Rule2021-16311
Medicare Program; FY 2022 Hospice Wage Index and Payment Rate Update, Hospice Conditions of Participation Updates, Hospice and Home Health Quality Reporting Program Requirements
Primary source
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Published
August 4, 2021
Effective
October 1, 2021
Issuing agencies
Health and Human Services DepartmentCenters for Medicare & Medicaid Services
Abstract
This final rule updates the hospice wage index, payment rates, and aggregate cap amount for Fiscal Year 2022. This rule makes changes to the labor shares of the hospice payment rates and finalizes clarifying regulations text changes to the election statement addendum that was implemented on October 1, 2020. In addition, this rule makes permanent selected regulatory blanket waivers that were issued to Medicare-participating hospice agencies during the COVID-19 public health emergency (PHE) and updates the hospice conditions of participation. This rule updates the Hospice Quality Reporting Program and finalizes changes beginning with the January 2022 public reporting for the Home Health Quality Reporting Program to address exceptions related to the COVID-19 PHE.
Full Text
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[Federal Register Volume 86, Number 147 (Wednesday, August 4, 2021)]
[Rules and Regulations]
[Pages 42528-42606]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2021-16311]
[[Page 42527]]
Vol. 86
Wednesday,
No. 147
August 4, 2021
Part V
Department of Health and Human Services
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Centers for Medicare & Medicaid Services
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42 CFR Part 418
Medicare Program; FY 2022 Hospice Wage Index and Payment Rate Update,
Hospice Conditions of Participation Updates, Hospice and Home Health
Quality Reporting Program Requirements; Final Rule
Federal Register / Vol. 86 , No. 147 / Wednesday, August 4, 2021 /
Rules and Regulations
[[Page 42528]]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
42 CFR Part 418
[CMS-1754-F]
RIN 0938-AU41
Medicare Program; FY 2022 Hospice Wage Index and Payment Rate
Update, Hospice Conditions of Participation Updates, Hospice and Home
Health Quality Reporting Program Requirements
AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.
ACTION: Final rule.
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SUMMARY: This final rule updates the hospice wage index, payment rates,
and aggregate cap amount for Fiscal Year 2022. This rule makes changes
to the labor shares of the hospice payment rates and finalizes
clarifying regulations text changes to the election statement addendum
that was implemented on October 1, 2020. In addition, this rule makes
permanent selected regulatory blanket waivers that were issued to
Medicare-participating hospice agencies during the COVID-19 public
health emergency (PHE) and updates the hospice conditions of
participation. This rule updates the Hospice Quality Reporting Program
and finalizes changes beginning with the January 2022 public reporting
for the Home Health Quality Reporting Program to address exceptions
related to the COVID-19 PHE.
DATES: These regulations are effective on October 1, 2021.
FOR FURTHER INFORMATION CONTACT: For general questions about hospice
payment policy, send your inquiry via email to
<a href="/cdn-cgi/l/email-protection#3850574b48515b5d485754515b41785b554b1650504b165f574e"><span class="__cf_email__" data-cfemail="d4bcbba7a4bdb7b1a4bbb8bdb7ad94b7b9a7fabcbca7fab3bba2">[email protected]</span></a>.
For questions regarding the CAHPS[supreg] Hospice Survey, contact
Lori Teichman at (410) 786-6684, Lauren Fuentes at (410) 786-2290, and
Debra Dean-Whittaker at (410)786-9848.
For questions regarding the hospice conditions of participation,
contact Mary Rossi-Coajou at (410) 786-6051 and CAPT James Cowher at
(410) 786-1948.
For questions regarding home health public reporting, contact
Charles Padgett (410) 786-2811.
For questions regarding the hospice quality reporting program,
contact Cindy Massuda at (410) 786-0652.
SUPPLEMENTARY INFORMATION:
I. Executive Summary
A. Purpose
This rule updates the hospice wage index, payment rates, and cap
amount for fiscal year (FY) 2022 as required under section 1814(i) of
the Social Security Act (the Act). In addition, this rule rebases the
labor shares of the hospice payment rates and finalizes clarifying
regulations text changes to the election statement addendum
requirements finalized in the FY 2020 Hospice Wage Index and Payment
Rate Update final rule (84 FR 38484). This rule also provides a summary
of comments received regarding hospice utilization and spending
patterns. This rule makes permanent selected regulatory blanket waivers
for hospice agencies during the COVID-19 public health emergency (PHE)
and provides revisions to the hospice conditions of participation
(CoPs). This rule finalizes changes to the Hospice Quality Reporting
Program (HQRP), summarizes the comments to the requests for information
on advancing to digital quality measurement and the use of Fast
Healthcare Interoperability Resources (FHIR) and the White House
Executive Order related to health equity in the HQRP. Finally, this
rule finalizes changes to the Home Health Quality Reporting Program (HH
QRP) to address the January 2022 refresh in accordance with sections
1895(b)(3)(B)(v)(III) and 1899B(f) of the Act.
B. Summary of the Major Provisions
Section III.A of this final rule includes a summary of comments
from the public, including hospice providers as well as patients and
advocates, regarding the presented analysis in the FY 2022 hospice
proposed rule on hospice utilization, spending patterns and non-hospice
spending during a hospice election.
Section III.B of this final rule rebases and revises the labor
shares for continuous home care (CHC), routine home care (RHC),
inpatient respite care (IRC), and general inpatient care (GIP) using
2018 Medicare cost report (MCR) data for freestanding hospice
facilities.
Section III.C of this rule updates the hospice wage index and makes
the application of the updated wage data budget neutral for all four
levels of hospice care and discusses the FY 2022 hospice payment update
percentage of 2.0 percent, updates to the hospice payment rates, as
well as the updates to the hospice cap amount for FY 2022 by the
hospice payment update percentage of 2.0 percent.
Section III.D finalizes clarifying regulations text changes
regarding the election statement addendum requirements that were
finalized in the FY 2020 Hospice Wage Index and Rate Update final rule
(84 FR 38484).
Section III.E makes permanent selected regulatory blanket waivers
that were issued to Medicare-participating hospice agencies during the
COVID-19 PHE. We are revising the hospice aide requirements to allow
the use of the pseudo-patient for conducting hospice aide competency
evaluations. We are also revising the hospice aide supervision
requirements to address situations when deficient practice is noted and
remediation is needed related to both deficient and related skills, in
accordance with Sec. 418.76(c).
In section III.F of this rule, we finalize proposals to the HQRP
including the addition of claims-based Hospice Care Index (HCI)
measure, and Hospice Visits in the Last Days of Life (HVLDL) measure
for public reporting; removal of the seven Hospice Item Set (HIS)
measures because a more broadly applicable measure, the NQF #3235 HIS
Comprehensive Assessment Measure for the particular topic is available
and already publicly reported; and further development of the Hospice
Outcome and Patient Evaluation (HOPE) assessment instrument. We also
finalize the public reporting change for one refresh cycle to report
less than the standard quarters of data due to the COVID-19 PHE
exemptions; use 2 years (8 quarters) of data for the claims-based
measures in order to report on small providers; and add the Consumer
Assessment of Healthcare Providers and Systems (CAHPS[supreg]) Hospice
Survey Star ratings. Additionally, we summarize the comments on the
requests for information (RFI) on advancing to digital quality
measurement and the use of FHIR and on addressing the White House
Executive Order related to health equity in the HQRP.
Finally, in section III.G of this rule, we are finalizing our
proposal to the HH QRP so that, beginning with the January 2022 through
the July 2024 public reporting refresh cycle, we will report fewer
quarters of data due to COVID-19 PHE exceptions granted on March 27,
2020. We included the HH QRP policy in this rulemaking in order to
resume public reporting for the HH QRP with the January 2022 refresh of
Care Compare. To accommodate the excepted HH QRP of 2020 Q1 and Q2, we
resume public reporting using 3 out of 4 quarters of data for the
January 2022 refresh. In order to finalize this proposal in time to
release the required preview report related to the January 2022
refresh, which we release 3 months prior to any given refresh (October
[[Page 42529]]
2021), we needed the rule containing this proposal to finalize by
October 2021.
C. Summary of Impacts
The overall economic impact of this final rule is estimated to be
$480 million in increased payments to hospices for FY 2022.
II. Background
A. Hospice Care
Hospice care is a comprehensive, holistic approach to treatment
that recognizes the impending death of a terminally ill individual and
warrants a change in the focus from curative care to palliative care
for relief of pain and for symptom management. Medicare regulations
define ``palliative care'' as patient and family-centered care that
optimizes quality of life by anticipating, preventing, and treating
suffering. Palliative care throughout the continuum of illness involves
addressing physical, intellectual, emotional, social, and spiritual
needs and to facilitate patient autonomy, access to information, and
choice (42 CFR 418.3). Palliative care is at the core of hospice
philosophy and care practices, and is a critical component of the
Medicare hospice benefit.
The goal of hospice care is to help terminally ill individuals
continue life with minimal disruption to normal activities while
remaining primarily in the home environment. A hospice uses an
interdisciplinary approach to deliver medical, nursing, social,
psychological, emotional, and spiritual services through a
collaboration of professionals and other caregivers, with the goal of
making the beneficiary as physically and emotionally comfortable as
possible. Hospice is compassionate beneficiary and family/caregiver-
centered care for those who are terminally ill.
As referenced in our regulations at Sec. 418.22(b)(1), to be
eligible for Medicare hospice services, the patient's attending
physician (if any) and the hospice medical director must certify that
the individual is ``terminally ill,'' as defined in section
1861(dd)(3)(A) of the Social Security Act (the Act) and our regulations
at Sec. 418.3; that is, the individual has a medical prognosis that
his or her life expectancy is 6 months or less if the illness runs its
normal course. The regulations at Sec. 418.22(b)(2) require that
clinical information and other documentation that support the medical
prognosis accompany the certification and be filed in the medical
record with it and those at Sec. 418.22(b)(3) require that the
certification and recertification forms include a brief narrative
explanation of the clinical findings that support a life expectancy of
6 months or less.
Under the Medicare hospice benefit, the election of hospice care is
a patient choice and once a terminally ill patient elects to receive
hospice care, a hospice interdisciplinary group is essential in the
seamless provision of primarily home-based services. The hospice
interdisciplinary group works with the beneficiary, family, and
caregivers to develop a coordinated, comprehensive care plan; reduce
unnecessary diagnostics or ineffective therapies; and maintain ongoing
communication with individuals and their families about changes in
their condition. The beneficiary's care plan will shift over time to
meet the changing needs of the individual, family, and caregiver(s) as
the individual approaches the end of life.
If, in the judgment of the hospice interdisciplinary team, which
includes the hospice physician, the patient's symptoms cannot be
effectively managed at home, then the patient is eligible for general
inpatient care (GIP), a more medically intense level of care. GIP must
be provided in a Medicare-certified hospice freestanding facility,
skilled nursing facility, or hospital. GIP is provided to ensure that
any new or worsening symptoms are intensively addressed so that the
beneficiary can return to his or her home and continue to receive
routine home care. Limited, short-term, intermittent, inpatient respite
care (IRC) is also available because of the absence or need for relief
of the family or other caregivers. Additionally, an individual can
receive continuous home care (CHC) during a period of crisis in which
an individual requires continuous care to achieve palliation or
management of acute medical symptoms so that the individual can remain
at home. Continuous home care may be covered for as much as 24 hours a
day, and these periods must be predominantly nursing care, in
accordance with the regulations at Sec. 418.204. A minimum of 8 hours
of nursing care, or nursing and aide care, must be furnished on a
particular day to qualify for the continuous home care rate (Sec.
418.302(e)(4)).
Hospices must comply with applicable civil rights laws,\1\
including section 504 of the Rehabilitation Act of 1973 and the
Americans with Disabilities Act, under which covered entities must take
appropriate steps to ensure effective communication with patients and
patient care representatives with disabilities, including the
provisions of auxiliary aids and services at no cost to the individual.
Additionally, they must take reasonable steps to ensure meaningful
access for individuals with limited English proficiency, consistent
with Title VI of the Civil Rights Act of 1964. Further information
about these requirements may be found at: <a href="http://www.hhs.gov/ocr/civilrights">http://www.hhs.gov/ocr/civilrights</a>.
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\1\ Hospices are also subject to additional Federal civil rights
laws, including the Age Discrimination Act, Section 1557 of the
Affordable Care Act, and conscience and religious freedom laws.
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B. Services Covered by the Medicare Hospice Benefit
Coverage under the Medicare hospice benefit requires that hospice
services must be reasonable and necessary for the palliation and
management of the terminal illness and related conditions. Section
1861(dd)(1) of the Act establishes the services that are to be rendered
by a Medicare-certified hospice program. These covered services
include: Nursing care; physical therapy; occupational therapy; speech-
language pathology therapy; medical social services; home health aide
services (called hospice aide services); physician services; homemaker
services; medical supplies (including drugs and biologicals); medical
appliances; counseling services (including dietary counseling); short-
term inpatient care in a hospital, nursing facility, or hospice
inpatient facility (including both respite care and procedures
necessary for pain control and acute or chronic symptom management);
continuous home care during periods of crisis, and only as necessary to
maintain the terminally ill individual at home; and any other item or
service which is specified in the plan of care and for which payment
may otherwise be made under Medicare, in accordance with Title XVIII of
the Act.
Section 1814(a)(7)(B) of the Act requires that a written plan for
providing hospice care to a beneficiary who is a hospice patient be
established before care is provided by, or under arrangements made by,
the hospice program; and that the written plan be periodically reviewed
by the beneficiary's attending physician (if any), the hospice medical
director, and an interdisciplinary group (section 1861(dd)(2)(B) of the
Act). The services offered under the Medicare hospice benefit must be
available to beneficiaries as needed, 24 hours a day, 7 days a week
(section 1861(dd)(2)(A)(i) of the Act).
Upon the implementation of the hospice benefit, the Congress also
expected hospices to continue to use volunteer services, though
Medicare
[[Page 42530]]
does not pay for these volunteer services (section 1861(dd)(2)(E) of
the Act). As stated in the Fiscal Year (FY) 1983 Hospice Wage Index and
Rate Update proposed rule (48 FR 38149), the hospice must have an
interdisciplinary group composed of paid hospice employees as well as
hospice volunteers, and that ``the hospice benefit and the resulting
Medicare reimbursement is not intended to diminish the voluntary spirit
of hospices.'' This expectation supports the hospice philosophy of
community based, holistic, comprehensive, and compassionate end of life
care.
C. Medicare Payment for Hospice Care
Sections 1812(d), 1813(a)(4), 1814(a)(7), 1814(i), and 1861(dd) of
the Act, and the regulations in 42 CFR part 418, establish eligibility
requirements, payment standards and procedures; define covered
services; and delineate the conditions a hospice must meet to be
approved for participation in the Medicare program. Part 418, subpart
G, provides for a per diem payment based on one of four prospectively-
determined rate categories of hospice care (routine home care (RHC),
CHC, IRC, and GIP), based on each day a qualified Medicare beneficiary
is under hospice care (once the individual has elected). This per diem
payment is meant to cover all of the hospice services and items needed
to manage the beneficiary's care, as required by section 1861(dd)(1) of
the Act.
While payments made to hospices are to cover all items, services,
and drugs for the palliation and management of the terminal illness and
related conditions, Federal funds cannot be used for the prohibited
activities, even in the context of a per diem payment. While recent
news reports \2\ have brought to light the potential role hospices
could play in medical aid in dying (MAID) where such practices have
been legalized in certain states, we wish to remind hospices that The
Assisted Suicide Funding Restriction Act of 1997 (Pub. L. 105-12)
prohibits the use of Federal funds to provide or pay for any health
care item or service or health benefit coverage for the purpose of
causing, or assisting to cause, the death of any individual including
mercy killing, euthanasia, or assisted suicide. However, the
prohibition does not pertain to the provision of an item or service for
the purpose of alleviating pain or discomfort, even if such use may
increase the risk of death, so long as the item or service is not
furnished for the specific purpose of causing or accelerating death.
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\2\ Nelson, R., Should Medical Aid in Dying Be Part of Hospice
Care? Medscape Nurses. February 26, 2020. <a href="https://www.medscape.com/viewarticle/925769#vp_1">https://www.medscape.com/viewarticle/925769#vp_1</a>.
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1. Omnibus Budget Reconciliation Act of 1989
Section 6005(a) of the Omnibus Budget Reconciliation Act of 1989
(Pub. L. 101-239) amended section 1814(i)(1)(C) of the Act and provided
changes in the methodology concerning updating the daily payment rates
based on the hospital market basket percentage increase applied to the
payment rates in effect during the previous Federal fiscal year.
2. Balanced Budget Act of 1997
Section 4441(a) of the Balanced Budget Act of 1997 (BBA) (Pub. L.
105-33) established that updates to the hospice payment rates beginning
FY 2002 and subsequent FYs be the hospital market basket percentage
increase for the FY. Section 4442 of the BBA amended section 1814(i)(2)
of the Act, effective for services furnished on or after October 1,
1997, to require that hospices submit claims for payment for hospice
care furnished in an individual's home only on the basis of the
geographic location at which the service is furnished. Previously,
local wage index values were applied based on the geographic location
of the hospice provider, regardless of where the hospice care was
furnished. Section 4443 of the BBA amended sections 1812(a)(4) and
1812(d)(1) of the Act to provide for hospice benefit periods of two 90-
day periods, followed by an unlimited number of 60-day periods.
3. FY 1998 Hospice Wage Index Final Rule
The FY 1998 Hospice Wage Index final rule (62 FR 42860),
implemented a new methodology for calculating the hospice wage index
and instituted an annual Budget Neutrality Adjustment Factor (BNAF) so
aggregate Medicare payments to hospices would remain budget neutral to
payments calculated using the 1983 wage index.
4. FY 2010 Hospice Wage Index Final Rule
The FY 2010 Hospice Wage Index and Rate Update final rule (74 FR
39384) instituted an incremental 7-year phase-out of the BNAF beginning
in FY 2010 through FY 2016. The BNAF phase-out reduced the amount of
the BNAF increase applied to the hospice wage index value, but was not
a reduction in the hospice wage index value itself or in the hospice
payment rates.
5. The Affordable Care Act
Starting with FY 2013 (and in subsequent FYs), the market basket
percentage update under the hospice payment system referenced in
sections 1814(i)(1)(C)(ii)(VII) and 1814(i)(1)(C)(iii) of the Act are
subject to annual reductions related to changes in economy-wide
productivity, as specified in section 1814(i)(1)(C)(iv) of the Act.
In addition, sections 1814(i)(5)(A) through (C) of the Act, as
added by section 3132(a) of the Patient Protection and Affordable Care
Act (PPACA) (Pub. L. 111-148), required hospices to begin submitting
quality data, based on measures specified by the Secretary of the
Department of Health and Human Services (the Secretary), for FY 2014
and subsequent FYs. Since FY 2014, hospices that fail to report quality
data have their market basket percentage increase reduced by 2
percentage points. Note that with the passage of the Consolidated
Appropriations Act, 2021 (hereafter referred to as CAA 2021) (Pub. L.
116 260), the reduction changes to 4 percentage points beginning in FY
2024.
Section 1814(a)(7)(D)(i) of the Act, as added by section 3132(b)(2)
of the
PPACA, required, effective January 1, 2011, that a hospice
physician or nurse practitioner have a face-to-face encounter with the
beneficiary to determine continued eligibility of the beneficiary's
hospice care prior to the 180th day recertification and each subsequent
recertification, and to attest that such visit took place. When
implementing this provision, the Centers for Medicare & Medicaid
Services (CMS) finalized in the FY 2011 Hospice Wage Index final rule
(75 FR 70435) that the 180th day recertification and subsequent
recertifications would correspond to the beneficiary's third or
subsequent benefit periods. Further, section 1814(i)(6) of the Act, as
added by section 3132(a)(1)(B) of the PPACA, authorized the Secretary
to collect additional data and information determined appropriate to
revise payments for hospice care and other purposes. The types of data
and information suggested in the PPACA could capture accurate resource
utilization, which could be collected on claims, cost reports, and
possibly other mechanisms, as the Secretary determined to be
appropriate. The data collected could be used to revise the methodology
for determining the payment rates for RHC and other services included
in hospice care, no earlier than October 1, 2013, as described in
section 1814(i)(6)(D) of the Act. In addition, CMS was required to
[[Page 42531]]
consult with hospice programs and the Medicare Payment Advisory
Commission (MedPAC) regarding additional data collection and payment
revision options.
