Fact Sheets

Fiscal Year (FY) 2023 Hospice Payment Rate Update Final Rule (CMS-1773-F)

Today, the Centers for Medicare & Medicaid Services (CMS) issued a final rule (CMS-1773-F) that    updates Medicare hospice payments and the aggregate cap amount for FY 2023 in accordance with existing statutory and regulatory requirements. This final rule establishes a permanent mitigation policy to smooth the impact of year-to-year changes in hospice payments related to changes in the hospice wage index. CMS is committed to addressing consistent and persistent inequities in health outcomes by improving data collection to measure and analyze disparities across programs and policies that apply to the Hospice Quality Reporting Program (HQRP). This final rule discusses the HQRP, including the Hospice Outcomes and Patient Evaluation (HOPE) tool; provides an update on Quality Measures (QMs) that will be in effect in FY 2023 as well as future QMs; and also provides updates on the Consumer Assessment of Healthcare Providers and Systems, Hospice Survey Mode Experiment. 

FY 2023 Routine Annual Rate Setting Changes

The FY 2023 hospice payment update percentage is 3.8% (an estimated increase of $825 million in payments from FY 2022). This is a result of the 4.1% market basket percentage increase reduced by a 0.3 percentage point productivity adjustment. Hospices that fail to meet quality reporting requirements receive a 2% point reduction to the annual hospice payment update percentage increase for the year.

The hospice payment update includes a statutory aggregate cap that limits the overall payments per patient that is made to a hospice annually. The cap amount for FY 2023 is $32,486.92 (FY 2022 cap amount of $31,297.61 increased by 3.8%). 

Permanent Cap on Wage Index Decreases

This final rule establishes, for FY 2023 and subsequent years, a permanent, budget neutral 5 % cap on any decrease to a geographic area’s wage index, so that a geographic area’s wage index would not be less than 95 % of its wage index calculated in the prior FY regardless of the circumstances causing the decline.

Hospice Quality Reporting Program

The final rule provides an update on the development of a patient assessment instrument, titled Hospice Outcomes and Patient Evaluation (HOPE). This includes an update on the beta testing and derivatives that will be achieved during this phase of testing, such as burden estimates and timepoints for collection, as well as additional outreach efforts that will be conducted during and after beta testing and during our planned adoption process. CMS also discusses potential future quality measures within the HQRP based on HOPE and administrative data, including HOPE-based process measures and hybrid quality measures, which could be based upon multiple sources that include HOPE, claims and other data sources. CMS appreciates the public comments we received on these updates.

This rule provides an update on testing conducted for the CAHPS Hospice Survey, which is used to collect data on experiences of hospice care from primary caregivers of hospice patients. In particular, CMS is providing an update on a survey-mode experiment whose goal was to test the effect of adding a web-based mode to the CAHPS Hospice Survey. 

In this final rule, we note our appreciation of public comments we received on our request for information on a number of questions related to improving health equity in hospices and on a potential future structural measure under consideration for the HQRP.   Public input is very valuable for the continuing development of CMS’ health equity quality measurement efforts and broader commitment to health equity; a key pillar of our strategic vision as further described here,   

The final rule displayed on July 27, 2022 at the Federal Register and will publish on July 29, 2022 here:

For further information, see the hospice webpage here: Type/Hospice-Center.html.