Rule2024-16910
Medicare Program; FY 2025 Hospice Wage Index and Payment Rate Update, Hospice Conditions of Participation Updates, and Hospice Quality Reporting Program Requirements
Primary source
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Published
August 6, 2024
Effective
October 1, 2024
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 (FY) 2025. This rule also adopts the most recent Office of Management and Budget statistical area delineations, which will impact the hospice wage index. This rule clarifies current policy related to the "election statement" and the "notice of election", as well as adds clarifying language regarding hospice certification and includes a technical regulation text change to the Conditions of Participation (CoPs). This rule finalizes changes to the Hospice Quality Reporting Program. Finally, this rule summarizes comments received regarding potential implementation of a separate payment mechanism to account for high intensity palliative care services.
Full Text
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[Federal Register Volume 89, Number 151 (Tuesday, August 6, 2024)]
[Rules and Regulations]
[Pages 64202-64273]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-16910]
[[Page 64201]]
Vol. 89
Tuesday,
No. 151
August 6, 2024
Part IV
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 2025 Hospice Wage Index and Payment Rate Update,
Hospice Conditions of Participation Updates, and Hospice Quality
Reporting Program Requirements; Final Rule
Federal Register / Vol. 89 , No. 151 / Tuesday, August 6, 2024 /
Rules and Regulations
[[Page 64202]]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
42 CFR Part 418
[CMS-1810-F]
RIN 0938-AV29
Medicare Program; FY 2025 Hospice Wage Index and Payment Rate
Update, Hospice Conditions of Participation Updates, and Hospice
Quality Reporting Program Requirements
AGENCY: Centers for Medicare & Medicaid Services (CMS), Department of
Health and Human Services (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 (FY) 2025. This rule also
adopts the most recent Office of Management and Budget statistical area
delineations, which will impact the hospice wage index. This rule
clarifies current policy related to the ``election statement'' and the
``notice of election'', as well as adds clarifying language regarding
hospice certification and includes a technical regulation text change
to the Conditions of Participation (CoPs). This rule finalizes changes
to the Hospice Quality Reporting Program. Finally, this rule summarizes
comments received regarding potential implementation of a separate
payment mechanism to account for high intensity palliative care
services.
DATES: These regulations are effective on October 1, 2024.
FOR FURTHER INFORMATION CONTACT:
For general questions about hospice payment policy, send your
inquiry via email to: <a href="/cdn-cgi/l/email-protection#4820273b38212b2d382724212b31082b253b6620203b662f273e"><span class="__cf_email__" data-cfemail="670f0814170e040217080b0e041e27040a14490f0f1449000811">[email protected]</span></a>.
For questions regarding the CAHPS[supreg] Hospice Survey, contact
Lauren Fuentes at (410) 786-2290.
For questions regarding the hospice conditions of participation
(CoPs), contact Mary Rossi-Coajou at (410) 786-6051.
For questions regarding the hospice quality reporting program,
contact Jermama Keys at (410) 786-7778.
SUPPLEMENTARY INFORMATION:
I. Executive Summary
A. Purpose
This final rule updates the hospice wage index, payment rates, and
cap amount for Fiscal Year (FY) 2025 as required under section 1814(i)
of the Social Security Act (the Act). This rule also finalizes the
adoption of the most recent Office of Management and Budget (OMB)
statistical area delineations based on data collected during the 2020
Decennial Census, which will result in changes to the hospice wage
index. In addition, this rule finalizes the reorganization of the
regulations to clarify current policy related to the ``election
statement'' and the ``notice of election (NOE),'' and adds clarifying
language regarding who can certify terminal illness and admit patients
to hospice. This rule also summarizes comments solicited regarding a
potential policy to account for the increased hospice costs of
providing high intensity palliative care services.
Additionally, this rule finalizes the Hospice Quality Reporting
Program (HQRP) measures collected through a new collection instrument,
the Hospice Outcomes and Patient Evaluation (HOPE); finalizes two HOPE-
based measures and lays out the planned trajectory for further
development of this instrument; and provides updates on Health Equity,
future quality measures (QMs), and public reporting requirements. We
also acknowledge responses on the request for information on potential
social determinants of health (SDOH) elements. Finally, this rule also
finalizes changes to the Hospice Consumer Assessment of Healthcare
Providers and Systems (Hospice CAHPS) Survey.
B. Summary of the Major Provisions
Section III.A.1 of this final rule updates the hospice wage index
and makes the application of the updated wage data budget neutral for
all four levels of hospice care.
Section III.A.2 of this final rule adopts the new OMB labor market
delineations from the July 21, 2023, OMB Bulletin No. 23-01 based on
data collected from the 2020 Decennial Census.
Section III.A.3 of this final rule includes the final FY 2025
hospice payment update percentage of 2.9 percent.
Section III.A.4 of this final rule includes updates to hospice
payment rates.
Section III.A.5 of this final rule includes an update to the
hospice cap amount for FY 2025 by the hospice payment update percentage
of 2.9 percent.
In section III.B of this final rule, we make clarifying changes to
the hospice Conditions of Participation (CoPs) and adopt clarifying
regulations text, with no change to current policy. This includes
reorganizing the regulations to clearly identify the distinction
between the ``election statement'' and the ``notice of election,'' as
well as including clarifying text changes that align payment
regulations and CoPs regarding who may certify terminal illness and
determine admission to hospice care. This section also finalizes
technical regulations text changes in the Medical Director CoP at Sec.
418.102. In addition, we are making a technical correction in the
personnel requirements at Sec. 418.114(b)(9), where we inadvertently
used the term ``marriage and family counselor'' when the correct term
is ``marriage and family therapist.''
In section III.C of this final rule, we include a summary of
comments received on a potential policy to account for higher hospice
costs involved in the provision of high intensity palliative care
treatments.
Finally, in section III.D of this final rule, we finalize HOPE-
based process measures; finalize the HOPE instrument; discuss updates
to potential future quality measures; and finalize changes to the
CAHPS[supreg] Hospice Survey.
C. Summary of Impacts
The overall economic impact of this final rule is estimated to be
$790 million in increased payments to hospices in FY 2025.
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
[[Page 64203]]
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 Act and our regulations at Sec. 418.3; that is,
the individual has a medical prognosis that the individual's 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. The
regulations at Sec. 418.22(b)(3) require that the certification and
recertification forms, or an addendum to 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 group (as
specified at Sec. 418.56(a)(1)), 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 home for
hospice care (routine home care) (RHC). 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. CHC 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 CHC rate (Sec. 418.302(e)(4)).
Hospices covered by this rule must comply with applicable civil
rights laws, including, section 504 of the Rehabilitation Act of 1973
and the Americans with Disabilities Act, which require covered programs
to take appropriate steps to ensure effective communication with
individuals with disabilities and companions with disabilities,
including the provisions of auxiliary aids and services when necessary
to afford qualified individuals with disabilities, including
applicants, participants, beneficiaries, companions and members of the
public, an equal opportunity to participate in, and enjoy the benefits
of, a service, program or activity of a recipient or public entity.\1\
Further information may be found at: <a href="https://www.hhs.gov/civil-rights/for-providers/provider-obligations/index.html">https://www.hhs.gov/civil-rights/for-providers/provider-obligations/index.html</a>.
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\1\ Hospices receiving Medicare Part A funds or other federal
financial assistance from the Department are also subject to
additional federal civil rights laws, including the Age
Discrimination Act, and are subject to conscience and religious
freedom laws where applicable.
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Title VI of the Civil Rights Act of 1964 prohibits discrimination
on the basis of race, color or national origin in federally assisted
programs or activities. The Office for Civil Rights (OCR) interprets
this to require that recipients of Federal financial assistance take
reasonable steps to provide meaningful access to their programs or
activities to individuals with limited English proficiency (LEP).\2\
Similarly, section 1557's of the Affordable Care Act implementing
regulation requires covered entities to take reasonable steps to
provide meaningful access to LEP individuals in federally funded health
programs and activities (45 CFR 92.201(a)). Meaningful access may
require the provision of interpreter services and translated materials
(45 CFR 92.201(c)).\3\
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\2\ HHS OCR, Guidance to Federal Financial Assistance Recipients
Regarding Title VI Prohibition Against National Origin
Discrimination Affecting Limited English Proficient Persons, 68 Fed.
Reg 47311 (Aug. 8, 2003), <a href="https://www.hhs.gov/civil-rights/for-individuals/special-topics/limited-english-proficiency/guidance-federal-financial-assistance-recipients-title-vi/index.html">https://www.hhs.gov/civil-rights/for-individuals/special-topics/limited-english-proficiency/guidance-federal-financial-assistance-recipients-title-vi/index.html</a>.
\3\ The Section 1557 final rule has been challenged in several
courts and is not currently in effect in Texas and Montana.
Additional information about the rule is available here: Section
1557 of the Patient Protection and Affordable Care Act [verbar]
<a href="http://HHS.gov">HHS.gov</a>.
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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 biological products);
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 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, Congress also
expected hospices to continue to use volunteer services, although
Medicare does not pay for these volunteer services (section
1861(dd)(2)(E) of the Act). As stated in the Health Care Financing
Administration's (now Centers for
[[Page 64204]]
Medicare & Medicaid Services (CMS)) proposed rule ``Medicare Program;
Hospice Care (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 (RHC, CHC, IRC, and GIP),
based on each day a qualified Medicare beneficiary is under hospice
care (once the individual has elected the benefit). This per diem
payment is meant to cover all hospice services and items needed to
manage the beneficiary's care, as required by section 1861(dd)(1) of
the Act.
While payment made to hospices is 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 prohibited
activities, even in the context of a per diem payment. For example,
hospices are prohibited from playing a role in medical aid in dying
(MAID) where such practices have been legalized in certain States. The
Assisted Suicide Funding Restriction Act of 1997 (Pub. L. 105-12, April
30, 1997) 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.
The Medicare hospice benefit has been revised and refined since its
implementation after various Acts of Congress and Medicare rules. For a
historical list of changes and regulatory actions, we refer readers to
the background section of previous Hospice Wage Index and Payment Rate
Update rules.\4\
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\4\ Hospice Regulations and Notices. <a href="https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/Hospice/Hospice-Regulations-and-Notices">https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/Hospice/Hospice-Regulations-and-Notices</a>.
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III. Provisions of the Final Rule
A. Final FY 2025 Hospice Wage Index and Rate Update
1. Final FY 2025 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. 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 Metropolitan Statistical Area (MSA) definitions.
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 September 14, 2018, OMB
issued OMB Bulletin No. 18-04, which superseded the April 10, 2018, OMB
Bulletin No. 18-03. OMB Bulletin No. 18-04 made revisions to the
delineations of MSAs, Micropolitan Statistical Areas, and Combined
Statistical Areas (CSA), and guidance on uses of the delineations in
these areas. This bulletin provided the delineations of all MSAs,
Metropolitan Divisions, Micropolitan Statistical Areas, CSAs, and New
England City and Town Areas in the United States and Puerto Rico based
on the standards published on June 28, 2010, in the Federal Register
(75 FR 37246 through 37252), and Census Bureau data. A copy of the
September 14, 2018, bulletin is available online at: <a href="https://www.whitehouse.gov/wp-content/uploads/2018/09/Bulletin-18-04.pdf">https://www.whitehouse.gov/wp-content/uploads/2018/09/Bulletin-18-04.pdf</a>. In
the FY 2021 Hospice Wage Index final rule (85 FR 47080), we finalized
our proposal to adopt the revised OMB delineations from the September
14, 2018, OMB Bulletin 18-04 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). 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 CSA, 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
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.
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 pre-floor, pre-reclassified hospital wage
index values below 0.8000 will be further adjusted by a 15 percent
increase subject to a maximum wage index value of 0.8000. 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 0.8000, 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
0.8000,
[[Page 64205]]
County B's hospice wage index would be 0.8000.
In the FY 2023 Hospice Wage Index final rule (87 FR 45673), we
finalized for FY 2023 and subsequent years, the application of a
permanent 5-percent cap on any decrease to a geographic area's wage
index from its wage index in the prior year, regardless of the
circumstances causing the decline, so that a geographic area's wage
index would not be less than 95 percent of its wage index calculated in
the prior FY. When calculating the 5-percent cap on wage index
decreases we start with the current fiscal year's pre-floor, pre-
reclassification hospital wage index value for a core-based statistical
area (CBSA) or statewide rural area and if that wage index value is
below 0.8000, we apply the hospice floor as discussed here. Next, we
compare the current fiscal year's wage index value after the
application of the hospice floor to the final wage index value from the
previous fiscal year. If the current fiscal year's wage index value is
less than 95 percent of the previous year's wage index value, the 5-
percent cap on wage index decreases would be applied and the final wage
index value would be set equal to 95 percent of the previous fiscal
year's wage index value. If the 5-percent cap is applied in one fiscal
year, then in the subsequent fiscal year, that year's pre-floor, pre-
reclassification hospital wage index would be used as the starting wage
index value and adjusted by the hospice floor. The hospice floor
adjusted wage index value would be compared to the previous fiscal
year's wage index which had the 5-percent cap applied. If the hospice
floor adjusted wage index value for that fiscal year is less than 95
percent of the capped wage index from the previous year, then the 5-
percent cap would be applied again, and the final wage index value
would be 95 percent of the capped wage index from the previous fiscal
year. Using the example previously stated, 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. If County A had a wage index value
of 0.6200 in the previous fiscal year, then we would compare 0.4593 to
the previous fiscal year's wage index value. Since 0.4593 is less than
95 percent of 0.6200, then County A's hospice wage index would be
0.5890, which is equal to 95-percent of the previous fiscal year's wage
index value of 0.6200. In the next fiscal year, the updated wage index
value would be compared to the wage index value of 0.5890.
Previously, this methodology was applied to all the counties that
make up the CBSA or rural area. However, as discussed in section
III.A.2.f of this final rule, because we are adopting the revised OMB
delineations this methodology will also be applied to individual
counties.
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. For FY 2025, we proposed
that the hospice wage index would be based on the FY 2025 hospital pre-
floor, pre-reclassified wage index for hospital cost reporting periods
beginning on or after October 1, 2020 and before October 1, 2021 (FY
2021 cost report data). We also stated that the proposed FY 2025
hospice wage index would not consider any geographic reclassification
of hospitals, including those in accordance with section 1886(d)(8)(B)
or 1886(d)(10) of the Act. The regulations that govern hospice payment
do not provide a mechanism for allowing hospices to seek geographic
reclassification or to utilize the rural floor provisions that exist
for Inpatient Prospective Payment System (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 and the hospital rural floor
policies apply to hospitals only, and not to hospices, we continue to
believe the use of the pre-floor and pre-reclassified hospital wage
index results is the most appropriate adjustment to the labor portion
of the hospice payment rates. This position is longstanding and
consistent with other Medicare payment systems, for example, the
skilled nursing facility prospective payment system (SNF PPS), the
inpatient rehabilitation facility prospective payment system (IRF PPS),
and the home health prospective payment system (HH PPS). However, the
hospice wage index does include the hospice floor, which is applicable
to all CBSAs, both rural and urban. The hospice floor adjusts pre-
floor, pre-reclassified hospital wage index values below 0.8000 by a 15
percent increase subject to a maximum wage index value of 0.8000. We
proposed that the FY 2025 hospice wage index would also include the 5-
percent cap on wage index decreases. The appropriate wage index value
would be 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.
We received 28 comments on the proposed FY 2025 hospice wage index
from various stakeholders including hospices, national industry
associations, and the Medicare Payment Advisory Commission (MedPAC). A
summary of these comments and our responses appear below:
Comment: One commenter expressed concern with the wage index
assigned to Montgomery County, Maryland (MD). This commenter stated
that Montgomery County, MD has a similar cost of living compared to
Washington, DC and shares the same labor market when competing for
labor; therefore, hospices in Montgomery County should be reimbursed at
the same level as hospices in Washington, DC This commenter stated that
hospices in Montgomery County are at a long-term competitive
disadvantage due to a Medicare hospice federal payment inequity
involving CBSAs and recommended that CMS assign the hospice wage index
valuation for the Washington, DC CBSA to the Montgomery/Frederick
County CBSA for a time-limited period, such as 5 years, in order to
evaluate the impact on Montgomery County hospices.
Response: We thank the commenter for the recommendation. 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. The general concept of the CBSAs
is that of an area containing a recognized population nucleus and
adjacent communities that have a high degree of integration with that
nucleus. The purpose of the 2020 standards for delineating Core Based
Statistical Areas is to provide nationally consistent definitions for
collecting, tabulating, and publishing federal statistics for a set of
geographic areas. CBSAs include adjacent counties that have a minimum
of 25 percent commuting to the central counties of the area. Based on
the OMB's current delineations, Montgomery County belongs in a separate
CBSA from the areas defined in the Washington, DC CBSA (CBSA 47764).
Unlike IPPS hospitals, IRFs, and SNFs, where each provider uses a
single wage index value, hospice agencies may serve multiple CBSAs and
be
[[Page 64206]]
reimbursed based on more than one wage index value. 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, DC CBSA, as well as to patients in other
surrounding CBSAs. We have used CBSAs for determining hospice payments
since FY 2006 and continue to believe that using the most current OMB
delineations provides an accurate representation of geographic
variation in wage levels and do not believe it would be appropriate to
allow hospices to opt for, or be assigned, a CBSA designation with a
higher wage index value. However, if a future OMB Bulletin updates the
designation for Montgomery County, Maryland, we would propose this
change through our normal rulemaking process.
Comment: A few commenters opposed the use of the IPPS wage index as
the basis for the hospice wage index. In general, these commenters
stated that the use of hospital wage data is inappropriate and
recommended that CMS utilize more appropriate wage information for the
hospice wage index. These commenters expressed concern that the
hospital wage index is derived from cost report wage data submitted by
hospitals which explicitly excludes hospice wage costs. Commenters
suggested that the exclusion of hospice costs undermines the accuracy
of wage adjustments for hospice providers and has the potential to lead
to inadequate services for terminally ill beneficiaries. Additionally,
two commenters also expressed concern with the lag in the hospital cost
report data used as the basis for the hospice wage index. One commenter
stated that the lag in the wage index data used in the proposed rule
likely means that any increase in reimbursement rates will be quickly,
and possibly completely, subsumed by recent and anticipated inflation
rates.