6. FY 2012 Hospice Wage Index Final Rule
In the FY 2012 Hospice Wage Index final rule (76 FR 47308 through
47314) it was announced that beginning in 2012, the hospice aggregate
cap would be calculated using the patient-by-patient proportional
methodology, within certain limits. Existing hospices had the option of
having their cap calculated through the original streamlined
methodology, also within certain limits. As of FY 2012, new hospices
have their cap determinations calculated using the patient-by-patient
proportional methodology.
7. IMPACT Act of 2014
The Improving Medicare Post-Acute Care Transformation Act of 2014
(IMPACT Act) (Pub. L. 113-185) became law on October 6, 2014. Section
3(a) of the IMPACT Act mandated that all Medicare certified hospices be
surveyed every 3 years beginning April 6, 2015 and ending September 30,
2025. In addition, section 3(c) of the IMPACT Act requires medical
review of hospice cases involving beneficiaries receiving more than 180
days of care in select hospices that show a preponderance of such
patients; section 3(d) of the IMPACT Act contains a new provision
mandating that the cap amount for accounting years that end after
September 30, 2016, and before October 1, 2025 be updated by the
hospice payment percentage update rather than using the consumer price
index for urban consumers (CPI-U) for medical care expenditures.
8. FY 2015 Hospice Wage Index and Payment Rate Update Final Rule
The FY 2015 Hospice Wage Index and Rate Update final rule (79 FR
50452) finalized a requirement that the Notice of Election (NOE) be
filed within 5 calendar days after the effective date of hospice
election. If the NOE is filed beyond this 5-day period, hospice
providers are liable for the services furnished during the days from
the effective date of hospice election to the date of NOE filing (79 FR
50474). As with the NOE, the claims processing system must be notified
of a beneficiary's discharge from hospice or hospice benefit revocation
within 5 calendar days after the effective date of the discharge/
revocation (unless the hospice has already filed a final claim) through
the submission of a final claim or a Notice of Termination or
Revocation (NOTR).
The FY 2015 Hospice Wage Index and Rate Update final rule (79 FR
50479) also finalized a requirement that the election form include the
beneficiary's choice of attending physician and that the beneficiary
provide the hospice with a signed document when he or she chooses to
change attending physicians.
In addition, the FY 2015 Hospice Wage Index and Rate Update final
rule (79 FR 50496) provided background, described eligibility criteria,
identified survey respondents, and otherwise implemented the Hospice
Experience of Care Survey for informal caregivers. Hospice providers
were required to begin using this survey for hospice patients as of
2015.
Finally, the FY 2015 Hospice Wage Index and Rate Update final rule
required providers to complete their aggregate cap determination not
sooner than 3 months after the end of the cap year, and not later than
5 months after, and remit any overpayments. Those hospices that fail to
submit their aggregate cap determinations on a timely basis will have
their payments suspended until the determination is completed and
received by the Medicare contractor (79 FR 50503).
9. FY 2016 Hospice Wage Index and Payment Rate Update Final Rule
In the FY 2016 Hospice Wage Index and Rate Update final rule (80 FR
47142), CMS finalized two different payment rates for RHC: A higher per
diem base payment rate for the first 60 days of hospice care and a
reduced per diem base payment rate for subsequent days of hospice care.
CMS also finalized a service intensity add-on (SIA) payment payable for
certain services during the last 7 days of the beneficiary's life. A
service intensity add-on payment will be made for the social worker
visits and nursing visits provided by a registered nurse (RN), when
provided during routine home care in the last 7 days of life. The SIA
payment is in addition to the routine home care rate. The SIA payment
is provided for visits of a minimum of 15 minutes and a maximum of 4
hours per day (80 FR 47172).
In addition to the hospice payment reform changes discussed, the FY
2016 Hospice Wage Index and Rate Update final rule implemented changes
mandated by the IMPACT Act, in which the cap amount for accounting
years that end after September 30, 2016 and before October 1, 2025
would be updated by the hospice payment update percentage rather than
using the CPI-U (80 FR 47186). In addition, we finalized a provision to
align the cap accounting year for both the inpatient cap and the
hospice aggregate cap with the FY for FY 2017 and thereafter. Finally,
the FY 2016 Hospice Wage Index and Rate Update final rule (80 FR 47144)
clarified that hospices would have to report all diagnoses on the
hospice claim as a part of the ongoing data collection efforts for
possible future hospice payment refinements.
10. FY 2017 Hospice Wage Index and Payment Rate Update Final Rule
In the FY 2017 Hospice Wage Index and Rate Update final rule (81 FR
52160), CMS finalized several new policies and requirements related to
the Hospice Quality Reporting Program (HQRP). First, CMS codified the
policy that if the National Quality Forum (NQF) made non-substantive
changes to specifications for HQRP measures as part of the NQF's re-
endorsement process, CMS would continue to utilize the measure in its
new endorsed status, without going through new notice-and-comment
rulemaking. CMS would continue to use rulemaking to adopt substantive
updates made by the NQF to the endorsed measures adopted for the HQRP;
determinations about what constitutes a substantive versus non-
substantive change would be made on a measure-by-measure basis. Second,
we finalized two new quality measures for the HQRP for the FY 2019
payment determination and subsequent years: Hospice Visits when Death
is Imminent Measure Pair and Hospice and Palliative Care Composite
Process Measure-Comprehensive Assessment at Admission (81 FR 52173).
The data collection mechanism for both of these measures is the Hospice
Item Set (HIS), and the measures were effective April 1, 2017.
Regarding the Consumer Assessment of Healthcare Providers and Systems
(CAHPS[supreg]) Hospice Survey, CMS finalized a policy that hospices
that receive their CMS Certification Number (CCN) after January 1, 2017
for the FY 2019 Annual Payment Update (APU) and January 1, 2018 for the
FY 2020 APU will be exempted from the Hospice CAHPS[supreg]
requirements due to newness (81 FR 52182). The exemption is determined
by CMS and is for 1 year only.
11. FY 2020 Hospice Wage Index and Payment Rate Update Final Rule
In the FY 2020 Hospice Wage Index and Rate Update final rule (84 FR
38484), we finalized rebased payment rates for CHC and GIP and set
those rates equal to their average estimated FY 2019 costs per day. We
also rebased IRC per diem rates equal to the estimated FY
[[Page 42532]]
2019 average costs per day, with a reduction of 5 percent to the FY
2019 average cost per day to account for coinsurance. We finalized the
FY 2020 proposal to reduce the RHC payment rates by 2.72 percent to
offset the increases to CHC, IRC, and GIP payment rates to implement
this policy in a budget-neutral manner in accordance with section
1814(i)(6) of the Act (84 FR 38496).
In addition, we finalized a policy to use the current year's pre-
floor, pre-reclassified hospital inpatient wage index as the wage
adjustment to the labor portion of the hospice rates. Finally, in the
FY 2020 Hospice Wage Index and Rate Update final rule (84 FR 38505), we
finalized modifications to the hospice election statement content
requirements at Sec. 418.24(b) by requiring hospices, upon request, to
furnish an election statement addendum effective beginning in FY 2021.
The addendum must list those items, services, and drugs the hospice has
determined to be unrelated to the terminal illness and related
conditions, increasing coverage transparency for beneficiaries under a
hospice election.
12. Consolidated Appropriations Act, 2021
Division CC, section 404 of Consolidated Appropriations Act, 2021
(CAA 2021) amended section 1814(i)(2)(B) of the Act and extended the
provision that currently mandates the hospice cap be updated by the
hospice payment update percentage (hospital market basket update
reduced by the productivity adjustment) rather than the CPI-U for
accounting years that end after September 30, 2016 and before October
1, 2030. Prior to enactment of this provision, the hospice cap update
was set to revert to the original methodology of updating the annual
cap amount by the CPI-U beginning on October 1, 2025. Division CC,
section 407 of CAA 2021 revises section 1814(i)(5)(A)(i) to increase
the payment reduction for hospices who fail to meet hospice quality
measure reporting requirements from two percent to four percent
beginning with FY 2024.
III. Provisions of the Final Rule
A. Hospice Utilization and Spending Patterns
In the FY 2022 proposed rule (86 FR 19700), CMS provided data
analysis on hospice utilization trends from FY 2010 through FY 2019.
The analysis included data on the number of beneficiaries using the
hospice benefit, live discharges, reported diagnoses on hospice claims,
Medicare hospice spending, and Parts A, B and D non-hospice spending
during a hospice election. The proposed rule also solicited comments
from the public, hospice providers, patients and advocates regarding
hospice utilization and spending patterns. We also solicited comments
regarding skilled visits in the last week of life, particularly, what
factors determine how and when visits are made as an individual
approaches the end of life and how hospices make determinations as to
what items, services and drugs are related versus unrelated to the
terminal illness and related conditions. That is, how do hospices
define what is unrelated to the terminal illness and related conditions
when establishing a hospice plan of care.
Likewise, we solicited comments on what other factors may influence
whether or how certain services are furnished to hospice beneficiaries.
Finally, we requested feedback from stakeholder as to whether the
hospice election statement addendum has changed the way hospices make
care decisions and how the addendum is used to prompt discussions with
beneficiaries and non-hospice providers to ensure that the care needs
of beneficiaries who have elected the hospice benefit are met. A
summary of these comments and our response to those comments appear
below:
1. Hospice Utilization and Spending Patterns
Several commenters thanked CMS for continuing to incorporate
monitoring and data analysis into its proposed hospice payment rule.
Many commenters stated that while the structure of the hospice benefit
and approach to care at the end of life remain unchanged, changes in
the characteristics of patients served (particularly the shift from
predominantly cancer patients to those with end-stage neurological and
other conditions) is largely responsible for driving changes in
utilization trends and hospice practice over recent decades. Many
commenters suggested that CMS provide more detailed analysis of
physician billing as it relates to non-hospice spending and a few
commenters suggested that CMS release additional data connected to CMS'
Part D spending analysis to better inform stakeholders and assist in
helping to determine what factors may be contributing to these
increased Part D expenditures during a hospice election.
2. Skilled Visits in the Last Days of Life
One commenter stated that the service intensity add-on (SIA)
payment has been one of the greatest improvements in the hospice
benefit in recent years. Many commenters recommended that CMS modify
the SIA payments to include any visits which could be counted toward
end-of-life care, not just skilled visits (for example, chaplain and
spiritual care or hospice aide).
3. Items, Services, and Drugs Related and Unrelated to the Terminal
Illness and Related Conditions
Several commenters stated that the determination of relatedness, as
applied to coverage decisions connected to terminal prognosis, is a
clinical decision specific to the unique clinical circumstances of each
patient. Several commenters stated that they work in collaboration with
their respective IDGs to determine the items, services, and drugs that
are related versus unrelated once the comprehensive assessment is
completed.
4. Election Statement Addendum
Several commenters stated that the addendum has not changed their
practices for determining what is related or unrelated under the
hospice benefit, but has enhanced the upfront communication with
patients and representatives during the admission process. One
commenter stated that their hospice revisited the way relatedness is
defined, and realized that many diagnoses that were previously thought
to be unrelated were related. Another commenter stated that very few
patients and their representatives have requested the addendum and that
the burden of implementation of the addendum outweighs the benefits.
We appreciate the comments provided regarding the analysis
presented in the proposed rule. We plan continue to monitor hospice
trends and vulnerabilities within the hospice benefit. We will consider
these comments and suggestions for ongoing monitoring analyses, program
integrity efforts, and for potential future rulemaking.
B. FY 2022 Labor Shares
1. Background
The labor share for CHC and RHC of 68.71 percent was established
with the FY 1984 Hospice benefit implementation based on the wage/
nonwage proportions specified in Medicare's limit on home health agency
costs (48 FR 38155 through 38156). The labor shares for IRC and GIP are
currently 54.13 percent and 64.01 percent, respectively. These
proportions were based on skilled nursing facility wage and nonwage
cost limits and
[[Page 42533]]
skilled nursing facility costs per day (48 FR 38155 through 38156; 56
FR 26917).
In the FY 2022 proposed rule (86 FR 19717 through 19719), we
proposed to rebase and revise the labor shares for CHC, RHC, IRC and
GIP using Medicare cost report (MCR) data for freestanding hospices
(collected via CMS Form 1984-14, OMB NO. 0938-0758) for 2018. We
proposed to continue to establish separate labor shares for CHC, RHC,
IRC, and GIP and base them on the calculated compensation cost weights
for each level of care from the 2018 MCR data. We describe our proposed
methodology for deriving the compensation cost weights for each level
of care using the MCR data below as well as a summary of the comments
received and our responses.
Twenty unique stakeholders submitted their comments on the proposal
to rebase the hospice labor shares. In response to public comments, we
are adopting the revised hospice labor shares calculated as we proposed
with a slight modification to the methodology.
Comment: A few commenters supported the proposal to rebase the
labor share for the four levels of care based on the 2018 MCR data. One
commenter supported the proposed methodology of using actual hospice
cost report data calculated using all applicable costs as well as
including only providers who performed each level of care normalizing
for outliers. Another commenter stated it was appropriate that the
hospice labor shares be based on data for hospice providers, rather
than home health agencies and skilled nursing facilities. Several
commenters stated that basing the hospice labor shares on recent MCR
data for hospice providers will improve payment accuracy.
One commenter strongly encouraged CMS not to revise the labor share
using the 2018 MCR for freestanding hospices. One commenter opposed the
proposed labor shares, stating that the data in the cost report do not
provide adequate or appropriate measures of labor expenses. One
commenter agreed with the increased labor share for CHC and for IRC,
but did not agree with lowering the labor share for RHC and GIP. One
commenter acknowledged the rationale for using hospice cost report
data, but stated that this will reduce reimbursement for many of their
members, particularly those who provide more GIP than average.
Response: We believe that our proposal to revise the labor shares
based on MCR data for hospice providers is a technical improvement to
the current labor shares and appreciate the support from the
commenters.
We disagree with commenters that the hospice MCR data does not
provide adequate or appropriate measure of labor expenses. The MCR data
captures detailed labor and non-labor expenses for patient (including
but not limited to nursing, physician, therapy and medical supply
expenses) and non-patient expenses (such as administrative and general)
by level of care. We would note that the freestanding hospice MCR data
was used to rebase the hospice payment rates effective for FY 2020 (84
FR 38487 to 38496). In addition, we remind providers that when
submitting the MCR data they must certify the cost report that ``to the
best of [their] knowledge and belief, [the] report and statement are
true, correct, complete and prepared from the books and records of the
provider in accordance with applicable instructions, except as noted.''
Comment: Several commenters expressed concern regarding the impact
of COVID-19 on labor costs. Commenters stated that while they do not
yet know the full extent of the impact on labor costs, they expect it
to be significant. They stated that the PHE could considerably change
the labor share in the next several years of cost report data, as the
use of cost reports has a 2-year delay in data. These commenters stated
that the impact of COVID-19 on the labor component of the rates cannot
be captured in cost report data that is at least 2 years old. The
commenters requested consideration of the impact of COVID-19 when
setting labor shares for future years.
Several other commenters stated that hospices face significant
challenges in the labor market, particularly for nurses. They stated
that more nurses are retiring, competition for available nurses is
fierce, and many hospices are paying premium salaries and bonuses to
recruit and retain qualified nursing staff. One commenter stated that
the hospice per diem structure severely limits the amounts they can
spend on staff. One commenter stated during the pandemic more time has
been needed to train and retrain on infection control standards, as
well as changes in communication due to practice changes.
One commenter stated that it is difficult to attract nurses to
their geographic area because of the increase in the median home price
between January 2021 and May 2021. The commenter stated that they are
forced to outsource many nursing functions at high cost, along with
paying retention bonuses to current staff. The commenter stated that
these labor market challenges will have an impact on the labor shares,
which will not necessarily be reflected when the cost report data used
is 2 years old. One commenter urged CMS to give special consideration
to challenges faced by rural health care providers with specific
attention given to the impact workforce shortages have in setting
reimbursement rates related to the labor shares.
Response: We acknowledge and appreciate the commenters' concerns
regarding labor costs and understand the challenges created by the PHE.
We believe using updated labor shares based on 2018 data is a technical
improvement over the current labor shares as they reflect recent cost
data for freestanding hospice providers. The current labor shares were
primarily based on data from the early 1980s. The proposed labor shares
reflect the skilled care (including the number of visits) provided
under the hospice per diem payment rates for each level of care. For
example, the higher labor share for CHC compared to RHC reflects the
higher number of visits per day provided with CHC relative to RHC. The
current labor shares did not reflect this differential in utilization
as the same labor share was used for both levels of care.
We plan on reviewing the 2020 hospice MCR data when complete
information is available that will allow us to consider whether the
hospice labor shares based on 2018 data are still appropriate. Any
future revisions to the hospice labor shares will be proposed and
subject to public comments in future rulemaking.
Comment: Several commenters expressed concerns about the frequency
of updating the labor shares in the future. A few of these commenters
requested that CMS provide further clarification of the frequency of
updates to the labor shares with hospice cost report data. One
commenter stated that it is important that CMS address this frequency
so that hospices and cost report preparers can ensure that the data
submitted on the cost report can be used for the labor share
calculations.
Response: We acknowledge the commenters' concern that the proposed
rule did not explicitly state when we plan to propose any revisions to
the hospice labor shares beyond FY 2022.
The labor shares for other PPS systems (for example, IPPS, SNF,
IRF, IPF, and LTCH) are typically rebased every four to five years. We
tentatively plan to rebase the hospice labor shares on a similar
schedule as the other payment systems under Medicare. However, in light
of the COVID-19 PHE, we plan to monitor the upcoming MCR
[[Page 42534]]
data to see if a more frequent revision to the hospice labor shares is
necessary in order to reflect the most recent cost structures of
hospice providers. We note that any future revisions to the hospice
labor shares will be proposed and subject to public comments in future
rulemaking.
Comment: A few commenters stated that while they understand the
desire and rationale for using hospice data to revise the hospice labor
shares (and to make other policy changes), they believe it is important
to recognize that the data inputs utilized must be appropriate to the
task. The commenters stated that the hospice cost report in its current
form does not suit all data purposes for hospice policy changes, and
does not fully support calculation of the hospice payment rate labor
shares.
One commenter noted that the hospice cost report for freestanding
providers is being proposed to be used for the first time to determine
the labor component of the rates for each level of care. While the
commenter commended CMS for using hospice-specific data, they were also
concerned about the accuracy of the data submitted by providers.
One commenter stated concern that due to hospice MCRs not being
audited, as well as some sections of the cost report offering multiple
methods of reporting, there is a general lack of consistency in the way
that the reports are completed by hospice providers that will
necessarily distort the average labor figures. The commenter was also
concerned that it's not likely that most payroll applications used by
hospice providers can correctly allocate costs by level of care, so due
to different methods applied by hospice providers to estimate this, the
labor costs will also be impacted.
One commenter stated that there are no checks and balances on
whether cost reporting data are accurate. They claimed that classifying
costs across the four levels of care can contain inaccuracies,
particularly when staff allocate time to various levels of care in the
same working day. The commenter stated that there are no regulations
that require cost reports to be completed by an outside or otherwise
qualified accounting firm, and many hospices are doing their own costs
reports without complete understanding of how to allocate specific
costs and which box is appropriate for particular costs. They stated
that the number of hospices that do not pass level 1 edits is also of
concern.
One commenter stated that they do not believe hospice cost reports
are historically very accurate. They stated that in many healthcare
systems someone from the accounting department completed the cost
report form with very little input from the hospice program. The
commenter stated that they never had an opportunity to review the cost
report prior to submission to verify the information was accurate and
that they believe this is a common occurrence across the country.
Therefore, the commenter stated that they do not believe that cost
reports capture labor costs very accurately.
