CMS Releases FY2023 Hospice Wage Index Final Rule with Rate Increase

Regulation | July 28, 2022 | by Katy Barnett

The final FY2023 Hospice Wage Index and Payment Rate Update and Hospice Quality Reporting Requirements was released on the Federal Register public inspection site on July 27th and finalize the market basket update at 3.8% instead of the origionally proposed 2.7%.

The proposed FY2023 Hospice Wage Index and Payment Rate Update and Hospice Quality Reporting Requirements was released on the Federal Register public inspection site on July 27th and is scheduled for publication in the Federal Register on July 29th. These regulations are effective on October 1st, 2022. This summary is not exhaustive; we encourage members to read the whole rule. The page numbers referenced in this summary refer to the public inspection copy of the final rule linked here. A comprehensive CMS factsheet on the final rule is available here.

LeadingAge will convene members in at the August 9th meeting of the Hospice Member Network to discuss the final rule. Join the Network here or emailing Katy Barnett.

Finalized FY2023 Hospice Payment Rates (PGS. 27-38)

CMS agreed with commenters that recent higher inflationary trends impacted were impacting hospice services. Based on requests from commenters like LeadingAge, CMS reviewed updated forecast of prices and adjusted projections to a 4.1 percent market basket with -0.3 productivity adjustment. CMS finalized FY2023 final hospice payment update of 3.8 percent instead of the proposed 2.7 percent (please see the rule for the SIA budget neutrality factor, the wage index standardization factor, and labor share standardization factor). These final rates are for hospices that submit their required quality data, hospices who do not submit quality data will receive a 2 percent decrease.  

Code

Description

FY 2022 Payment Rate

Proposed

FY 2023 Hospice Payment Update

Proposed FY 2023 Payment Rates

651

Routine Home Care (days 1-60)

$203.40

x1.038

$211.34

651

Routine Home Care (day 61+)

$160.74

x1.038

$167.00

652

CHC Full Rate = 24 hours of care

$1,462.52 ($60.94 per hour)

x1.038

$1,522.04

655

IRC

$473.75

x1.038

$492.10

656

GIP

$1,068.28

x1.038

$1,110.76

The final hospice cap for FY2023 cap year is $32,486.92, which is equal to the FY 2022 cap amount ($31,297.61) updated by the finalized FY 2023 hospice payment update percentage of 3.8 percent.

Finalized Permanent Cap on Hospice Wage Index Decreases (PGS. 20-27)

For FY2023 and subsequent years, CMS finalized a permanent 5-percent cap on any decreases to a geographic area’s wage index from its wage index in the prior year, regardless of the circumstances causing the decline. CMS declined to make this retroactive to FY2022 wage index decreases.

CMS provided an estimate of the impact to payments for providers in FY2023 based on this policy change on page 83 of the final rule and stated they would examine the proposed policy’s effects on an ongoing basis.

Updates to the Hospice Quality Reporting Program (PGS. 38-58)

Hospice Outcomes and Patient Evaluation (HOPE) National Beta Testing

CMS appreciated the feedback from commenters on the HOPE tool’s development and will take them into consideration for future rulemaking.

CMS and their contractor, Abt Associates, are recruiting additional Medicare-certified hospice providers to participate in a beta test of the draft hospice patient assessment instrument called Hospice Outcomes & Patient Evaluation (HOPE). Recruitment is ongoing and training will occur on a rolling basis. Data collection begins when training is completed and is expected to continue through fall 2022. While any Medicare-certified hospice can participate, the test does require certain staffing expectations which hospice members will need to consider before committing to being a test site. Those interested in participating should email HOPETesting@abtassoc.com. The detailed recruitment announcement is available on CMS's Hospice QRP Provider and Stakeholder Engagement webpage.

CAHPS Hospice Survey with Star Rating

Several commenters stated CMS should examine CAHPS Hospice Survey to ensure questions were appropriate for ethnically diverse families and provide information that can be used to address health equity. CMS shared that in 2021 they conducted an experiment of a revised version of the CAHPS Hospice Survey that included new survey questions designed to assess cultural sensitivity of care and identify disparities in care by race and ethnicity. CMS plans to share information about the results of this test as it becomes available.

