Proposal Would Raise Medicare Payments for Hospice Care Services

CMS on Monday issued a proposed rule that would increase Medicare reimbursement rates to hospices by 1.1%, or $180 million, for fiscal year 2014, Modern Healthcare reports.

CMS said the increase was proposed in part because of a nearly 60% increase in average length of stays among Medicare beneficiaries, from 54 days in fiscal year 2000 to 86 days in FY 2010. In addition, CMS spending on hospice services has grown from $2.9 billion in FY 2000 to $14.7 billion in FY 2012 (Daly, Modern Healthcare, 4/29).

The proposed increase is the net result of a 2.5% payment increase that is offset by a 0.7 percentage point reduction to payments mandated by law and another 0.7 percentage point reduction to reflect updated wage data as part of a seven-year phase out of an old wage system (CQ HealthBeat, 4/29).

The proposed rule also included a coding change that would transition hospices from using billing codes that include certain nonprincipal diagnoses to those for the principal diagnosis, based on the patient's main cause for care.

CMS also proposed changing quality-reporting requirements for hospices -- beginning in FY 2016 -- by replacing reporting on pain-management and structural measures with two other measures and requiring hospices -- beginning in FY 2017 -- to conduct a hospice experience-of-care survey for patients' families and friends.

Beginning July 1, 2014, CMS also would require hospices to collect and submit new patient-data forms -- called Hospice Item Sets -- designed to track standardized aspects of patient care at admission and discharge. The new data collection would begin affecting payments in FY 2016.

In addition, CMS' proposed rule includes updates on Medicare hospice payment reform efforts, such as detailed reform model options, recent reform research and an update on data collection efforts (Modern Healthcare, 4/29).