Response: We appreciate the commenters concerns; however, these
comments are outside the scope of the proposed rule, as we did not
propose changes to our hospice wage index methodology. Changes to the
hospice wage index methodology, including changes to the underlying
data used to create the hospice wage index, would have to go through
notice and comment rulemaking. Furthermore, we continue to believe the
use of the pre-floor and pre-reclassified hospital wage index results
is the most appropriate adjustment to the labor portion of the hospice
payment rates. This position is longstanding and consistent with other
Medicare payment systems; however, we will consider these comments in
the future if CMS does consider changes to this methodology.
Comment: A few commenters recommended more far-reaching revisions
to the hospice wage index methodology. Some commenters, including
MedPAC, recommended an overhaul of the entire hospice wage index
methodology. One commenter stated that the time is long overdue for CMS
to develop and implement a wage index model that is consistent across
all provider types so that all providers have a level playing field
from which to compete for personnel. MedPAC recommended that existing
Medicare wage index policies be repealed, including current exceptions,
and to phase in a new Medicare wage index system for hospitals and
other types of providers that uses all-employer, occupation-level wage
data with different occupation weights for the wage index of each
provider type; reflects local area level differences in wages between
and within metropolitan statistical areas and statewide rural areas;
and smooths wage index differences across adjacent local areas. In
addition, many commenters recommended allowing hospices to take
advantage of wage index protections afforded to hospitals such as
geographic redesignation and the rural floor. One commenter suggested
that CMS investigate how MedPAC's wage index proposal would impact
hospices and work with stakeholders, including Congress, to determine
how to implement a fairer system that also takes into account increased
labor costs.
Response: We appreciate the commenters' recommendations; however,
these comments are outside the scope of the proposed rule, as we did
not propose changes to our hospice wage index methodology. Any changes
regarding the adjustment of the hospice payments to account for
geographic wage differences, beyond the wage index proposals discussed
in the FY 2025 Hospice Wage Index and Rate Update proposed rule, would
require notice and comment rulemaking.
Comment: Several commenters also expressed concern that hospices
are not given the opportunity for geographic reclassification like
hospitals. These commenters recommended that hospices be allowed to
reclassify to a different CBSA to receive a higher wage index in order
to compete with hospitals and other health systems for the same labor
pool. One commenter stated that the inability to reclassify a hospice's
wage index means the hospice wage index often fails to reflect true
labor costs accurately, placing the hospice at a competitive and
financial disadvantage. Another commenter recommended that
reclassification be allowed for provider-based home health and hospice
providers who are a part of a hospital and/or health system. Many
commenters also recommended that CMS reinstitute the rural floor policy
so that no hospice serving patients in urban areas is paid below the
rural wage index value of the State. These commenters stated that
hospices are at a competitive disadvantage because they are unable to
take advantage of geographic reclassification and the rural floor
provisions that are allowed for hospitals.
Response: We remind stakeholders that the statutory provisions that
govern hospice payment 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 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 apply only to
hospitals, and not to hospices (even those hospices that are affiliated
with a hospital or other health care system), we continue to believe
the use of the pre-floor and pre-reclassified hospital wage index
results is the most appropriate adjustment to the labor portion of the
hospice payment rates. However, we note that hospices do receive the
hospice floor which adjusts the pre-floor, pre-reclassified hospital
wage index values below 0.8000 by a 15 percent increase subject to a
maximum wage index value of 0.8000 and the 5-percent cap on wage index
decreases.
Comment: Two commenters encouraged CMS to add details and
transparency to the wage index section of the rule. These commenters
requested that CMS describe in detail how the wage index is calculated,
the basis in the hospital cost report, and the role of the wage index
standardization factor. Commenters requested this information so that
hospices receive more information on how and why year to year wage
index variation occurs.
Response: We thank the commenters for their recommendations. In
reference to the commenters' recommendation for more details describing
how the pre-
[[Page 64207]]
floor pre-reclassified wage index is calculated, we refer readers to
the FY 2025 IPPS proposed rule (89 FR 36139 through 36159) for
additional information on the cost report worksheets used to calculate
the wage index, information on how those worksheets are validated, the
process for hospitals to request corrections, and the method for
calculating the proposed unadjusted wage index. Once we receive the
pre-floor, pre-reclassified wage index values as discussed, those
values are then adjusted by the hospice floor so that all wage index
values lower than 0.8000 are increased by 15 percent up to 0.8000. The
hospice floor adjusted wage index values are subsequently updated by
the permanent 5-percent cap on wage index decreases so that the wage
index for the current fiscal year is not less than 95 percent of the
wage index value the previous fiscal year. Regarding the wage index
standardization factors, we finalized in the FY 2017 Hospice Wage Index
and Rate Update final rule (81 FR 52156), a policy of applying wage
index standardization factors for each level of care to hospice
payments in order to eliminate the aggregate effect of annual
variations in hospital wage data. In order to calculate the wage index
standardization factor, we simulate total payments using FY 2023
hospice utilization claims data with the FY 2024 wage index (pre-floor,
pre-reclassified hospital wage index with the hospice floor, old OMB
delineations, and the 5-percent cap on wage index decreases) and FY
2024 payment rates and compare that total to our simulation of total
payments using FY 2023 utilization claims data, the final FY 2025
hospice wage index (pre-floor, pre-reclassified hospital wage index
with hospice floor, and the revised OMB delineations, with the 5-
percent cap on wage index decreases) and FY 2024 payment rates. By
dividing payments for each level of care (RHC days 1 through 60, RHC
days 61+, CHC, IRC, and GIP) using the FY 2024 wage index and FY 2024
payment rates for each level of care by the FY 2025 wage index and FY
2024 payment rates, we obtain a wage index standardization factor for
each level of care. The wage index standardization factors for each
level of care are then applied to the national payment amounts for that
level of care to calculate the final FY 2025 payment amounts.
Final Decision: We are finalizing our proposal to use the FY 2025
pre-floor, pre-reclassified hospital wage index data as the basis for
the FY 2025 hospice wage index. The wage index applicable for FY 2025
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 2025 is effective October 1, 2024, through September 30,
2025.
There exist some geographic areas where there are no hospitals, and
thus, no hospital wage data on which to base the calculation of the
hospice wage index. 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 the
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 2025, the only CBSA without
a hospital from which hospital wage data can be derived is 25980,
Hinesville-Fort Stewart, Georgia. The FY 2025 final wage index value
for Hinesville-Fort Stewart, Georgia is 0.8872.
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). For FY 2025, as
part of our proposal to adopt the revised OMB delineations discussed
further in section III.A.2 of this final rule, we proposed that rural
North Dakota would now become a rural area without a hospital from
which hospital wage data can be derived. Therefore, to calculate the
wage index for rural area 99935, North Dakota, we proposed to use as a
proxy, the average pre-floor, pre-reclassified hospital wage data
(updated by the hospice floor) from the contiguous CBSAs: CBSA 13900-
Bismark, ND, CBSA 22020-Fargo, ND-MN, CBSA 24220-Grand Forks, ND-MN and
CBSA 33500, Minot, ND, which resulted in a proposed FY 2025 hospice
wage index of 0.8446 for rural North Dakota.
While no commenters expressly opposed or supported this proposal,
we did receive one comment acknowledging the proposal to shift rural
North Dakota to a rural area without a hospital from which hospital
data can be formulated. We are finalizing our proposal to use as a
proxy the average pre-floor, pre-reclassified hospital wage data
(updated by the hospice floor) from the contiguous CBSAs: CBSA 13900-
Bismark, ND, CBSA 22020-Fargo, ND-MN, CBSA 24220-Grand Forks, ND-MN and
CBSA 33500, Minot, ND. For this final rule, using updated data, the
final FY 2025 hospice wage index for rural North Dakota is 0.8545.
[GRAPHIC] [TIFF OMITTED] TR06AU24.052
[[Page 64208]]
Previously, the only rural area without a hospital from which
hospital wage data could be derived was in Puerto Rico. However, for
rural Puerto Rico, we did not apply this methodology due to the
distinct economic circumstances that exist there (for example, due to
the close proximity of almost all of Puerto Rico's various urban areas
to 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 used the most recent wage index previously available for
that area which was 0.4047, subsequently adjusted by the hospice floor
for an adjusted wage index value of 0.4654. For FY 2025, we noted that
as part of our proposal to adopt the revised OMB delineations discussed
further in section III.A.2.c of this final rule, there would now be a
hospital in rural Puerto Rico from which hospital wage data can be
derived. Therefore, we proposed that the wage index for rural Puerto
Rico would now be based on the hospital wage data for the area instead
of the previously available pre-hospice floor wage index of 0.4047,
which equaled an adjusted wage index value of 0.4654. The FY 2025
proposed pre-hospice floor unadjusted wage index for rural Puerto Rico
would be 0.2520, and is subsequently adjusted by the hospice floor to
equal 0.2898. Because 0.2898 is more than a 5-percent decline in the FY
2024 wage index, the adjusted FY 2025 wage index with the 5-percent cap
applied would equal 0.95 multiplied by 0.4654 (that is, the FY 2024
wage index with floor), which resulted in a proposed wage index of
0.4421.
We did not receive any comments on our proposal to use hospital
wage data to calculate the wage index of rural Puerto Rico instead of
the previously available hospice floor adjusted wage index of 0.4654.
We are finalizing this policy as proposed. For FY 2025 the final
hospice wage index for rural Puerto Rico is 0.2510, subsequently
adjusted by the hospice floor which equals 0.2887. Because 0.2887 is
more than a 5-percent decline in the FY 2024 wage index, the adjusted
FY 2025 wage index with the 5-percent cap applied will equal 0.95
multiplied by 0.4654 (that is, the FY 2024 wage index with floor),
which results in a final wage index of 0.4421.
Finally, due to the proposed adoption of the revised OMB
delineations discussed in section III.A.2.c of this final rule, we
noted that Delaware, which was previously an all-urban State, would now
have one rural area with a hospital from which hospital wage data can
be derived. As such, the proposed FY 2025 wage index for rural area
99908 Delaware was 1.0429. We did not receive any comments on our
proposal to use hospital wage data to calculate the wage index of rural
Delaware. We are finalizing our proposal and the FY 2025 final hospice
wage index for rural Delaware is 1.0385.
2. Implementation of New Labor Market Delineations
As discussed, on July 21, 2023, OMB issued Bulletin No. 23-01,
which updates and supersedes OMB Bulletin No. 20-01, issued on March 6,
2020. OMB Bulletin No. 23-01 establishes revised delineations for the
MSAs, Micropolitan Statistical Areas, CSAs, and Metropolitan Divisions,
collectively referred to as Core Based Statistical Areas (CBSAs).
According to OMB, the delineations reflect the 2020 Standards for
Delineating Core Based Statistical Areas (the ``2020 Standards''),
which appeared in the Federal Register (86 FR 37770 through 37778) on
July 16, 2021, and application of those standards to Census Bureau
population and journey-to-work data (for example, 2020 Decennial
Census, American Community Survey, and Census Population Estimates
Program data). A copy of OMB Bulletin No. 23-01 is available online at:
<a href="https://www.whitehouse.gov/wp-content/uploads/2023/07/OMB-Bulletin-23-01.pdf">https://www.whitehouse.gov/wp-content/uploads/2023/07/OMB-Bulletin-23-01.pdf</a>.
The July 21, 2023, OMB Bulletin No. 23-01 contains a number of
significant changes. For example, there are new CBSAs, urban counties
that have become rural, rural counties that have become urban, and
existing CBSAs that have been split apart. We believe it is important
for the hospice wage index to use the latest OMB delineations available
in order to maintain the most accurate and up-to-date payment system,
reflecting the reality of population shifts and labor market
conditions. We further believe that using the most current OMB
delineations would increase the integrity of the hospice wage index by
creating a more accurate representation of geographic variation in wage
levels. We proposed to implement the new OMB delineations as described
in the July 21, 2023, OMB Bulletin No. 23-01 for the hospice wage index
effective beginning in FY 2025. A summary of comments and our responses
on this overall proposal, and on the more specific changes discussed in
sections III.A.2.c through III.A.2.f of this final rule that occur as a
result of this final policy, are discussed further in this document.
a. Micropolitan Statistical Areas
As discussed in the FY 2006 Hospice Wage Index and Payment Rate
Update proposed rule (70 FR 22397) and final rule (70 FR 45132), we
considered how to use the Micropolitan Statistical Area definitions in
the calculation of the wage index. Previously, OMB defined a
``Micropolitan Statistical Area'' as a ``CBSA'' ``associated with at
least one urban cluster that has a population of at least 10,000, but
less than 50,000'' (75 FR 37252). We refer to these as Micropolitan
Areas. After extensive impact analysis, consistent with the treatment
of these areas under the IPPS as discussed in the FY 2005 IPPS final
rule (69 FR 49029), we determined the best course of action would be to
treat Micropolitan Areas as ``rural'' and include them in the
calculation of each State's Hospice rural wage index (70 FR 22397 and
70 FR 45132). Thus, the hospice statewide rural wage index has been
determined using IPPS hospital data from hospitals located in non-MSAs.
In the FY 2021 Hospice final rule (85 FR 47074, 47080), we finalized a
policy to continue to treat Micropolitan Areas as ``rural'' and to
include Micropolitan Areas in the calculation of each State's rural
wage index.
The OMB ``2020 Standards'' continues to define a ``Micropolitan
Statistical Area'' as a CBSA with at least one Urban Area that has a
population of at least 10,000, but less than 50,000. The Micropolitan
Statistical Area comprises the central county or counties containing
the core, plus adjacent outlying counties having a high degree of
social and economic integration with the central county, or counties as
measured through commuting. (86 FR 37778). Overall, there are the same
number of Micropolitan Areas (542) under the new OMB delineations based
on the 2020 Census as there were using the 2010 Census. We note,
however, that a number of urban counties have switched status and have
joined or become Micropolitan Areas, and some counties that once were
part of a Micropolitan Area, and thus were treated as rural, have
become urban based on the 2020 Decennial Census data. We believe that
the best course of action would be to continue our established policy
and include Micropolitan Areas in each State's rural wage index as
these areas continue to be defined as having relatively small urban
cores (populations of 10,000 to 49,999). Therefore, in conjunction with
our proposal to implement the new OMB labor market delineations
beginning in FY 2025, and consistent with the treatment of Micropolitan
Areas under
[[Page 64209]]
the IPPS, we also proposed to continue to treat Micropolitan Areas as
``rural'' and to include Micropolitan Areas in the calculation of each
State's rural wage index.
Final Decision: We did not receive any comments on our proposal to
continue to treat Micropolitan Areas as rural and to include those
areas in the calculation of each State's rural wage index. We are
finalizing this policy as proposed.
b. Change to County-Equivalents in the State of Connecticut
In a June 6, 2022, Notice (87 FR 34235--34240), the Census Bureau
announced that it was implementing the State of Connecticut's request
to replace the eight counties in the State with nine new ``Planning
Regions''. Planning regions are included in OMB Bulletin No. 23-01 and
now serve as county-equivalents within the CBSA system. We evaluated
the change and proposed to adopt the planning regions as county
equivalents for wage index purposes. We believe it is necessary to
adopt this migration from counties to planning region county-
equivalents in order to maintain consistency with our established
policy of adopting the most recent OMB updates.
Final Decision: We did not receive any comments on our proposal to
adopt the Connecticut planning regions as county equivalents for wage
index purposes. We are finalizing this policy as proposed. We are
providing the following crosswalk in Table 2 for counties located in
Connecticut with the current and final FIPS county and county-
equivalent codes and CBSA assignments.
[GRAPHIC] [TIFF OMITTED] TR06AU24.053
c. Urban Counties That Would Become Rural
Under the revised OMB statistical area delineations (based upon OMB
Bulletin No. 23-01), a total of 53 counties (and county equivalents)
that are currently considered urban would be considered rural beginning
in FY 2025. Table 3 lists the 53 counties that will become rural when
we implement the revised OMB delineations.
[[Page 64210]]
[GRAPHIC] [TIFF OMITTED] TR06AU24.054
[[Page 64211]]
[GRAPHIC] [TIFF OMITTED] TR06AU24.055
d. Rural Counties That Would Become Urban
Under the revised OMB statistical area delineations (based upon OMB
Bulletin No. 23-01), a total of 54 counties (and county equivalents)
that are currently located in rural areas will be considered located in
urban areas under the revised OMB delineations beginning in FY 2025.
Table 4 lists the 54 counties that will be urban if we implement the
revised OMB delineations beginning in FY 2025.
[[Page 64212]]
[GRAPHIC] [TIFF OMITTED] TR06AU24.056
[[Page 64213]]
[GRAPHIC] [TIFF OMITTED] TR06AU24.057
e. Urban Counties That Would Move to a Different Urban CBSA Under the
Revised OMB Delineations
In addition to rural counties becoming urban and urban counties
becoming rural, several urban counties would shift from one urban CBSA
to a new or existing urban CBSA under our proposal to adopt the revised
OMB delineations. In other cases, applying the new OMB delineations
would involve a change only in CBSA name or number, while the CBSA
would continue to encompass the same constituent counties. For example,
CBSA 35154 (New Brunswick-Lakewood, NJ) would experience both a change
to its number and its name, and become CBSA 29484 (Lakewood-New
Brunswick, NJ), while all three of its constituent counties would
remain the same. In other cases, only the name of the CBSA would be
modified. Table 5 lists CBSAs that would change in name and/or CBSA
number only, but the constituent counties would not change (except in
instances where an urban county became rural, or a rural county became
urban, as discussed in the previous sections).