Public Reporting

Some commenters shared concerns that low survey response rates will prevent hospices from being assigned a Star Rating. CMS shared that for the August 2022 reporting period, the first where the new Star Rating will be shared, most hospices with publicly reported CAHPS Hospice Survey measure scores (68 percent) met the threshold of 75 completed surveys and were assigned a Star Rating. Additionally, the vast majority of 2020 Medicare decedents (approximately nine out of ten) received care from hospices that received a Star Rating in August 2022. CMS also clarified their intention to add footnotes and other documentation on the Care Compare website to clearly explain why hospices with smaller numbers of completed surveys do not have Star Ratings.

Request for More Information on Health Equity (PGS. 59-74)

Comments on this request for information on health equity were consistent with LeadingAge’s comments including:

  • Commenters reiterated and acknowledged health disparities in hospice care and were supportive of CMS’ efforts to advance health equity and expressed appreciation for the opportunity to partner with CMS to address disparities in hospice settings.
  • Commenters suggested convening a Technical Expert Panel (TEP) to inform the development of health equity measures.
  • Commenters recommended incorporating social determinates of health (SDOH) items into HOPE and delaying public reporting of a health equity measure until HOPE is available.
  • Commenters also requested that CMS postpone public reporting of hospice health equity measures to allow for HOPE implementation, testing of health equity metrics in other settings of care, and pilot testing of the structural composite measure.
  • There was also a concern that the first domain proposed by CMS, focused on organizational strategies around health equity, would not assess whether outcomes are improved as a result of making equity a key organizational priority.
  • Commenters generally supported and appreciated the attention toward culturally and linguistically appropriate services (CLAS) training and other health equity trainings, however commenters suggested CMS develop or approve evidence-based trainings and/or certification available without imposing a financial burden on hospices.
  • Commenters also noted that hiring practices, the focus of CMS’ final proposed domain, are not the only area in which a culture of equity can be promoted.
  • Commenters stated that the current workforce shortages are leaving employers with limited applicant pools and reduced potential to give adequate weight to equity considerations during the hiring process.
  • Suggestions to amend the final domain included evaluating existing staff capacity to address disparities, assessing patient profile concordance with community profile, and borrowing from proposed measures in hospital and skilled nursing facility settings for this domain.

Based on comments received on the proposed rule, CMS and their contractor, Abt Associates, announced the recuritment of stakeholders to participate in a Technical Expert Panel (TEP) to provide input on a proposed health equity structural composite measure for both hospice and home health care settings. Potential participants include providers, patient advocates, quality improvement, and health equity experts. The Call for TEP materials, including the draft TEP Charter and Nomination Form, are available at the Current TEP Opportunities webpage. If you have general questions about the TEP and would like to contact Abt Associates, please email HHA_Hospice_HealthEquityTEP@abtassoc.com.

Update Hospice Survey and Enforcement Procedures (PGS. 74-77)

The Consolidated Appropriations Act (CAA) of 2021 directed the Secretary of Health and Human Services to create a Special Focus Program (SFP) for poor-performing hospice programs, set out authority for noncompliant hospice programs, and require the development and implementation of a range of remedies as well as procedures for appealing determinations. CMS found commenters were generally supportive of the development of a SFP for hospices. Prior to publishing the final rule, CMS announced a Technical Expert Panel (TEP) for the development of SFP.

Abt Associates is currently supporting recruitment for the TEP to contribute feedback and thoughtful input during Special Focus program (SFP) development. Potential participants include providers, patient advocates, national and state associations, and other hospice staff members. The objectives of the TEP are to provide input on the SFP algorithm that will be used to identify hospices that have substantially failed to meet applicable Medicare requirements based on identified criteria and measures and to help develop public reporting requirements for the SFP and how to present this information to the general public. The nomination Form is available here. Completed nomination forms and general questions about the Hospice SFP TEP can be sent to HospiceSFP@abtassoc.com.