A few commenters stated that if data from the hospice cost report
is to be used for calculating the labor component by level of care,
revisions to the cost report should be proposed to address current
inconsistent, but acceptable, reporting practices. Further, the
commenters stated that these changes should be instituted to ensure
greater accuracy of the data being used to establish labor shares for
GIP and IRC. A few commenters stated that these changes should be
implemented as quickly as possible, and once they are in place CMS
should undertake a recalculation of the labor shares.
Response: The freestanding hospice MCR form used for the proposed
labor shares (CMS-1984-14; OMB NO. 0938-0758) was revised effective for
cost reporting periods beginning on or after October 1, 2014 in
response to section 1814(i)(6) of the Act, as added by section
3132(a)(1)(B) of the PPACA, which authorized the Secretary to collect
additional data and information determined appropriate to revise
payments for hospice care and other purposes. The types of data and
information suggested in the PPACA could capture accurate resource
utilization, which could be collected on claims, cost reports, and
possibly other mechanisms, as the Secretary determined to be
appropriate.
CMS form 1984-14 was proposed and subject to public comments.
Hospice providers previously completed MCR form (CMS-1984-89, OMB NO.
0938-0758). The revised MCR enabled CMS to collect more detailed data
regarding labor costs by level of care. The prior MCR did not collect
total costs by level of care or detailed costs by level of care (such
as labor and nonlabor).
We disagree with the commenter that the cost report in its current
form does not support the calculation of the hospice payment rate labor
shares. Providers are required to report detailed patient costs
(including but not limited to nursing, physician, therapy, and medical
supplies) and non-patient costs for each level of care. These costs are
further subdivided into labor and non-labor costs.
Our proposal to use the 2018 MCR data recognizes that providers
have had 4 years to familiarize themselves with the form and, thereby,
improve the accuracy of the data. We note that based on comments
received during the CMS-1984-14; OMB NO. 0938-0758 clearance process,
the implementation of the MCR form was delayed to October 1, 2014. In
addition, as stated previously, providers must certify the cost report
that ``to the best of [their] knowledge and believe, [the] report and
statement are true, correct, complete and prepared from the books and
records of the provider in accordance with applicable instructions,
except as noted.'' Nonetheless, we recognize that data can be
misreported at times and, therefore, our proposal for revising the
labor shares included applying several edits to remove possible outlier
data--a common statistical practice.
We continue to encourage hospice providers to report accurate and
complete data on the cost reports. We will evaluate and consider any
future changes to the hospice cost report that will allow for the
collection of data that may improve the calculation of the hospice
labor shares. In addition, we will monitor the compensation cost
weights reported by hospices over time to determine if changes to the
labor share are appropriate. Any future changes to the cost report or
labor shares would be subject to public comments.
While we acknowledge that hospice providers can use different
methodologies for reporting data, we believe that our proposed
methodology allows for these differences and still results in a
reasonable and accurate measure of the cost structures of hospice
facilities.
The proposed labor shares are based on MCR data for freestanding
hospice facilities. As stated in the proposed rule, we did explore the
possibility of using facility-based hospice MCR data to calculate the
compensation cost weights; however, very few providers passed the Level
I edits (as described in more detail below) and so these reports were
not usable.
Comment: One commenter stated that the finances of freestanding
hospices are significantly different than those of hospices based at
hospitals, home health agencies and nursing homes; therefore, data from
freestanding hospices should not be allowed to represent the industry
as a whole.
Response: As stated in the FY 2022 Hospice Wage Index and Rate
Update proposed rule (86 FR 19717), we did
[[Page 42535]]
explore the possibility of using facility-based hospice MCR data to
calculate the compensation cost weights; however, very few providers
passed the Level I edits and so these reports were not usable. We also
plan to continue to review the 2020 hospital-based hospice MCR data to
see if the reporting of the detailed expense data by level of care has
improved for possible incorporation into the labor share calculations.
We would note that the freestanding hospice providers account for about
85 percent of hospice providers and therefore, we believe our proposal
to use only the freestanding hospice MCR data to revise the labor
shares is reasonable and a technical improvement over the current labor
shares.
2. Methodology for Calculating Compensation Costs
We proposed to derive a compensation cost weight for each level of
care that consists of five major components: (1) Direct patient care
salaries and contract labor costs, (2) direct patient care benefits
costs, (3) other patient care salaries, (4) overhead salaries, and (5)
overhead benefits costs. For each level of care, we proposed to use the
same methodology to derive the components; however, for the (1) direct
patient care salaries and (3) other patient care salaries, we proposed
to use the MCR worksheet that is specific to that level of care (that
is, Worksheet A-1 for CHC, Worksheet A-2 for RHC, Worksheet A-3 for
IRC, and Worksheet A-4 for GIP).
a. Direct Patient Care Salaries and Contract Labor Costs
Direct patient care salaries and contract labor costs are costs
associated with medical services provided by medical personnel
including but not limited to physician services, nurse practitioners,
RNs, and hospice aides. We proposed to define direct patient care
salaries and contract labor costs to be equal to costs reported on
Worksheet A-1 (for CHC) or Worksheet A-2 (for RHC) or Worksheet A-3
(for IRC) or Worksheet A-4 (for GIP), column 7, for lines 26 through
37.
Comment: One specific concern of the commenters regarding the
proposed methodology was on the data used from Worksheet A-1 and A-2
column 7, lines 26 through 37 for total labor costs associated with
each respective level of care. The commenters stated that certain costs
are not consistently reported by hospices despite these costs being in
compliance with cost reporting instructions. For example, the
commenters provided that some hospices track mileage allowances
enabling them to be reported on Worksheet A-1 and A-2 while other
hospices allocate these mileage reimbursement costs via Worksheet B and
B-1 using miles traveled. The commenters asked CMS whether any
consideration was given to this inconsistent, but acceptable, reporting
for mileage allowances.
Response: We appreciate the commenter's concern. The proposed
methodology for calculating the labor shares cited by the commenter of
using Worksheet A-1 and A-2 column 7, lines 26 through 37 for total
labor costs reflects only one component of the proposed calculation of
the labor share. As discussed in the FY 2022 Hospice proposed rule (86
FR 19718) and above, we proposed to derive Direct patient care salaries
and contract labor costs using (for CHC as an example) Worksheet A-1
column 7, lines 26 through 37 on the cost report, which would capture
any staff transportation costs reported in these cost centers on
Worksheet A-1.
Also included in the compensation costs for each level of care, as
discussed in the FY 2022 Hospice proposed rule (86 FR 19718) and below,
is a proportion overhead salaries and benefits. The overhead salaries
includes those reported in the staff transportation cost center
(reported in Worksheet A, column 1, line 12) and the overhead benefits
for the staff transportation cost center (Worksheet B, column 3, line
12).
Therefore, after consideration of public comments, we believe that
our proposed methodology is capturing both the direct patient care
costs reported on Worksheet A-1 and any overhead salaries and overhead
benefits related to staff transportation costs that are allocated on
Worksheet B. We believe that the non-salary non-benefit costs for staff
transportation that are allocated on Worksheet B (for example, cost of
owning or renting vehicles) should not be included in the labor share
of the hospice payment rate that is adjusted by the wage index, as they
are not compensation costs, nor do they vary with the local labor
market.
b. Direct Patient Care Benefits Costs
We proposed that direct patient care benefits costs for CHC are
equal to Worksheet B, column 3, line 50, for RHC are equal to Worksheet
B, column 3, line 51, for IRC are equal to Worksheet B, column 3, line
52, and for GIP are equal to Worksheet B, column 3, line 53.
c. Other Patient Care Salaries
Other patient care salaries are those salaries attributable to
patient services including but not limited to patient transportation,
labs, and imaging services. These salaries reflecting all levels of
care are reported on Worksheet A, column 1, lines 38 through 46 and
then are further disaggregated for CHC, RHC, IRC, and GIP on Worksheets
A-1, A-2, A-3, and A-4, respectively, on column 1 (salaries), lines 38
through 46. Our analysis, however, found that many providers were not
reporting salaries on the detailed level of care worksheets (A-1, A-2,
A-3, A-4, column 1), but rather reporting total costs (reflecting
salary and nonsalary costs) for these services for each level of care
on Worksheets A-1, A-2, A-3, A-4, column 7. Therefore, we proposed to
estimate other patient care salaries attributable to CHC, RHC, IRC, and
GIP by first calculating the ratio of total facility (reflecting all
levels of care) other patient care salaries (Worksheet A, column 1,
lines 38 through 46) to total facility other patient care total costs
(Worksheet A, column 7, lines 38 through 46). For CHC, we proposed to
then multiply this ratio by other patient care total costs for CHC
(Worksheet A-1 column 7, lines 38 through 46). For RHC, we proposed to
multiply this ratio by total other patient care costs for RHC
(Worksheet A-2, column 7, lines 38 through 46). For IRC, we proposed to
multiply this ratio by total other patient care costs for IRC
(Worksheet A-3, column 7, lines 38 through 46). For GIP, we proposed to
multiply this ratio by total other patient care costs for GIP
(Worksheet A-4, column 7, lines 38 through 46). This proposed
methodology assumes that the proportion of salary costs to total costs
for other patient care services is consistent for each of the four
levels of care.
Comment: One commenter stated that the proposed methodology for
calculating compensation costs omits two of the required disciplines in
a hospice patient's interdisciplinary team. They stated that social
workers and counselors provide direct patient care along with nurses
and hospice aides in both routine home care and general inpatient care.
The commenter claimed that the proposed methodology only captures
salaries and benefits of physicians, nurse practitioners, RNs and
hospice aides. The commenter stated that this disregards the essence of
the hospice interdisciplinary team which cares for the patient and
family as a unit of care. Social workers and counselors serve both the
patient and their family. Their salaries and benefits must also be
captured in the methodology. The commenter stated that it is unclear in
the proposed rule whether they are
[[Page 42536]]
included in ``Other Patient Care Salaries'' since only mentioned are
patient transportation, labs and imaging services.
Response: As stated in the FY 2022 hospice proposed rule (86 FR
19717 through 19719) as well as above, we proposed that Direct patient
care salaries and contract labor costs be equal to costs reported on
Worksheet A-1 (for CHC) or Worksheet A-2 (for RHC) or Worksheet A-3
(for IRC) or Worksheet A-4 (for GIP), column 7, for lines 26 through 37
(86 FR 19718). These lines include Medical Social Services (line 33),
Spiritual Counseling (line 34), Dietary Counseling (line 25), and
Counseling Other (line 36). Therefore, we proposed to include direct
patient care salaries and contract labor for social workers and
counselors in the calculation of the labor shares.
d. Overhead Salaries
The MCR captures total overhead costs (including but not limited to
administrative and general, plant operations and maintenance, and
housekeeping) attributable to each of the four levels of care. To
estimate overhead salaries for each level of care, we first proposed to
calculate noncapital nonbenefit overhead costs for each level of care
to be equal to Worksheet B, column 18, less the sum of Worksheet B,
columns 0 through 3, for line 50 (CHC), or line 51 (RHC) or line 52
(IRC) or line 53 (GIP). We then proposed to multiply these noncapital
nonbenefit overhead costs for each level of care times the ratio of
total facility overhead salaries (Worksheet A, column 1, lines 4
through 16) to total facility noncapital nonbenefit overhead costs
(which is equal to Worksheet B, column 18 (total costs), line 101 less
the sum of Worksheet B, columns 0 (direct patient care costs), column 1
(fixed capital), column 2 (moveable capital) and column 3 (employee
benefits), line 101).
e. Overhead Benefits Costs
To estimate overhead benefits costs for each level of care, we
proposed a similar methodology to overhead salaries. For each level of
care, we proposed to calculate noncapital overhead costs for each level
of care to be equal to Worksheet B, column 18, less the sum of
Worksheet B, columns 0 through 2, for line 50 (CHC), or line 51 (RHC)
or line 52 (IRC) or line 53 (GIP). We then proposed to multiply these
noncapital overhead costs for each level of care times the ratio of
total facility overhead benefits (Worksheet B, column 3, lines 4
through 16) to total facility noncapital overhead costs (Worksheet B,
column 18, line 101 less the sum of Worksheet B, columns 0 through 2,
line 101). This proposed methodology assumes the ratio of total
overhead benefit costs to total noncapital overhead costs is consistent
among all four levels of care.
Comment: Another specific concern raised by the commenters was that
there are inconsistencies in reporting medical supply and pharmacy
costs on line 10 and line 14 of Worksheet A. They stated that some
hospices use Worksheets A-1, A-2, A-3, and A-4 to report all or most of
these costs whereas others use lines 10 and lines 14 and report costs
as overhead costs. The commenters recommended that CMS look further
into reporting all pharmacy and medical supply costs as direct patient
care costs on future cost reports. The commenter stated that other
acceptable cost reporting methods may be applicable; however, a Level 1
edit is not currently produced if costs are reported in one of the two
acceptable locations.
Response: As described in the FY 2022 hospice proposed rule (86 FR
19717 through 19719), our proposed calculation to derive the hospice
labor shares uses the sum of five categories of compensation costs. The
estimated compensation costs related to medical supply and pharmacy
costs would be reflected in the Other Patient Care Salaries, Overhead
Salaries, and Overhead Benefits categories. We proposed that total
costs for CHC be equal to Worksheet B, column 18, line 50, for RHC are
equal to Worksheet B, column 18, line 51, for IRC would be equal to
Worksheet B, column 18, line 52, and for GIP are equal to Worksheet B,
column 18, line 53. These total costs would reflect medical supply and
pharmacy costs when reported on Worksheet A line 10 and 14 or when
reported on Worksheet A-1, A-2, A-3, and A-4. Therefore, we believe our
proposed methodology captures these costs appropriately. However, we
will consider this comment when requesting any future revisions to the
Level 1 edits applied to the hospice cost report.
Comment: One commenter had concerns with the inconsistent reporting
of certain types of overhead expenses among hospices. They stated in
some instances, Medical Directors are employees and salaries would be
reported; however, other hospices contract for this position. The
commenter stated that the contracted payments for Medicare Directors
are not included in the proposed calculation of overhead salaries. The
commenter asked whether any consideration was made regarding this
inconsistency or other common inconsistencies in the nature of the
expenses.
Response: We appreciate the commenter's concern and conducted an
additional review of our proposed methodology for appropriately
capturing overhead costs in the labor shares.
As noted by the commenter, salaries and benefit costs for employed
Medical Directors would be reported in Worksheet A, column 1, line 15
(salaries) and Worksheet B, column 3, line 15 (benefits), which are
both included in our proposed methodology as these expenses are
reported in overhead salaries and overhead benefits. As described in
the proposed rule (86 FR 19718) and above, we include a proportion
overhead salaries and overhead benefits in the compensation cost
weights for each level of care.
However, after performing a detailed review of the calculation, we
acknowledge that Medical Director contract labor costs would be
reported in Worksheet A, column 2, line 15, which we do not include in
the proposed compensation cost weight. In addition to Physician
Administrative Services (line 15), we identified one additional
overhead cost center where contract labor costs for patient care are
reported and not reflected in the labor shares for each level of care:
Nursing Administration (line 9). We believe these cost centers
(Physician Administrative Services and Nursing Administration) are
labor-intensive and vary with the local labor market and, thus, we
believe contract labor costs for these services should be included in
the labor shares for each level of care. Therefore, in response to
public comment, we are revising our methodology for calculating
overhead benefits attributable to each level of care. We are including
in total facility overhead benefits those costs reported in Worksheet
A, column 2, lines 9 and 15. A proportion of overhead benefit costs are
allocated to each level of care using our methodology as stated above
and in the proposed rule (86 FR 19718). This revision to our labor
share methodology results in upward revisions to the proposed labor
shares for each of the levels of care (between 0.6 percentage point and
1.1 percentage point). The labor shares showing the revised methodology
are provided in Table 1.
f. Total Compensation Costs and Total Costs
To calculate the compensation costs for each provider, we proposed
to then sum each of the costs estimated in steps (1) through (5) to
derive total compensation costs for CHC, RHC, IRC, and GIP. We proposed
that total costs
[[Page 42537]]
for CHC are equal to Worksheet B, column 18, line 50, for RHC are equal
to Worksheet B, column 18, line 51, for IRC are equal to Worksheet B,
column 18, line 52, and for GIP are equal to Worksheet B, column 18,
line 53.
3. Methodology for Deriving Compensation Cost Weights
To derive the compensation cost weights for each level of care, we
first proposed to begin with a sample of providers who met new Level I
edit conditions that required freestanding hospices to fill out certain
parts of their cost reports effective for freestanding hospice cost
reports with a reporting period that ended on or after December 31,
2017.\3\ Specifically, we required the following costs to be greater
than zero: Fixed capital costs (Worksheet B, column 0, line 1), movable
capital costs (Worksheet B, column 0, line 2), employee benefits
(Worksheet B, column 0, line 3), administrative and general (Worksheet
B, column 0, line 4), volunteer service coordination (Worksheet B,
column 0, line 13), pharmacy and drugs charged to patients (sum of
Worksheet B, column 0, line 14 and Worksheet A, column 7, line 42.50),
registered nurse costs (Worksheet A, column 7, line 28), medical social
service costs (Worksheet A, column 7, line 33), hospice aide and
homemaker services costs (Worksheet A, column 7, line 37), and durable
medical equipment (Worksheet A, column 7, line 38). Applying these
Level I edits to the 2018 freestanding hospice MCRs resulted in 3,345
providers that passed the edits (four were excluded).
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\3\ Medicare Department of Health and Human Services (DHHS)
Provider Reimbursement Manual--Part 2, Provider Cost Reporting Forms
and Instructions, Chapter 43, Form CMS-1984-14. April 13, 2018.
<a href="https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/2018Downloads/R3P243.pdf">https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/2018Downloads/R3P243.pdf</a>.
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Then, for each level of care separately, we proposed to further
trim the sample of MCRs. We outline our proposed trimming methodology
using CHC as an example. Specifically, for CHC, we proposed that total
CHC costs (Worksheet B, column 18, line 50) and CHC compensation costs
to be greater than zero. We also proposed that CHC direct patient care
salaries and contract labor costs per day is greater than 1. We also
proposed to exclude those providers whose CHC compensation costs were
greater than total CHC costs.
For the IRC and GIP compensation cost weights, we proposed to only
use those MCRs from providers that provided inpatient services in their
facility. Therefore, we proposed to exclude providers that reported
costs greater than zero on Worksheet A-3, column 7, line 25 (Inpatient
Care--Contracted) for IRC and Worksheet A-4, column 7, line 25
(Inpatient Care--Contracted) for GIP. The facilities that remained
after this trim reported detailed direct patient care costs and other
patient care costs for which we could then derive direct patient care
salaries and other patient care salaries per the methodology described
earlier.
Comment: One commenter stated that many of the hospice cost reports
filed in 2018 failed to report contracted GIP days and contracted IRC
care days on Worksheet S-1. Instead, they included all these days on
line 23 and 33 of Worksheet S-1 but failed to report contracted days on
line 40 and 41 of Worksheet S-1. The commenter stated that the failure
to report contracted days on lines 40 and 41 would avoid a Level 1 edit
if costs were not reported on Worksheets A-3 and A-4, line 25. The
commenter stated that they understand that this reporting is
inaccurate; however, there is no existing Level 1 edit that would catch
it. The commenter questioned how CMS is determining that the inpatient
costs are related solely to a freestanding inpatient unit on Worksheet
A-4. The commenter claimed that if it is solely because no costs are
reported on line 25, this assumption is in error. The commenter also
claimed that if it is based on no days being reported as contracted on
Worksheet S-1, this assumption is also in error. The commenter was
concerned that costs--and accordingly labor component costs--are based
on a small population with high risk of error.
One commenter stated that with only those cost reports from
providers that have a hospice inpatient unit being used to determine
the GIP and inpatient respite labor costs, they are concerned because
one of their two affiliated hospices does have an inpatient unit, and
yet they sometimes refer patients to contracted facilities for these
levels of care as well. The commenter stated that it appears that the
percentage of hospice cost reports used for determining GIP and respite
total costs and labor-component costs is based on a small population of
hospice providers with a significant risk of error; therefore, the
commenter recommended that CMS rethink its approach for GIP and respite
labor costs.