[[Page 64214]]
[GRAPHIC] [TIFF OMITTED] TR06AU24.058
[[Page 64215]]
[GRAPHIC] [TIFF OMITTED] TR06AU24.059
In some cases, all the urban counties from a FY 2024 CBSA would be
moved and subsumed by another CBSA in FY 2025. Table 6 lists the CBSAs
that, under our proposal to adopt the revised OMB statistical area
delineations, would be subsumed by another CBSA.
[GRAPHIC] [TIFF OMITTED] TR06AU24.060
In other cases, if we adopt the new OMB delineations, some counties
will shift between existing and new CBSAs, changing the constituent
makeup of the CBSAs. In another type of change, some CBSAs have
counties that would split off to become part of or to form entirely new
labor market areas. For example, the District of Columbia, DC, Charles
County, MD and Prince Georges County, MD would move from CBSA 47894
(Washington-Arlington-Alexandria, DC-VA-MD-WV) into CBSA 47764
(Washington, DC-MD). Calvert County, MD would move from CBSA 47894
(Washington-Arlington-Alexandria, DC-VA-MD-WV) into CBSA 30500
(Lexington Park, MD). The remaining counties that currently make up
47894 (Washington-Arlington-Alexandria, DC-VA-MD-WV) would move into
CBSA 11694 (Arlington-Alexandria-Reston, VA-WV). Finally, in some
cases, a CBSA will lose counties to another existing
[[Page 64216]]
CBSA if we adopt the new OMB delineations. For example, Grainger
County, TN would move from CBSA 34100 (Morristown, TN) into CBSA 28940
(Knoxville, TN). Table 7 lists the 73 urban counties that would move
from one urban CBSA to a new or modified urban CBSA if we adopt the
revised OMB delineations.
[GRAPHIC] [TIFF OMITTED] TR06AU24.061
[[Page 64217]]
[GRAPHIC] [TIFF OMITTED] TR06AU24.062
[[Page 64218]]
[GRAPHIC] [TIFF OMITTED] TR06AU24.063
[[Page 64219]]
[GRAPHIC] [TIFF OMITTED] TR06AU24.064
[[Page 64220]]
[GRAPHIC] [TIFF OMITTED] TR06AU24.065
f. Transition Period
In the past we have provided for transition periods when adopting
changes that have significant payment implications, particularly large
negative impacts, in order to mitigate the potential impacts of
proposed policies on hospices. For example, we have proposed and
finalized budget-neutral transition policies to help mitigate negative
impacts on hospices following the adoption of the new CBSA delineations
based on the 2010 Decennial Census data in the FY 2016 hospice final
rule (80 FR 47142). Specifically, we applied a blended wage index for
one year (FY 2016) for all geographic areas that consisted of a 50/50
blend of the wage index values using OMB's old area delineations and
the wage index values using OMB's new area delineations. That is, for
each county, a blended wage index was calculated equal to 50 percent of
the FY 2016 wage index using the old labor market area delineation and
50 percent of the FY 2016 wage index using the new labor market area
delineations, which resulted in an average of the two values.
Additionally, in the FY 2021 hospice final rule (85 FR 47079 through
47080), we proposed and finalized a transition policy to apply a 5-
percent cap on any decrease in a geographic area's wage index value
from the wage index value from the prior FY. This transition allowed
the effects of our adoption of the revised CBSA delineations from OMB
Bulletin 18-04 to be phased in over 2 years, where the estimated
reduction in a geographic area's wage index was capped at five percent
in FY 2021 (that is, no cap was applied to the reduction in the wage
index for the second year (FY 2022)). We explained that we believed a
5-percent cap on the overall decrease in a geographic area's wage index
value would be appropriate for FY 2021, as it provided predictability
in payment levels from FY 2020 to FY 2021 and additional transparency
because it was administratively simpler than our prior one-year 50/50
blended wage index approach.
As discussed previously, in the FY 2023 hospice final rule, we
adopted a permanent 5-percent cap on wage index decreases beginning in
FY 2023 and each subsequent year (87 FR 45677). The policy applies a
permanent 5-percent cap on any decrease to a geographic area's wage
index from its wage index in the prior year, regardless of the
circumstances causing the decline, so that a geographic area's wage
index would not be less than 95 percent of its wage index calculated in
the prior FY.
For FY 2025, we believe that the permanent 5-percent cap on wage
index decreases would be sufficient to mitigate any potential negative
impact for hospices serving beneficiaries in areas that are impacted by
the proposal to adopt the revised OMB delineations and that no further
transition is necessary. Previously, the 5-percent cap had been applied
at the CBSA or statewide rural area level, meaning that all the
counties that make up the CBSA or rural area received the 5-percent
cap. However, for FY 2025, to mitigate any
[[Page 64221]]
potential negative impact caused by our proposed adoption of the
revised delineations, we proposed that in addition to the 5-percent cap
being calculated for an entire CBSA or statewide rural area the cap
would also be calculated at the county level, so that individual
counties moving to a new delineation would not experience more than a 5
percent decrease in wage index from the previous fiscal year.
Specifically, we proposed for FY 2025, that the 5-percent cap would
also be applied to counties that move from a CBSA or statewide rural
area with a higher wage index value into a new CBSA or rural area with
a lower wage index value, so that the county's FY 2025 wage index would
not be less than 95 percent of the county's FY 2024 wage index value
under the old delineation despite moving into a new delineation with a
lower wage index.
Due to the way that we proposed to calculate the 5-percent cap for
counties that experience an OMB designation change, some CBSAs and
statewide rural areas could have more than one wage index value because
of the potential for their constituent counties to have different wage
index values as a result of application of the 5-percent cap.
Specifically, some counties that change OMB designations would have a
wage index value that is different than the wage index value assigned
to the other constituent counties that make up the CBSA or statewide
rural area that they are moving into because of the application of the
5-percent cap. However, for hospice claims processing, each CBSA or
statewide rural area can have only one wage index value assigned to
that CBSA or statewide rural area.
Therefore, hospices that serve beneficiaries in a county that would
receive the cap would need to use a number other than the CBSA or
statewide rural area number to identify the county's appropriate wage
index value for hospice claims in FY 2025. We proposed that beginning
in FY 2025, counties that have a different wage index value than the
CBSA or rural area into which they are designated due to the
application of the 5-percent cap would use a wage index transition
code. These special codes are five digits in length and begin with
``50.'' The 50XXX wage index transition codes would be used only in
specific counties; counties located in CBSAs and rural areas that do
not correspond to a different transition wage index value will still
use the CBSA number. For example, FIPS county 13171 Lamar County, GA is
currently part of CBSA 12060 Atlanta-Sandy Springs-Alpharetta. However,
for FY 2025 we proposed that Lamar County would be redesignated into
the Rural Georgia Code 99911. Because the wage index value of rural
Georgia is more than a 5-percent decrease from the wage index value
that Lamar County previously received under CBSA 12060, the FY 2025
wage index for Lamar County would be capped at 95 percent of the FY
2024 wage index value for CBSA 12060. Additionally, because rural
Georgia can only have one wage index value assigned to code 99911, in
order for Lamar County to receive the capped wage index for FY 2025,
transition code 50002 would be used instead of rural Georgia code
99911.
Table 8 includes a list of counties that have changed designation
and must use a transition code beginning in FY 2025. This list is
comprised of counties that are redesignated into a new CBSA or rural
area and will receive the 5-percent cap on wage index decreases. These
counties must use a transition code because the wage index for that
county is higher than all other constituent counties that make up the
CBSA or rural area (like the example above for Lamar County, GA.)
Additionally, the list also includes counties that move into a new CBSA
or rural area and have a different wage index value because the
constituent counties that make up the CBSA or rural receive the 5-
percent cap for FY 2025 while the county that moves into the CBSA or
rural area does not. For example, rural area 99922 rural Massachusetts
is comprised of FIPS code 25007 Dukes County, FIPS code 25019 Nantucket
County and the redesignated FIPS code 25011 Franklin County. Dukes
County and Nantucket County were part of rural area 99922 Massachusetts
for FY 2024 and will receive the 5-percent cap because the FY 2025 wage
index for rural area 99922 is more than a 5-percent decrease from the
FY 2024 wage index for rural area 99922. However, Franklin County was
included in CBSA 44140 Springfield, MA in FY 2024 and the uncapped FY
2025 wage index for rural area 99922 is higher than the FY 2024 wage
index for CBSA 44140. In this example, Franklin County, MA would
receive the uncapped wage index for rural Area 99922 while Dukes and
Nantucket counties receive the 5-percent capped wage index. Therefore,
hospices that serve beneficiaries in Franklin County, MA must use the
transition code 50010 on hospice claims.
Additionally, we proposed that the 5-percent cap would apply to a
county that corresponds to a different wage index value than the wage
index value in the CBSA or rural area in which they are designated due
to a delineation change until the county's new wage index is more than
95 percent of the wage index from the previous fiscal year. We also
proposed that in order to capture the correct wage index value, the
county would continue to use the assigned 50XXX transition code until
the county's wage index value calculated for that fiscal year using the
new OMB delineations is not less than 95 percent of the county's capped
wage index from the previous fiscal year. Thus, in the example
mentioned previously, Lamar County would continue to use transition
code 50002 until the wage index in its revised designation of Rural
Georgia is equal to or more than 95 percent of its wage index value
from the previous fiscal year. The counties that will require a
transition code in FY 2025 and the corresponding 50XXX codes are shown
in Table 8 and will also be shown in the last column of the FY 2025
hospice wage index file.
[[Page 64222]]
[GRAPHIC] [TIFF OMITTED] TR06AU24.066
We received 11 comments on our proposal to adopt the latest OMB
delineations from OMB Bulletin No. 23-01 (and the resulting changes)
with the permanent 5-percent cap as a transition. The following is a
summary of these
[[Page 64223]]
comments and our responses to those comments.
Comment: Most commenters stated that they support the adoption of
the revised OMB delineations from the July 21, 2023, Bulletin No. 23-
01. Most commenters also expressed support for the use of the permanent
5-percent cap policy as a transition to the policy.
Response: We appreciate the commenters' support of the adoption of
the new OMB delineations and the use of the permanent 5-percent cap as
a transition.
Comment: A few commenters opposed our proposal to adopt the new
delineations. One commenter from Montgomery County, MD, expressed
concern that the revised delineations fail to resolve the issue of the
county being excluded from the Washington, DC CBSA. Other commenters
stated that the adoption of the revised OMB delineations would result
in a reduction in reimbursement for counties in states such as
California, Illinois, and New York. One commenter suggested that the
proposed updates to CBSAs based on the 2020 Decennial Census will not
only eliminate any proposed rate increase but will reduce reimbursement
in thirty-three percent of New York's sixty-one counties.
Response: We appreciate the concerns commenters raised regarding
the impact of implementing the revised designations on their specific
counties. While we understand the concern regarding the potential
financial impact, we believe that implementing the revised OMB
delineations will create more accurate representations of labor market
areas nationally and result in hospice wage index values being more
representative of the actual costs of labor in a given area. Although
these comments only addressed any negative impacts on specific
geographic areas, we believe it is important to note that there are
many geographic locations and hospice providers that will experience
positive impacts upon implementation of the revised CBSA designations.
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 revised delineations
will result in more appropriate payments to providers by more
accurately accounting for and reflecting the differences in area wage
levels. We also recognize that there are areas which will experience a
decrease in their wage index. As such, it is our longstanding policy to
provide temporary adjustments to mitigate negative impacts from the
adoption of new policies or procedures. In the FY 2025 Hospice Wage
Index and Payment Rate Update proposed rule, we proposed to use the
finalized 5-percent cap policy as a transition in order to mitigate the
resulting short-term instability and negative impacts on certain
providers. We continue to believe that the finalized 5-percent cap
policy provides an adequate safeguard against any significant payment
reductions, allows for sufficient time to make operational changes for
future fiscal years, and provides 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.
Comment: A few commenters, including MedPAC, suggested alternatives
to the 5-percent cap transition policy. MedPAC suggested that the 5-
percent cap limit should apply to both increases and decreases in the
wage index so that no provider would have its wage index value increase
or decrease by more than 5 percent. However, several commenters
recommended lowering the finalized 5-percent cap on wage index
decreases (for example, a 2-percent cap was recommended). These
commenters stated that capping decreases at 5 percent is insufficient
to mitigate negative impacts faced by hospices. One commenter stated
that while the permanent maximum drop in wage index values is
appreciated, even a 5 percent drop in rates from one year to the next
in this inflationary time is very difficult. Another commenter
recommended that CMS limit the maximum wage index reduction to a
percentage equal to or less than the payment update for that year. This
commenter also suggested that CMS change the policy so that there is no
reduction in wage index values but instead only increases. One
commenter recommended the wage index cap be lowered for FY 2025 as a
transition to the adoption of the revised delineations. Two commenters
requested that CMS institute a one-time zero wage index adjustment in
all CBSAs where there is a negative adjustment.
Response: We appreciate the commenters' recommendations for changes
to the finalized cap policy. Regarding MedPAC's suggestion that the cap
on wage index changes of more than 5 percent should also be applied to
wage index increases, as we discussed previously, the purpose of the
finalized 5-percent cap policy is to help mitigate the significant
negative impacts of certain wage index changes. Additionally, we
believe that the 5-percent cap on wage index decreases is an adequate
safeguard against any significant payment reductions and do not believe
that capping wage index decreases at 2 percent instead of 5 percent is
appropriate. We also do not believe it would be appropriate to
institute a one-time zero wage index adjustment or implement a policy
where there are no wage index decreases. We continue to believe that a
5-percent cap would more effectively mitigate any significant decreases
in a hospice's wage index for a fiscal year, while still balancing the
importance of ensuring that area wage index values accurately reflect
relative differences in area wage levels. Furthermore, a 5-percent cap
on wage index decreases provides a degree of predictability in payment
changes for providers and allows providers time to adjust to any
significant decreases they may face year to year.
Final Decision: We are finalizing our proposal to adopt the revised
OMB delineations from the July 21, 2018 OMB Bulletin 23-01, and will
also apply the permanent 5-percent cap on wage index decreases at the
county level with the use of a transition code, so that counties
impacted by the revised designations will receive a 5-percent cap on
any decrease in a geographic area's wage index value from the wage
index value from the prior fiscal year for FY 2025. We are also
finalizing that beginning in FY 2025, counties that have a different
wage index value than the CBSA or rural area into which they are
designated due to the application of the 5-percent cap (including
redesignated counties that will receive the 5-percent cap and
redesignated counties that move into a CBSA or rural area where all
other constituent counties receive the 5-percent cap) would use a wage
index transition code. These special codes are five digits in length
and begin with ``50.'' The 50XXX wage index transition codes will be
used only in specific counties; counties located in CBSAs and rural
areas that do not correspond to a different transition wage index value
will still use the CBSA number. Finally, we are finalizing the policy
that the 5-percent cap will apply to a county that corresponds to a
different wage index value than the wage index value in the CBSA or
rural area in which they are designated due to a delineation change
until the county's new wage index is more than 95 percent of the wage
index from the previous fiscal year. In order to capture the correct
wage index value, the county will continue to use the assigned 50XXX
transition code until the county's wage index value calculated for that
fiscal year using the new OMB delineations is
[[Page 64224]]
not less than 95 percent of the county's capped wage index from the
previous fiscal year.
The final FY 2025 wage index file provides a crosswalk between the
current OMB delineations and the final revised OMB delineations that
will be in effect in FY 2025. This file shows each State and county and
its corresponding final wage index along with the previous CBSA number,
the final CBSA number or alternate identification number, and the final
CBSA name. The final hospice wage index file applicable for FY 2025
(October 1, 2024 through September 30, 2025) is available on the CMS
website at: <a href="https://www.cms.gov/medicare/payment/fee-for-service-providers/hospice/hospice-wage-index">https://www.cms.gov/medicare/payment/fee-for-service-providers/hospice/hospice-wage-index</a>.
3. FY 2025 Hospice Payment Update Percentage
Section 4441(a) of the Balanced Budget Act of 1997 (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 one percentage point. Payment rates for FYs since 2002 have
been updated as required by 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 hospital market basket percentage increase for
that FY. In the FY 2022 IPPS final rule, we finalized the rebased and
revised IPPS market basket to reflect a 2018 base year. We refer
readers to the FY 2022 IPPS final rule (86 FR 45194) for further
information.
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) as projected by the Secretary
for the 10-year period ending with the applicable FY, year, cost
reporting period, or other annual period (the ``productivity
adjustment''). The United States Department of Labor's Bureau of Labor
Statistics (BLS) publishes the official measures of productivity for
the United States economy. We note that previously the productivity
measure referenced in section 1886(b)(3)(B)(xi)(II) of the Act was
published by BLS as private nonfarm business multifactor productivity.
Beginning with the November 18, 2021, release of productivity data, BLS
replaced the term ``multifactor productivity'' with ``total factor
productivity'' (TFP). BLS noted that this is a change in terminology
only and would not affect the data or methodology. As a result of the
BLS name change, the productivity measure referenced in section
1886(b)(3)(B)(xi)(II) of the Act is now published by BLS as ``private
nonfarm business total factor productivity.'' However, as mentioned,
the data and methods are unchanged. We refer readers to <a href="http://www.bls.gov">http://www.bls.gov</a> for the BLS historical published TFP data. A complete
description of IGI's TFP projection methodology is available on the CMS
website at <a href="https://www.cms.gov/data-research/statistics-trends-and-reports/medicare-program-rates-statistics/market-basket-research-and-information">https://www.cms.gov/data-research/statistics-trends-and-reports/medicare-program-rates-statistics/market-basket-research-and-information</a>. In addition, in the FY 2022 IPPS final rule (86 FR 45214),
we noted that beginning with FY 2022, CMS changed the name of this
adjustment to refer to it as the ``productivity adjustment'' rather
than the ``MFP adjustment''. Consistent with our historical practice,
we estimate the market basket percentage increase and the productivity
adjustment based on IHS Global Inc.'s (IGI's) forecast using the most
recent available data. The proposed hospice payment update percentage
for FY 2025 was based on the most recent estimate of the inpatient
hospital market basket (based on IGI's fourth quarter 2023 forecast
with historical data through the third quarter of 2023). 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 percentage
increase for FY 2025 of 3.0 percent is required to be reduced by a
productivity adjustment as mandated by section 3401(g) of the
Affordable Care Act. The proposed productivity adjustment for FY 2025
was 0.4 percentage point (based on IGI's fourth quarter 2023 forecast).
