAs that bill MAC Jurisdiction 6 (Wellpoint Federal).
| California milestone | Date |
|---|---|
| Public comment deadline on the paperwork package | November 16, 2026 |
| Selection period opens | November 16, 2026 |
| Selection period closes | December 16, 2026 |
| Demonstration starts | Billing periods beginning on or after January 18, 2027 |
Sources: CMS RCD page; 91 FR 68960.
How the review choices work
Every agency starts by choosing one of two initial options. CMS makes the choice at the PTAN level, so an organization with several provider numbers makes a choice for each one. An agency that doesn’t choose is automatically assigned to Choice 2: Postpayment Review.
| Choice | How it works | Who can choose it |
|---|---|---|
| 1: Pre-Claim Review | You submit documentation before the final claim, and the MAC decides within 10 business days. Affirmed claims carry a Unique Tracking Number (UTN). | Anyone, at the start or later |
| 2: Postpayment Review | All claims are paid, then pulled for review. You get an ADR and have 45 days to respond, and the MAC then has 60 days to decide. | Anyone. This is the default if you don’t choose. |
| 3: Selective Postpayment Review | Every 6 months, the MAC reviews a statistically valid random sample of claims. Once you pick this, you stay in it for the rest of the demonstration. | Only after reaching 90% or higher |
| 4: Spot Check Review | The MAC pulls a random 5% of claims for prepayment review. You have to stay at 90% or higher to remain in this choice. | Only after reaching 90% or higher |
The 90% rule: Every six months, the MAC calculates each agency’s affirmation rate (pre-claim review) or claim approval rate (postpayment review). An agency at 90% or higher on at least 10 requests or claims can pick Choice 1, 3, or 4. If it qualifies but doesn’t choose, it’s automatically placed in Choice 3 for the rest of the demonstration. Agencies below 90%, or with fewer than 10 requests or claims, have to choose again between Choices 1 and 2.
What about the old 25% option? The original demonstration had a “Minimal Review with 25% Payment Reduction” choice. CMS removed it in 2024, and on November 4, 2026, it corrected the California notice to say that option “is no longer part of this information collection request.” A 25% reduction still applies in one case that matters: under pre-claim review, a final claim submitted without a pre-claim review decision is stopped for prepayment review and, if payable, paid 25% less. That reduction can’t be passed to the beneficiary and can’t be appealed. (CMS HH RCD Operational Guide)
Pre-claim review documentation basics
The Operational Guide says a pre-claim review request must show that the patient:
- Is homebound. The patient normally can’t leave home, leaving takes considerable and taxing effort, and they either need a device, special transportation, or another person’s help to leave, or leaving is medically contraindicated.
- Is under a physician’s care and receiving services under a plan of care that a physician set up and reviews periodically.
- Needs skilled services.
- Had a qualifying face-to-face encounter. It must be no more than 90 days before or 30 days after the start of care, related to the main reason for home health, performed by an approved provider type, with the date documented by the certifying physician.
The request also needs beneficiary, certifying physician, agency, and submitter details, along with the dates of the 30-day billing period and the 60-day episode. Recertifications, OASIS completion, and plan-of-care updates still follow the usual 60-day certification rules.
California-specific note: The Operational Guide says the multiple-billing-period option “is not currently available in California.” California agencies must send a separate request for each 30-day billing period, with all episode documentation included in each request.
Rejections and non-affirmations aren’t the same thing. The MAC rejects an incomplete or invalid request without a medical review, and a rejection doesn’t count as a non-affirmation. The Operational Guide lists these common rejection reasons:
- The request went to the wrong MAC.
- The beneficiary has Medicare Advantage or Medicaid.
- The MBI or beneficiary name is invalid, missing, or belongs to a deceased beneficiary.
- The agency’s PTAN, NPI, or type of bill is invalid or missing.
- No clinical documentation was attached.
- Another HHA already has a UTN for the same episode.
