Industry Insights

CMS Issues Final 2018 Hospice Wage Index Rule

September 2017
Author:  Jessica Dillard

Jessica Dillard

Senior Consultant

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On August 1, 2017, the Centers for Medicare & Medicaid Services (CMS) issued the final rule that updates the wage index, payment rates and cap amount for hospice agencies serving Medicare beneficiaries in fiscal year (FY) 2018. The final rule also includes changes to the Hospice Quality Reporting Program (HQRP).

Hospice providers are estimated to see a 1 percent increase in their Medicare payments, which translates to an approximately $180 million overall increase in FY 2018. The updated percentage would’ve been calculated using the proposed hospital market basket update of 2.7 percent and reduced by the Affordable Care Act (ACA)-enacted adjustments. However, the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) mandated that the FY 2018 hospice payment update be limited to 1 percent. The following table lists the FY 2018 hospice base payment rates for providers submitting quality data:

The table doesn’t include the 2 percent Medicare sequestration reduction, which remains a reduction applied to the final claim payment. Download BKD’s complimentary hospice FY 2018 payment rate tables. Also included in the final rule are updates to the hospice wage index tables.

The final rule also includes an update to the hospice aggregate cap amount for FY 2018. That amount will increase 1 percent, rising from the 2017 rate of $28,404.99 to $28,689.04. Also, as a part of 2016 final rule CMS-1629-F,
FY 2016 Hospice Wage Index and Payment Rate Update and Hospice Quality Reporting Requirements
, the cap accounting year is being changed to align with the federal fiscal year. FY 2017 will be the transition year, and the cap period will be October 1, 2016, to September 30, 2017. The Self-Determined Hospice Cap reports deadline will be moved forward, and those reports will be due to hospices’ respective Medicare Administrative Contractors between December 31, 2017, and February 28, 2018.

Also included in the FY 2018 final rule are updates to the HQRP, which include eight new quality measures using data already collected in the hospice Consumer Assessment of Healthcare Providers and Systems (CAHPS®) survey. The rule adopts two global CAHPS hospice survey measures and six composite CAHPS hospice survey-based measures.

Two Global Survey-Based Measures

  • Rating of hospice
  • Willingness to recommend

Six Composite Survey Measures

  • Hospice team communication
  • Getting timely care
  • Treating family member with respect
  • Getting emotional and religious support
  • Getting help for symptoms
  • Getting hospice care training

The final rule didn’t include any new measures based on the Hospice Item Set (HIS). However, CMS is working toward enhancing the current HIS to be more in line with other post-acute care settings. The final rule discusses introducing the Hospice Evaluation & Assessment Reporting Tool (HEART), a revised collection instrument. The HEART would be a patient assessment tool aimed at meeting two primary objectives:

  • Provide the quality data necessary for HQRP requirements and the current function of the HIS
  • Provide additional clinical data that could inform future payment refinements

The final rule also discusses the new Hospice Compare website, which CMS released in August 2017. Hospice Compare’s purpose is to meet the ACA’s requirement of making quality measure data public—it will allow the public to search for and view the quality measure scores of all Medicare-certified hospice providers. The new website will initially display only HIS data. Hospice CAHPS survey data display is expected to be added in winter 2018. Similar to other CMS Compare websites, hospice providers also will be given a star rating of one to five; however, methods for the star rating determination and proposed timeline for implementation have not been announced.

Updates to the hospice payment rates, cap, wage index and pricer for FY 2018 also can be found in the August 4, 2017, CMS Change Request.

Hospice agencies can review the final rule and evaluate possible resulting effects. Contact your trusted BKD advisor for more information.

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