Therefore, the proposed hospice payment update percentage for FY 2025
was 2.6 percent. We also proposed that if more recent data became
available after the publication of the proposed rule and before the
publication of the final rule (for example, a more recent estimate of
the inpatient hospital market basket percentage increase or
productivity adjustment), we would use such data, if appropriate, to
determine the hospice payment update percentage in the FY 2025 final
rule. We continue to believe it is appropriate to routinely update the
hospice payment system so that it reflects the best available data
about differences in patient resource use and costs among hospices as
required by the statute.
In the FY 2022 Hospice Wage Index final rule (86 FR 42532), we
rebased and revised the labor shares for RHC, CHC, GIP, and IRC using
Medicare cost report data for freestanding hospices (CMS Form 1984-14,
OMB Control Number 0938-0758) from 2018. The current labor portion of
the payment rates are: RHC, 66.0 percent; CHC, 75.2 percent; GIP, 63.5
percent; and IRC, 61.0 percent. The non-labor portion is equal to 100
percent minus the labor portion for each level of care. The non-labor
portion of the payment rates are as follows: RHC, 34.0 percent; CHC,
24.8 percent; GIP, 36.5 percent; and IRC, 39.0 percent. We received 45
comments on the proposed hospice update percentage of 2.6 percent. A
summary of the comments and our responses to those comments are as
follows:
Comment: A couple of commenters stated appreciation for the
proposed hospice market basket update for FY 2025; however, most
commenters stated that the proposed 2.6 percent increase does not cover
the increased operating costs they have faced throughout the pandemic.
The commenters requested CMS determine whether additional updates could
be made during FY 2025.
Specifically, the commenters stated that they have been facing
unprecedented increases in labor costs, particularly for nursing staff
and that labor accounts for a large percentage of their operating
costs, more so than other provider types. Additionally, several
commenters noted that the healthcare worker shortages exacerbate wage
pressure increases. For example, a few commenters stated that their
compensation costs account for approximately 80 percent of the overall
operating costs. Several commenters stated that they have experienced
increased expenses for employed nursing staff, therapy staff, and
ancillary staff. Many commenters noted the difficulty in recruiting and
retaining staff, as other provider types can pay higher wages. One
commenter stated that New York State Medicaid recognized the
catastrophic impact of rising healthcare costs and approved a rate
increase of 3.5 percent, acknowledging the higher cost of doing
business in New York, which was partly driven by the largest wage
increase in New York City's public sector nursing history. One industry
association stated that their members reported that
[[Page 64225]]
workforce shortages are their biggest challenge.
The commenters also stated that the proposed payment update does
not appropriately capture the inflation pressures experienced for non-
labor operating expenses, specifically the increased costs for medical
supplies, pharmaceuticals, materials, and utilities. One commenter
stated that their total drug expenses per hospice day are 14 percent
higher and medical supply costs and staff travel reimbursement (as
staff travel to patient homes to provide care) have increased 4 percent
and 6.5 percent, respectively, over the past year. The commenters
stated that it has been difficult to budget wage increases in order to
attract and retain staff while at the same time covering higher input
costs for other operating expenses.
Several commenters explicitly noted that the proposed 2.6 percent
increase in hospice payments is less than the current rate of U.S.
inflation as measured by the Consumer Price Index for All Urban
Consumers (CPI-U) which they state increased by 3.4 percent year-over-
year in April 2024, nearly a percent higher than the proposed FY 2025
hospice update of 2.6 percent. One commenter also noted that the
proposed update is below the 3.7 percent increase for Medicare
Advantage plans. Several commenters stated that unlike other Medicare
provider types, like hospitals, most hospice care is financed
predominantly by Medicare and Medicaid and as a result, hospice
providers are unable to shift costs to other payers to help offset
losses.
MedPAC recognized that CMS is required by statute to propose an
increase to the hospice payment rates; however, the Commission
recommended eliminating the update for FY 2025. The Commission
referenced their March 2024 Report to the Congress and that their
assessment of indicators of payment adequacy for hospices--beneficiary
access to care, quality of care, provider access to capital, and
Medicare payments relative to providers' costs--were positive.
Additionally, MedPAC noted that hospice Medicare profit margins were
between 13 to 17 percent in aggregate.
Response: We appreciate the commenters' support for the statutorily
required hospice payment update and reiterate that we are required to
update hospice payments by the IPPS market basket update adjusted for
productivity, as directed by section 1814(i)(1)(C)(ii)(VII) of the Act.
We believe the increase in the 2018-based IPPS operating market basket
adequately reflects the average change in the price of goods and
services hospitals purchase in order to provide medical services. The
IPPS market basket is a fixed-weight, Laspeyres-type index that
measures price changes over time and would not reflect increases in
costs associated with changes in the volume or intensity of input goods
and services. As such, the IPPS market basket update would reflect the
prospective price pressures described by the commenters during a high
inflation period (such as faster wage growth or higher energy prices)
but might not reflect other factors that could increase costs such as
the quantity of labor used or any shifts between contract and staff
nurses. We note that cost changes (that is, the product of price and
quantities) would only be reflected when a market basket is rebased,
and the base year weights are updated to a more recent time period.
We agree with the commenters that recent higher inflationary trends
have impacted the outlook for price growth over the pandemic period.
However, the purpose of the FY 2025 hospice payment update is to
reflect the price pressures providers are expected to face in FY 2025,
and thus is a forward-looking update as opposed to one that reflects
historical price changes. At the time of the FY 2025 hospice PPS
proposed rule, based on IGI's fourth quarter 2023 forecast with
historical data through third quarter 2023, IGI forecasted the 2018-
based IPPS market basket update of 3.0 percent for FY 2025 reflecting a
3.6-percent forecasted compensation price increase. We would note that
the 10-year historical average (2014-2023) growth rate of the 2018-
based IPPS market basket is 2.8 percent with compensation prices
increasing 2.8 percent. We stated in the FY 2025 hospice PPS proposed
rule (89 FR 23800) that if more recent data became available, we would
use such data, if appropriate, to derive the final FY 2025 hospice
payment update percentage for the final rule. For this final rule, we
are using an updated forecast of the price proxies underlying the 2018-
based IPPS market basket that incorporates more recent historical data
and reflects a revised outlook regarding the U.S. economy, including
compensation and inflationary pressures. Based on IGI's second quarter
2024 forecast with historical data through first quarter 2024, the FY
2025 IPPS market basket update is 3.4 percent (reflecting forecasted
compensation price growth of 3.9 percent). The FY 2025 productivity
adjustment based on IGI's second quarter 2024 forecast is 0.5
percentage point. Therefore, as discussed further in this section and
after consideration of the comments received, for FY 2025, the final
hospice payment update is 2.9 percent (3.4 percent market basket
percentage increase less a 0.5 percentage point productivity
adjustment), compared to the proposed hospice payment update of 2.6
percent. Finally, we believe the FY 2025 hospice payment update to be
adequate based on the MedPAC analysis that showed positive payment
indicators of beneficiary access to care, quality of care, provider
access to capital, and Medicare payments relative to providers' costs.
Comment: Many commenters stated that there have been 3 years of
under forecasted payment rate updates. The commenters noted that the
market basket forecast for FY 2021 through FY 2023 was cumulatively
under forecast by 4.6 percentage points over those 3 years and
requested a one-time retrospective adjustment to rectify the
significant forecast error since 2021. The commenters stated that they
understand that the market basket updates are based on a forecast of
projected inflation; however, they also stated that multiple years in a
row of significantly under forecast updates is not sustainable and has
impaired hospices' capacity to serve their beneficiary communities.
Several commenters also acknowledged that while the adjustment can be
applied positively or negatively, the update for the last 3 years was
consistently and significantly under forecast. A few commenters pointed
to the public data from the CMS Office of the Actuary, which show the
actual forecast error. Finally, commenters noted that the inadequacy of
this payment update is further compounded by continued sequestration,
which reduces Medicare payments by two percent and is currently set to
continue through FY 2032. Many commenters requested a retrospective
adjustment be finalized to account for the significant forecast error
since 2021.
Several commenters highlighted that the CMS response to a similar
concern in the FY 2024 rule stated that CMS lacks the statutory
authority to implement an adjustment; however, the commenters requested
that CMS provide additional information and a specific explanation
supporting that it lacks the statutory authority to apply an adjustment
using the special exceptions and adjustment authority. Several
commenters also stated that there exists a precedent for CMS to adjust
for forecast errors in the market basket updates, as was previously
implemented in a SNF PPS update, which finalized a 3.6 percent forecast
error adjustment in the FY 2024 SNF
[[Page 64226]]
PPS final rule (88 FR 53205 through 53206). One commenter stated the
cumulative forecast error of hospital market basket updates was below
both the growth in the Employment Cost Index (ECI) total compensation
index and the Producer Price Index (PPI)--All Commodities Index. One
commenter requested that CMS impose an additional 3 percent payment
adjustment at a minimum even if the full cumulative forecast error
adjustment is not possible.
Several commenters stated that if CMS is limited by statute to
implement a forecast error adjustment for updating hospice payments
that CMS work with Congress to include funding for a one-time market
basket forecast error adjustment for hospice providers as a component
of any end of year legislation taken up by the 118th Congress.
Response: We thank the commenters for their recommendations. The
inpatient hospital market basket percentage increases are required by
law to be set prospectively, which means that the update relies on a
mix of both historical data for part of the period for which the update
is calculated and forecasted data for the remainder. There is currently
no mechanism to adjust for market basket forecast error in the hospice
payment update. Furthermore, beginning in 1989, the Congress gave
hospices their first increase (20 percent) in payment since 1986 and
tied future increases to the annual increase in the hospital market
basket through a provision contained in the Omnibus Budget
Reconciliation Act of 1989. While the projected inpatient hospital
market basket percentage increases for FY 2021, FY 2022, and FY 2023
were under forecast, this was largely due to unanticipated inflationary
and labor market pressures as the economy emerged from the COVID-19
PHE. Importantly, the hospital market basket has been used for many
years to update hospice payment rates and an analysis of the forecast
error over a longer period of time shows that the forecast error has
been both positive and negative. For example, the 10-year cumulative
forecast error (excluding FY 2018 when the hospice payment update was
statutorily required to be 1.0 percent) was slightly positive, equal to
0.2 percentage point (2014-2023). Each year from 2014 through 2020, the
final FY hospital market basket update was higher than the actual
hospital market basket update once historical data was finalized; with
(5 out of the 7 years between 2014 to 2020 having a forecast error
greater than 0.5 percentage point.). Only considering the forecast
error for years when the final inpatient hospital market basket
percentage increase was lower than the actual inpatient hospital market
basket percentage increase does not consider the numerous years that
providers benefited from the forecast error. CMS understands that the
market basket updates may differ from other overall inflation indexes
such as the topline ECI, CPI, or PPI; however, we would reiterate that
comparisons between these topline indexes are not comparable since they
measure different mixes of products, services, or wages than reflected
in the legislatively defined CMS IPPS hospital market basket.
Comment: One commenter stated they have repeatedly shared concerns
with CMS on the quality of cost report data, especially with regards to
capturing actual labor costs, and that cost reports should be improved
and optimized before they are used for payment purposes. The commenter
recommends that the cost reports be amended to allow for a greater
breakdown of costs for contracted versus hospice-administered inpatient
services to apportion the labor share appropriately. They further
requested that CMS clarify how frequently they intend to update the
labor share component moving forward and clarify the development and
methodology around the ``standardization factor.'' This includes
clarification as to how CMS will adjust the labor share if certain
types of hospices are found to provide more services and thus, are
likely to have a larger labor share but contribute fewer cost reports.
Lastly the commenter recommended that the definition of a ``day'' be
any 24-hour period or that CMS create a modifier to allow hospices to
bill into a second day up to a 24-hour limit.
Response: We appreciate the commenter's request for future changes
to the hospice cost report. The labor shares for other PPS systems (for
example, IPPS and HHA) are typically updated every 4 to 5 years. As
stated in the FY 2022 hospice final rule (86 FR 42533 through 42534),
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 Public Health Emergency (PHE), we plan to monitor the
upcoming Medicare cost report data to see if more frequent revision of
the hospice labor shares is necessary in order to reflect more recent
cost structures of hospice providers. Given that the COVID-19 PHE
continued into 2023, we have only been able to conduct preliminary
analysis of 2021 and 2022 Medicare cost report data as the 2023
Medicare cost report data are not yet available. Therefore, in the FY
2025 hospice proposed rule, we did not propose to rebase the hospice
labor shares because of this incomplete data. We will continue to
monitor these data and any future revisions to the hospice labor shares
will be proposed and subject to public comments in future rulemaking.
Comment: One commenter stated that the updated hospice wage index
should reflect the competitive nature of the healthcare job market and
include substantial increases in hourly rates for hospice registered
nurses, certified nursing assistants, and support staff. They further
stated that the Bureau of Labor Statistics reports that a hospice nurse
earns an average of $32.10 per hour while the average for nurses in all
other settings is $39.05 per hour. They noted that vacancy rates for
registered nurses and licensed practical nurses is averaging as high as
20 percent in some states. They stated that this issue can be solved by
increasing the payment rate of hospice workers through the update of
this rule.
Response: We appreciate the commenter's concerns regarding labor
wage rates. Hospice payment rates for FYs since 2002 have been updated
according to section 1814(i)(1)(C)(ii)(VII) of the Act, which provides
that the update to the payment rates for subsequent FYs must be the
inpatient hospital market basket percentage increase for that FY.
Additionally, as mandated by section 3401(g) of the Affordable Care
Act, the inpatient hospital market basket percentage increase is
required to be reduced by a productivity adjustment. The inpatient
hospital market basket percentage increase reflects the projected wage
inflation for healthcare and non-health care workers employed in
hospitals (as measured by the Employment Cost Index (ECI) for wages and
salaries for hospital workers). As stated in the FY 2025 hospice
proposed rule (89 FR 23800), we estimated the market basket percentage
increase and the productivity adjustment based on IHS Global Inc.'s
(IGI's) forecast using the most recent available data. IGI is a
nationally recognized economic and financial forecasting firm with
which CMS contracts to forecast the price proxies of the market
baskets. The proposed inpatient hospital market basket percentage
increase for FY 2025 was 3.0 percent reflecting compensation prices
increasing 3.6 percent. When developing its forecasts for the ECI for
wages and salaries and employee benefits for hospital workers, IHS
Global Inc. considers the overall competitive
[[Page 64227]]
nature of labor market conditions. We would note that the 10-year
historical average (2014-2023) growth rate of the 2018-based IPPS
market basket is 2.8 percent with compensation prices increasing 2.8
percent. As also stated in the FY 2025 hospice proposed rule (89 FR
23800), we stated that if more recent data became available after the
publication of the proposed rule and before the publication of the
final rule (for example, a more recent estimate of the inpatient
hospital market basket percentage increase or productivity adjustment),
we would use such data, if appropriate, to determine the hospice
payment update percentage in the FY 2025 final rule.
Final Decision: We are finalizing the hospice payment update using
the methodology outlined. For this final rule, based on the more recent
IGI second quarter 2024 forecast with historical data through the first
quarter of 2024 the 2018-based IPPS market basket increase factor for
FY 2025 is 3.4 percent. The FY 2025 productivity adjustment based on
the more recent IGI second quarter 2024 forecast is 0.5 percentage
point. Therefore, CMS is finalizing for FY 2025, a hospice payment
update of 2.9 percent (3.4 percent market basket percentage increase
less a 0.5 percentage point productivity adjustment).
4. FY 2025 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 care is intended 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
Service Intensity Add-On (SIA) payment for RHC when direct patient care
is provided by a registered nurse (RN) or social worker during the last
seven 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 four 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 an SIA budget neutrality factor (SBNF). The SBNF is used to
reduce the overall RHC rate in order to ensure that SIA payments are
budget neutral. At the beginning of every FY, SIA utilization is
compared to the prior year in order calculate a budget neutrality
adjustment. For FY 2025, the proposed SIA budget neutrality factor is
1.009 for RHC days 1-60 and 1.000 for RHC days 61+.
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 in order to eliminate the aggregate effect
of annual variations in hospital wage data. For FY 2025 hospice rate
setting, we are continuing our longstanding policy of using the most
recent data available. Specifically, we proposed to use FY 2023 claims
data as of January 11, 2024 for the FY 2025 payment rate updates. We
noted that the budget neutrality factors and payment rates would be
updated with more complete FY 2023 claims data for the final rule. In
order to calculate the wage index standardization factor, we simulate
total payments using FY 2023 hospice utilization claims data with the
FY 2024 wage index (pre-floor, pre-reclassified hospital wage index
with the hospice floor, old OMB delineations, and the 5-percent cap on
wage index decreases) and FY 2024 payment rates and compare it to our
simulation of total payments using FY 2023 utilization claims data, the
final FY 2025 hospice wage index (pre-floor, pre-reclassified hospital
wage index with hospice floor, and the revised OMB delineations, with
the 5-percent cap on wage index decreases) and FY 2024 payment rates.
By dividing payments for each level of care (RHC days 1 through 60, RHC
days 61+, CHC, IRC, and GIP) using the FY 2024 wage index and FY 2024
payment rates for each level of care by the FY 2025 wage index and FY
2024 payment rates, we obtain a wage index standardization factor for
each level of care. The wage index standardization factors for each
level of care are shown in Tables 1 and 2.
The final FY 2025 RHC rates are shown in Table 9. The final FY 2025
payment rates for CHC, IRC, and GIP are shown in Table 10.