A non-affirmation means the MAC decided Medicare coverage requirements weren’t met. The decision letter lists every reason, and you can resubmit a complete packet, marked as a resubmission with the original UTN.
Free Download: RCD Pre-Claim Review Checklist
A 3-page checklist of what goes into a complete pre-claim review packet, plus pre-submission QA and the most common rejection reasons.
What California agencies should do before December 16
- Confirm your status. Watch the CMS RCD page and Wellpoint Federal for word of OMB approval.
- List every PTAN. You make a choice for each one.
- Decide between pre-claim and postpayment review on purpose. If you do nothing, you’re placed in postpayment review.
- Get access to the Wellpoint Federal provider portal and find out who on your team will make the selection.
- Audit current charts for homebound status, face-to-face timing and content, signed plans of care and orders, and certification.
- Write an RCD SOP that covers intake, packet assembly, submission, UTN tracking, resubmissions, and ADR response.
- Plan for one request per 30-day period, since California can’t bundle billing periods.
- Brief referring physicians on documentation needs. CMS publishes a physician/practitioner letter.
- Model cash flow for claims that are held, delayed, or reviewed.
- Consider commenting on the burden estimate by November 16, 2026.
The hidden staff hours: questions to ask yourself
CMS estimates 1,600,608 hours a year across 3,173,016 responses, which works out to about 30 minutes per response (91 FR 68960). Before you plan around that number, ask:
- How long does it really take us to pull the OASIS, face-to-face note, orders, plan of care, and visit notes into one complete packet?
- How many Medicare 30-day periods do we bill each month? What do we get when we multiply that by our real time per request?
- Who will absorb those hours: billers, clinical managers, intake, or overtime? What stops getting done while they do?
- When a request is rejected or non-affirmed, who fixes it and resubmits, and how fast?
- If we’re in postpayment review, who owns the 45-day ADR deadline? What happens to cash if paid claims are later found not payable?
- Who tracks our affirmation rate toward the 90% threshold that opens up lighter review options?
How HealthRev Partners helps
HealthRev Partners works with home health and hospice agencies on coding, OASIS review, and revenue cycle management. For RCD, we can help with:
- RCD SOPs and workflows, built around your EMR, intake process, and staff.
- Pre-claim review submission support, including packet assembly, completeness checks, UTN tracking, and resubmissions.
- ADR response for agencies in postpayment review or with claims pulled for review.
- Coding and OASIS accuracy, so the diagnoses, functional scoring, and plan of care tell the same story.
- Full RCM with RCD built in, so pre-claim review and claim submission run in one coordinated workflow and nothing gets billed without a decision on file.
FAQ
Is California definitely in RCD? Not yet. CMS has announced it, but implementation depends on OMB approving revisions to PRA package CMS-10599 (OMB 0938-1311).
What happens if a California agency doesn’t make a selection? It’s automatically assigned to Choice 2: Postpayment Review.
Can an agency still choose a 25% payment reduction instead of reviews? No. CMS removed that option in 2024, and the November 4, 2026 correction confirms it isn’t part of the California collection. Under pre-claim review, though, a claim billed without a pre-claim decision is still subject to a 25% reduction if it’s found payable.
How do agencies get to lighter reviews? They need a 90% or higher affirmation or approval rate on at least 10 requests or claims over a six-month cycle. That opens up selective postpayment review or spot check review.
How long does the MAC take on a pre-claim review request? The MAC sends its decision within 10 business days, excluding federal holidays, for both initial and resubmitted requests.
Does RCD change the Medicare home health benefit? No. CMS says the demonstration doesn’t change the benefit or create new coverage rules. It changes how compliance is checked.
Talk to a specialist
RCD rewards agencies that get their documentation right the first time. If you want help choosing a review option, building your SOPs, or running pre-claim review alongside billing, speak with a HealthRev Partners specialist.
This article is general information, not legal advice. Dates and requirements are current as of November 4, 2026, and may change pending OMB approval.