One commenter stated that their hospice utilizes general inpatient
contracts, as they do not have our own facility. Thus, inpatient
services on line 25 are not captured.
Response: We appreciate the commenters' concerns on the accuracy of
the IRC and GIP cost data on the MCR. As stated in the FY 2022 Hospice
proposed rule (86 FR 19718 through 19719) and above, for purposes of
calculating the IRC and GIP compensation cost weights, we excluded
providers that reported costs greater than zero on Worksheet A-3,
column 7, line 25 (Inpatient Care--Contracted) for IRC and Worksheet A-
4, column 7, line 25 (Inpatient Care--Contracted) for GIP. Then, for
each level of care separately, we further trimmed the sample of cost
reports. Specifically, for IRC, we required total IRC costs (Worksheet
B, column 18, line 52) and IRC compensation costs to be greater than
zero. We also required that IRC direct patient care salaries and
contract labor costs per day would be greater than 1. We also excluded
those providers whose IRC compensation costs were greater than total
IRC costs. We then simultaneously removed those providers whose total
IRC costs per day fall in the top and bottom one percent of total IRC
costs per day for all IRC providers as well remove those providers
whose compensation cost weight falls in the top and bottom five percent
of compensation cost weights for all IRC providers.
We did not exclude providers based on the reporting of contracted
inpatient days as reported on Worksheet S-1. In response to the public
comment, we did test applying an additional edit that would exclude
providers who reported contracted inpatient days on Worksheet S-1 as
part of our basic trims. This excluded two providers and had no impact
on the compensation cost weights for both IRC and GIP when rounded to a
tenth of a percentage point. We encourage providers to report their
cost report data accurately and timely.
Comment: Another specific concern stated by the commenters was that
the determination of the labor share for GIP and IRC is based on
Worksheet A-3 and A-4; however, any hospices reporting costs on line 25
(contracted services) were not included in the sample used for setting
the labor share. The commenters recognize that the inclusion of any
costs on line 25 would distort the labor component for these inpatient
services; however, the commenters' experience indicates that most
hospices with inpatient units also contract for some inpatient days
with outside providers for a variety of reasons. The commenters stated
that many of these hospices providers have some of the best accounting
records in the industry and the proposed methodology for calculating
the labor components eliminates the costs of these facilities from
consideration. The commenters stated that the proposed rule indicates
[[Page 42538]]
that 20 percent of IRC and 28 percent of GIP providers were included in
the calculation. The commenters requested that CMS provide the final
number of hospices with inpatient units that were used in the
calculation of the labor components for both levels of care, and the
total universe of IRC and GIP providers. One commenter also stated that
they were interested in how the percentage of hospices that operate
inpatient facilities can be increased and all costs, including
contracted costs, can be included.
Response: The proposed hospice labor shares for the IRC level of
care and GIC level of care (after trimming for outliers) is based on
costs for 416 and 295 providers, respectively. These providers
reflected approximately 53,000 IRP days of which about 47,000 were
Medicare and approximately 136,000 GIC days of which about 108,000 were
Medicare. Although this a smaller sample of providers than used for the
other proposed labor shares for RHC (2,919 providers) and CHC (1,240
providers), we believe this is a technical improvement to the current
labor shares that were primarily based on skilled nursing facility
costs from the early 1980s. Our proposed methodology utilizes
freestanding hospice cost report data reflecting the skilled hospice
care provided in 2018 and the associated direct and indirect costs
required to provide these services in 2018. We encourage all providers
to report the cost report data accurately and timely so we can include
more providers' cost report data in the labor share calculations. We
will monitor the cost report data to determine whether the proposed
updated labor shares are still appropriate.
Comment: Another specific concern raised by commenters was that the
cost reports should be amended to allow for a greater breakdown of
costs for contracted vs. hospice-administered inpatient services.
Specifically, one commenter stated that when the cost report was
revised in 2014, some industry experts recommended that CMS develop two
separate worksheets for IRC and GIC. The first worksheet would
represent costs associated with freestanding units operated by the
hospice and the second worksheet would be for costs associated with
contracted services. The commenter stated CMS should see value in
potentially adding these worksheets if, in fact, it intends to
calculate labor components for these levels of care based on cost
report data going forward. The commenter also recommended that CMS
could add a question to the cost report asking whether the hospice
operates a freestanding inpatient and/or inpatient respite care
facility. A ``no'' answer would require reporting contracted days and
contracted costs or produce a Level 1 edit. The commenter stated that
this would better allow CMS to isolate the costs of those facilities
that truly operate an inpatient unit.
One commenter requested that CMS work with stakeholders and the
hospice community to identify the best approaches, and separate
worksheets, for GIP and inpatient respite costs, including both
hospices that operate a freestanding facility and hospices that have
contracted beds.
Response: We appreciate the commenters request for future changes
to the hospice cost report to allow us to better isolate costs of those
facilities that operate an inpatient unit. As stated above, we believe
that our current method for calculating the IRC and GIP compensation
cost weights provides an accurate measure of the labor shares for these
levels of care. We will consider this comment when working on any
future modifications to the hospice cost report. We will also continue
to monitor the hospice labor shares as more recent data become
available. We note that any future revisions to the hospice labor
shares will be proposed and subject to public comments in future
rulemaking.
Finally, as proposed, to derive the compensation cost weights for
each level of care for each provider, we divide compensation costs for
each level of care by total costs for each level of care. We then trim
the data for each level of care separately to remove outliers.
Following our example for CHC, we simultaneously remove those providers
whose total CHC costs per day fall in the top and bottom one percent of
total CHC costs per day for all CHC providers as well remove those
providers whose compensation cost weight falls in the top and bottom
five percent of compensation cost weights for all CHC providers. We
then sum the CHC compensation costs and total CHC costs of the
remaining providers, yielding a proposed compensation cost weight for
CHC.
Since we limited our sample for IRC and GIP compensation cost
weights to those hospices providing inpatient services in their
facility, we conducted sensitivity analysis to test for the
representative of this sample by reweighting compensation cost weights
using data from the universe of freestanding providers that reported
either IRC or GIP total costs. For example, we calculated reweighted
compensation cost weights by ownership-type (proprietary, government
and nonprofit), by size (based on RHC days) and by region. Our
reweighted compensation cost weights for IRC and GIP were similar (less
than one percentage point in absolute terms) to our proposed
compensation cost weights for IRC and GIP (as shown in Table 1) and,
therefore, we believe our sample is representative of freestanding
hospices providing inpatient hospice care.
Comment: One commenter requested that clarification as to how CMS
will adjust the labor share if certain types of hospices are found to
provide more services and thus, likely have a larger labor share but
contribute fewer cost reports.
Response: As described in the FY 2022 Hospice proposed rule (86 FR
17919) and above, the proposed compensation cost weights are equal to
the sum of the compensation costs divided by the sum of the total costs
for those remaining providers after trimming for outliers. Therefore,
hospice providers with larger costs (reflecting larger utilization)
would have a larger weight in the proposed labor shares. We would note
that Medicare days, in aggregate, account for over 80 percent of total
facility days. As stated previously, we will continue to monitor the
labor shares over time and propose revisions to these shares to reflect
a more recent cost structure and mix of providers.
Comment: One commenter stated that given the inherent differences
in the provision of the hospice benefit between different types of
hospice providers, they would recommend that CMS monitor any
significant disparities in the distribution of labor and non-labor
inputs across the hospice industry by program characteristics. The
commenter stated that they would become concerned, for instance, if
data indicates that some providers offer significantly fewer hours of
professional interdisciplinary team (IDT) care yet make up a
disproportionate percentage of providers filing cost reports. This
could lead to unintended negative consequences for those providers
fulfilling the true spirit and intent of the benefit. Put simply, if
cost reports and other data indicate a widening gap in labor inputs
between for-profit and not-for-profit providers, then CMS should
investigate this trend further.
Response: We appreciate the commenter's concern regarding labor
hours provided by type of facility. As we are able to obtain more
recent cost report data, we will monitor the labor shares by ownership-
type over time.
Comment: One commenter stated that if the labor shares are going to
have a greater weight on CHC, hospices should
[[Page 42539]]
be allowed to use it effectively. The commenter recommended that the
current continuous care timeframe change from midnight to midnight to a
new time frame of noon to noon and that visits from other providers
such as chaplains and home health aides count toward the continuous
care timeframe.
Response: While this comment is outside the scope of this rule as
we did not make any proposals relating to our CHC policy, we thank the
commenter for their recommendations and will take them under
consideration for future rulemaking.
Final Decision: In summary, in response to public comments, we are
adopting the revised hospice labor shares calculated as we proposed
with a slight modification to the methodology to derive the overhead
benefit calculations as described previously. Table 1 provides the
finalized labor share for each level of care based on the compensation
cost weights we derived using our revised methodology. As we proposed,
the labor shares are rounded to three decimal places consistent with
the labor shares used in other Prospective Payment Systems (PPS) (such
as the inpatient prospective payment system (IPPS) and the Home Health
Agency PPS). The revised labor shares will be implemented in a budget
neutral manner through the use of labor share standardization factors.
[GRAPHIC] [TIFF OMITTED] TR04AU21.138
We also received six comments on the use of the labor share
standardization factor including hospices, national industry
associations. A summary of these comments and our responses to those
comments appear below:
Comment: A few commenters requested more information regarding the
labor share standardization factor; specifically, its purpose, and any
anticipated future use of the factor.
Response: The labor share standardization factor is applied to the
FY 2022 hospice payment rates so that the aggregate payments do not
increase or decrease due to changes in the labor share values. We
proposed to implement the proposed hospice labor shares in a budget
neutral manner which is consistent with our policy of implementing
updates to the hospice wage index in a budget neutral manner as well as
updates in other perspective payment systems such as the annual
recalibration of the case-mix weights in home health and updates to the
home health wage index. In order to calculate the labor share
standardization factor, we simulate total payments using FY 2020
hospice utilization claims data with the FY 2022 hospice wage index and
the current labor shares and compare it to our simulation of total
payments using the FY 2022 hospice wage index with the final revised
labor shares. By dividing total payments for each level of care (RHC
days 1 through 60, RHC days 61+, CHC, IRC, and GIP) using the FY 2022
wage index, current labor shares and payment rates for each level of
care by the total payments for each level of care using the final
revised labor shares and FY 2022 wage index and payment.
Final Decision: We are finalizing the proposal to implement the
hospice labor shares in a budget neutral manner through the use of the
labor share standardization factors, so that the aggregate payments do
not increase or decrease due to changes in the labor share values.
C. FY 2022 Hospice Wage Index and Rate Update
1. FY 2022 Hospice Wage Index
The hospice wage index is used to adjust payment rates for hospices
under the Medicare program to reflect local differences in area wage
levels, based on the location where services are furnished. The hospice
wage index utilizes the wage adjustment factors used by the Secretary
for purposes of section 1886(d)(3)(E) of the Act for hospital wage
adjustments. Our regulations at Sec. 418.306(c) require each labor
market to be established using the most current hospital wage data
available, including any changes made by the Office of Management and
Budget (OMB) to the Metropolitan Statistical Areas (MSAs) definitions.
[[Page 42540]]
In general, OMB issues major revisions to statistical areas every
10 years, based on the results of the decennial census. However, OMB
occasionally issues minor updates and revisions to statistical areas in
the years between the decennial censuses. On March 6, 2020, OMB issued
Bulletin No. 20-01, which provided updates to and superseded OMB
Bulletin No. 18-04 that was issued on September 14, 2018. The
attachments to OMB Bulletin No. 20-01 provided detailed information on
the update to statistical areas since September 14, 2018, and were
based on the application of the 2010 Standards for Delineating
Metropolitan and Micropolitan Statistical Areas to Census Bureau
population estimates for July 1, 2017 and July 1, 2018. (For a copy of
this bulletin, we refer readers to the following website: <a href="https://www.whitehouse.gov/wp-content/uploads/2020/03/Bulletin-20-01.pdf">https://www.whitehouse.gov/wp-content/uploads/2020/03/Bulletin-20-01.pdf</a>). In
OMB Bulletin No. 20-01, OMB announced one new Micropolitan Statistical
Area, one new component of an existing Combined Statistical Are and
changes to New England City and Town Area (NECTA) delineations. In the
FY 2021 Hospice Wage Index final rule (85 FR 47070) we stated that if
appropriate, we would propose any updates from OMB Bulletin No. 20-01
in future rulemaking. After reviewing OMB Bulletin No. 20-01, we have
determined that the changes in Bulletin 20-01 encompassed delineation
changes that would not affect the Medicare wage index for FY 2022.
Specifically, the updates consisted of changes to NECTA delineations
and the redesignation of a single rural county into a newly created
Micropolitan Statistical Area. The Medicare wage index does not utilize
NECTA definitions, and, as most recently discussed in the FY 2021
Hospice Wage Index final rule (85 FR 47070), we include hospitals
located in Micropolitan Statistical areas in each state's rural wage
index. Therefore, while we proposed to adopt the updates set forth in
OMB Bulletin No. 20-01 consistent with our longstanding policy of
adopting OMB delineation updates, we note that specific wage index
updates would not be necessary for FY 2022 as a result of adopting
these OMB updates. In other words, these OMB updates would not affect
any geographic areas for purposes of the wage index calculation for FY
2022.
In the FY 2020 Hospice Wage Index final rule (84 FR 38484), we
finalized the proposal to use the current FY's hospital wage index data
to calculate the hospice wage index values. In the FY 2021 Hospice Wage
Index final rule (85 FR 47070), we finalized the proposal to adopt the
revised OMB delineations with a 5 percent cap on wage index decreases,
where the estimated reduction in a geographic area's wage index would
be capped at 5 percent in FY 2021 and no cap would be applied to wage
index decreases for the second year (FY 2022). For FY 2022, the final
hospice wage index will be based on the FY 2022 hospital pre-floor,
pre-reclassified wage index for hospital cost reporting periods
beginning on or after October 1, 2017 and before October 1, 2018 (FY
2018 cost report data). The final FY 2022 hospice wage index will not
include a cap on wage index decreases and would not take into account
any geographic reclassification of hospitals, including those in
accordance with section 1886(d)(8)(B) or 1886(d)(10) of the Act. The
appropriate wage index value is applied to the labor portion of the
hospice payment rate based on the geographic area in which the
beneficiary resides when receiving RHC or CHC. The appropriate wage
index value is applied to the labor portion of the payment rate based
on the geographic location of the facility for beneficiaries receiving
GIP or IRC.
In the FY 2006 Hospice Wage Index final rule (70 FR 45135), we
adopted the policy that, for urban labor markets without a hospital
from which hospital wage index data could be derived, all of the Core-
Based Statistical Areas (CBSAs) within the state would be used to
calculate a statewide urban average pre-floor, pre-reclassified
hospital wage index value to use as a reasonable proxy for these areas.
For FY 2022, the only CBSA without a hospital from which hospital wage
data can be derived is 25980, Hinesville-Fort Stewart, Georgia. The FY
2022 final wage index value for Hinesville-Fort Stewart, Georgia is
0.8635.
There exist some geographic areas where there were no hospitals,
and thus, no hospital wage data on which to base the calculation of the
hospice wage index. In the FY 2008 Hospice Wage Index final rule (72 FR
50217 through 50218), we implemented a methodology to update the
hospice wage index for rural areas without hospital wage data. In cases
where there was a rural area without rural hospital wage data, we use
the average pre-floor, pre-reclassified hospital wage index data from
all contiguous CBSAs, to represent a reasonable proxy for the rural
area. The term ``contiguous'' means sharing a border (72 FR 50217).
Currently, the only rural area without a hospital from which hospital
wage data could be derived is Puerto Rico. However, for rural Puerto
Rico, we would not apply this methodology due to the distinct economic
circumstances that exist there (for example, due to the close proximity
to one another of almost all of Puerto Rico's various urban and non-
urban areas, this methodology would produce a wage index for rural
Puerto Rico that is higher than that in half of its urban areas);
instead, we would continue to use the most recent wage index previously
available for that area. For FY 2022, we proposed to continue to use
the most recent pre-floor, pre-reclassified hospital wage index value
available for Puerto Rico, which is 0.4047, subsequently adjusted by
the hospice floor.
As described in the August 8, 1997 Hospice Wage Index final rule
(62 FR 42860), the pre-floor and pre-reclassified hospital wage index
is used as the raw wage index for the hospice benefit. These raw wage
index values are subject to application of the hospice floor to compute
the hospice wage index used to determine payments to hospices. As
previously discussed, the adjusted pre-floor, pre-reclassified hospital
wage index values below 0.8 will be further adjusted by a 15 percent
increase subject to a maximum wage index value of 0.8. For example, if
County A has a pre-floor, pre-reclassified hospital wage index value of
0.3994, we would multiply 0.3994 by 1.15, which equals 0.4593. Since
0.4593 is not greater than 0.8, then County A's hospice wage index
would be 0.4593. In another example, if County B has a pre-floor, pre-
reclassified hospital wage index value of 0.7440, we would multiply
0.7440 by 1.15, which equals 0.8556. Because 0.8556 is greater than
0.8, County B's hospice wage index would be 0.8.
The final hospice wage index applicable for FY 2022 (October 1,
2021 through September 30, 2022) is available on our website at:
<a href="https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/Hospice/Hospice-Wage-Index">https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/Hospice/Hospice-Wage-Index</a>.html.
We received seven comments on the proposed FY 2022 hospice wage
index from various stakeholders including hospices, and national
industry associations. A summary of these comments and our responses to
those comments appear below:
Comment: One commenter expressed concern that hospices in
Montgomery County, Maryland are at a long-term competitive disadvantage
due to what they refer to as a Medicare hospice Federal payment
inequity involving CBSAs specifically when Metropolitan Divisions are
present. The commenter stated that that hospices in Montgomery County
should be reimbursed at the
[[Page 42541]]
same level as hospices in the Washington, DC area because Montgomery
County has a similar cost of living and cost of doing business compared
to Washington, DC and shares the same labor market when competing for
labor. This commenter recommended several solutions to resolve this
issue, including applying the outmigration hospital adjustment which is
a hospital wage adjustment based on commuting patterns referenced in
section 505 of the Medicare Prescription Drug, Improvement and
Modernization Act of 2003 to the hospice wage index; allowing hospices
serving patients in MSAs that are large enough to be subdivided into
metropolitan divisions to opt for the higher wage index valuation
within the MSA's respective CBSAs or providing a 1-year limited
increase in hospice wage index payments in the Montgomery County
Metropolitan Divisions as a short-term fix to this problem.
Response: We thank the commenter for these recommendations.
However, we continue to believe that the OMB's geographic area
delineations represent a useful proxy for differentiating between labor
markets and that the geographic area delineations are appropriate for
use in determining Medicare hospice payments. Additionally, we do not
believe that we have the authority to apply the outmigration hospital
adjustment to the hospice wage index because it is specific to the
commuting patterns of hospital employees. We also do not believe it
would be appropriate to allow hospices to opt for or be assigned a
higher CBSA designation based on subdivided metropolitan divisions.
Finally, in the FY 2021 Hospice Wage Index and Payment Rate Update
final rule (85 FR 47079), we finalized a 1-year transition 5 percent
cap on wage index decreases for fiscal year (FY) 2021 only. We believe
that this transition was sufficient in order to mitigate the resulting
short-term instability and negative impacts on certain providers after
the implementation of the new OMB labor market delineations. We do not
believe that a 1-year limited increase in hospice wage index payments
for hospices specifically in the Montgomery County Metropolitan
Divisions is appropriate at this time.