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[[Page 64228]]
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Sections 1814(i)(5)(A) through (C) of the Act require that hospices
submit quality data 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 Hospice Quality Reporting Program
(HQRP) as required by those sections. Hospices were required to begin
collecting quality data in October 2012 and submit those quality data
in 2013. Section 1814(i)(5)(A)(i) of the Act requires that beginning
with FY 2014 through FY 2023, the Secretary shall reduce the market
basket percentage increase by 2 percentage points for any hospice that
does not comply with the quality data submission requirements with
respect to that FY. Section 1814(i)(5)(A)(i) of the Act was amended by
section 407(b) of Division CC, Title IV of the Consolidated
Appropriations Act (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. Depending on the amount of the annual
update for a particular year, a reduction of 4 percentage points
beginning in FY 2024 makes a negative payment update more likely than
the previous 2 percent reduction. This 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. We applied this policy beginning with the FY 2024 Annual
Payment Update (APU), which we based on CY 2022 quality data.
Therefore, the final FY 2025 rates for hospices that do not submit the
required quality data would be updated by -1.1 percent, which is the
final FY 2025 hospice payment update percentage of 2.9 percent minus
four percentage points. Using updated data, these final rates are shown
in Tables 11 and 12.
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[[Page 64229]]
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5. Hospice Cap Amount for FY 2025
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, Oct. 6, 2014). Specifically, we stated
that for accounting years that end after September 30, 2016, and before
October 1, 2025, the hospice cap is updated by the hospice payment
update percentage rather than using the CPI-U. Division CC, section 404
of the CAA, 2021 extended the accounting years impacted by the
adjustment made to the hospice cap calculation until 2030. In the FY
2022 Hospice Wage Index final rule (86 FR 42539), we finalized
conforming regulations text changes at Sec. 418.309 to reflect the
provisions of the CAA, 2021. Division P, section 312 of the CAA, 2022
(Pub. L. 117-103) amended section 1814(i)(2)(B) of the Act and extended
the provision that mandates the hospice cap be updated by the hospice
payment update percentage (the inpatient hospital market basket
percentage increase reduced by the productivity adjustment) rather than
the CPI-U for accounting years that end after September 30, 2016 and
before October 1, 2031. Division FF, section 4162 of the CAA, 2023
(Pub. L. 118-328) 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 (the inpatient hospital market basket
percentage increase reduced by the productivity adjustment) rather than
the CPI-U for accounting years that end after September 30, 2016 and
before October 1, 2032. Division G, Section 308 of the Consolidated
Appropriations Act, 2024 (CAA, 2024) (Pub. L. 118-42) extends this
provision to October 1, 2033. Before the 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,
2032. Therefore, for accounting years that end after September 30,
2016, and before October 1, 2033, the hospice cap amount is updated by
the hospice payment update percentage rather than the CPI-U. As a
result of the changes mandated by the CAA, 2024, we proposed conforming
regulation text changes at Sec. 418.309 to reflect the revisions at
section 1814(i)(2)(B) of the Act.
The proposed hospice cap amount for the FY 2025 cap year was
$34,364.85, which is equal to the FY 2024 cap amount ($33,494.01)
updated by the proposed FY 2025 hospice payment update percentage of
2.6 percent. We also proposed that if more recent data became available
after the publication of the proposed rule and before the publication
of the final rule (for example, a more recent estimate of the hospice
payment update percentage), we would use such data, if appropriate, to
determine the hospice cap amount in the FY 2025 final rule. As such,
the hospice cap amount for the FY 2025 cap year is $34,465.34, which is
equal to the FY 2024 cap amount ($33,494.01) updated by the FY 2025
hospice payment update percentage of 2.9 percent.
We received 3 comments on the proposed hospice cap. The following
is a summary of these comments and our responses:
Comment: One commenter expressed support for the FY 2025 hospice
cap.
Response: We thank the commenter for their support.
Comment: Two commenters opposed an increase to the hospice cap. One
commenter recommended the cap remain at the FY 2024 level of $33,494.01
and one commenter recommended that the cap be lowered for FY 2025.
Response: We thank the commenters for their recommendations to
improve the hospice cap; 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.
Final Decision: We are finalizing the update to the hospice cap
amount for FY 2025 in accordance with statutorily mandated requirements
and adopting the proposed regulation text change at Sec. 418.309 to
reflect the revisions at section 1814(i)(2)(B) of the Act, which
require that, for accounting years that end after September 30, 2016,
and before October 1, 2033, the hospice cap amount be updated by the
hospice payment update percentage rather than the CPI-U.
B. Clarifying Regulation Text Changes and Technical Edit
1. Medical Director Condition of Participation
CMS has broad statutory authority to establish health and safety
standards for most Medicare- and Medicaid-participating provider and
supplier types. The Secretary gives CMS the authority to enact
regulations that are in the interest of the health and safety of
[[Page 64230]]
individuals who are furnished services in an institution, while other
laws, as outlined below, give CMS the authority to prescribe
regulations as may be necessary to carry out the administration of the
program. Section 122 of the Tax Equity and Fiscal Responsibility Act of
1982 (TEFRA) (Pub. L. 97-248) added section 1861(dd) to the Act to
provide coverage for hospice care to terminally ill Medicare
beneficiaries who elect to receive care from a Medicare-participating
hospice. The CoPs apply to the hospice as an entity, as well as to the
services furnished to each individual patient under hospice care. In
accordance with section 1861(dd) of the Act, the Secretary is
responsible for ensuring that the CoPs are adequate to protect the
health and safety of the individuals under hospice care.
Based on feedback from interested parties, including hospice
providers, national hospice associations, and accrediting
organizations, we identified discrepancies between the Medical Director
CoP at Sec. 418.102 and the payment requirements for the
``certification of the terminal illness'' and the ``admission to
hospice care'' at Sec. 418.22 and Sec. 418.25, respectively.
Specifically, the industry questioned the language in the requirements
as it relates to medical directors in the CoPs, physician designees in
the CoPs, and physician members of the interdisciplinary group (IDG) in
the payment requirements. Currently, the medical director provisions in
the CoPs at Sec. Sec. 418.102(b) and (c) require the medical director
or physician designee to review the clinical information for each
patient and provide written certification that it is anticipated that
the patient's life expectancy is 6 months or less if the illness runs
its normal course. However, the statutory requirements in sections
1814(a)(7)(A)(i)(II) and (ii) of the Act and the regulatory payment
requirements at Sec. 418.22 (Certification of terminal illness)
provide that the medical director of the hospice or the physician
member of the hospice interdisciplinary group can certify the patient's
terminal illness. Although the CoP provisions at Sec. Sec. 418.102(b)
and (c) include requirements for the initial certification and
recertification of terminal illness, they do not include the physician
member of the interdisciplinary group among the types of practitioners
who can provide these certifications, even though these physicians are
able to certify terminal illness under the payment regulation at Sec.
418.22 (Certification of terminal illness).
This misalignment between the CoPs and the payment requirements has
caused some confusion for hospice providers, accrediting bodies, and
surveyors. As a result, we determined that conforming changes to the
medical director CoP were appropriate for clarity and consistency. To
align the medical director CoP and the hospice payment requirements, we
proposed to amend Sec. 418.102(b) by adding the physician member of
the hospice interdisciplinary group, as defined in Sec.
418.56(a)(1)(i), as an individual who may provide the initial
certification of terminal illness. We also proposed to amend the
medical director CoP in Sec. 418.102(c) to include the medical
director, or physician designee, as defined at Sec. 418.3, if the
medical director is not available, or physician member of the IDG among
the specified physicians who may review the clinical information as
part of the recertification of the terminal illness.
We refer readers to section III.B.2 of this final rule for comments
and responses received on the proposed payment regulation changes
regarding the certification of the terminal illness and admission to
hospice care under Sec. Sec. 418.22 and 418.25, which are also
intended to align the medical director CoP and payment regulations.
In this section, we discuss the public comments received on the
alignment of language in the existing requirements for hospices
regarding the medical director, physician designee, and physician
member of the IDG.
We received a total of 27 comments from individuals, health care
professionals, and national associations that expressed general support
and appreciation for the proposed alignment of language used in the
CoPs with the language in the corresponding payment policy. Commenters
highlighted how the clarification would reduce variability and
confusion related to who provides certification of terminal illness.
Additionally, commenters noted that the clarification supports hospice
providers and audit contractors and ensures continued care for
patients. The following is a summary of the comments we received, our
responses, and the policies we are finalizing.
Comment: Multiple commenters expressed support and appreciation for
our proposal to align the CoPs at Sec. 418.102 with the payment policy
language at Sec. Sec. 418.22(c) and 418.25, stating that these changes
would allow for greater clarity and consistency between key components
of the hospice requirements. Commenters also stated the misalignment
between the CoPs and the payment requirements has caused some confusion
for hospice providers, accrediting bodies, and surveyors and that the
proposed conforming changes to the medical director CoP and the payment
requirements would result in more clarity and consistency for hospices.
Response: We appreciate the supportive feedback from commenters
regarding the alignment of language in the CoPs with language in
payment policy.
Comment: Several commenters expressed support for the proposed
alignment of the CoPs with the payment policy and recommended further
language alignment in the standards for the Medical Director in the
hospice CoPs at Sec. 418.102. Specifically, they recommended that we
replace the terms ``physician designated by'' with ``physician
designee'' in the CoP at Sec. 418.102, which states, ``When the
medical director is not available, a physician designated by the
hospice assumes the same responsibilities and obligations as the
medical director.'' Commenters noted that this would align with the
existing terminology used throughout the requirements.
Response: We appreciate the commenters' support and recommendation
to further modify the introductory language in the medical director CoP
at Sec. 418.102. We agree with the commenters' recommendation to align
this first paragraph of the medical director CoP by replacing
``physician designated by'' with ``physician designee'' to align the
terminology used through the requirements.
Final Decision: After consideration of public comments on this
provision, we are finalizing the requirements at Sec. 418.102(b) and
Sec. 418.102(c) as proposed. In addition, we are modifying Sec.
418.102 by removing the phrase ``physician designated by'' and
replacing it with ``physician designee as defined at Sec. 418.3''. The
definition of ``physician designee'' at Sec. 418.3 is defined as, ``.
. . a doctor of medicine or osteopathy designated by the hospice who
assumes the same responsibilities and obligations as the medical
director when the medical director is not available.'' We are
finalizing revisions to the medical director standard to state, ``The
hospice must designate a physician to serve as medical director. The
medical director must be a doctor of medicine or osteopathy who is an
employee, or is under contract with the hospice. When the medical
director is not available, a physician designee as defined at Sec.
418.3, assumes the same responsibilities and obligations as the medical
director.'' Lastly, we are
[[Page 64231]]
revising the standards for initial certification of terminal illness
and recertification of terminal illness at Sec. 418.102(b) and Sec.
418.102(c), respectively, to provide in a parenthetical that physician
designee, as defined at Sec. 418.3, can conduct the review of clinical
information and certification or recertification if the medical
director is unavailable.
We believe this modification will provide consistency and alignment
in the payment and CoP requirements. These changes align the payment
requirements and the health and safety requirements such that there
will be consistency across the requirements for hospices, resulting in
improved compliance and clearer enforcement activities.
2. Certification of Terminal Illness and Admission to Hospice Care
The Medicare hospice benefit provides coverage for a comprehensive
set of services described in section 1861(dd)(1) of the Act for
individuals who are deemed ``terminally ill'' based on a medical
prognosis that the individual's life expectancy is 6 months or less, as
described in section 1861(dd)(3)(A) of the Act.
As such, section 1814(a)(7)(A) of the Act requires the individual's
attending physician (if the patient designates an attending physician)
and hospice medical director or physician member of the IDG to certify
in writing at the beginning of the first 90-day period of hospice care
that the individual is ``terminally ill'' based on the physician's or
medical director's clinical judgment regarding the normal course of the
individual's illness. In a subsequent 90- or 60-day period of hospice
care, only the hospice medical director or the physician member of the
IDG is required to recertify at the beginning of the period that the
patient is terminally ill based on such clinical judgment.
The CoPs at Sec. 418.102 state that ``when the medical director is
not available, a physician designated by the hospice assumes the same
responsibilities and obligations as the medical director.'' The term
``physician designee'' was utilized in the 1983 hospice final rule (48
FR 56029) that implemented the Medicare hospice benefit when describing
who can establish and review the hospice plan of care and was later
defined and finalized in the FY 2008 hospice final rule (73 FR 32093)
in response to comments requesting CMS clarify this individual's role.
Section 418.3 defines ``physician designee'' to mean a doctor of
medicine or osteopathy designated by the hospice who assumes the same
responsibilities and obligations as the medical director when the
medical director is not available. Currently, the requirements at Sec.
418.22(c), Sources of Certification, state that for the initial 90-day
period, the hospice must obtain written certification statements from
the medical director of the hospice or the physician member of the IDG
and the individual's attending physician if the individual has an
attending physician. For subsequent periods, only the ``medical
director of the hospice or the physician member of the
interdisciplinary group'' must certify terminal illness. Similarly, the
requirements at Sec. 418.22(b), Content of Certification, only include
the ``the physician's or medical director's'' when referencing the
clinical judgment on which the certification must be based.
Additionally, Sec. 418.25, Admission to Hospice Care, only refers to
the recommendation of the hospice medical director (in consultation
with the patient's attending physician (if any)) when determining
admission to hospice and when reaching a decision to certify that the
patient is terminally ill. We note that in the preamble of the proposed
rule, we inadvertently referred to paragraph (b) of Sec. 418.22 as the
paragraph we proposed to amend. However, the proposed amendment to the
text of the regulation was to paragraph (c) of Sec. 418.22. We refer
in the preamble to this final rule to the correct paragraph of Sec.
418.22, which is paragraph (c), not paragraph (b).
In order to align Sec. Sec. 418.22(c) and 418.25 with the CoPs at
Sec. 418.102, we proposed to add ``physician designee (as defined in
Sec. 418.3)'' to clarify that when the medical director is not
available, a physician designated by the hospice, who is assuming the
same responsibilities and obligations as the medical director, may
certify terminal illness and determine admission to hospice care. We
clarified that this does not connote a change in policy; rather, we
believe aligning the language at Sec. Sec. 418.22(c) and 418.25 with
the CoPs at Sec. 418.102 allows for greater clarity and consistency
between key components of hospice regulations and policies.
We received 29 comments on these proposed clarifying hospice
regulation text changes. A summary of the comments and our responses to
those comments are as follows:
Comment: All commenters supported the clarifying regulation text
changes and applauded CMS for the clarification and consistency between
key components of the hospice regulations. Commenters stated that the
clarification will help simplify language, reduce confusion among
stakeholders (that is, hospice providers, CMS audit contractors, and
Medicare Administrative Contractors (MACs)), and protect hospices
against inappropriate citations.
Response: We thank commenters for their support.
Comment: Several commenters requested ``physician member of the
interdisciplinary group'' be added to Sec. 418.25 to further reduce
confusion and provide clarity regarding the hospice admission process.
Additionally, one commenter requested that nurse practitioners (NPs)
and physician assistants (PAs) be allowed to certify a beneficiary as
terminally ill and be included on initial hospice certifications.
Response: We thank commenters for their recommendations; however,
adding ``physician member of the interdisciplinary group'' to Sec.
418.25 would be a substantive policy change and the proposals included
in the proposed rule were intended only to clarify existing policy.
Additionally, allowing NPs and PAs to certify a beneficiary as
terminally ill is not permitted under the statute.
Final Decision: We are finalizing the regulation text revisions to
add ``physician designee (as defined in Sec. 418.3)'' at Sec. Sec.
418.22(c) and 418.25 as proposed.
3. Election of Hospice Care
A distinctive characteristic of the Medicare hospice benefit is
that it requires a patient (or their representative) to intentionally
choose hospice care by electing the benefit. As part of the election
required by Sec. 418.24, a beneficiary (or their representative) must
file an ``election statement'' with the hospice, which must include an
acknowledgement that they fully understand the palliative, rather than
curative, nature of hospice care as it relates to the individual's
terminal illness and related conditions, as well as other requirements
as set out at Sec. 418.24(b). Additionally, as set out at Sec.
418.24(f), when electing the hospice benefit, an individual waives all
rights to Medicare payment for any care for the terminal illness and
related conditions except for services provided by the designated
hospice, another hospice under arrangement with the designated hospice,
and the individual's attending physician if that physician is not an
employee of the designated hospice or receiving compensation from the
hospice for those services. Because of this waiver, this means that the
designated hospice is the only provider to which Medicare payment can
be
[[Page 64232]]
made for services related to the terminal illness and related
conditions for the patient; providers other than the designated
hospice, a hospice under arrangement with the designated hospice, or
the individual's attending physician cannot receive payment for
services to a hospice beneficiary unless those services are unrelated
to the terminal illness and related conditions when a patient is under
a hospice election.
In the FY 2015 Hospice Wage Index and Payment Rate Update final
rule (79 FR 50452, 50478), we finalized a requirement that a Notice of
Election (NOE) must be filed with the hospice MAC within five calendar
days after the effective date of hospice election. If the NOE is filed
beyond this timeframe, 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 50478). Also, because non-hospice
providers may be unaware of a hospice election, late filing of the NOE
leaves Medicare vulnerable to paying non-hospice claims related to the
terminal illness and related conditions when these services are
furnished by these non-hospice providers. Moreover, beneficiaries may
potentially be liable for any associated cost-sharing they would not
have incurred if these services were furnished by the hospice provider.
When discussing hospice election, stakeholders (such as Medicare
contractors, medical reviewers, and hospices) often conflate the terms
``election statement'' and ``NOE.'' Further, we have received recent
inquiries requesting clarification on timeframe requirements for both
the election statement and the NOE that indicate confusion between such
documents. Upon review of this regulation, we believe the organization
at Sec. 418.24 does not make it clear that these are two separate and
distinct documents intended for separate purposes under the benefit. We
proposed to reorganize the language in this section to clearly denote
the differences between the election statement and the NOE. That is, we
proposed to title Sec. 418.24(b) as ``Election Statement'' and would
include the title ``Notice of Election'' at Sec. 418.24(e). We stated
that by clearly titling this section, the requirements for the election
statement and the notice of election would be distinguished from one
another, mitigating any confusion between the two documents. These
changes would align with existing subregulatory guidance. We also noted
this reorganization would not be a change in policy, rather it is
intended to identify the requirements more clearly for the election
statement and the NOE by reorganizing the structure of the regulations.
