Just about a week ago, CMS released their proposed payment rule for hospices, effective for the Federal Fiscal Year of 2024, beginning October 1, 2023. As readers likely know, these proposed rules are more than just payment rates, incorporating certain regulatory requirements that pertain to the program and Medicare participation (for providers). The rules are subject to change and often, end-up somewhat modified. In most cases however, one can get a pretty good feel for the final “macro” events – rate and programmatic changes to getting a provider, reimbursed for the work it did.
As has been the trend with all Medicare programs, rate is noted as “gross” then subject to certain offsets. The offsets are typically, changes in the labor regions, market baskets (inflation), and the dreaded “multi-factor productivity adjustments”. Each of these elements singular or in combination can influence the final rate providers receive. Note: Initial payment rate updates are basically internally modeled CMS rates, times the market basket calculated inflation.
For Hospice, the market basket inflated rate projected for 2024 is 3.0% – increase. The net rate, after the productivity factor adjustment of .2% is applied is 2.8%. The aggregate cap (max payable to a hospice patient per year) inflates as well by 2.8%, from $32,486.92 to $33,396.55.
Now, the rub for 2024 in this proposed rule is the penalty hospices will receive for failing to meet quality reporting requirements. CMS is recommending that the penalty move from 2% to 4%. This would provide a deficient hospice (not meeting quality reporting requirements) with a rate reduction equal to -1.2% (2.8 – 4.0). CMS indicates that it will provide updates to the HQRP (quality reporting) data reporting periods along with updates on new quality measures and the HOPE patient assessment (Hospice Outcomes and Patient Evaluation) development.
Part of this proposed rule incorporates the end of the COVID -19 public health emergency, slated for May 11. As such, certain elements within the emergency are updated within the proposed rule. Telehealth is one such element impacted. In the rule, CMS is proposing to end the allowance of telehealth routine visits on May 12, 2023, but continuing the allowance of routing home care certifications via telehealth until 12/31/2024 (yes, through the end of 2024).
In an effort to address what is believed to be, on the part of CMS, increasing hospice fraud, CMS is proposing that physicians or permitted providers that can certify patients for hospice, be participating Medicare providers or have validly opted out of the program for the certification period of the patient.
The proposed rule incorporates a fair amount of statistical data on utilization and program growth. Without questions, CMS is concerned about program integrity and in particular, the growth of for-profit agencies. States that have raised suspicion with rapid growth are Texas, Arizona, California, and Nevada. California took action to restrict new agency growth, creating a moratorium. At issue? Hospices where the license location includes more than one hospice, management working at more than one agency simultaneously (a no-no) and concerns about legitimacy of certification of cases. To note however, this issue is not new within the hospice industry as even the large providers (e.g., VITAS) have come under scrutiny for inappropriate certifications, long-lengths of stay within institutional settings, etc.
The fact sheet for the proposed rule is here: https://www.cms.gov/newsroom/fact-sheets/fiscal-year-fy-2024-hospice-payment-rate-update-proposed-rule-cms-1787-p