Based on the OMB's current delineations, Montgomery County belongs
in a separate CBSA from the areas defined in the Washington-Arlington-
Alexandria, DC-VA CBSA. Unlike inpatient prospective payment system
(IPPS) hospitals, inpatient rehabilitation facilities (IRFs), and
skilled nursing facilities (SNFs), where each provider uses a single
CBSA, hospice agencies may be reimbursed based on more than one wage
index. Payments are based upon the location of the beneficiary for
routine and continuous home care or the location of the facility for
respite and general inpatient care. Hospices in Montgomery County,
Maryland may provide RHC and CHC to patients in the ``Washington-
Arlington-Alexandria, DC-VA'' CBSA and to patients in the ``Baltimore-
Columbia-Towson, Maryland'' CBSA. We have used CBSAs for determining
hospice payments since FY 2006. Additionally, other provider types,
such as IPPS hospitals, home health agencies (HHAs), SNFs, IRFs, and
the dialysis facilities all use CBSAs to define their labor market
areas. We believe that using the most current OMB delineations provides
a more accurate representation of geographic variation in wage levels
and do not believe it would be appropriate to allow hospices to be
assigned a higher CBSA designation or to allow 1-year limited increase
in hospice wage index payments for hospices only in the Montgomery
County Metropolitan Divisions.
Comment: One commenter recommended CMS institute a policy that no
hospice be paid below the rural floor for their state, allow hospices
and other post-acute providers to utilize a reclassification board
similar to hospitals, and consider working with the Congress on
policies to reform the wage index such as revisiting MedPAC's 2007
proposal which recommended that the Congress repeal the existing
hospital wage index statute, including reclassifications and
exceptions, and give the Secretary authority to establish new wage
index systems. In chapter 6 of the June 2007 Report to Congress, MedPAC
recommended the new wage index should: Use wage data from all employers
and industry-specific occupational weights, adjust for geographic
differences in the ratio of benefits to wages, adjust at the county
level and smooth large differences between counties, and be implemented
so that large changes in wage index values are phased in over a
transition period.\4\ Another commenter recommended that CMS develop
and implement a wage index model that is consistent across all provider
types so that all types of providers have a level playing field from
which to compete for personnel.
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\4\ Report to Congress, Promoting Greater Efficiency in
Medicare. MedPAC. June 2007. <a href="http://www.medpac.gov/docs/default-source/reports/Jun07_EntireReport.pdf">http://www.medpac.gov/docs/default-source/reports/Jun07_EntireReport.pdf</a>.
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Response: We appreciate the commenters' recommendations; however,
these comments are outside the scope of the proposed rule. Any changes
to the way we adjust hospice payments to account for geographic wage
differences, beyond the wage index proposals discussed in the FY 2022
Hospice Wage Index and Rate Update proposed rule, would have to go
through notice and comment rulemaking. While CMS and other stakeholders
have explored potential alternatives to the current CBSA-based labor
market system, no consensus has been achieved regarding how best to
implement a replacement system.
Additionally, the regulations that govern hospice reimbursement do
not provide a mechanism for allowing hospices to seek geographic
reclassification or to utilize the rural floor provisions that exist
for IPPS hospitals. The reclassification provision found in section
1886(d)(10) of the Act is specific to hospitals. Section 4410(a) of the
Balanced Budget Act of 1997 (Pub. L. 105-33) provides that the area
wage index applicable to any hospital that is located in an urban area
of a state may not be less than the area wage index applicable to
hospitals located in rural areas in that state. This rural floor
provision is also specific to hospitals. Because the reclassification
provision and the hospital rural floor applies only to hospitals, and
not to hospices, we continue to believe the use of the pre-floor and
pre-reclassified hospital wage index results in the most appropriate
adjustment to the labor portion of the hospice payment rates. We remind
stakeholders that the hospice wage index does include the hospice floor
which is applicable to all CBSAs, both rural and urban. Pre-floor, pre-
reclassified hospital wage index values below 0.8 are adjusted by a 15
percent increase subject to a maximum wage index value of 0.8.
Comment: A few commenters stated that providers should be protected
against substantial payment reductions due to dramatic reductions in
wage index values from one year to the next. One commenter recommended
that CMS maintain the 5 percent cap that was put in place for FY 2021
or lower the cap to 3 percent to protect hospice providers who are
already operating with negative or razor thin operating margins.
Another commenter expressed concern regarding the adoption of the New
Brunswick-Lakewood, NJ CBSA and recommended CMS adopt a transition
policy that holds the FY 2022 and FY 2023 wage index for all affected
facilities harmless from any reduction relative to their FY 2021 wage
index.
[[Page 42542]]
Response: We appreciate the concerns sent in by the commenters
regarding the impact of wages index changes from year to year as well
as the concerns from providers who have been impacted by the
implementation of the New Brunswick-Lakewood, NJ CBSA designation.
While, we understand the commenters' concern regarding the potential
financial impact, we believe that the OMB delineations for Metropolitan
and Micropolitan Statistical Areas are appropriate for use in
accounting for wage area differences and that the values computed under
the delineations result in more appropriate payments to providers by
more accurately accounting for and reflecting the differences in area
wage levels. In the FY 2021 Hospice Wage Index and Payment Rate Update
final rule (85 FR 47079), we finalized a 1-year transition for fiscal
year (FY) 2021 only, to mitigate the resulting short-term instability
and negative impacts on certain providers and to provide time for
providers to adjust to their new labor market delineations. We believe
that the 1-year 5 percent cap transitional policy provided for FY 2021
was an adequate safeguard against any significant payment reductions,
allowed for sufficient time to make operational changes for future
fiscal years, and provided a reasonable balance between mitigating some
short-term instability in hospice payments and improving the accuracy
of the payment adjustment for differences in area wage levels.
We note that certain changes to wage index policy may significantly
affect Medicare payments. These changes may arise from revisions to the
OMB delineations of statistical areas resulting from the decennial
census data, periodic updates to the OMB delineations in the years
between the decennial censuses, or other wage index policy changes.
While we consider how best to address these potential scenarios in a
consistent and thoughtful manner, we reiterate that our policy
principles with regard to the wage index include generally using the
most current data and information available and providing that data and
information, as well as any approaches to addressing any significant
effects on Medicare payments resulting from these potential scenarios,
in notice and comment rulemaking.
Final Decision: We are finalizing our proposal to use the FY 2022
pre-floor, pre-reclassified hospital wage index data as the basis for
the FY 2022 hospice wage index. The wage index applicable for FY 2022
is available on our website at <a href="https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/Hospice/Hospice-Wage-Index">https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/Hospice/Hospice-Wage-Index</a>. The hospice wage
index for FY 2022 is effective October 1, 2021 through September 30,
2022.
2. FY 2022 Hospice Payment Update Percentage
Section 4441(a) of the BBA (Pub. L. 105-33) amended section
1814(i)(1)(C)(ii)(VI) of the Act to establish updates to hospice rates
for FYs 1998 through 2002. Hospice rates were to be updated by a factor
equal to the inpatient hospital market basket percentage increase set
out under section 1886(b)(3)(B)(iii) of the Act, minus 1 percentage
point. Payment rates for FYs since 2002 have been updated according to
section 1814(i)(1)(C)(ii)(VII) of the Act, which states that the update
to the payment rates for subsequent FYs must be the inpatient market
basket percentage increase for that FY. CMS currently uses 2014-based
IPPS operating and capital market baskets to update the market basket
percentage. In the FY 2022 IPPS proposed rule \5\ we proposed to rebase
and revise the IPPS market baskets to reflect a 2018 base year. We
refer stakeholders to the FY 2022 IPPS proposed rule for further
information (86 FR 25416 through 25428).
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\5\ IPPS Regulations and Notices. <a href="https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/AcuteInpatientPPS/IPPS-Regulations-and-Notices">https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/AcuteInpatientPPS/IPPS-Regulations-and-Notices</a>.
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Section 3401(g) of the Affordable Care Act mandated that, starting
with FY 2013 (and in subsequent FYs), the hospice payment update
percentage would be annually reduced by changes in economy-wide
productivity as specified in section 1886(b)(3)(B)(xi)(II) of the Act.
The statute defines the productivity adjustment to be equal to the 10-
year moving average of changes in annual economy-wide private nonfarm
business multifactor productivity (MFP).
In the FY 2022 Hospice Wage Index and Payment Rate Update proposed
rule (86 FR 19720), we proposed the market basket percentage increase
of 2.5 percent for FY 2022 using the most current estimate of the
inpatient hospital market basket (based on IHS Global Inc.'s fourth-
quarter 2020 forecast with historical data through the third quarter
2020). Due to the requirements at sections 1886(b)(3)(B)(xi)(II) and
1814(i)(1)(C)(v) of the Act, the proposed inpatient hospital market
basket update for FY 2022 of 2.5 percent was reduced by a productivity
adjustment as mandated by Affordable Care Act (estimated in the
proposed rule to be 0.2 percentage point for FY 2022). Therefore, the
proposed hospice payment update percentage for FY 2022 was 2.3 percent.
We also stated if more recent data became available after the
publication of the proposed rule and before the publication of the
final rule (for example, more recent estimates of the inpatient
hospital market basket update and/or productivity adjustment), we would
use such data to determine the hospice payment update percentage for FY
2022 in the final rule. For this final rule, based on IHS Global Inc.'s
(IGI) second quarter 2021 forecast with historical data through the
first quarter 2021 of the inpatient hospital market basket update, the
market basket percentage increase for FY 2022 is 2.7 percent. The
productivity adjustment for FY 2022, based on IGI's second quarter 2021
forecast, is 0.7 percent. Therefore, the hospice payment update
percentage for FY 2022, based on more recent data, is 2.0 percent.
Currently, the labor portion of the hospice payment rates are as
follows: For RHC, 68.71 percent; for CHC, 68.71 percent; for GIP, 64.01
percent; and for IRC, 54.13 percent. As discussed in section III.B of
this rule, we are finalizing to rebase and revise the labor shares for
CHC, RHC, GIP and IRC using MCR data for freestanding hospices (CMS
Form 1984-14, OMB Control Number 0938-0758) for 2018. We are finalizing
the labor portion of the payment rates to be for CHC, 75.2 percent; for
RHC, 66.0 percent; for GIP, 63.5 percent; and for IRC, 61.0 percent.
The non-labor portion is equal to 100 percent minus the labor portion
for each level of care. Therefore, we are finalizing the non-labor
portion of the payment rates to be as follows: For CHC, 24.8 percent;
RHC, 34 percent; for GIP, 36.5 percent; and For IRC, 39.0 percent.
Comment: We received seven comments in support of the proposed
hospice update percentage of 2.3 percent. However, in its comment,
MedPAC ``concluded that the aggregate level of payments could be
reduced and would still be sufficient to cover hospice providers' costs
and preserve beneficiaries' access to care.'' Therefore, MedPAC
recommended a zero percent update for FY 2022 for all hospice
providers.
Response: We appreciate the support from commenters as well as
MedPAC's concerns. However, section 1814(i)(1)(C)(iii) of the Act
requires the Secretary, for years subsequent to the first fiscal year
in which payment revisions described in paragraph (6)(D) are
implemented, to update the payment rates by the market basket
percentage increase (as defined in section 1886(b)(3)(B)(iii)) of the
Act for the
[[Page 42543]]
fiscal year; section 1814(i)(1)(C)(iv)(I) of the Act requires that
subsequent to such increase, the payment rates be reduced by the
productivity adjustment described in section 1886(b)(3)(B)(xi)(II) of
the Act.
Final Decision: We are finalizing the hospice payment update
percentage of 2.0 percent for FY 2022. Based on IHS Global, Inc.'s more
recent forecast of the inpatient hospital market basket update and the
productivity adjustment, the hospice payment update percentage for FY
2022 will be 2.0 percent for hospices that submit the required quality
data and 0.0 percent (FY 2022 hospice payment update of 2.0 percent
minus 2.0 percentage points) for hospices that do not submit the
required data.
3. FY 2022 Hospice Payment Rates
There are four payment categories that are distinguished by the
location and intensity of the hospice services provided. The base
payments are adjusted for geographic differences in wages by
multiplying the labor share, which varies by category, of each base
rate by the applicable hospice wage index. A hospice is paid the RHC
rate for each day the beneficiary is enrolled in hospice, unless the
hospice provides CHC, IRC, or GIP. CHC is provided during a period of
patient crisis to maintain the patient at home; IRC is short-term care
to allow the usual caregiver to rest and be relieved from caregiving;
and GIP is to treat symptoms that cannot be managed in another setting.
As discussed in the FY 2016 Hospice Wage Index and Rate Update
final rule (80 FR 47172), we implemented two different RHC payment
rates, one RHC rate for the first 60 days and a second RHC rate for
days 61 and beyond. In addition, in that final rule, we implemented a
SIA payment for RHC when direct patient care is provided by an RN or
social worker during the last 7 days of the beneficiary's life. The SIA
payment is equal to the CHC hourly rate multiplied by the hours of
nursing or social work provided (up to 4 hours total) that occurred on
the day of service, if certain criteria are met. To maintain budget
neutrality, as required under section 1814(i)(6)(D)(ii) of the Act, the
new RHC rates were adjusted by a service intensity add-on budget
neutrality factor (SBNF). The SBNF is used to reduce the overall RHC
rate to ensure that SIA payments are budget-neutral. At the beginning
of every fiscal year, SIA utilization is compared to the prior year in
order calculate a budget neutrality adjustment.
In the FY 2017 Hospice Wage Index and Rate Update final rule (81 FR
52156), we initiated a policy of applying a wage index standardization
factor to hospice payments to eliminate the aggregate effect of annual
variations in hospital wage data. Typically, the wage index
standardization factor is calculated using the most recent, complete
hospice claims data available. However, due to the COVID-19 PHE, we
looked at using the previous fiscal year's hospice claims data (FY
2019) to determine if there were significant differences between
utilizing 2019 and 2020 claims data. The difference between using FY
2019 and FY 2020 hospice claims data was minimal. Therefore, we will
continue our practice of using the most recent, complete hospice claims
data available; that is, we used FY 2020 claims data for the FY 2022
payment rate updates.
To calculate the wage index standardization factor, we simulate
total payments using FY 2020 hospice utilization claims data with the
FY 2021 wage index (pre-floor, pre-reclassified hospital wage index
with the hospice floor, and a 5 percent cap on wage index decreases)
and FY 2021 payment rates (that include the current labor shares) and
compare it to our simulation of total payments using the FY 2022
hospice wage index (with hospice floor, without the 5 percent cap on
wage index decreases) and FY 2021 payment rates (that include the
current labor shares). By dividing total payments for each level of
care (RHC days 1 through 60, RHC days 61+, CHC, IRC, and GIP) using the
FY 2021 wage index and payment rates for each level of care by the
total payments using the FY 2022 wage index and FY 2021 payment rates,
we obtain a wage index standardization factor for each level of care.
As stated above, in order to calculate the labor share standardization
factor, we simulate total payments using FY 2020 hospice utilization
claims data with the FY 2022 hospice wage index and the current labor
shares and compare it to our simulation of total payments using the FY
2022 hospice wage index with the final revised labor shares. By
dividing total payments for each level of care (RHC days 1 through 60,
RHC days 61+, CHC, IRC, and GIP) using the current labor shares and FY
2022 wage index and payment rates for each level of care by the total
payments for each level of care using the final revised labor shares
and FY 2022 wage index and payment rates for each level of care, we
obtain a labor share standardization factor for each level of care. The
wage index and labor share standardization factors for each level of
care are shown in the Tables 2 and 3.
The FY 2022 RHC rates are shown in Table 2. The FY 2022 payment
rates for CHC, IRC, and GIP are shown in Table 3.
BILLING CODE 4120-01-P
[GRAPHIC] [TIFF OMITTED] TR04AU21.139
[[Page 42544]]
[GRAPHIC] [TIFF OMITTED] TR04AU21.140
Sections 1814(i)(5)(A) through (C) of the Act require that hospices
submit quality data, based on measures to be specified by the
Secretary. In the FY 2012 Hospice Wage Index and Rate Update final rule
(76 FR 47320 through 47324), we implemented a HQRP as required by those
sections. Hospices were required to begin collecting quality data in
October 2012, and submit that quality data in 2013. Section
1814(i)(5)(A)(i) of the Act requires that beginning with FY 2014 and
each subsequent FY, the Secretary shall reduce the market basket update
by 2 percentage points for any hospice that does not comply with the
quality data submission requirements with respect to that FY. The FY
2022 rates for hospices that do not submit the required quality data
would be updated by the FY 2022 hospice payment update percentage of
2.0 percent minus 2 percentage points. These rates are shown in Tables
4 and 5.
[GRAPHIC] [TIFF OMITTED] TR04AU21.141
[[Page 42545]]
[GRAPHIC] [TIFF OMITTED] TR04AU21.142
BILLING CODE 4120-01-C
Final Decision: We are implementing the updates to hospice payment
rates as discussed in the proposed rule.
4. Hospice Cap Amount for FY 2022
As discussed in the FY 2016 Hospice Wage Index and Rate Update
final rule (80 FR 47183), we implemented changes mandated by the IMPACT
Act of 2014 (Pub. L. 113-185). Specifically, the IMPACT Act requires
that, for accounting years that end after September 30, 2016 and before
October 1, 2025, the hospice cap be updated by the hospice payment
update percentage rather than using the CPI-U. Division CC, section 404
of the CAA 2021 has extended the accounting years impacted by the
adjustment made to the hospice cap calculation until 2030. Therefore,
for accounting years that end after September 30, 2016 and before
October 1, 2030, the hospice cap amount is updated by the hospice
payment update percentage rather than using the CPI-U. As a result of
the changes mandated by Division CC, section 404 of the CAA 2021, we
proposed conforming regulation text changes at Sec. 418.309 to reflect
the new language added to section 1814(i)(2)(B) of the Act.
The hospice cap amount for the FY 2022 cap year will be $31,297.61,
which is equal to the FY 2021 cap amount ($30,683.93) updated by the FY
2022 hospice payment update percentage of 2.0 percent.
Comment: Generally, commenters supported the update to the cap
amount. We received a comment indicating some hospice agencies never
hit the cap amount and recommend for CMS to utilize available claims
and quality data to target hospices with questionable practices to
avoid exceeding the cap amount.
Response: We appreciate the concern and recommendation. We
encourage those who have concerns about fraud, waste, or abuse to
report these to CMS Center for Program Integrity. Resources can be
found at <a href="https://www.cms.gov/About-CMS/Components/CPI">https://www.cms.gov/About-CMS/Components/CPI</a>.
Comment: MedPAC recommended the hospice cap amount be reduced by 20
percent as a way to focus payment reductions on providers with
particularly high margins. MedPAC also recommended wage adjusting the
hospice cap amount to make it more equitable across providers.
Response: We appreciate MedPAC's comments; however, we are required
by law to update the hospice cap amount from the preceding year by the
hospice payment update percentage, in accordance with section
1814(i)(2)(B)(ii) of the Act. Therefore, we do not have the statutory
authority to reduce the aggregate cap amount nor the statutory
authority to wage-adjust the cap amount.
Final Decision: We are finalizing the update to the hospice cap
amount for FY 2022 in accordance with statutorily-mandated requirements
as well as the conforming regulation text changes at Sec. 418.309.
D. Clarifying Regulation Text Changes for the Hospice Election
Statement Addendum
In the FY 2020 Hospice Wage Index and Payment Rate Update final
rule (84 FR 38484), we finalized modifications to the hospice election
statement content requirements at Sec. 418.24(b) to increase coverage
transparency for patients under a hospice election. These changes
included a new condition for payment requiring a hospice, upon request,
to provide the beneficiary (or representative) an election statement
addendum (hereafter called ``the addendum'') outlining the items,
services, and drugs that the hospice has determined are unrelated to
the terminal illness and related conditions. We stated in the final
rule that the addendum is intended to complement the Hospice Conditions
of Participation (CoPs) at Sec. 418.52(c)(7) and (8), which require
hospices to verbally inform beneficiaries, at the time of hospice
election, of the services covered under the Medicare hospice benefit,
as well as the limitations of such services (84 FR 38509). The
requirements at Sec. Sec. 418.24(b) and 418.52(a) ensure that
beneficiaries are aware of any items, services, or drugs they would
have to seek outside of the benefit, as well as their potential out-of-
pocket costs for hospice care, such as co-payments and/or coinsurance.