We believe this reorganization is important to ensure that stakeholders
fully understand that the election statement is required as
acknowledgement of a beneficiary's understanding of the decision to
elect hospice and filed with the hospice, whereas the NOE is required
for claims processing purposes and filed with the hospice MAC within
five calendar days after the effective date of the election statement.
We also noted that the MACs have informed us of ongoing instances
of hospices omitting certain elements of the hospice election
statement. We reminded readers that a complete election statement
containing all required elements as set forth at Sec. 418.24(b) is a
condition for payment. Additionally, we emphasized the importance of
each element in informing the beneficiary of their coverage when
choosing to elect the Medicare hospice benefit. We continued to
encourage hospice agencies to utilize the ``Model Example of Hospice
Election Statement'' on the hospice web page at <a href="https://www.cms.gov/medicare/payment/fee-for-service-providers/hospice">https://www.cms.gov/medicare/payment/fee-for-service-providers/hospice</a> to limit potential
claims denials.
We received 21 comments on the proposed clarification of the
election statement and the NOE. A summary of the comments and our
responses to those comments are as follows:
Comment: All commenters supported the reorganization and
clarification of the election statement and the NOE and expressed
appreciation that CMS is working to mitigate confusion between the two
documents and promoting clarity. Other commenters stated that the
changes are helpful in clarifying key components of the hospice
regulations for hospice providers, Administrative Law Judges (ALJs),
CMS audit contractors, MACs, and other stakeholders.
Response: We thank commenters for their support.
Comment: We received four comments on the reference to the model
election statement and a concern that the MACs are treating the model
election statement example as a required form despite CMS instruction
that the model election statement is intended to be an example of a
form agencies can utilize if desired. Specifically, a few commenters
reported receiving ``technical denials'' from MACs when specific
language or organization did not match the election statement example.
Lastly, a commenter suggested that CMS conduct an analysis of
overturned claim denials to improve audit activity.
Response: We thank the commenters for their feedback. We reiterate
that the model election statement is intended to be an example of a
form that hospices may utilize and that hospice agencies are not
required to use this exact example. We appreciate the suggestion to
analyze overturned claim denials in order to improve future audit
activity.
Comment: One commenter recommended the physician national provider
identifier (NPI) number be included on the model hospice election
statement.
Response: We thank the commenter for the suggestion. A provider may
add additional information, such as an NPI number, to their own
election statement; however, we do not want providers to infer the NPI
is required under Sec. 418.24(b), and as such, will not add it to the
model election statement at this time.
Final Decision: We are finalizing the regulation text revisions to
reorganize and clarify the election statement and the NOE requirements
at Sec. 418.24 as proposed.
4. Hospice Marriage and Family Therapist Technical Edit
In the final rule that appeared in the November 16, 2023 Federal
Register on (88 FR 78818) titled ``Medicare and Medicaid Programs; CY
2024 Payment Policies Under the Physician Fee Schedule and Other
Changes to Part B Payment and Coverage Policies; Medicare Shared
Savings Program Requirements; Medicare Advantage; Medicare and Medicaid
Provider and Supplier Enrollment Policies; and Basic Health Program''
there is one technical error noted in the hospice personnel
requirements at Sec. 418.114(b)(9) that is identified and corrected in
this final rule.
Throughout the final rule (88 FR 78818) we correctly used the term
``marriage and family therapist.'' However, on page 79539 under Sec.
418.114(b)(9) of the final rule, we inadvertently finalized regulation
text that uses the term ``marriage and family counselor'' when the
correct term is ``marriage and family therapist.'' Therefore, we are
making a technical correction in this final rule by replacing
``marriage and family counselor'' with ``marriage and family
therapist'' at Sec. 418.114(b)(9).
[[Page 64233]]
C. Request for Information (RFI) on Payment Mechanism for High
Intensity Palliative Care Services
We define hospice care as a set of comprehensive services described
in section 1861(dd)(1) of the Act, identified and coordinated by an IDG
to provide for the physical, psychosocial, spiritual, and emotional
needs of a terminally ill patient and/or family members, as delineated
in a specific patient plan of care (Sec. 418.3). Hospice care changes
the focus of a patient's illness to comfort care (palliative care) for
pain relief and symptom management from a curative type of care. Under
the hospice benefit, palliative care is defined as patient and family
centered care that optimizes quality of life by anticipating,
preventing, and treating suffering (Sec. 418.3). Palliative care
throughout the continuum of illness involves addressing physical,
intellectual, emotional, social, and spiritual needs and facilitating
patient autonomy, access to information, and choice. CMS continually
works to ensure access to quality hospice care for all eligible
Medicare beneficiaries by establishing, refining, readapting, and
reinforcing policies to improve the value of care at the end of life
for these beneficiaries. That is, we seek to strengthen the notion that
in order to provide the highest level of care for hospice
beneficiaries, we must provide ongoing focus on those services that are
consistent with CMS' definitions of hospice and palliative care and
eliminate any barriers to accessing hospice care.
Adequate care under the hospice benefit has consistently been
associated with symptom reduction, less intensive care, decreased
hospitalizations, improved outcomes from caregivers, lower overall
costs, and higher alignment with patient preferences and family
satisfaction.\5\ Although hospice use has grown considerably since the
inception of the Medicare hospice benefit in 1983, there are still
barriers that terminally ill and hospice benefit eligible beneficiaries
may face when accessing hospice care. Specifically, the national trends
\6\ that examine hospice enrollment and service utilization for those
beneficiary populations with complex palliative needs and potentially
high-cost medical care needs reveal that there may be an underuse of
the hospice benefit, despite the demonstrated potential to both improve
quality of care and lower costs.\7\
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\5\ Obermeyer Z, Makar M, Abujaber S, Dominici F, Block S,
Cutler DM. Association Betweeen the Medicare Hospice Benefit and
Health Care Utilization and Costs for Patients With Poor-Prognosis
Cancer. JAMA.2014;312(18): 1888-1896. doi:10.1001/jama.2014.14950.
\6\ Wachterman MW, Hailpern SM, Keating NL, Kurella Tamura M,
O'Hare AM. Association Between Hospice Length of Stay, Health Care
Utilization and Medicare Costs at the End of Life Among Patients Who
Received Maintenance Hemodialysis. JAMA Intern Med. 2018 Jun
1;178(6):792-799. doi:10.1001/jamainternmed.2018.0256. PMID;
29710217; PMCID: PMC5988968.
\7\ Meier DE. Increased access to palliative care and hospice
services: opportunities to improve value in health care. Milbank Q.
2011 Sep;89(3):343-80. doi: 10.1111/j.1468-0009.2011.00632.x. PMID:
21933272; PMCID:PMC3214714.
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There is a subset of hospice eligible beneficiaries that would
likely benefit from receiving palliative, rather than curative,
chemotherapy, radiation, blood transfusions, and dialysis. Anecdotally,
we have heard from beneficiaries and families their understanding that
upon election of the hospice benefit, certain therapies such as
dialysis, chemotherapy, radiation, and blood transfusions are not
available to them, even if such therapies would provide palliation for
their symptoms. Generally, these patients report that they have been
told by hospices that Medicare does not allow for the provision of
these types of treatments upon hospice election. While these types of
treatments are not intended to cure the patient's terminal illness,
some practitioners, with input from the hospice IDG, may determine
that, for some patients, these adjuvant treatment modalities would be
beneficial for symptom control. In such instances, these palliative
treatments would be covered under the hospice benefit because they are
not intended to be curative. In the FY 2024 Hospice final rule (88 FR
51168), we noted in response to our RFI on hospice utilization; non-
hospice spending; ownership transparency; and hospice election
decision-making, that commenters stated providing complex palliative
treatments and higher intensity levels of hospice care may pose
financial risks to hospices when enrolling such patients. Commenters
stated that the current bundled per diem payment is not reflective of
the increased expenses associated with higher-cost and certain patient
subgroups. As we continue to focus on improved access and value within
the hospice benefit, we solicited additional information on the
potential implementation of a payment mechanism to account for the
increased costs of providing more intensive palliative treatments.
We received approximately 60 comments on our RFI on high-cost
palliative services. Most of the comments we received included both
general recommendations as well as specific comments in response to the
questions asked in the proposed rule. Therefore, we summarize general
comments, followed by specific comments we received in response to each
question presented in the proposed rule.
Comment: A few commenters suggested that, to minimize the
complexity of the topic and prior to consideration of RFI responses,
CMS should first avoid using ``comfort care'' interchangeably with
``palliative care'', clearly distinguish between ``hospice care'' and
``palliative care'', and remove the term ``palliative'' altogether and
replace it with ``high-cost therapies''. Many commenters stated there
is an underutilization of the hospice benefit, in part due to the
availability of high-cost, intensive services outside of the hospice
benefit (that is services covered under another Medicare benefit, such
as ESRD). For example, several commenters stated that patients often
choose not to elect hospice, or they elect later in the trajectory of
their illness, as they would need to give up the option for many of the
palliative but higher cost treatments. This often results in patients
electing hospice services in the final days or weeks of their lives
when the patient and their families do not receive the full benefit of
hospice. Several anecdotal stories were provided in support of
continuing these high-cost services, particularly home blood
transfusions, and often these were provided to align with patient goals
at end of life. A few commenters stated the issue is not a lack of
access to these services, but rather hospices' decisions that the costs
of these services are prohibitive. A few commenters expressed concern
about potential fraudulent activity by certain providers if a separate
payment mechanism was established and suggested that CMS should first
identify gaps in care and potential fraud, waste, and abuse. The
commenters recommended incentivizing advance care planning, as well as
monitoring and enforcing appropriate provisions of the hospice benefit.
Another commenter stated the financial impact is not the only concern
for electing hospice; they stated that there can be a concern related
to a patient's prognosis and understanding palliative treatment versus
a reluctance to forgo a plan to continue curative treatment. The
commenter recommended CMS consider the roles of specialists
(oncologists, hematologists, etc.) when determining the impact of this
potential policy on the hospice
[[Page 64234]]
philosophy of reducing patients' suffering as well as the requirement
to determine a life expectancy of six-months or less. Some commenters
requested that CMS consider additional data mining to determine whether
high intensity, high-cost palliative treatments are offered more
frequently during the course of a hospice stay versus upon admission
when conflicting goals of the medical providers are more obvious.
Lastly, a commenter recommended better electronic medical record (EMR)
coordination and interoperability between the hospice teams and
specialists to ensure all potential treatments are communicated.
Multiple commenters, including several national organizations, stated
concern that under the current statutory budget neutrality requirement,
the introduction of any new payment would have to be offset by
reductions to existing payments. Commenters stated they do not believe
this is tenable given hospices' financial pressures and the challenges
they already experience paying for high-intensity palliative services
under the current reimbursement rates. Likewise, a few commenters
stated that smaller and non-profit hospices disproportionately tend to
care for the sickest patients who often require these types of high-
intensity services, and the costs associated with providing these
higher-intensity services are too often prohibitive, particularly for
these small hospices and non-profit hospices. Commenters expressed
concern that any changes implemented under CMS' current statutory
authority would not sufficiently address this issue. These commenters
recommended CMS work with industry stakeholders to pursue legislative
authority from Congress to create a payment policy to ensure that
hospice patients have adequate access to high intensity palliative care
services. In addition, commenters recommended CMS convene a Technical
Expert Panel (TEP) in conjunction with robust data collection to be
able to advance those discussions. For robust data collection, several
commenters recommended gathering comprehensive data on historic and
current beneficiary utilization of high-cost palliative interventions
for hospice and hospice-eligible patients, conducting an analysis of
any specific barriers impacting access to these services throughout the
care continuum, and developing rules, protocols, and sustainable
payment avenues for these kinds of treatments to improve access to
hospice for traditionally underserved patients and families that come
from diverse racial and ethnic backgrounds.
MedPAC reported it plans to conduct research regarding access to
hospice and end-of-life care for beneficiaries with End Stage Renal
Disease (ESRD), interviewing clinicians; hospice providers; and ESRD
facilities, including programs that provide palliative kidney care, and
other groups.
A few commenters recommended providing further education and
clarity to providers and new hospice enrollees upfront to promote a
better understanding of the coverage policy regarding the
appropriateness of the use of high intensity palliative care services
in conjunction with traditional hospice services. These commenters also
recommended CMS issue guidance, rules, or incentives that make it
easier for hospices to secure contracts with the upstream providers of
these services. Several commenters recommended implementing measures to
reduce administrative burden to hospices for these high-cost services.
We received a comment that greater utilization of physician
assistants (PAs) has the potential to reduce care barriers and move
toward ameliorating the problem of eligible beneficiaries not
sufficiently accessing hospice services, including high-cost palliative
services. The commenter recommended modifying the hospice regulations
and the Medicare Benefit Policy Manual to authorize PAs employed by the
hospice to serve in the role of a patient's attending physician if an
attending physician was not previously selected by the patient.
Below are the questions we posed in RFI in the proposed rule, along
with the comment summaries.
What could eliminate the financial risk commenters previously noted
when providing complex palliative treatments and higher intensity
levels of hospice care?
Comment: Several commenters strongly supported a more robust
payment for high intensity palliative care services to help cover the
costs. Specifically, we received multiple comments stating that if all
hospices are expected to regularly provide complex palliative
treatments and higher intensity levels of hospice care, additional
payment or a higher daily per diem rate must be provided for patients
receiving these complex, high-cost treatments. Commenters stated higher
payment rates, add-on payments, or an outlier payment would allow
hospice agencies to provide the additional treatments and staff to
support higher intensity care without having significant financial
burdens. Specifically, commenters suggested additional payments for
staff training and resource support to sufficiently ensure skills to
deliver high-quality, complex care and staff retention to support
quality patient outcomes and cost-effective care delivery.
Commenters stated these extra payments should not only include the
cost of the service or item itself, but also costs associated with the
care management and coordination activities such as monitoring,
mapping, office visits, repeat imaging, and transportation. Commenters
recommended various modifiers or ``payment tiers'' to reflect the
intensity of services or resource utilization, and suggested CMS
analyze the cost of care for various services to determine individual
payment tiers, as well as implementing a ``cap'' for these higher
intensity service payments.
Other commenters opposed additional payment under the hospice
benefit and multiple commenters recommended some version of a carve out
or concurrent care payments. We received several comments recommending
different payment models including adopting the Medicare Care Choices
Model (MCCM) or a modified version of the MCCM and reviving and
expanding the Medicare Coordinated Care Demonstration (MCCD). Many
commenters stated that CMS should not attempt to cover these high-cost
services within the existing hospice benefit payment structure, rather
specialty providers should be able to bill Medicare Part B directly
while the patient remains under a hospice plan of care. These
commenters recommended CMS permit conditioned access to these
treatments for beneficiaries concurrently enrolled in hospice and
develop new policy and payment guidelines for the specialty
practitioners. They suggested these practitioners could use modifiers
and advised limiting the number of treatments while patients are under
a hospice election. Some commenters recommended that the concurrent
care payment for high-cost palliative treatments only be available
during the first benefit period.
A few commenters recommended that in addition to covering high-cost
treatments and their related medications, it would also be beneficial
for Medicare to cover high-cost medications unrelated to higher
intensity services (for example, novel oral anticoagulants, certain
inhalers, antibiotics, other medications typically used for curative
purposes) when provided with palliative intent.
What specific financial risks or costs are of particular concern to
hospices that would prevent the provision of higher-cost palliative
treatments when
[[Page 64235]]
appropriate for some beneficiaries? Are there individual cost barriers
which may prevent a hospice from providing higher-cost palliative care
services? For example, is there a cost barrier related to obtaining the
appropriate equipment (for example, dialysis machine)? Or is there a
cost barrier related to the treatment itself (for example, obtaining
the necessary drugs or access to specialized staff)?
Comment: Almost all commenters provided specific financial risks
and cost barriers to providing higher-cost palliative care services.
Commenters stated that across all diagnoses and situations there is a
wide variance of incremental costs involved in higher intensive care.
Commenters described barriers related to both direct and ancillary
costs. The most cited expenses included the treatment itself, staffing,
equipment, transportation logistics, contracting, facility usage, and
administrative burden.
Many commenters stated these palliative treatments require the use
of high-cost drugs, which represent a significant proportion of the
cost. Commenters noted even medications covered by Medicare Part D
prior to hospice election continue to prove challenging for hospices to
manage. Commenters stated that these high-cost palliative treatments
can also require additional medications to address burdensome side
effects and symptoms of the interventions themselves. Several
commenters recommended developing a national formulary with negotiated
rates that hospices could use to procure medications or seek to
leverage Veterans Affairs pharmacy contracts. Alternatively, one
commenter noted that while the equipment required for these services
will still be needed, some of the drugs and related supplies (for
bundled and separately payable drugs) and labs could potentially be
discontinued or reduced, as they may not support the goals of comfort
at the end of life.
Commenters also stated many of these treatments require specialized
staff, such as oncologists, nephrologists, and trained nurses who have
the expertise to administer complex treatments like chemotherapy and
dialysis. Commenters noted the salaries and benefits for these
specialized professionals are higher than for general hospice staff,
adding to the financial burden on hospices. In addition, existing
hospice staff may need additional training and certifications to
understand and/or help administer and educate patients and families on
these interventions and their side effects. Commenters stated the costs
associated with staff training can include course fees, travel, and
time away from regular duties which can present a significant barrier.
Commenters also stated these high intensity patients also typically
require more frequent medication adjustments requiring more frequent
provider and nursing visits, which increases the financial burden. A
commenter noted for many of these services, there is also an increased
complexity for the caregiver at home, therefore there can be a greater
need for respite and GIP care.
