On July 30, 2024, CMS issued (CMS-1810-F), its final rule updating the Medicare hospice payment rates and aggregate cap amount for fiscal year (FY) 2025 (the Final Rule). Highlights of the Final Rule are below.
Hospice Payment Policy Updates
The Final Rule adopts the Office of Management and Budget’s (OMB) statistical area delineations that revise the core-based statistical areas, impact the hospice wage index, and clarify various hospice policies, including those concerning election statements and notices, admissions, and terminal illness certifications. In FY 2025, a permanent cap will still prevent a geographic area’s wage index from falling below 95% of its wage index from the prior fiscal year.
2025 Rate Setting Updates
As a result of the 3.4% inpatient hospital market basket percentage increase, reduced by a 0.5% productivity adjustment, the fiscal year 2025 hospice update percentage is 2.9%. This update is estimated to increase aggregate Medicare hospice payments by roughly $790 million from fiscal year 2024. The updated percentage reduction for failing to meet hospice quality reporting requirements is -1.1%.
The Final Rule also includes a statutory aggregate cap limiting the total annual Medicare hospice payments per patient to $34,465.34, which is 2.9% higher than the 2024 annual cap.
Hospice Quality Reporting Program Updates
The Final Rule adopts two new process measures for the Hospice Quality Reporting Program that are expected to begin in fiscal year 2028: (1) Timely Follow-up for Pain Impact; and (2) Timely Follow-Up for Non-Pain Symptom Impact, which will document whether a follow-up visit occurred within forty-eight hours of an initial assessment where there was an impact of moderate or severe symptoms with and without pain.
These new process measures will be reported through HOPE, which is a new patient-level data collection tool that was adopted by the Final Rule. Beginning in fiscal year 2025, HOPE—which collects data at multiple time points across the hospice stay—will functionally replace the existing Hospice Item Set (HIS) structure, which only collects data at hospice admission and discharge. Compared to HIS, HOPE includes several domains that are new or expanded, including: Sociodemographic (updated); Diagnoses (expanded); Symptom Impact Assessment; Skin Conditions; and Imminent death.
The Final Rule also implements the following changes to the Hospice CAHPS Survey: (1) adds a web-mail mode that emails online survey invitations and follows up with non-responders; (2) shortens and simplifies the survey; (3) modifies survey administration protocols to include a pre-notification letter and extension of the field period from 42 to 49 days; (4) adds a new two-item Care Preferences measure; (5) revises the existing Hospice Team Communication measure and Getting Hospice Care Training measure; and (6) removes three nursing home items and additional survey items impacted by other proposed changes in the rule.
According to CMS, the Hospice Special Focus Program (SFP) will monitor hospices identified as poor performers based on selected quality indicators, as additional oversight will enable continuous improvement. The SFP algorithm will use data from the Help for Pain and Symptoms measure, Getting Timely Help measure, Willingness to Recommend this Hospice measure, and Overall Rating of this Hospice measure (collected by the CAHPS Hospice Survey). The Final Rule adopts non-substantive changes to the Overall Rating of this Hospice measure that will not impact the SFP algorithm.
Hospice Conditions of Participation and Payment Requirements Technical Updates
CMS is finalizing technical changes to the Conditions of Participation (CoPs) that will add the physician member of the hospice interdisciplinary group (IDG) as an individual who may review the clinical information for each patient and provide written certification that the patient’s life expectancy is anticipated to be six months or less if the illness runs its normal course. In the hospice payment regulations, CMS updated the provisions regarding certification and admission to hospice care to certify that, if the medical director is unavailable, the physician designee may certify the terminal illness and determine admission to hospice.
CMS is also finalizing changes to the text of the payment regulations that are intended to reorganize and more clearly distinguish the separate requirements for the election statement and notice of election.
The text of the Final Rule is available here. CMS’s fact sheet on the Final Rule is available here.
