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CMS Issues Rule to Increase Hospice Payments by $180 Million for FY 2018

Posted on Friday, April 28, 2017 1:14 PM

A proposed rule was issued by the Centers for Medicare & Medicaid Services (CMS) to update hospice payment rates with a $180 million overall increase for fiscal year 2018.

The rule recommends new quality measures and releases an update on the hospice quality reporting program (HQRP). In addition, the proposed rule states that the Hospice Compare website will be released in the summer of 2017.

The 2018 payment update is extremely lower than the total $350 million increase in payments for the 2017 fiscal year update.

The Medicare hospice benefit pays for the following levels:
• Routine home care
• General inpatient care
• Continuous home care
• Inpatient respite care

Since 1983, the hospice benefit utilization has grown from 513,000 in FY 2000 to nearly 1.4 million in FY 2016. Throughout that time period, hospice expenditures have risen from $2.8 billion to approximately $16.5 billion in 2016.

According to CMS’ Office of the Actuary (OACT), expenditures are expected to continued rising by approximately 7% annually.

The proposed rule reads, “We have recognized in previous rules that prognostication is not an exact science, and thus, a beneficiary may be under a hospice election longer than six months, as long as there remains a reasonable expectation that the individual has a life expectancy of six months or less.”

The rule also began new data collection mechanisms under consideration, including the Hospice Evaluation & Assessment Reporting Tool (HEART). While HEART is ongoing, it would provide the following:
• The data necessary for Hospice Quality Reporting Program (HQRP) and the current function of Hospice Item Set (HIS)
• The clinical data to inform payment refinements

CMS stated, “While the Home Health Compare website will become active in 2017, hospice star ratings, between 1 and 5 stars, will be determined through methods yet to be announced.”

Although the rule was submitted to the Federal Register, it won’t be published until May 3. To review an unpublished version of the proposed rule, you can download it on the Federal Register.

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