Several commenters stated that the cost of specialized equipment
can vary depending on the treatment provided. Although one commenter
said it is unlikely that a hospice would obtain the necessary
equipment, such as a dialysis machine, as it is available in most
communities, many commenters raised issues securing contracts with
specialty providers and hospitals or other facilities where these
treatments are administered. Commenters also stated the contracting and
payment processes for these services would be an uncharted and
potentially confusing process for the hospices and specialty providers
alike. In addition, commenters stated hospice providers are unable to
negotiate contracts at Medicare allowable rates for these related
services, and therefore providers of these high-cost palliative
treatments may be reluctant to reduce costs for hospices compared to
other existing reimbursement rates. A few commenters noted that even if
a contract is in place, there may be a lack of access to beds and
treatments when needed.
Commenters also stated a potential burden with care management,
such as coordination with the facilities where these treatments are
delivered and with the providers who deliver them. Commenters reported
that hospices can dedicate signi[filig]cant resources when arranging
for high-intensity services including labs, imaging, and transportation
for patients and family to a location where these high-cost treatments
are administered. One commenter also stated patients and their
specialty providers, not the hospice provider, decide where to receive
treatment, and that beneficiaries may choose to continue receiving
dialysis from their current provider, rather than the hospice-
contracted provider.
A commenter also reported that regulatory burdens related to
compliance requirements governing the provision of complex palliative
treatments may add administrative burden and costs to the agency.
Overall, commenters stated the complexity and variability of these
costs, coupled with uncertainties in reimbursement rates for such
services, pose significant barriers for hospices to offer them
routinely.
Should there be any parameters around when palliative treatments
should qualify for a different type of payment? For example, we are
interested in understanding from hospices who do provide these types of
palliative treatments whether the patient is generally in a higher
level of care (CHC, GIP) when the decision is made to furnish a higher-
cost palliative treatment? Should an additional payment only be
applicable when the patient is in RHC?
Comment: Most commenters stated CMS should not limit higher
reimbursement for complex treatments to certain types of patients.
Commenters stated that patients at any level of care could benefit from
a high-cost palliative service and that such service should not only be
provided to patients in a higher level of care.
Several commenters stated that the use of these services does not
necessarily correlate to a need for a higher intensity level of hospice
care and therefore, beneficiaries do frequently remain at an RHC level.
For example, a commenter stated that beneficiaries with uncontrolled
symptoms and at the CHC or GIP level of care are unlikely to be
candidates for receiving these high intensity services as these
services are intended for long-term symptom management rather than
acute symptom management. However, several commenters stated there are
times when a patient might be eligible for a higher level of care for
reasons unrelated to the administration of the high intensity
palliative services, but that high intensity service might still be
appropriate.
Commenters also reported that symptom burden can also result in the
need for GIP or CHC and providing a higher intensity palliative
treatment during RHC may reduce or eliminate the need for this higher
level of care.
We received a few comments in support of establishing parameters
around these high-cost palliative services. These commenters
recommended that payment for higher cost palliative treatments should
be subject only to the determination based on the ability to improve
the person's quality of life. That is, these treatments should only be
utilized by a hospice beneficiary expressly for palliative purposes as
evidenced by current clinical guidelines for the treatment's
utilization as palliative care. Another commenter stated guidelines for
additional payments should be based upon identified symptom burden that
would reasonably be expected to be
[[Page 64236]]
relieved or managed by the palliative intervention with specified
outcomes.
Another commenter stated that moving to a higher level of care (for
example, GIP, CHC) could trigger higher cost palliative treatments or
that these patients may need a higher level of monitoring and would
therefore be expected to be in GIP or CHC while receiving these
treatments.
Under the hospice benefit, palliative care is defined as patient
and family centered care that optimizes quality of life by
anticipating, preventing, and treating suffering (Sec. 418.3). In
addition to this definition of palliative care, should CMS consider
defining palliative services, specifically regarding high-cost
treatments? Note, CMS is not seeking a change to the definition of
palliative care, but rather should CMS consider defining palliative
services with regard to high-cost treatments?
Comment: A few commenters stated it can be easy to misconstrue the
use of high-cost services, as the intent, dose, duration, or stage of
the illness can dictate whether these services are palliative or
curative. Additionally, commenters recommended first considering how
palliative care fits within the current hospice benefit especially if
palliative care is life prolonging. Another commenter recommended any
palliative definitions should align with the Center to Advance
Palliative Care (CPAC) definitions related to palliation.
We received multiple comments in support of defining palliative
services, particularly for additional reimbursement. Commenters in
support of a definition of palliative services stated it could help
provide clarity, standardization, and understanding about the types of
services that would be included under this potential additional payment
category which could help promote equity in patient care. Commenters
stated a definition of palliative services should characterize these
services as resource intensive services that are independent of
curative treatments. A few commenters, while in support of a
definition, also cautioned that any definition should be broad enough
so as not to inadvertently exclude certain services. For example,
commenters stated the definition should not specify individual drugs,
durable medical equipment (DME), or other therapies, to allow for
separate billing for these items. Another commenter stated a definition
of palliative services should be specific to services offered under the
Medicare hospice benefit, to eliminate potential confusion that this
would be a separate palliative care benefit. Lastly, some commenters in
support of defining palliative services stated establishing specific
criteria can help prevent overuse or misuse of expensive treatment, as
well as allow hospices to better plan financially and ensure they are
adequately compensated for providing these complex and expensive
services.
We also received multiple comments in opposition of defining
palliative services. These commenters stated defining services that
could be disease-modifying as palliative is a dynamic area and instead
treatments should be determined on an individual patient basis rather
than explicitly defining palliative services. Commenters stated a
flexible approach is needed, as patient and family goals and needs are
highly specific and medical advances in the future could result in as-
yet unidentified treatments that could be considered ``palliative
services.'' A few commenters stated defining palliative services would
be a substantial undertaking that would require broad stakeholder
engagement, as narrowing the definition of palliative care based on
certain services would likely lead to additional confusion and
administrative burden. As such, any definition of ``palliative
services'' as separate from the definition of palliative care should be
focused on facilitating understanding of payment of these services.
Should there be documentation that all other palliative measures
have been exhausted prior to billing for a payment for a higher-cost
treatment? If so, would that continue to be a barrier for hospices?
Comment: Commenters stated the focus should be on the goals and
quality of life for beneficiaries. They stated that physicians'
clinical judgment should be the basis to determine if such treatment is
necessary and beneficial to the patient. Commenters raised concerns
that requiring all other palliative measures be exhausted prior to
billing for a higher-cost treatment is nebulous and could be a barrier
to patient care. Multiple commenters stated, while the rationale for
billing for a higher-cost treatment should be documented in the record,
they oppose additional requirements to document that all other
palliative measures have been exhausted prior to billing for a higher-
cost service. They stated this could lead to inefficiencies,
administrative burden, unnecessary services, delays in hospice
admissions leading to shorter lengths of hospice stays, and delays in
the relief of symptoms. Commenters also stated that time spent trying
other, potentially lower cost but ineffective interventions before
utilizing the higher cost treatment will raise total costs for these
patients and extend the time they are not receiving proper care for
their condition(s). Commenters also stated as treatment decisions are
often made urgently, CMS should limit the barriers to the use of
complex treatments. And finally, commenters stated this could undermine
the clinical judgment of the hospice IDG and upstream providers and
lead to fear of retrospective audits questioning the clinical
appropriateness of providing one treatment instead of another. These
commenters stated that determining when all other measures have been
exhausted may be clinically subjective and challenging, leading to
variations in interpretation and exacerbating delays in treatment or
claims denials.
Other commenters stated that the use of complex treatments is
individualized and should be used only if all other treatments have
been tried. Commenters recommended that documentation should include
the symptoms being addressed, the treatments that have been tried
unsuccessfully, and the plan for using a particular complex treatment.
Some commenters stated that requiring documentation that all other
palliative measures have been exhausted prior to billing ensures high-
cost treatments are used as a last resort and maintains cost-
effectiveness and appropriate resource allocation; however, as this
could be a huge barrier to hospice providers, they suggested that
covering these treatments outside of the hospice benefit may help
eliminate this burden.
Should there be separate payments for different types of higher-
cost palliative treatments or one standard payment for any higher-cost
treatment that would exceed the per-diem rate?
Comment: A few commenters stated that making blanket inclusions of
therapies in all situations would not align with the hospice philosophy
and recommended separate payments for different treatments. Other
commenters noted the costs of these treatments vary greatly, and
separate payments would be necessary to adequately account for this
variation. Commenters stated that separate payments would ensure that
hospices have adequate financial resources to provide a range of
higher-cost treatments as needed. They stated each treatment should be
reimbursed at a predetermined rate, reflecting its value and cost-
effectiveness and separate from the standard per diem payment for
hospice care. Multiple commenters recommended using Medicare allowable
rates and existing CPT or HCPCS codes sets. Other recommendations
included individual billing modifiers that could be used when these
treatments are furnished to a hospice patient for
[[Page 64237]]
palliative purposes. Commenters also noted that a single rate to cover
all high-cost treatments would inevitably pay too much for some and not
enough for others.
We received several comments in support of a single per diem rate
for all high-cost treatments. Commenters stated that one standard
payment for any higher-cost treatment would be in alignment with the
structure of the per diem rate provided by hospice for standard care
and reduce confusion. Other commenters noted that having separate
payments for different types of higher-cost palliative treatments could
lead to a particular therapy being inadvertently left out of the higher
cost structure and managing separate payments could increase
administrative complexity to the claim-submission process.
A few commenters stated either option would work as long as it
alleviates the concerns of the financial impact of these high-cost
treatments and other commenters recommended simply increasing
reimbursement overall to encompass the costs of high-intensity
treatments. A few commenters recommended starting with a single payment
for a period of time while CMS engages in a robust cost analysis to
develop the most appropriate payment mechanism. And finally, many
commenters stated CMS should not have separate payments nor a single
payment, and instead cover these treatments separately from the
existing hospice benefit. Commenters again recommended concurrent care
and suggested carving out these palliative treatments under Medicare
Part B.
Response: We thank the commenters for their insight and thoughtful
recommendations. We are incredibly appreciative of the time and effort
readers put forth in collaborating with CMS as we explore ways to
improve coverage under the Medicare hospice benefit. We will consider
all comments and recommendations received on this rule and will
continue to welcome thoughts regarding these issues through our hospice
policy mailbox at <a href="/cdn-cgi/l/email-protection#87efe8f4f7eee4e2f7e8ebeee4fec7e4eaf4a9efeff4a9e0e8f1"><span class="__cf_email__" data-cfemail="ef87809c9f868c8a9f8083868c96af8c829cc187879cc1888099">[email protected]</span></a>. We also remind readers
they can report suspected fraud, waste, or abuse to CMS. Further
information on reporting fraud can be found in The Medicare & You
handbook at page 105 and at <a href="https://www.cms.gov/medicare/medicaid-coordination/center-program-integrity/reporting-fraud">https://www.cms.gov/medicare/medicaid-coordination/center-program-integrity/reporting-fraud</a>. Readers can also
report suspected fraud, waste, and abuse to the Office of Inspector
General at <a href="https://oig.hhs.gov/fraud/report-fraud/">https://oig.hhs.gov/fraud/report-fraud/</a>.
D. Proposals to the Hospice Quality Reporting Program (HQRP)
1. Background and Statutory Authority
The Hospice Quality Reporting Program (HQRP) specifies reporting
requirements for the Hospice Item Set (HIS), administrative data, 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, and
requires, beginning with FY 2014, that the Secretary reduce the market
basket update by 2 percentage points for those hospices failing to meet
quality reporting requirements. Section 1814(i)(5)(A)(i) of the Act was
amended by section 407(b) of Division CC, Title IV of the CAA, 2021 to
change the payment reduction for failing to meet hospice quality
reporting requirements from 2 to 4 percentage points beginning in FY
2024 for any hospice that does not comply with the quality data
submission requirements for that FY. In the FY 2024 Hospice final rule,
we codified the application of the 4-percentage point payment reduction
for failing to meet hospice quality reporting requirements and set
completeness thresholds at Sec. 418.312(j).
Depending on the amount of the annual update for a particular year,
a reduction of 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. Typically, about 18
percent of Medicare-certified hospices are found non-compliant with the
HQRP reporting requirements annually and are subject to the APU payment
reduction for a given FY.
In the FY 2014 Hospice Wage Index and Payment Rate Update final
rule (78 FR 48234, 48257 through 48262), and in compliance with section
1814(i)(5)(C) of the Act, we finalized a new standardized patient-level
data collection vehicle called the Hospice Item Set (HIS). We also
finalized the specific collection of data items that support eight
consensus-based entity (CBE)-endorsed measures for hospice.
In the FY 2015 Hospice Wage Index and Payment Rate Update final
rule (79 FR 50452), we finalized national implementation of the
CAHPS[supreg] Hospice Survey, a component of the CMS HQRP which is used
to collect data on the experiences of hospice patients and the primary
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 the FY 2014 and FY 2015
Hospice Wage Index and Payment Update final rules (78 FR 48261 and 79
FR 50452, respectively). National implementation commenced January 1,
2015. We adopted eight CAHPS[supreg] survey-based measures for the CY
2018 data collection period and for subsequent years. These eight
measures are publicly reported on the Care Compare website.
In the FY 2016 Hospice Wage Index and Rate Update final rule (80 FR
47142, 47186 through 47188), we finalized the policy for retention of
HQRP measures adopted for previous payment determinations and seven
factors for removal. In that same final rule, we discussed how we would
provide public notice through rulemaking of measures under
consideration for removal, suspension, or replacement. We also stated
that if we had reason to believe continued collection of a measure
raised potential safety concerns, we would take immediate action to
remove the measure from the HQRP and not wait for the annual rulemaking
cycle. The measures would be promptly removed and we would immediately
notify hospices and the public of such a decision through the usual
HQRP communication channels, including but not limited to listening
sessions, email notifications, Open Door Forums, and Web postings. In
such instances, the removal of a measure will be formally announced in
the next annual rulemaking cycle.
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.
In the FY 2017 Hospice Wage Index and Payment Rate Update final
rule, we
[[Page 64238]]
finalized the ``Hospice Visits When Death is Imminent'' measure pair
(HVWDII, Measure 1 and Measure 2), effective April 1, 2017. We refer
the public to the FY 2017 Hospice Wage Index and Payment Rate Update
final rule (81 FR 52144, 52163 through 52169) for a detailed
discussion.
As stated in the FY 2019 Hospice Wage Index and Rate Update final
rule (83 FR 38622, 38635 through 38648), 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. The Meaningful Measures Initiative is not intended to
replace any existing CMS quality reporting programs, but will help such
programs identify and select individual measures. The Meaningful
Measure Initiative areas are intended to increase measure alignment
across our quality programs and other public and private initiatives.
Additionally, it will point to high priority areas where there may be
gaps in available quality measures while helping to guide our efforts
to develop and implement quality measures to fill those gaps. 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 2022 Hospice Wage Index and Payment Rate Update final
rule (86 FR 42552), we finalized two new measures using claims data:
(1) Hospice Visits in the Last Days of Life (HVLDL); and (2) Hospice
Care Index (HCI). We also removed the Hospice Visits when Death is
Imminent (HVWDII) measure, as it was replaced by HVLDL. We also
finalized a policy that claims-based measures would use 8 quarters of
data to publicly report on more hospices.
In addition, we removed the seven Hospice Item Set (HIS) Process
Measures from the program as individual measures, and ceased their
public reporting because, in our view, the HIS Comprehensive Assessment
Measure is sufficient for measuring care at admission without the seven
individual process measures. In the FY 2022 Hospice Wage Index and Rate
Update final rule (86 FR 42553), we finalized Sec. 418.312(b)(2),
which requires hospices to provide administrative data, including
claims-based measures, as part of the HQRP requirements for Sec.
418.306(b). In that same final rule, we provided CAHPS Hospice Survey
updates.
As finalized in the FY 2022 Hospice Wage Index and Payment Rate
Update final rule (86 FR 42552), public data reflecting hospices'
reporting of the two new claims-based quality measures (QMs), the
``Hospice Visits in Last Days of Life'' (HVLDL) and the ``Hospice Care
Index'' (HCI) measures, are available on the Care Compare/Provider Data
Catalogue (PDC) web pages as of the August 2022 refresh. In the FY 2023
and FY 2024 Hospice Wage Index final rules, we did not propose any new
quality measures. However, we provided updates on already-adopted
measures. Table 13 shows the current quality measures in effect for the
FY 2025 HQRP, which were finalized in the FY 2022 Hospice Wage Index
and Payment Rate Update final rule and have been carried over in each
subsequent year.
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[GRAPHIC] [TIFF OMITTED] TR06AU24.071
2. Implementation of Two Process Quality Measures Based on Proposed
HOPE Data Collection
Section 1814(i)(5) of the Act requires the Secretary to establish
and maintain a quality reporting program for hospices, develop and
implement quality measures, and publicly report quality measures. In
this final rule, we are finalizing the addition of two process measures
no sooner than FY 2028 to the HQRP calculated from data collected from
HOPE: Timely Follow-Up for Pain Impact and Timely Follow-Up for Non-
Pain Symptom Impact. We will use the data collected from HOPE (see
section III.D.3 on the proposal to implement HOPE and associated PRA),
which a nurse would assess at multiple time points during a hospice
stay to collect data related to patients' symptoms during those
assessments. These two measures will determine whether a follow-up
visit occurs within two (2) days of an initial assessment of moderate
or severe symptom impact.
Symptom alleviation is an important aspect of hospice care,
including both pain management and non-pain symptom management. CMS has
heard this feedback consistently from both clinicians and caregivers,
including the Technical Expert Panel (TEP) which CMS convened from 2019
through 2023. At present, HQRP only has a component of a measure
indicating whether the pain symptom was assessed, as a part of the
comprehensive assessment at admission measure. This measure alone does
not adequately measure whether hospices are alleviating hospice
patients' symptoms throughout their hospice stay.
