CMS proposed hospice payment rule for FY 2015

CMS released their proposed hospice payment rule for fiscal year 2015, yesterday. Highlights:

  • 1.3% increase of hospice per diem payments
  • proposes clarifying the “terminal illness” requirement to elect hospice. The primary change would be to allow for consideration of patient functioning/co-morbidity in determining eligibility as opposed to a singular focus on prognosis
  • proposes setting a 3-day time limit by which a patient must file notice of “hospice election” which means they are un-electing “curative” care that is covered by Medicare. The current standard requires “timely” notification, and in some cases that has taken up to 10 days. The point is that Medicare can be paying for both hospice and “curative” care during this interval which would now be formalized.
  • files notice to clarify what physician is the primary medical provider for billing purposes (to be defined by the patient/decision maker). In the past, multiple physicians have billed as the primary medical provider.

The payment update is straightforward and is most notable for what it is not (a re-basing similar to home health, or a u shape payment with higher payments earlier and later in a stay, but lower in the middle). The other items are a series of policies that could be understood as pre-cursors to more fundamental reform (clarifying what physician is viewed by the patient as their primary doctor, and setting a clear period of time by which notice of hospice election must be filed). Further, the quality reporting requirements for hospice that were brought about by the ACA will be coming online this year, which is a key component for evaluating future payment policy changes; a baseline will be collected this coming year. The most interesting aspect of the rule for me is the clear statement of importance of palliative care, and noting hospice as a subset of palliative care. I am not sure I have seen CMS write about this relationship so clearly in the context of setting hospice policy, and there are many barriers to the financing of palliative care in the Medicare program when a beneficiary is not terminally ill based on Medicare regulations.

The payment update will likely get the focus on this proposed rule, but the other items and tenor of the document portend more consequential changes coming down the road, likely including facilitation of non-hospice palliative care.

About Don Taylor
Professor of Public Policy (with appointments in Business, Nursing, Community and Family Medicine, and the Duke Clinical Research Institute), and Chair of the Academic Council at Duke University . I am one of the founding faculty of the Margolis Center for Health Policy. My research focuses on improving care for persons who are dying, and I am co-PI of a CMMI award in Community Based Palliative Care. I teach both undergrads and grad students at Duke. On twitter @donaldhtaylorjr

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