Fiscal Year 2024 Hospice Payment Rate Update Final Rule (CMS-1787-F)
On July 28, 2023, the Centers for Medicare & Medicaid Services (CMS) issued a final rule (CMS-1787-F) that updates Medicare hospice payments and the aggregate cap amount for fiscal year (FY) 2024 in accordance with existing statutory and regulatory requirements. CMS is publishing this final rule in accordance with the legal requirements to update Medicare payment policies for hospices on an annual basis.
This fact sheet discusses the major provisions of the final rule, including the annual update to hospice payments and the aggregate cap amount for FY 2024. It also discusses comments received regarding information related to the provision of higher levels of hospice care; spending patterns for non-hospice services provided during the election of the hospice benefit; ownership transparency; equipping patients and caregivers with information to inform hospice selection; and ways to examine health equity under the hospice benefit. This rule also finalizes conforming regulation text changes related to the expiration of the COVID-19 public health emergency (PHE).
Importantly, this rule is taking several important steps as part of CMS’ efforts to closely examine the hospice industry, as we have increasing concerns about fraud, waste, and abuse in this space. Furthering these efforts, this rule finalizes our proposal that physicians who certify patient eligibility for hospice services must be enrolled in Medicare or validly opted out as a prerequisite for payment for the hospice period of care in question. Our certifying physician enrollment requirement is part of a larger effort by CMS to address hospice fraud, waste, and abuse among these providers. Additional hospice-related enrollment proposals were included in the Calendar Year 2024 Home Health Prospective Payment System Rate Update proposed rule (88 FR 43654).
This rule finalizes the codification of the Hospice Quality Reporting Program (HQRP) data submission threshold policy adopted in the FY 2016 Hospice final rule at §418.312. The rule discusses the Hospice Outcomes and Patient Evaluation (HOPE) tool; provides an update on future Quality Measures (QM) development and health equity efforts and provides updates on the Consumer Assessment of Healthcare Providers and Systems (CAHPS) Hospice Survey mode experiment.
Finally, this rule discussed updates on the hospice special focus program (SFP) established under the Consolidated Appropriations Act, 2021 (CAA, 2021), which is being proposed in the CY 2024 Home Health Prospective Payment System Rate Update proposed rule.
Medicare Hospice Payment Policies
This final rule discusses the comments received regarding information related to the provision of higher levels of hospice care; spending patterns for non-hospice services provided during the election of the hospice benefit; ownership transparency; equipping patients and caregivers with information to inform hospice selection; and ways to examine health equity under the hospice benefit.
Additionally, we are finalizing regulations’ text changes related to the provision of telehealth services for Routine Home Care with the expiration of the COVID-19 PHE and for the use of telecommunications technology for the face-to-face encounter conducted by a hospice physician or hospice nurse practitioner for the sole purpose of hospice recertification through December 31, 2024.
FY 2024 Routine Annual Rate Setting Changes
The FY 2024 hospice payment update percentage is 3.1% (an estimated increase of $780 million in payments from FY 2023). This results from the 3.3% inpatient hospital market basket percentage increase reduced by a 0.2 percentage point productivity adjustment. Section 1814(i)(5)(A)(i) of the Act was amended by section 407(b) of Division CC, Title IV of the CAA, 2021 (Pub. L. 116–260) to change the payment reduction for failing to meet hospice quality reporting requirements from 2 to 4 percentage points. Therefore, beginning in FY 2024 and for each subsequent year, hospices that fail to meet quality reporting requirements receive a 4 percentage point reduction to the annual hospice payment update percentage increase for the year. The FY 2024 rates for hospices that do not submit the required quality data would be updated by -0.9%, which is the FY 2024 hospice payment update percentage of 3.1% minus 4 percentage points.
The hospice payment update includes a statutory aggregate cap limiting the overall payments per patient made to a hospice annually. The hospice cap amount for FY 2024 is $33,494.01, which is equal to the FY 2023 cap amount ($32,486.92), updated by the FY 2024 hospice payment update percentage of 3.1%.
Hospice Quality Reporting Program
CMS codified the HQRP data completion threshold policy at §418.312 and provided several updates relative to the development of a patient assessment instrument, titled HOPE, and future quality measures. CMS also provided updates on health equity related to HQRP and future efforts to develop health equity measures.
CMS updated the CAHPS Hospice Survey and discussed the results of a survey mode experiment conducted in 2021.
CMS discussed updates related to the establishment of an SFP for poor-performing hospice programs. CMS has made further hospice SFP proposals in the CY 2024 Home Health Prospective Payment System Rate Update proposed rule (88 FR 43654). We are accepting comments on the proposed rule through August 29, 2023.
Hospice Certifying Physician Enrollment
Under our existing regulations, (1) the hospice medical director or the physician member of the hospice interdisciplinary group (hereafter the “hospice physician”) and (2) the attending physician (if the beneficiary has one) must initially certify the patient’s terminal condition. (For subsequent periods, only the hospice physician must do so.) As part of CMS’ larger strategy to address hospice program integrity and quality of care, and under our authority under section 6405 of the Affordable Care Act, we are finalizing our proposal that these two categories of physicians must be enrolled in or opted out of Medicare for hospice services to be paid. Requiring enrollment or opt-out will allow us to screen the physician to ensure they are qualified (e.g., licensed) to certify the terminal condition.
In response to concerns raised by commenters, we will not implement or enforce this requirement until May 1, 2024, to give unenrolled and non-opted-out physicians more time to enroll in or opt-out of the Medicare program.
The final rule will be displayed on July 28, 2023, at the Federal Register’s Public Inspection Desk and will be available under “Special Filings” at https://www.federalregister.gov/public-inspection/2023-16116/medicare-program-fy-2024-hospice-wage-index-and-payment-rate-update-hospice-conditions-of.
For further information, see the hospice webpage here: http://www.cms.gov/Center/Provider- Type/Hospice-Center.html.