Section 418.24(c) sets forth the elements that must be included on
the addendum:
1. The addendum must be titled ``Patient Notification of Hospice
Non-Covered Items, Services, and Drugs'';
2. Name of the hospice;
3. Beneficiary's name and hospice medical record identifier;
4. Identification of the beneficiary's terminal illness and related
conditions;
5. A list of the beneficiary's current diagnoses/conditions present
on
[[Page 42546]]
hospice admission (or upon plan of care update, as applicable) and the
associated items, services, and drugs, not covered by the hospice
because they have been determined by the hospice to be unrelated to the
terminal illness and related conditions;
6. A written clinical explanation, in language the beneficiary and
his or her representative can understand, as to why the identified
conditions, items, services, and drugs are considered unrelated to the
terminal illness and related conditions and not needed for pain or
symptom management. This clinical explanation must be accompanied by a
general statement that the decision as to what conditions, items,
services, or drugs are unrelated is made for each individual patient,
and that the beneficiary should share this clinical explanation with
other health care providers from which he or she seeks services
unrelated to his or her terminal illness and related conditions;
7. References to any relevant clinical practice, policy, or
coverage guidelines;
8. Information on the following:
a. Purpose of the addendum
b. patient's right to immediate advocacy
9. Name and signature of the Medicare hospice beneficiary (or
representative) and date signed, along with a statement that signing
this addendum (or its updates) is only acknowledgement of receipt of
the addendum (or its updates) and not necessarily the beneficiary's
agreement with the hospice's determinations.
The hospice is required to furnish the addendum in writing in an
accessible format, so the beneficiary (or representative) can
understand the information provided, make treatment decisions based on
that information, and share such information with non-hospice providers
rendering un-related items and services to the beneficiary. Therefore,
the format of the addendum must be usable for the beneficiary and/or
representative. Although we stated in the FY 2020 Hospice Wage Index
and Payment Rate Update that hospices may develop their own election
statement addendum (84 FR 38507), we posted a modified model election
statement and addendum on the Hospice web page,\6\ along with the
publication of the FY 2021 Hospice Wage Index and Payment Rate Update
final rule (85 FR 47070). The intent was to provide an illustrative
example so hospices can modify and develop their own forms to meet the
content requirements. In the FY 2021 Hospice Wage Index and Payment
Rate Update final rule, we stated that most often we would expect the
addendum would be in a hard copy format the beneficiary or
representative can keep for his or her own records, similar to how
hospices are required by the hospice CoPs at Sec. 418.52(a)(1) to
provide the individual a copy of the notice of patient rights and
responsibilities (85 FR 47091). The hospice CoPs at Sec. 418.104(a)(2)
state that the patient's record must include ``signed copies of the
notice of patient rights in accordance with Sec. 418.52.'' Likewise,
since the addendum is part of the election statement as set forth in
Sec. 418.24(b)(6), then it is required to be part of the patient's
record (if requested by the beneficiary or representative). The signed
addendum is only acknowledgement of the beneficiary's (or
representative's) receipt of the addendum (or its updates) and the
payment requirement is considered met if there is a signed addendum
(and any signed updates) in the requesting beneficiary's medical record
with the hospice. We believe that a signed addendum indicates the
hospice discussed the addendum and its contents with the beneficiary
(or representative). Additionally, in the event that a beneficiary (or
representative) does not request the addendum, we expect hospices to
document, in some fashion, that an addendum has been discussed with the
patient (or representative) at the time of election, similar to how
other patient and family discussions are documented in the hospice's
clinical record. It is necessary for the hospice to document that the
addendum was discussed and whether or not it was requested, in order to
prevent potential claims denials related to any absence of an addendum
(or addendum updates) in the medical record.
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\6\ Hospice web page. <a href="https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/Hospice/index">https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/Hospice/index</a>.
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Though we did not propose any changes to the election statement
addendum content requirements at Sec. 418.24(c), or the October 1,
2020 effective date, in the FY 2021 Hospice Wage Index and Payment Rate
Update proposed rule, we solicited comments on the usefulness of the
modified model election statement and addendum posted on the Hospice
Center web page (85 FR 20949). In the FY 2021 Hospice Wage Index and
Payment Rate Update final rule (85 FR 47093), we responded to comments
received, and stated that, as finalized in the FY 2020 Hospice Wage
Index and Payment Rate Update final rule, the hospice election
statement addendum will remain a condition for payment that is met when
there is a signed addendum (and its updates) in the beneficiary's
hospice medical record.
Since its implementation on October 1, 2020, CMS has received
additional inquiries from stakeholders asking for clarification on
certain aspects of the addendum. We appreciate and understand the
importance of provider input and involvement in ensuring that this
document is effective in increasing coverage transparency for
beneficiaries. Therefore, in the FY 2022 proposed rule (86 FR 19724) we
provided clarification on, and proposed modifications to, certain
signature and timing requirements and proposed corresponding clarifying
regulations text changes.
Currently the regulations at Sec. 418.24(c) require that if a
beneficiary or his or her representative requests the addendum at the
time of the initial hospice election (that is, at the time of admission
to hospice), the hospice must provide this information, in writing, to
the individual (or representative) within 5 days from the date of the
election. In the FY 2022 hospice proposed rule, we noted that hospices
have reported that beneficiaries or representatives sometimes do not
request the addendum at the time of election, but rather within the 5
days after the effective date of the election (86 FR 19724). In these
situations, the regulations require the hospice to provide the addendum
within 3 days, as the beneficiary requested the addendum during the
course of care. However, in accordance with Sec. 418.54(b), the
hospice IDG, in consultation with the individual's attending physician
(if any), must complete the hospice comprehensive assessment no later
than 5 calendar days after the election of hospice care. We stated that
in some instances, this may mean that the hospice must furnish the
addendum prior to completion of the comprehensive assessment. The
comprehensive assessment includes all areas of hospice care related to
the palliation and management of a beneficiary's terminal illness. This
assessment is necessary because it provides an overview of the items,
services and drugs that the patient is already utilizing as well as
helps determine what the hospice may need to add in order to treat the
patient throughout the dying process. If the addendum is completed
prior to the comprehensive assessment, the hospice may not have a
complete patient profile, which could potentially result in the hospice
incorrectly anticipating the extent of covered and non-covered services
and lead to an inaccurate election statement addendum. Hospice
[[Page 42547]]
providers are only able to discern what items, services, and drugs they
will not cover once they have a beneficiary's comprehensive assessment.
We proposed allowing the hospice to furnish the addendum within 5 days
from the date of a beneficiary or representative request, if the
request is within 5 days from the date of a hospice election. For
example, if the patient elects hospice on December 1st and requests the
addendum on December 3rd, the hospice would have until December 8th to
furnish the addendum.
Additionally, we acknowledged that hospices have noted that there
is not a timeframe in regulations regarding the patient signature on
the addendum. Section 418.24(c)(9) requires the beneficiary's signature
(or his/her representative's signature) as well as the date the
document was signed. We noted in the FY 2021 Hospice Wage Index &
Payment Rate Update final rule that because the beneficiary signature
is an acknowledgement of receipt of the addendum, this means the
beneficiary would sign the addendum when the hospice provides it, in
writing, to the beneficiary or representative (85 FR 47092). Obtaining
the required signatures on the election statement has been a
longstanding regulatory requirement. Therefore, we stated that we
expect that hospices already have processes and procedures in place to
ensure that required signatures are obtained, either from the
beneficiary, or from the representative in the event the beneficiary is
unable to sign, and we anticipate that hospices would use the same
procedures for obtaining signatures on the addendum. We did note that
we understand that some beneficiaries or representatives may request an
emailed addendum or request more time to review the addendum before
signing, in which case the date that the hospice furnished the addendum
to the beneficiary (or representative) may differ from the date that
the beneficiary or representative signs the addendum. This means the
hospice may furnish the addendum within the required timeframe;
however, the signature date may be beyond the required timeframe.
Therefore, we proposed to clarify in regulation that the ``date
furnished'' must be within the required timeframe (that is, 3 or 5 days
of the beneficiary or representative request, depending on when such
request was made), rather than the signature date. At Sec.
418.24(c)(10), we proposed that the hospice would include the ``date
furnished'' in the patient's medical record and on the addendum itself.
In the FY 2021 Hospice Wage Index and Payment Rate Update final
rule, we addressed a concern regarding a potential situation wherein
the beneficiary or representative refuses to sign the addendum (85 FR
47088). We reiterated that the signature on the addendum is only
acknowledgement of receipt and not a tacit indication of agreement with
its contents, and that we expect the hospice to inform the beneficiary
of the purpose of the addendum and rationale for the signature.
However, we recognized that there might be rare instances in which the
beneficiary (or representative) refuses to sign the addendum, and noted
that we would consider whether this issue would require future
rulemaking. In the proposed rule, we stated that we have subsequently
received this question from stakeholders post implementation, and
therefore, clarified that if a patient or representative refuses to
sign the addendum, the hospice must document clearly in the medical
record (and on the addendum itself) the reason the addendum is not
signed in order to mitigate a claims denial for this condition for
payment. We stated that in such a case, although the beneficiary has
refused to sign the addendum, the ``date furnished'' must still be
within the required timeframe (that is, within 3 or 5 days of the
beneficiary or representative request, depending on when such request
was made), and noted in the chart and on the addendum itself (86 FR
19725).
We also noted that stakeholders again requested that CMS clarify
whether a non-hospice provider is required to sign the addendum in the
event that the non-hospice provider requests the addendum rather than
the beneficiary or representative. We reiterated that if only a non-
hospice provider or Medicare contractor requests the addendum (and not
the beneficiary or representative) we would not expect a signed copy in
the patient's medical record. We stated that hospices can develop
processes (including how to document such requests from non-hospice
providers and Medicare contractors) to address circumstances in which
the non-hospice provider or Medicare contractor requests the addendum,
and the beneficiary or representative does not (86 FR 19725). As such,
we proposed to clarify in regulation that if a non-hospice provider
requests the addendum, rather than the beneficiary or representative,
the non-hospice provider is not required to sign the addendum.
We also discussed that there may be instances in which the
beneficiary or representative requests the addendum and the beneficiary
dies, revokes, or is discharged prior to signing the addendum (86 FR
19725). While we stated in the FY 2020 Hospice Wage Index and Payment
Rate Update final rule, that if the beneficiary requests the election
statement addendum at the time of hospice election but dies within 5
days, the hospice would not be required to furnish the addendum as the
requirement would be deemed as being met in this circumstance (84 FR
38521), this policy was not codified in regulation. Therefore, we
proposed conforming regulations text changes at Sec. 418.24(c) to
reflect this policy. Furthermore, we proposed to clarify at Sec.
418.24(d)(4) that if the patient dies, revokes election, or is
discharged within the required timeframe (3 or 5 days after a request,
depending upon when such request was made), but the hospice has not yet
furnished the addendum, the hospice is not required to furnish the
addendum. Similarly, we proposed to clarify at Sec. 418.24(d)(5) that
in the event that a beneficiary requests the addendum and the hospice
furnishes the addendum within 3 or 5 days (depending upon when the
request for the addendum was made), but the beneficiary dies, revokes,
or is discharged prior to signing the addendum, a signature from the
individual (or representative) is no longer required. We stated that we
would continue to expect that the hospice would note the ``date
furnished'' in the patient's medical record and on the addendum, if the
hospice has already completed the addendum, as well as an explanation
in the patient's medical record noting that the patient died, revoked,
or was discharged prior to signing the addendum (86 FR 19725).
Finally, we proposed conforming regulations text changes at Sec.
418.24(c) in alignment with subregulatory guidance indicating that
hospices have ``3 days,'' rather than ``72 hours'' to meet the
requirement when a patient requests the addendum during the course of a
hospice election. We proposed that hospices must furnish the addendum
no later than 3 calendar days after a beneficiary's (or
representative's) request during the course of a hospice election. This
means that hospice providers must furnish the addendum to the
beneficiary or representative on or before the third day after the date
of the request. For example, if a beneficiary (or representative)
requests the addendum on February 22nd, then the hospice will have
until February 25th to furnish the addendum, regardless of what time
the addendum was requested on February
[[Page 42548]]
22nd. The intent of this clarification is to better align with the
requirement for furnishing an election statement addendum when the
addendum is requested within 5 days of the date of election, which also
uses ``days'' rather than ``hours''.
Thirty-one unique stakeholders submitted their comments on the
proposed clarifications to the election statement addendum. A few
commenters requested additional clarification on certain topics and
offered recommendations for the election statement addendum. These
comments along with our responses are summarized below.
Comment: The majority of commenters supported the clarifications
and proposed regulation text changes regarding the election statement
addendum. Commenters thanked CMS for these regulatory changes, stating
that these clarifications will facilitate administration of the
addendum and reduce hospice burden.
Response: We thank commenters for their feedback.
Comment: Some commenters recommended that the timeframe to furnish
the addendum to the beneficiary (or representative) when requested
after the first 5 days of a hospice election be changed from 3 days to
5 days. Other commenters recommended that CMS change the requirement
from 3 calendar days to 3 business days. One commenter requested
clarification that the day of request is considered day zero. Another
commenter mentioned that providing the addendum within 3 days is
burdensome to beneficiaries (or representatives), because they felt
pressured to meet with hospice staff to provide their signature for the
requested addendum.
Response: We did not propose to change the timeline for furnishing
the addendum when a beneficiary requests the addendum during the course
of a hospice election (that is, after the first five days of a hospice
election date), and we continue to believe that 3 days is an adequate
amount of time for the hospice to furnish the addendum. As we stated in
the FY 2020 hospice final rule, because the hospice has already
completed the comprehensive assessment and has begun providing care, we
believe that this represents a sufficient timeframe for reviewing the
patient record and completing the addendum if this information is
requested during the course of hospice care (84 FR 38511).
Additionally, as the plan of care should identify the conditions or
symptoms that the hospice determines to be ``unrelated,'' this
information should be readily accessible to the hospice in order to
allow for the timely completion of the addendum. Hospices should update
the addendum to include such conditions, items, services, and drugs
they determine to be unrelated throughout the course of a hospice
election. Hospices are able to create their own process when it comes
to updating and providing the requested addendum to the beneficiary (or
representative). Furthermore, we believe 3 calendar days, rather than 3
business days continues to be appropriate, as hospice care is provided
around the clock rather than only during business days and hours.
In the proposed rule, we provided an example acknowledging the day
of the request as day zero. We stated that when the request is within 5
days from the date of a hospice election, and the patient elects
hospice on December 1st and requests the addendum on December 3rd, the
hospice would have until December 8th to furnish the addendum (86 FR
19724), making December 1st as day zero in this example. Moreover,
because we proposed to change the timeframe requirements to correspond
with the ``date furnished'' rather than the ``signature date,'' we
disagree that this timeframe would be burdensome to beneficiaries. We
noted in the FY 2021 Hospice Wage Index & Payment Rate Update final
rule that because the beneficiary signature is an acknowledgement of
receipt of the addendum, this means the beneficiary would sign the
addendum when the hospice provides it, in writing, to the beneficiary
or representative (85 FR 47092). Obtaining the required signatures on
the election statement has been a longstanding regulatory requirement
(84 FR 38484); however, we did acknowledge in the proposed rule that
there may be time constraints and/or circumstances that would prevent a
beneficiary from signing and returning the addendum to the hospice by a
specified deadline. We proposed to require that the ``date furnished''
be within the required timeframe, rather than the signature date, to
mitigate any undue strain on the beneficiary or representative in
returning the addendum to the hospice by a specified date.
Comment: Some commenters expressed concern that the request from a
non-hospice provider for the election statement addendum does not
require a signature. Commenters stated that hospices would have no
proof that the addendum was provided to the non-hospice provider
without the provider's signature.
Response: If a non-hospice provider requests the addendum, the
hospice must furnish the addendum, however, the non-hospice provider is
not required to sign the addendum. We remind commenters that the intent
of the addendum is to ensure that hospice beneficiaries and their
representatives are fully informed of any items or services for which
they must assume financial responsibility. Consequently, if only a non-
hospice provider or Medicare contractor request the addendum (and not
the beneficiary or representative) CMS would not expect a signed copy
in the patient's medical record. Hospices can develop processes
(including how to document such requests from non-hospice providers and
Medicare contractors) to address circumstances in which the non-hospice
provider or Medicare contractor requests the addendum, and the
beneficiary or representative does not, as a means of demonstrating
that the addendum was furnished to a non-hospice provider and/or
Medicare contractor upon request.
Comment: A commenter asked CMS to define whether or not a mailed
copy of the form would be acceptable. The commenter stated that they
believe their patients and their representatives would welcome this
option; however, it is unclear whether mailing the form is acceptable
for CMS.
Response: There is nothing precluding hospices from furnishing an
addendum through mail. We expect that hospices would take steps in
working with patients and their representatives to better understand
which methods (that is, in person, mail, etc.) of delivery would work
best in furnishing the addendum. Some beneficiaries or representatives
may have time constraints that prevent them from signing and returning
the addendum by a certain deadline, in which case, the date that the
hospice furnishes the addendum to the beneficiary may differ from the
date that the beneficiary (or representative) signs the addendum.
Hospices would need to make sure the ``date furnished' on the addendum
is within the required timeframe (3 or 5 days, depending upon when the
request was made). Furthermore, we expect that hospices will have
processes in place when they are obtaining a signed addendum from a
beneficiary or representative.
Comment: Many commenters requested making the proposed
clarifications to the hospice election statement addendum retroactive
to the implementation date of October 1, 2020. One commenter requested
delaying the effective date of the proposed
[[Page 42549]]
clarification for the hospice election statement addendum to provide
time for software updates in addition to reporting and system alerts.
Response: We do not believe that making these clarifications
retroactive or delaying the effective date is necessary. To date we
have not received reports of claims denials resulting from the
implementation of the election statement addendum and the current
regulations at Sec. 418.24. Furthermore, many of these clarifying
regulations text changes have been previously addressed in sub-
regulatory guidance. As such, the implementation of these
clarifications on October 1, 2021 would not cause a burden for software
updates.
Comment: Many commenters encouraged CMS to update the model hospice
election statement addendum on the CMS hospice center web page to
illustrate these clarifications.
Response: We will post an updated model election statement addendum
on the Hospice web page,\7\ along with the publication of this FY 2022
Hospice Wage Index and Payment Rate Update final rule. This is an
illustrative example for hospices to modify and develop their own forms
that meet the content requirements at Sec. 418.24.
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\7\ Hospice web page: <a href="https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/Hospice/index">https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/Hospice/index</a>.
---------------------------------------------------------------------------
Comment: Some commenters stated that it is redundant to require the
hospice to note on the addendum and in the medical record the reason
that a beneficiary did not provide their signature.
Response: We recognize the commenters' concerns and agree that it
is appropriate for the hospice to document only on the addendum itself
the reason that an addendum is un-signed. This could include not only a
beneficiary refusing to sign, but also death, discharge, or revocation
prior to the hospice obtaining the signature. However, while a hospice
can choose to document the reason for an unsigned addendum in the
medical record, as well as on the addendum, it is not required.
Comment: Many commenters offered suggestions regarding additional
aspects of the election statement addendum for which we did not propose
clarifying changes. Some commenters recommended that CMS align the late
penalty for the addendum with the penalty for late submission of the
NOE. Other commenters stated that denying the whole hospice claim when
the addendum is furnished late is excessive. A commenter stated that as
currently structured, the penalty is a negative incentive to furnish
the addendum in a timely manner if a hospice misses the initial
required timeframe. Some commenters mentioned there was confusion
regarding billing when an addendum is furnished late. Other commenters
recommended using a code to indicate billed but not covered hospice
days when the addendum is furnished late. A few commenters stated they
believe the addendum and the ABN have the potential to decrease
transparency and increase confusion for hospice patients, whereas,
other commenters recommended expanding the usage of the addendum, which
included combining the ABN and addendum, and to include drugs or
services which the hospice has determined to be medically unreasonable
or no longer necessary. One commenter recommended that CMS explore ways
to educate hospice providers about how they can inform their
beneficiaries (or representative) when items, services, or drugs are
considered related, but non-covered due to reasons such as not
reasonable or necessary for the palliation and management of the
terminal illness and related conditions. Moreover, a commenter
recommended developing an exceptions process for when hospice providers
are unable to provide an addendum because of `exceptional
circumstances' that are beyond the control of the hospice. Lastly, one
commenter suggested that since an electronically sent addendum could be
tracked, a signature should not be required.
