$330M hospice payment rate increase in 2017

Hospices would see a proposed 2 percent increase in their payments for fiscal year (FY) 2017, amounting to a $330 million increase over FY 2016 numbers, along with changes to the hospice quality reporting program. In an advance release of a Proposed rule set to publish in the Federal Register on April 28, 2016, CMS shared its plan to update the hospice wage index, payment rates, and cap amount for FY 2017. The proposed 2 percent hospice payment update for FY 2017 is based on an estimated 2.8 percent inpatient hospital market basket update, reduced by a 0.5 percent productivity adjustment and by a 0.3 percent point adjustment set by the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148).

The Proposed rule would also address the hospice quality reporting program, which was established by ACA sec. 3004(c), including the addition of new quality measures. CMS would solicit feedback on an enhanced data collection tool and a plan to publicly display quality measures and other hospice data beginning in the middle of 2017. The Proposed rule would update hospice monitoring data analysis and provides discussion about ongoing monitoring efforts. Starting in FY 2014, hospices that fail to meet quality reporting requirements receive a 2 percent reduction to their payments.

Public reporting of hospice information via a Health Compare website will be available some time in calendar year 2017.

Payment cap update

In the FY 2016 Hospice Wage Index and Payment Rate Update Final rule (see Hospice 2016 rate update will bring $160M payment increase, Health Law Daily, August 6, 2015), CMS implemented changes that updated the hospice payment update by percentage rather than using the consumer price index for urban consumers. As required by Soc. Sec. Act sec. 1814(i)(2)(B)(ii), the hospice cap amount for the 2017 cap year will be $28,377.17, which is equal to the 2016 cap amount ($27,820.75) updated by the FY 2017 hospice payment update percentage of 2.0 percent.

The 2017 cap year will start on October 1, 2016, and end on September 30, 2017, as the FY 2016 Final rule had set the alignment of the cap accounting year with the federal fiscal year beginning in 2017.

Quality measures and data collection

Two new quality measures are proposed for FY 2017. The first measure—Hospice Visits When Death is Imminent—would assess hospice staff visits to patient and caregivers in the last week of life. The second measure—Hospice and Palliative Care Composite Process Measure—would assess the percentage of hospice patients who received care consistent with the guidelines. The second measure would be based on measures from the seven currently submitted under the Hospice quality reporting program (QRP).

CMS would enhance the current hospice data collection tool to be more in line with other post-acute care settings. The data collection would be a comprehensive patient assessment tool, rather than the current chart abstraction tool. According to the agency, hospices could use the data as a foundation for valid and reliable information for patient assessment, care planning, and service delivery. The expectation is that there would be greater accuracy in quality reporting, reduction to provider burdens, assurance for hospices fulfilling conditions of participation, and higher quality patient care. CMS also believes that with the data collection tool, future payment determinations could be made.

Additional ACA impact

The Hospice Consumer Assessment of Healthcare Providers and Systems (Hospice CAHPS®) Survey is a component of the Hospice QRP required under the ACA. The Proposed rule provides detailed description of the Hospice CAHPS® Survey, including the model of survey implementation, the survey respondents, eligibility criteria for the sample, and the languages in which the survey is offered, as well as participation requirements for FY 2019 and 2020. Public display of the survey results will not occur until CMS has collected at least four quarters of data. CMS expects public display of the data to occur during CY 2017 at the CAHPS® HOSPICE Survey website.