CMS considers symptom management an important domain to address
further via the HQRP program. Therefore, we will implement these new
concepts on
[[Page 64240]]
timely follow-up of symptoms with the support and input of hospice
experts. For cases where a patient is assessed as having high (that is,
more severe) symptom impact, practitioners suggest that good care
processes include trying to follow-up with the patient and having in-
person visits within two (2) days to ensure treatment has helped
alleviate and/or manage those symptoms. Therefore, we are finalizing
two process measures derived from HOPE data--Timely Follow-Up for Pain
Impact and Timely Follow-Up for Non-Pain Symptom Impact--will capture
these care processes.
Our paramount concern is the successful development of an HQRP that
promotes the delivery of high-quality healthcare services. We seek to
adopt measures for the HQRP that promote efficient, safer, and patient-
centered care. Our measure selection activities for the HQRP take into
consideration input we receive from the CBE, as part of a pre-
rulemaking process that we have established and are required to follow
under section 1890A of the Act. The CBE convenes interested parties
from multiple groups to provide CMS with recommendations on the
Measures Under Consideration (MUC) list. This input informs how CMS
selects certain categories of quality and efficiency measures as
required by section 1890A(a)(3) of the Act. By February 1st of each
year, the CBE must provide that input to CMS. For more details about
the pre-rulemaking process, please visit the Partnership for Quality
Measurement website at <a href="https://p4qm.org/PRMR">https://p4qm.org/PRMR</a>.
We also consider national priorities, such as those established by
the Partnership for Quality Measurement, the HHS Strategic Plan, and
the National Strategy for Quality Improvement in Healthcare located at
<a href="https://www.cms.gov/cciio/resources/forms-reports-and-other-resources/quality03212011a">https://www.cms.gov/cciio/resources/forms-reports-and-other-resources/quality03212011a</a>. To the extent possible, we have sought to adopt
measures that have been endorsed by the national CBE, recommended by
multiple organizations of interested parties, and developed with the
input of providers, payers, and other relevant stakeholders.
a. Measure Importance
The FY 2019 Hospice Wage Index final rule (83 FR 38622) introduced
the Meaningful Measure Initiative to hospice providers to identify high
priority areas for quality measurement and improvement. The Meaningful
Measure Initiative areas are intended to increase measure alignment
across programs and other public and private initiatives. Additionally,
the Initiative points to high priority areas where there may be
informational gaps in available quality measures. The Initiative helps
guide our efforts to develop and implement quality measures to fill
those gaps and develop those concepts towards quality measures that
meet the standards for public reporting. The goal of HQRP quality
measure development is to identify measures from a variety of data
sources that provide a window into hospice care services throughout the
dying process, fit well with the hospice business model, and meet the
objectives of the Meaningful Measures Initiative.
To that end, the Timely Follow-Up for Pain Impact and Timely
Follow-Up for Non-Pain Symptom Impact measures will add value to HQRP
by filling an identified informational gap in the current measure set.
Specifically, the Timely Follow-Up for Pain Impact process measure will
determine how many patients assessed with moderate or severe pain
impact were reassessed by the hospice within 2-calendar days, and the
Timely Follow-Up for Non-Pain Symptom Impact process measure will
determine how many patients assessed with moderate or severe non-pain
impact were reassessed by the hospice within 2-calendar days. Compared
to the single existing HQRP measure that includes pain symptom
assessment, the two HOPE-based process measures will better reflect
hospices' efforts to alleviate patients' symptoms on an ongoing basis.
b. Specifications of the Measures
We are finalizing that both the process measures based on HOPE data
will be calculated using assessments collected at admission or the HOPE
Update Visit (HUV) timepoints. Pain symptom severity and impact will be
determined based on hospice patients' responses to the pain symptom
impact data elements within HOPE. Non-pain symptom severity and impact
will be determined based on patients' responses to the HOPE data
elements related to shortness of breath, anxiety, nausea, vomiting,
diarrhea, constipation, and agitation. Additional information regarding
these data items and time points can be found in the draft HOPE
Guidance Manual of the HOPE web page at <a href="https://www.cms.gov/medicare/quality/hospice/hope">https://www.cms.gov/medicare/quality/hospice/hope</a> and the PRA package that accompanies this Rule can
be accessed at <a href="https://www.cms.gov/medicare/regulations-guidance/legislation/paperwork-reduction-act-1995/pra-listing">https://www.cms.gov/medicare/regulations-guidance/legislation/paperwork-reduction-act-1995/pra-listing</a>. We finalize the
proposal that only in-person visits will count for the collection of
data for these proposed measures--that is, telehealth calls will not
count for a follow-up. We sought comment on whether only in-person
visits are appropriate for collection of data for these proposed
measures or if other types of visits, such as telehealth, should be
included. We are finalizing the decision that a follow-up visit cannot
be the same visit as the initial assessment, but it can occur later in
the same day (as a separate visit).
However, we recognize that requiring in-person visits may impact
existing staffing shortages faced by many hospice providers. CMS
maintains to avoid creating unnecessary burden for hospice providers.
Therefore, to minimize the burdensome impact of the in-person staffing
requirement and to take advantage of the staff members hospices have,
we are finalizing a decision that symptom follow-up visits (SFVs),
referred to in the proposed rule as the Symptom Reassessment, may be
performed by either RNs or Licensed Practical Nurses (LPNs)/Licensed
Vocational Nurses (LVNs).
For both the Timely Follow-Up for Pain Impact and Timely Follow-Up
for Non-Pain Symptom Impact measures, beneficiaries will be included in
the denominator if they have a moderate or severe level of pain or non-
pain symptom impact, respectively, at their initial assessment.
However, certain exclusions will apply to these denominators, such as
beneficiaries who die or are discharged alive before the two-day
window, if the patient/caregiver refused the follow-up visit, the
hospice was unable to contact the patient/caregiver to perform the
follow-up, the patient traveled outside the service area, or the
patient was in the ER/hospital during the two-day follow-up window. In
these situations, a hospice will be unable to conduct a follow-up due
to circumstances beyond their control, and therefore these situations
will not be included in the measure denominator.
The numerators for these measures will reflect beneficiaries who
did receive a timely symptom follow-up. These will include
beneficiaries who receive a separate HOPE follow-up within 2-calendar
days of the initial assessment (for example, if a pain has moderate or
severe symptoms assessed on Sunday, the hospice would be expected to
complete the follow-up on or before Tuesday).
c. Measure Reportability, Variability, and Validity
As part of developing these quality measures, CMS and their measure
development contractor conducted simulations of measure reportability
rates and measure variability. We used
[[Page 64241]]
the results of the HOPE Beta Test to estimate HOPE data availability
for a national population of hospice patients. Detailed information
regarding reportability and variability testing is provided in the HOPE
Beta Testing Report, available on the HOPE web page at <a href="https://www.cms.gov/medicare/quality/hospice/hope">https://www.cms.gov/medicare/quality/hospice/hope</a>. Additionally, CMS assessed
each proposed quality measure face validity with input from TEP members
convened in March 2023. Further information about our validity analysis
is provided in the 2022-2023 HQRP TEP Report, available in the
Downloads section of the HQRP Provider and Stakeholder Engagement page.
Our reportability and variability analyses did not present concerns for
the proposed HOPE-based process measures, and our validity analysis
indicated that the proposed measures have high face validity.
d. Future Plans for Testing HOPE-Based Quality Measures
Testing of the two process quality measures has thus far relied on
data from the HOPE beta (field) test. We proposed future measure
testing to be conducted using a full sample of hospices collected after
HOPE has been implemented nationally, to support further development of
quality measures.
e. Public Engagement and Support
CMS engaged the public in multiple stages of HOPE-based measure
development. To support measure development, CMS convened multiple
technical expert panel (TEP) meetings which served as information
gathering activities, consistent with the Meaningful Measure
Initiative. The TEP consisted of experts in hospice and clinical
quality measurement, and it has contributed to development of the HOPE
tool and measure concepts since 2019. Based on early TEP input about
measure prioritization, measure concept development focused on pain and
non-pain symptoms. TEP members noted the importance of measuring the
quality of pain and symptom management, as this is a key role of
hospice. Through 2020 and 2021, the TEP provided further feedback on
pain and non-pain symptom measure specifications. In Spring 2023, CMS
convened the TEP a final time to review the final measure
specifications, HOPE Beta test results, and rate face validity of the
measure score. The TEP gave strong support for the proposed measure
specifications, rated high face validity for these two process
measures, and noted the importance of measuring the quality of pain
management in hospice care. More information about the TEP meetings and
recommendations can be found in the HQRP TEP Reports for 2019-2023,
available on the Provider and Stakeholder Engagement web page. CMS also
sought hospice provider input during the HOPE Beta Test to further
inform the development of these HOPE-based process measures. During
beta testing, registered nurses (RNs) reported that the two-day window
of HOPE symptom follow-up aligned with their usual practices.
f. Update on Future Quality Measure (QM) Development
As stated in the FY 2022 Hospice Wage Index final rule (86 FR
42528), we continue to consider developing hybrid quality measures that
could be calculated from multiple data sources, such as claims, HOPE
data, or other data sources (for example, CAHPS Hospice Survey). To
support new measure development, our contractor convened technical
expert panel (TEP) meetings in 2022 and 2023. The TEP agreed that CMS
should consider applying several risk adjustment factors, such as age
and diagnosis, to ensure comparable, representative comparisons between
hospices. The TEP also suggested using length of hospice stay but not
functional status as risk adjustment factor for hospice performance.
To support new HOPE-based measure development, our contractor
convened technical expert panel (TEP) meetings between 2020 and 2023.
The TEP recommended specifications for the two HOPE-based quality
measures proposed in this Rule--Timely Follow-Up for Pain Impact and
Timely Follow-Up for Non-Pain Symptom Impact. CMS also sought TEP input
on several measurement concepts proposed for future quality measure
development. Of these measurement concepts, the TEP supported CMS
further developing the Education for Medication Management and Wound
Management Addressed in Plan of Care process concepts. More information
about the TEP recommendations can be found in the 2023 HQRP TEP Report,
available on the Provider and Stakeholder Engagement web page. CMS will
take the TEP's recommendations under consideration as we continue to
develop HOPE-based quality measures.
Additional information about CMS's HOPE-based measure development
efforts is available in the 2022-2023 HQRP TEP Summary Report (<a href="https://www.cms.gov/files/document/2023-hqrp-tep-summary-report.pdf">https://www.cms.gov/files/document/2023-hqrp-tep-summary-report.pdf</a> and the
2023 Information Gathering Report, available on the HQRP Provider and
Stakeholder Engagement web page, or at <a href="https://www.cms.gov/files/document/hospicequalityreportingprograminformationgatheringreport2023508.pdf">https://www.cms.gov/files/document/hospicequalityreportingprograminformationgatheringreport2023508.pdf</a>.
For further details about the ongoing development of these measures,
please visit the Partnership for Quality Measurement website: <a href="https://p4qm.org/">https://p4qm.org/</a>.
Comment: We received 13 public comments regarding the two HOPE-
based process measures. Public comments generally supported the
addition of the two proposed HOPE-based QMs.
Several commenters suggested modifications to the measures. One
commenter suggested that CMS discontinue the collection of some HIS
measures rather than combining them into the HOPE tool. One commenter
suggested that CMS standardize the definitions of slight, moderate, and
severe symptom impact to improve the reliability of QM data. One
commenter requested guidance regarding how hospices should categorize
patients whose symptom impact has lessened or stabilized at the time of
the follow-up visit. Another commenter suggested that CMS calculate the
measures both with and without patients who refused to visit to
determine whether visit refusals correlate with other quality concerns.
One commenter requested clarification regarding penalties to
hospices for patients who decline a symptom follow-up visit. One
comment requested clarification about the start date of HOPE QM public
reporting and whether the start date would be based on the Fiscal Year
(FY) or the Calendar Year (CY). One commenter requested clarification
regarding penalties to hospices for patients who decline a symptom
follow-up visit. Another commenter requested that CMS provide data
regarding the proportion of QRP compliant agencies nationally, efforts
to improve hospices' ability to report data to CMS, and efforts to
enhance transparency to the public. Several commenters requested that
CMS delay public reporting of the HOPE-based QMs until 2028 to ensure
adequate time for hospices and EMR vendors to implement the measures,
as well as sufficient time to collect data and issue provider preview
reports.
Some commenters expressed concerns about the new QMs. One comment
recommended the measures be further developed before implementation,
citing the lack of CBE endorsement. Several comments encouraged CMS to
next focus on developing HOPE-based outcome measures, which would add
further value to HQRP.
Response: CMS appreciates all public comments regarding the new
HOPE-
[[Page 64242]]
based process QMs. We understand that there are several tools to
measure the severity of these symptoms. However, the items for Symptom
Impact are not measuring symptom intensity or severity, but rather the
impact the patient is experiencing. The Symptom Impact data elements
were adapted from an Integrated Palliative Outcome Scale (IPOS) data
element that asked about the effect of symptoms on the patient. Please
refer to the HOPE development and Testing Report posted on the HOPE web
page for more details: <a href="https://www.cms.gov/files/document/hqrp-hospice-outcomes-and-patient-evaluation-hope-development-and-testing-report.pdf">https://www.cms.gov/files/document/hqrp-hospice-outcomes-and-patient-evaluation-hope-development-and-testing-report.pdf</a>. We will continue to provide guidance on this measure, which
will be informed by commenters questions and concerns.
CMS is committed to providing hospice providers and vendors with
adequate time to implement the new HOPE-based QMs, and intends to
support hospices during the transition period. In this final rule, we
clarified the timeframes for anticipated public reporting. Additional
guidance regarding the new HOPE-based measures will be provided through
education and training materials and events leading up to the public
reporting of the measures. CMS also intends to continue working with
the CBE to ensure that these and future quality measures meaningfully
measure the quality of hospice care and help patients, families, and
caregivers to make important hospice decisions.
Comments: We received 15 public comments regarding the time points
and burden of the two HOPE-based measures.
Several commenters sought clarification on the number of symptom
follow-up visits required and whether the symptom follow-up is allowed
at the admission or HUV timepoints. One comment suggested that symptom
follow-up should be considered an additional timepoint if it may not be
completed during another timepoint.
Several commenters requested that CMS clarify whether the time
frame for symptom follow-up will be 48 hours or 2-calendar days. One
commenter requested that CMS extend the time frame for follow-up
visits. Another commenter appreciated CMS' decision that the symptom
follow-up visit cannot be the same as the initial assessment visit,
although it can occur in the same day.
Several commenters expressed concerns about the anticipated burden
the new measures will add to hospices. Many commenters requested that
we allow telehealth or phone visits for symptom follow-up. Two
commenters recommended that patients' preference for and tolerance of
pain be included in the measures. Two commenters requested that LPNs be
allowed to reassess patients' symptom impact. One commenter requested
that occupational therapists be included as members of the hospice
interdisciplinary team for purposes of the new QMs. One comment
suggested that any hospice team member should be allowed to complete
the symptom follow-up visit, whether clinical or administrative.
Many comments expressed concern that the symptom follow-up visits
(SFV) would create undue burden unless they can be completed via
telehealth or phone visits. Two comments highlighted staffing
challenges, and several other comments anticipated burdensome costs due
to staff training, EMR management, monitoring and oversight, and/or the
increased number of patient visits. One commenter raised concerns that
the measures would disproportionately burden rural hospices.
Response: CMS appreciates all comments regarding the new HOPE-based
process QMs and their corresponding time points.
At this time, CMS does not believe the symptom follow-up should be
considered a unique HOPE time point. Commenters seeking additional
guidance regarding the symptom follow-up visits should refer to the
HOPE v1.0 Guidance Manual (page 8 and 9), which states that ``Depending
upon responses to J2051. Symptom Impact, at Admission and the two HUV
timepoints, up to three symptom follow-up visits may be required over
the course of the hospice stay.'' The Guidance Manual further states
that ``Although multiple symptom follow-up visits are not required for
the purpose of the HQRP, it is expected that the hospice staff will
continue to follow up with the patient, based on their clinical and
symptom management needs.''
We acknowledge the commenters' recommendation that more hospice
team members should be allowed to complete the symptom follow-up visit.
Therefore, in this final rule, we have decided that both RNs and LPNs/
LVNs may complete the symptom follow-up. At this time, CMS believes it
is most appropriate for clinical staff to complete symptom assessments
and follow-up visits.
While we understand commenters' concerns about the potential
staffing burdens of in-person visits, CMS selected this requirement
based on expert input regarding hospice best practices. However, to
minimize the burdensome impact of the in-person staffing requirement
and to take advantage of the staff members hospices have, we are
finalizing a decision that symptom follow-up visits (SFVs) may be
performed by either RNs or LPNs/LVNs. We will continue to monitor the
provision and burden of in-person HOPE follow-up visits after HOPE
implementation and evaluate whether revisions to the HOPE
administration requirements are necessary. If modifications to the HOPE
instrument are required, they will be proposed in future rulemaking.
Commenters seeking additional guidance regarding the symptom
follow-up visits should refer to the HOPE v1.0 Guidance Manual (page 8
and 9), which states that ``Depending upon responses to J2051. Symptom
Impact, at Admission and the two HUV timepoints, up to three symptom
follow-up visits may be required over the course of the hospice stay.''
The Guidance Manual further states that ``Although multiple symptom
follow-up visits are not required for the purpose of the HQRP, it is
expected that the hospice staff will continue to follow up with the
patient, based on their clinical and symptom management needs.''
CMS is committed to providing hospice providers and vendors with
adequate time to implement the new HOPE-based QMs, and intends to
support hospice stakeholders during the transition period. In this
final rule, CMS has clarified the time frames for the HOPE-based QMs
and anticipated public reporting. Additional guidance regarding the new
HOPE-based measures will be provided through education and training
materials and events leading up to the public reporting of the
measures, anticipated to occur no earlier than November 2027 (FY 2028).
CMS also intends to continue working with CBEs to ensure that these and
future quality measures meaningfully measure the quality of hospice
care and help patients, families, and caregivers to make important
hospice decisions.
After considering the public feedback received on the FY 2025
Hospice proposed rule we are finalizing the measures with modifications
from the version proposed in the proposed rule. As finalized, theses
QMs measure
[…truncated; see source link]Indexed from Federal Register on August 6, 2024.
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