Response: While these comments are out of scope of the proposed
rule, we appreciate and welcome all feedback related to the late
penalty; ABN and expansion of the addendum; signatures; exceptional
circumstances; and educating hospice providers. While we did not
propose any of these recommendations we could consider them for future
rulemaking. We understand the possibility of conflating the differences
between the ABN and the hospice election statement addendum. The ABN
transfers potential financial liability to the Medicare beneficiary in
certain instances, whereas the addendum (upon request) informs
terminally ill beneficiaries (or their representative) only of items,
services, or drugs the hospice will not be providing because the
hospice has determined them to be unrelated to the terminal illness and
related conditions. We refer readers to FY 2020 Hospice Wage Index and
Payment Rate Update final rule (84 FR 38512) to learn more about the
usage of the ABN. The hospice CoPs at Sec. 418.56(b) require hospices
to educate each patient and their primary caregivers(s) on services
identified on the plan of care and document the patient's (or
representative's) level of understanding involvement and agreement with
the plan of care. We expect that hospices would use the same methods
when educating patients (or representatives) about the addendum and
non-covered items, services and drugs, which the hospice has determined
are not reasonable or necessary for the palliation and management of
the terminal illness and related conditions.
The hospice CoPs at Sec. 418.52(a)(1) require that in advance of
receiving care, patients are informed about their rights, and hospices
must provide the patient (or representative) with verbal and written
notice of the patient's rights and responsibilities in a language and
manner the patient understands. Likewise, the hospice CoPs at Sec.
418.52(a)(3) requires that hospices obtain the patient's or
representative's signature confirming that he or she has received a
copy of the notice of rights and responsibilities. So, it is not
unreasonable to require that the electronically sent addendum also be
signed to ensure that the patient is aware of the important information
about hospice non-covered items, services, and drugs. We do not have a
policy for `exceptional circumstances' (that is floods, hurricanes,
etc.) but we will consider addressing this policy in future rulemaking.
Final Decision: We are finalizing the clarifications and addendum
regulation text changes at Sec. 418.24(c) as proposed, with the
exception of requiring the reason that the addendum is not signed to be
documented in the patient's medical record. This explanation must be
clearly noted on the addendum itself, but is not required to be
documented in both places. Based on comments, we are amending the
regulation text at Sec. 418.24 to state that if the beneficiary dies,
revokes election, is discharged prior to signing the addendum, or
refuses to sign the addendum, the addendum would not be required to be
signed in order for the hospice to receive payment. The hospice must
note (on the addendum itself) the reason the addendum was not signed
and the addendum would become part of the patient's medical record.
These changes will be effective on October 1, 2021.
[[Page 42550]]
E. Hospice Waivers Made Permanent Conditions of Participation
1. Background
In order to support provider and supplier communities due to the
COVID-19 PHE, CMS has issued an unprecedented number of regulatory
waivers under our statutory authority set forth at section 1135 of the
Act. Under section 1135 of the Act, the Secretary may temporarily waive
or modify certain Medicare, Medicaid, and Children's Health Insurance
Program (CHIP) requirements to ensure that sufficient health care items
and services are available to meet the needs of individuals enrolled in
the programs in the emergency area and time periods, and that providers
who furnish such services in good faith, but who are unable to comply
with one or more requirements as described under section 1135(b) of the
Act, can be reimbursed and exempted from sanctions for violations of
waived provisions (absent any determination of fraud or abuse). The
intent of these waivers was to expand healthcare system capacity while
continuing to maintain public and patient safety, and to hold harmless
providers and suppliers unable to comply with existing regulations
after a good faith effort.
While some of these waivers simply delay certain administrative
deadlines, others directly affect the provision of patient care. The
utilization and application of these waivers pushed us to consider
whether permanent changes would be beneficial to patients, providers,
and professionals. We identified selected waivers as appropriate
candidates for formal regulatory changes. Those changes and their
respective histories and background information are discussed in the
rule. We are also finalizing regulatory changes that are not directly
related to PHE waivers that will clarify or align some policies that
have been raised as concerns by stakeholders.
We are finalizing the following revisions to the hospice CoPs.
2. Hospice Aide Training and Evaluation--Using Pseudo-Patients
Hospice aides deliver a significant portion of direct care. Aides
are usually trained by an employer, such as a hospice, HHA or nursing
home and may already be certified as an aide prior to being hired. The
competency of new aides must be evaluated by the hospice to ensure
appropriate care can be provided by the aide. Aide competency
evaluations should be conducted in a way that identifies and meets
training needs of the aide as well as the patient's needs. These
evaluations are a critical part of providing safe, quality care.
The current hospice aide competency standard regulations at Sec.
418.76(c)(1) requires the aide to be evaluated by observing an aide's
performance of the task with a patient. We are finalizing similar
changes to hospice aide competency standards to those already made with
respect to HHAs (see Sec. 484.80(c)) in our hospice regulations at
Sec. 418.76(c)(1)). Additionally, we are finalizing definitions for
both ``pseudo-patient'' and ``simulation'' at Sec. 418.3. Therefore,
we are finalizing changes to permit skill competencies to be assessed
by observing an aide performing the skill with either a patient or a
pseudo-patient as part of a simulation. The final definitions are as
follows:
<bullet> ``Pseudo-patient'' means a person trained to participate
in a role-play situation, or a computer-based mannequin device. A
pseudo-patient must be capable of responding to and interacting with
the hospice aide trainee, and must demonstrate the general
characteristics of the primary patient population served by the hospice
in key areas such as age, frailty, functional status, cognitive status
and care goals.
<bullet> ``Simulation'' means a training and assessment technique
that mimics the reality of the homecare environment, including
environmental distractions and constraints that evoke or replicate
substantial aspects of the real world in a fully interactive fashion,
in order to teach and assess proficiency in performing skills, and to
promote decision making and critical thinking.
These changes will allow hospices to utilize pseudo-patients, such
as a person trained to participate in a role-play situation or a
computer-based mannequin device, instead of actual patients, in the
competency testing of hospice aides for those tasks that must be
observed being performed on a patient. This could increase the speed of
performing competency testing and would allow new aides to begin
serving patients more quickly while still protecting patient health and
safety.
3. Hospice Aide Training and Evaluation--Targeting Correction of
Deficiencies
We are also amending the requirement at Sec. 418.76(h)(1)(iii) to
specify that if an area of concern is verified by the hospice during
the on-site visit, then the hospice must conduct, and the hospice aide
must complete, a competency evaluation of the deficient skill and all
related skill(s) in accordance with Sec. 418.76(c). This change will
permit the hospice to focus on the hospice aides' specific deficient
and related skill(s) instead of completing another full competency
evaluation. We believe when a deficient area(s) in the aide's care is
assessed by the RN, there may be additional related competencies that
may also lead to additional deficient practice areas and thus would
require that those skills be included in the targeted competency
evaluation.
We received a total of 32 comments pertaining to the proposed
revision to the CoPs. Commenters included individuals, hospice
agencies, state hospice associations, national provider organizations,
and patient advocacy groups. The response to those comments follows:
Comment: Commenters were overwhelmingly supportive of the
provisions to permit the use of pseudo-patients and simulation when
conducting hospice aide competency training and for retraining of
deficient skills. Several commenters indicated that the changes will
facilitate a more time-efficient process in the evaluation of aide
skills. Another commenter stated the changes improve the efficiency of
onboarding new staff in a safe and effective manner.
Response: We appreciate these comments and agree that the
utilization of pseudo-patients and simulation will facilitate more
timely completion of training requirements for newly hired hospice
aides as well as allowing hospices to target specific competency
training for hospice aides noted to have deficient skill(s) on the
supervisory visit. We believe that this will benefit the hospice and
the patient by allowing new aide trainees and aides requiring remedial
training and competency testing to begin serving patients more quickly
while protecting patient health and safety.
Comment: Several commenters stated that the use of pseudo-patients
and simulation techniques are common in healthcare and a standard of
practice in many formal nursing assistant programs. These commenters
also state that hospices can adequately assess an aide's skills through
these means during competency training. Another commenter indicated
that the use of pseudo-patients and simulation will support patient
privacy.
Response: We appreciate the commenters highlighting the use of
pseudo-patients and simulation techniques in other healthcare setting
and agree that the use of these techniques is standard of practice in
many formal nursing assistant programs. We believe patient privacy is a
fundamental right for those persons
[[Page 42551]]
receiving hospice care. We agree that permitting competency testing of
hospice aides utilizing a pseudo-patient will support patient privacy
while also assuring a competently trained hospice aide workforce that
provide high quality patient care.
Comment: While the majority of commenters supported the proposed
changes; one commenter did not support the use of the pseudo-patient or
targeted competency testing. The commenter suggested that more research
and data are required on the use of pseudo-patients and changes to
competency requirements prior to making a policy decision. The
commenter also stated that data and research should support that using
a non-patient in training is safe when aides subsequently provide care.
Additionally, the commenter raised concerns regarding instances when
multiple areas of deficient practice are noted and if a full competency
would be done these instances.
Response: We appreciate the commenter's concern and the request for
additional research in this area. We believe, and other commenters
noted, that the use of pseudo-patients and simulation is an accepted
standard of practice for training in healthcare, including nurse aide
training programs. These same requirements were implemented for home
health aide supervision in 2019 (see 84 FR 51732 and the associated
regulations at Sec. 484.80(c)(1)), without any reported adverse
impacts noted to-date in CMS survey data or complaints being reported
to CMS. Both the use of the pseudo-patient and targeted aide training
align requirements between these two providers, home health and
hospice, affording the opportunity for efficiency in implementation for
many agencies that are Medicare certified to provide both services.
When deficient aide skills are noted during a supervisory visit,
the RN determines the deficient skills and all related skills that may
be impacted. The supervising RN then determines the scope of the
competency testing required, which may include a full competency
testing of all skills if warranted, such as when multiple areas of
deficient practice are noted.
Comment: One commenter recommended CMS broaden its view of nurses
to include licensed practical nurses (LPNs) for conducting aide
supervisory visits. The commenter indicated that this change would
provide greater staffing flexibility for hospices given workforce
shortages among essential workers.
Response: We appreciate the recommendation to permit greater
flexibility for hospices in regards to staffing of essential workers.
However, we have previously addressed this matter in prior rulemaking
(see Medicare and Medicaid Programs: Hospice Conditions of
Participation; final rule; 73 FR 32131 issued June 5, 2008) and believe
the rationale for requiring a RN for conducting supervisory visits
continues to be warranted. Registered nurses, through their education,
training, and role in provision of hospice care, are best positioned to
assess the adequacy of the aide services in relationship to the needs
of the patient and family to a greater degree than LPNs, or licensed
vocational nurses (LVNs). Ideally, the supervising RN is both
responsible for supervision of the aide services as well as being
primarily responsible for the patient's nursing care. This allows the
RN to develop a complete picture of the patient and family and of the
aide's services.
Comment: Many commenters stated that focusing the competency
training on specific deficient skills provided greater efficiency for
hospices. One commenter indicated that comprehensive competency testing
can take up to a full 8-hour day and a targeted approach will save time
related to this requirement. Another commenter stated that completing a
full competency test takes the focus away from the identified
deficiency and is not effective. A third commenter stated that topic-
specific evaluations will significantly reduce time and allow hospices
to concentrate on the specific deficient skills with additional
practice and training.
Response: We appreciate the support for this comment and agree that
a targeted approach is both more efficient and will permit greater
focus on remediating the deficient skills.
Comment: Many commenters requested clarification related to the use
of technology under the Medicare hospice benefit during the PHE. These
commenters requested that CMS further clarify that technology-based
visits are permissible outside of a PHE under the same circumstances
and conditions as under a PHE, provided applicable HIPAA requirements
are met, and requested that CMS establish modifiers that can be used on
claims to designate such visits.
Response: While comments on this topic are out of scope for this
rulemaking, we do believe the subject is important to address, given
the number of comments on this topic. On April 6, 2020, we published an
interim final rule ``Medicare and Medicaid Programs; Policy and
Regulatory Revisions in Response to the COVID-19 Public Health
Emergency'' (85 FR 19230). This rule provided individuals and entities
that provide services to Medicare beneficiaries needed flexibilities to
respond effectively to the serious public health threats posed by the
spread of COVID-19. The rule implemented temporary changes to the
hospice payment requirements to provide broad flexibilities to furnish
services using telecommunications technology in order to avoid exposure
risks to health care providers, patients, and the community during the
PHE. These changes will expire at the end of the COVID-19 PHE. The use
of telehealth for conducting the required hospice face-to-face (F2F)
encounter is statutorily limited to the PHE for COVID-19 in accordance
with section 1814(a)(1)(7)(D)(i) of the Act, as amended by section 3706
of the Coronavirus Aid, Relief, and Economic Security Act (Pub. L. 116-
136).
The CoPs are not relevant to payment questions regarding the use of
technology, such as telehealth, in the provision of hospice services.
The standard of practice for hospice is that care and services are
provided on an in-person basis based on needs identified in the
comprehensive assessment and services ordered by the IDG and outlined
in the plan of care. While nothing in the COPs prevent hospices from
augmenting in-person visits with technological means, such as
telehealth, these are not intended to change the standard of practice
or replace in-person visits. Additionally, for the duration of the PHE,
we expect that it would be up to the clinical judgment of hospice as to
whether such technology can meet the patient's/caregiver's/family's
needs and the use of technology should be included on the plan of care
for the patient and family.
We will continue to evaluate the impact of the COVID-19 PHE. At
this point, we are still assessing the impact of all waivers and
flexibilities on beneficiaries and the delivery of healthcare services
under the PHE. While the impact of some waiver and flexibilities may be
more apparent at this time, such as the waivers related to hospice aide
supervision, flexibilities associated with other aspects of care are
more complex requiring additional time for a complete understanding of
their impact. We will continue to evaluate the flexibilities to
determine if additional changes are warranted in the future.
Final Rule Action: We are finalizing as proposed at Sec.
418.76(c)(1) our policy that hospices may conduct competency testing by
observing an aide's
[[Page 42552]]
performance of the task with a patient or pseudo-patient. Additionally,
we are finalizing as proposed at Sec. 418.3 the definitions of
``pseudo-patient'' and ``simulation''.
We are also finalizing as proposed the requirement at Sec.
418.76(h)(1)(iii) to specify that if an area of concern is verified by
the hospice during the on-site visit, then the hospice must conduct,
and the hospice aide must complete, a competency evaluation of the
deficient skill and all related skill(s) in accordance with Sec.
418.76(c).
F. Updates to the Hospice Quality Reporting Program
1. Background and Statutory Authority
The Hospice Quality Reporting Program (HQRP) specifies reporting
requirements for both the Hospice Item Set (HIS) and Consumer
Assessment of Healthcare Providers and Systems (CAHPS[supreg]) Hospice
Survey. Section 1814(i)(5) of the Act requires the Secretary to
establish and maintain a quality reporting program for hospices.
Section 1814(i)(5)(A)(i) of the Act was amended by section 407(b) of
Division CC, Title IV of the CAA 2021 (Pub. L. 116-260) to change the
payment reduction for failing to meet hospice quality reporting
requirements from 2 to 4 percentage points. This policy will apply
beginning with FY 2024 annual payment update (APU). Specifically, the
Act requires that, beginning with FY 2014 through FY 2023, the
Secretary shall reduce the market basket update by 2 percentage points
and beginning with the FY 2024 APU and for each subsequent year, the
Secretary shall reduce the market basket update by 4 percentage points
for any hospice that does not comply with the quality data submission
requirements for that FY. We noted this revised statutory requirement
in our proposed rule (86 FR 19726) and are codifying the revision at
Sec. 418.306(b)(2).
In addition, section 407(a)(2) of the CAA 2021 removes the
prohibition on public disclosure of hospice surveys performed be a
national accreditation agency in section 1865(b) of the Act, thus
allowing the Secretary to disclose such accreditation surveys. In
addition, section 407(a)(1) of the CAA 2021 adds new requirements in a
newly added section 1822(a)(2) to require each state and local survey
agency, and each national accreditation body with an approved hospice
accreditation program, to submit information regarding any survey or
certification made with respect to a hospice program. Such information
shall include any inspection report made by such survey agency or body
with respect to such survey or certification, any enforcement actions
taken as a result of such survey or certification, and any other
information determined appropriate by the Secretary. This information
will be published publicly on our website, such as Care Compare, in a
manner that is easily accessible, readily understandable, and
searchable no later than October 1, 2022. In addition, national
accreditation bodies with approved hospice accreditation programs are
required to use the same survey form used by state and local survey
agencies, which is currently the Form CMS-2567, on or after October 1,
2021.
Depending on the amount of the annual update for a particular year,
a reduction of 2 percentage points through FY 2023 or 4 percentage
points beginning in FY 2024 could result in the annual market basket
update being less than zero percent for a FY and may result in payment
rates that are less than payment rates for the preceding FY. Any
reduction based on failure to comply with the reporting requirements,
as required by section 1814(i)(5)(B) of the Act, would apply only for
the specified year. Any such reduction would not be cumulative nor be
taken into account in computing the payment amount for subsequent FYs.
We are revising the regulations text at Sec. 418.306(b)(2) under a
``good cause'' waiver of proposed rulemaking as this change was noted
in the proposed rule and is a statutory requirement of the CAA of 2021.
Under the Administrative Procedure Act (APA) (5 U.S.C. 553), the agency
is not required to conduct notice and comment rulemaking for a change
that is statutory. Section V. of this final rule further details this
waiver of proposed rulemaking. Thus, 42 CFR 418.306(b)(2) has been
revised to follow the CAA of 2021 updates for the survey agencies.
Section 1814(i)(5)(C) of the Act requires that each hospice submit
data to the Secretary on quality measures specified by the Secretary.
The data must be submitted in a form, manner, and at a time specified
by the Secretary. Any measures selected by the Secretary must have been
endorsed by the consensus-based entity which holds a performance
measurement contract with the Secretary under section 1890(a) of the
Act. This contract is currently held by the National Quality Forum
(NQF). However, section 1814(i)(5)(D)(ii) of the Act provides that in
the case of a specified area or medical topic determined appropriate by
the Secretary for which a feasible and practical measure has not been
endorsed by the consensus-based entity, the Secretary may specify
measures that are not endorsed, as long as due consideration is given
to measures that have been endorsed or adopted by a consensus-based
organization identified by the Secretary. Section 1814(i)(5)(D)(iii) of
the Act requires that the Secretary publish selected measures
applicable with respect to FY 2014 no later than October 1, 2012.
In the FY 2014 Hospice Wage Index and Payment Rate Update final
rule (78 FR 48234), and in compliance with section 1814(i)(5)(C) of the
Act, we finalized the specific collection of data items that support
the seven NQF-endorsed hospice measures described in Table 6. In
addition, we finalized the Hospice Visits When Death is Imminent
measure pair (HVWDII, Measure 1 and Measure 2) in the FY 2017 Hospice
Wage Index and Payment Rate Update final rule, effective April 1, 2017.
We refer the public to the FY 2017 Hospice Wage Index and Payment Rate
Update final rule (81 FR 52144) for a detailed discussion.
The CAHPS Hospice Survey is a component of the CMS HQRP, which is
used to collect data on the experiences of hospice patients and their
family caregivers listed in their hospice records. Readers who want
more information about the development of the survey, originally called
the Hospice Experience of Care Survey, may refer to 79 FR 50452 and 78
FR 48261. National implementation of the CAHPS Hospice Survey commenced
January 1, 2015, as stated in the FY 2015 Hospice Wage Index and
Payment Rate Update final rule (79 FR 50452).
