CMS Proposes Rule Increasing Medicare Reimbursment to Hospices
Tuesday, April 30, 2013
by: VNAA Policy Team

Section: Public Policy and Advocacy

Medicare reimbursement to hospices would increase 1.1 percent in fiscal year 2014 under a proposed rule (CMS-1449-P) released April 29 by the Centers for Medicare and Medicaid Services.

The payment increase of 1.1 percent would be the net result of:
  1. 2.5 percent market basket update for hospices;
  2. 0.7 percentage decrease for reductions mandated by law; and
  3. 0.7 percentage points decrease due to updated wage data and the fifth year of the seven-year phase-out of the wage index budget neutrality adjustment factor.
An advanced copy of the proposed rule is available online. An agency fact sheet can be found here.
The proposed rule will be published in the May 10 Federal Register and comments are due 60 days after publication.

CMS and MedPAC have been concerned with the growth of Medicare hospice expenditures which rose from $2.9 billion in fiscal 2000 to $14.7 billion in fiscal 2012. The number of Medicare beneficiaries receiving hospice services also rose from 513,000 in fiscal 2000 to more than 1.3 million in fiscal 2012.

Other Issues Contained in the Proposed Rule

Diagnosis: The proposed rule seeks comments on appropriate diagnosis coding for hospice claims. CMS noted that hospices should code the principal diagnosis of the  underlying condition that is the main focus of the patient's care and not certain nonspecific diagnoses. 
Quality: Under the Affordable Care Act, hospices that do not meet quality reporting requirements will receive a two percentage point reduction to their market basket update beginning in fiscal 2014.

For the fiscal 2014 payment determination, hospices have reported two quality measures: one on pain management and one on participation in a quality assessment and performance improvement program. CMS is asking for comments on eliminating the two currently reported quality measures, beginning with the 2016 payment determination, and replacing them with other measures.

Patient Experience of Care: This proposed rule provides information about CMS’s efforts to develop a Hospice Experience of Care Survey for informal caregivers of hospice patients.  The rule also proposes to require use of the survey beginning in 2015. The survey would include questions on hospice provider communications with patients and families; hospice provider care, and overall rating of hospice.  CMS proposes to include participation in the survey as a quality-reporting requirement for hospices to receive their full annual payment update beginning in fiscal 2017.

VNAA will prepare a comment on the proposed rule after reaching out to its members for input.
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