The CAHPS Hospice Survey measures received NQF endorsement on
October 26, 2016 and was re-endorsed November 20, 2020 (NQF #2651). NQF
endorsed six composite measures and two overall measures from the CAHPS
Hospice Survey. Along with nine HIS-based quality measures, the CAHPS
Hospice Survey measures are publicly reported on a designated CMS
website that is currently Care Compare. Beginning no earlier than May
2022, the Hospice Visits in Last Days of Life measure and the Hospice
Care Index will also be publicly reported on the CMS website. Table 6
lists all quality measures planned for FY 2022 for HQRP.
[[Page 42553]]
[GRAPHIC] [TIFF OMITTED] TR04AU21.143
The Hospice and Palliative Care Composite Process Measure--HIS-
Comprehensive Assessment at Admission measure (hereafter referred to as
``the HIS Comprehensive Assessment Measure'') underwent an off-cycle
review by the NQF Palliative and End-of-Life Standing Committee and
successfully received NQF endorsement in July 2017 (NQF 3235). The HIS
Comprehensive Assessment Measure captures whether multiple key care
processes were delivered upon patients' admissions to hospice in one
measure as described in the Table 6. NQF 3235 does not require NQF's
endorsements of the previous components to remain valid. Thus, if the
components included in NQF 3235 do not individually maintain
endorsement, the endorsement status of NQF 3235, as a single measure,
will not change.
In the FY 2016 Hospice Wage Index and Rate Update final rule (80 FR
47142), we finalized the policy for retention of HQRP measures adopted
for previous payment determinations and seven factors for measure
removal. In that same final rule, we discussed that we will issue
public notice, through rulemaking, of measures under consideration for
removal, suspension, or replacement. However, if there is reason to
believe continued collection of a measure raises potential safety
concerns, we will take immediate action to remove the measure from the
HQRP and will not wait for the annual
[[Page 42554]]
rulemaking cycle. Such measures will be promptly removed and we will
immediately notify hospices and the public of our decision through the
usual HQRP communication channels, including but not limited to
listening sessions, email notification, Open Door Forums, HQRP Forums,
and Web postings. In such instances, the removal of a measure will be
formally announced in the next annual rulemaking cycle.
In the FY 2019 Hospice Wage Index and Rate Update final rule (83 FR
38622), we also adopted an eighth factor for removal of a measure. This
factor aims to promote improved health outcomes for beneficiaries while
minimizing the overall costs associated with the program. These costs
are multifaceted and include the burden associated with complying with
the program. The finalized reasons for removing quality measures are:
1. Measure performance among hospices is so high and unvarying that
meaningful distinctions in improvements in performance can no longer be
made;
2. Performance or improvement on a measure does not result in
better patient outcomes;
3. A measure does not align with current clinical guidelines or
practice;
4. A more broadly applicable measure (across settings, populations,
or conditions) for the particular topic is available;
5. A measure that is more proximal in time to desired patient
outcomes for the particular topic is available;
6. A measure that is more strongly associated with desired patient
outcomes for the particular topic is available;
7. Collection or public reporting of a measure leads to negative
unintended consequences; or
8. The costs associated with a measure outweighs the benefit of its
continued use in the program.
On August 31, 2020, we added correcting language to the FY 2016
Hospice Wage Index and Payment Rate Update and Hospice Quality
Reporting Requirements; Correcting Amendment (85 FR 53679) hereafter
referred to as the FY 2021 HQRP Correcting Amendment. In this final
rule, we made correcting amendments to 42 CFR 418.312 to correct
technical errors identified in the FY 2016 Hospice Wage Index and
Payment Rate Update final rule. Specifically, the FY 2021 HQRP
Correcting Amendment (85 FR 53679) adds paragraph (i) to Sec. 418.312
to reflect our exemptions and extensions requirements, which were
referenced in the preamble but inadvertently omitted from the
regulations text. Thus, these exemptions or extensions can occur when a
hospice encounters certain extraordinary circumstances.
As stated in the FY 2019 Hospice Wage Index and Rate Update final
rule (83 FR 38622), we launched the Meaningful Measures initiative
(which identifies high priority areas for quality measurement and
improvement) to improve outcomes for patients, their families, and
providers while also reducing burden on clinicians and providers. More
information about the Meaningful Measures initiative can be found at:
<a href="https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/QualityInitiativesGenInfo/MMF/General-info-Sub-Page.html">https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/QualityInitiativesGenInfo/MMF/General-info-Sub-Page.html</a>.
In the FY 2020 Hospice Wage Index and Payment Rate Update final
rule (84 FR 38484), we discussed our interest in developing quality
measures using claims data, to expand data sources for quality measure
development. While we acknowledged in that rule the limitations with
using claims data as a source for measure development, there are
several advantages to using claims data as part of a robust HQRP as
discussed previously in the FY 2020 rule. We also discussed developing
the Hospice Outcomes & Patient Evaluation (HOPE), a new patient
assessment instrument that is planned to replace the HIS. See an update
on HOPE development in section III.F.6, ``Update regarding the Hospice
Outcomes & Patient Evaluation (HOPE) development''.
We also discussed our interest in outcome quality measure
development. Unlike process measures, outcome measures capture the
results of care as experienced by patients, which can include aspects
of a patient's health status and their experiences in the health
system. The portfolio of quality measures in the HQRP will include
outcome measures that reflect the results of care.
We received comments from various stakeholders on the proposals and
updates including a consumer advocacy group, health care providers,
hospice provider organizations, hospice trade groups, including those
focused on rural providers, consultants, EHR vendors, and MedPAC.
Comment: We received a comment that we are making many updates in
this rule and the resources for them are significant, especially during
the COVID-19 Public Health Emergency (PHE). They ask us to consider a
more gradual transition to new quality initiatives, staggered and
prioritized.
Response: We are mindful of the burden related to our updates. We
purposely made no updates or proposals in the FY 2021 final rule during
the COVID-19 PHE. For FY 2022, two of the four measures we proposed to
add were claims-based measures which do not increase burden to
providers. We also proposed to remove multiple measures thus leading to
a net decrease of total measures. Under our proposal, the HQRP will go
from 10 measures down to 4 measures with two of these measures being
claims-based measures, and the two already publicly reported measures
of the CAHPS Hospice Survey and NQF #3235, the HIS-Comprehensive
Assessment Measure. The public reporting has been thoughtfully
considered as discussed in this rule so that providers can access their
data earlier and prepare for public reporting in FY 2022, no sooner
than May 2022. We also consider this work in coordination with planned
future HOPE implementation and ensuring that the HQRP now covers the
entire hospice stay with these 4 measures rather than just admission
and discharge.
2. Removal of the Seven ``Hospice Item Set Process Measures'' From HQRP
Beginning FY 2022
In the FY 2014 Hospice Wage Index and Payment Rate Update final
rule (78 FR 48234), and in compliance with section 1814(i)(5)(C) of the
Act, we finalized the specific collection of standardized data items,
known as the HIS, that support the following NQF-endorsed measures:
<bullet> NQF #1617 Patients Treated with an Opioid who are Given a
Bowel Regimen
<bullet> NQF #1634 Pain Screening
<bullet> NQF #1637 Pain Assessment
<bullet> NQF #1638 Dyspnea Treatment
<bullet> NQF #1639 Dyspnea Screening
<bullet> NQF #1641 Treatment Preferences
<bullet> NQF #1647 Beliefs/Values Addressed (if desired by the patient)
These measures were adopted to increase public awareness of key
components of hospice care, such as pain and symptom management and
non-clinical care needs. Consistent with our policy for measure
retention and removal, finalized in the FY 2016 Hospice Wage Index and
Rate Update final rule (80 FR 47142), we reviewed these measures
against the factors for removal. Our analysis found that they meet
factor 4: ``a more broadly applicable measure (across settings,
populations, or conditions) for the particular topic is available.'' We
determined that the HIS Comprehensive
[[Page 42555]]
Assessment Measure, discussed in detail in the FY 2017 Hospice Wage
Index and Payment Rate Update final rule (81 FR 52144), is a more
broadly applicable measure and continues to provide, in a single
measure, meaningful differences between hospices regarding overall
quality in addressing the physical, psychosocial, and spiritual factors
of hospice care upon admission.
The HIS Comprehensive Assessment Measure's ``all or none''
criterion requires hospices to perform all seven care processes in
order to receive credit. In this way, it is different from an average-
based composite measure and sets a higher bar for performance. This
single measure differentiates hospices and holds them accountable for
completing all seven process measures to ensure core services of the
hospice comprehensive assessment are completed for all hospice
patients. Therefore, the HIS Comprehensive Assessment Measure continues
to encourage hospices to improve and maintain high performance in all
seven processes simultaneously, rather than rely on its component
measures to demonstrate quality hospice care in a way that may be hard
to interpret for consumers. The individual measures show performance
for only one process and do not demonstrate whether the hospice
provides high-quality care overall, as an organization. For example, a
hospice may perform extremely well assessing treatment preferences, but
poorly on addressing pain. High-quality hospice care not only manages
pain and symptoms of the terminal illness, but assesses non-clinical
needs of the patient and family caregivers, which is a hallmark of
patient-centered care. Since the HIS Comprehensive Assessment Measure
captures all seven processes collectively, we believe that public
display of the individual component measures is not necessary.
The interdisciplinary, holistic scope of the HIS Comprehensive
Assessment Measure aligns with the public's expectations for hospice
care. In addition, the measure supports alignment across our programs
and with other public and private initiatives. The seven individual
components address care processes around hospice admission that are
clinically recommended or required in the hospice CoPs. The Medicare
Hospice CoPs require that hospice comprehensive assessments identify
patients' physical, psychosocial, emotional, and spiritual needs and
address them to promote the hospice patient's comfort throughout the
end-of-life process. Furthermore, the person-centered, family, and
caregiver perspective align with the domains identified by the CoPs and
the National Consensus Project \8\ as patients and their family
caregivers also place value on physical symptom management and
spiritual/psychosocial care as important factors at the end-of-life.
The HIS Comprehensive Assessment Measure is a composite measure that
serves to ensure all hospice patients receive a comprehensive
assessment for both physical and psychosocial needs at admission.
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\8\ The National Consensus Project Guidelines expand on the
eight domains of palliative care in the 3rd edition and include
clinical and organizational strategies, screening and assessment
elements, practice examples, tools and resources. The guidelines
were developed by the National Consensus Project for Quality
Palliative Care, comprising 16 national organizations with extensive
expertise in and experience with palliative care and hospice, and
were published by the National Coalition for Hospice and Palliative
Care. Journal of Hospice & Palliative Nursing: December 2018--Volume
20--Issue 6--p 507.
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In addition, MedPAC's Report to Congress: Medicare Payment Policy
\9\ in recent years noted that the HIS Comprehensive Assessment Measure
differentiates the hospice's overall ability to address care processes
better than the seven individual HIS process measures. In this way, it
provides consumers viewing data on Care Compare with a streamlined way
to assess the extent to which a hospice follows care processes. In this
final rule, we are not making any revisions to the HIS Comprehensive
Assessment Measure because the single measure continues to show
sufficient variability and therefore provides value to patients, their
families, and providers.
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\9\ MedPAC. (2020). Chapter 12: Hospice Services. <a href="http://medpac.gov/docs/default-source/reports/mar20_medpac_ch12_sec.pdf">http://medpac.gov/docs/default-source/reports/mar20_medpac_ch12_sec.pdf</a>.
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Because the HIS Comprehensive Assessment Measure is a more broadly
applicable measure, we are finalizing our proposal to remove the seven
individual HIS process measures from the HQRP, no longer publicly
reporting them as individual measures on Care Compare beginning with FY
2022. In addition, we proposed and finalize in this rule to remove the
``7 measures that make up the HIS Comprehensive Assessment Measure''
section of Care Compare, which displays the seven HIS measures. We
proposed and are finalizing these changes to remove the seven HIS
process measures as individual measures from HQRP no earlier than May
2022.
Although we would remove the seven individual HIS process measures,
it does not change the requirement to submit the HIS admission
assessment. Since the HIS Comprehensive Assessment Measure is a
composite of the seven HIS process measures, the burden and requirement
to report the HIS data remain unchanged in the time, manner, and form
finalized in the FY 2017 Hospice Wage Index and Rate Update final rule
(81 FR 52144). Hospices which do not report HIS data used for the HIS
Comprehensive Assessment Measure will not meet the requirements for
compliance with the HQRP.
We solicited public comment on the proposal to remove the seven HIS
process quality measures as individual measures from the HQRP no
earlier than May 2022, and to continue including the seven HIS process
measures in the confidential quality measure (QM) Reports which are
available to hospices. The seven HIS process measures are also
available by visiting the data catalogue at <a href="https://data.cms.gov/provider-data/topics/hospice-care">https://data.cms.gov/provider-data/topics/hospice-care</a>. We sought public comment on the
technical correction to the regulation at Sec. 418.312(b) effective
October 1, 2021.
We received several comments on the proposal to remove the seven
``Hospice Item Set process measures'' from the HQRP beginning FY 2022.
A summary of the comments and our responses to those comments appears
below:
Comment: The majority of commenters supported the removal of the
seven HIS process measures. Several commenters opposed removing the
seven HIS process measures, at least prior to implementation of HOPE.
These commenters believed that the existing process measures provide
more valuable and transparent information about hospice performance
than the HIS Comprehensive Assessment composite measure. Finally, some
commenters recommended both removing the seven individual HIS process
measures and retiring the HIS Comprehensive Assessment measure. These
commenters suggested that retiring the composite measure would reduce
provider burden.
Response: We appreciate the support for this proposal. In response
to the concerns raised by those opposing the removal of seven HIS
process measures, we would like to emphasize that all but one of the
seven HIS measures are topped out individually and one HIS measure is
almost topped out and shows insignificant variability between hospices.
The 7 HIS measures credited hospices when any of these measures were
performed regardless of the individual patient. In contrast, the HIS
Comprehensive Assessment Measure measures whether a hospice assesses
each patient on the 7 HIS measures. This distinction is important since
it explains why the individual HIS
[[Page 42556]]
measures can be topped out but when measured together as a group, or
composite, that is required on each patient in order to get credit for
the measure, the HIS Comprehensive Assessment Measure shows variability
and meets public reporting standards. This distinction explains why
most hospices receive the maximum possible score on each of the 7 HIS
measures, but not on the HIS Comprehensive Assessment Measure. As such,
the individual measures have a limited ability to differentiate
hospices. In contrast, the HIS Comprehensive Assessment Measure shows
that hospices need to improve on providing a comprehensive set of
assessments on each patient at admission and supports why it continues
to be a useful HQRP measure.
While we consider it a success that hospices are assessing the care
processes included in the 7 HIS measures, hospices have improved since
2014 to the point that these 7 individual HIS measures no longer
differentiate quality of care between hospices and need to be retired
as individual quality measures and thereby removed from the HQRP. Now
that we reached that milestone, we need to recognize that there is a
need to focus on assessing the 7 HIS measures to each patient at
admission, which is what the HIS Comprehensive Assessment Measure
addresses. It more closely aligns with the intent of the Hospice CoPs
at Title 42 Part 418.54 that require a comprehensive assessment on each
patient. This is why the HIS Comprehensive Assessment Measure provides
valuable and transparent information about hospice performance.
Patients electing to receive hospice services should expect quality
care and a comprehensive assessment of their needs at admission, which
the HIS Comprehensive Assessment Measure reflects. While the transition
from the HIS to HOPE will eventually enable the HQRP to be more robust,
we should not wait to seek improvement on this composite measure as an
indicator of quality. This supports why we must remove the 7 HIS
measures now in favor of the one more meaningful measure.
Finally, we support minimizing provider burden while maintaining
quality measures that provide valuable information to providers and
consumers about hospice quality. The variability shown in the HIS
Comprehensive Assessment measure continues to provide useful
information that allows patients and families to differentiate hospices
and help select the best providers for their care.
Comment: MedPAC recommended that CMS consider removing the HIS
Comprehensive Assessment Measure because the scores suggest the
composite measure is limited in distinguishing provider quality. The
comment suggested that the HIS Comprehensive Assessment measure would
be likely to top out due to high scoring trends among hospices.
Response: We appreciate MedPAC raising this concern. We recognize
that the HIS Comprehensive Assessment Measure reflects high scores and
is improving over time, which may cause the measure to also become
topped out in the future.\10\ However, we believe that the single
measure currently continues to show sufficient variability to
differentiate hospices and therefore provides value to patients, their
families, and providers. Further, the HIS Comprehensive Assessment
Measure reflects the Hospice CoPs for comprehensive assessments
performed at admission, which is a critical time to determine the plan
of care. Its removal would not only leave HQRP without this important
admission quality of care measure but also result in HQRP having only
two claims-based measures, HCI and HVLDL, and the CAHPS Hospice Survey.
It is these four quality measures, the HIS Comprehensive Assessment
Measure, HCI, HVLDL, and CAHPS Hospice Survey that make up the FY 2022
HQRP requirements. These four measures cover hospice care throughout
the hospice stay. The HIS Comprehensive Assessment Measure covers care
at admission. HCI covers care throughout the hospice stay. HVLDL covers
care during discharge and the CAHPS Hospice Survey covers the caregiver
experience of hospice care. They complement each other and further
support the need for each measure in the HQRP. We will continue to
monitor the HIS Comprehensive Assessment Measure performance and
consider if removal or refinements would be appropriate in the future.
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\10\ MedPAC. (2020). Chapter 11: Hospice Services. <a href="http://www.medpac.gov/docs/default-source/reports/mar21_medpac_report_to_the_congress_sec.pdf?sfvrsn=0">http://www.medpac.gov/docs/default-source/reports/mar21_medpac_report_to_the_congress_sec.pdf?sfvrsn=0</a>.
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Final Decision: In this final rule, we are not making any revisions
to the HIS Comprehensive Assessment Measure. We are finalizing our
proposal to remove the seven individual HIS process measures from the
HQRP, no longer publicly reporting them as individual measures on Care
Compare beginning with FY 2022. In addition, we will remove the ``7
measures that make up the HIS Comprehensive Assessment Measure''
section of Care Compare, which displays the seven HIS measures. These
will be effective no earlier than May 2022. Hospice providers, must
report HIS data used for the HIS Comprehensive Assessment Measure, in
order to meet the requirements for compliance with the HQRP.
3. Addition of a ``Claims-Based Index Measure'', the Hospice Care Index
We proposed the addition of a new hospice quality measure, called
the Hospice Care Index (HCI), to HQRP. The HCI will provide more
information to better reflect several processes of care during a
hospice stay, and better empower patients and family caregivers to make
informed health care decisions. The HCI is a single measure comprising
ten indicators calculated from Medicare claims data. The index design
of the HCI simultaneously monitors all ten indicators. Collectively
these indicators represent different aspects of hospice service and
thereby characterize hospices comprehensively, rather than on just a
single care dimension. Therefore, the HCI composite yields a more
reliable provider ranking.
The HCI indicators, through the composite, will add new information
to HQRP that was either directly recommended for CMS to publicly report
by Federal stakeholders <SUP>11 12</SUP> or identified as areas for
improvement during information gathering activities. Furthermore, each
indicator represents either a domain of hospice care recommended by
leading hospice and quality experts \13\ for CMS to publicly report, or
a requirement included in the hospice CoPs. The indicators required to
calculate the single composite are discussed in the ``Specifications
for the HCI Indicators Selected'' section. These specifications list
all the information required to calculate each indicator, including the
numerator and denominator definitions, different thresholds for
receiving credit toward the overall HCI score, and explanations for
those thresholds. Indicators reflect practices or outcomes hospices
should pursue, thereby awarding points based on the criterion. The HCI
scoring example in Table 8 illustrates how points are awarded based on
meeting the criterion of the indicator. For example, Gaps in Skilled
Nursing Visits have a criterion of ``lower than the 90th percentile,''
and supports the hospice CoPs that require an assessment of the patient
and caregiver needs as well as
[[Page 42557]]
implementation of the plans of care. Other indicators, such as nurse
visits (RN and LPN) on weekends or near death, have a criterion of
``higher than the 10th perc
[…truncated; see source link]Indexed from Federal Register on August 4, 2021.
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