CMS Proposes 2.6% Hospice Increase, HOPE Tool Implementation

  • Regulations
  • 4/25/2024
Eliminating delays in patient care with digital technology

Key insights

  • CMS proposes a net market basket update of 2.6%.
  • CMS makes various wage index changes to reflect new delineations.
  • CMS proposes implementing the Hospice Outcomes and Patient Evaluation Tool (HOPE) to replace the hospice item set (HIS).

Learn what new hospice changes may mean for your organization.

Consult an Advisor

The Centers for Medicare and Medicaid Services (CMS) proposed the fiscal year (FY) 2025 hospice payment rule. View the complete rule at the Federal Register.

Payment updates

CMS proposes a market basket update of 3% for FY 2025. With the required productivity adjustment of 0.4%, the net update is 2.6%.

Under the proposed rule, routine home care per diem would be $223.83 for first 60 days and $176.39 for 61+ days.

See tables 9 and 10 for all proposed rates.

CMS proposes a hospice cap amount for the FY 2025 cap year of $34,364.85. This is derived from the FY 2024 cap amount ($33,494.01) updated by the proposed FY 2025 hospice payment update of 2.6%.

Table 9: Proposed FY 2025 Hospice RHC Payment Rates

Code Description  FY 2024 Payment Rates SIA Budget Neutrality Factor  Wage Index Standardization FY 2025 Hospice Payment Update Proposed FY 2025 Payment Rates
651 Routine Home Care (days 1-60) $218.33 1.0009 0.9983 1.026 $223.83
 651  Routine Home Care (days 60+)  $172.35 1.0000 0.9975 1.026 $176.39

Table 10: Proposed FY 2025 Hospice CHC, IRC, and GIP Payment Rates

Code  Description FY 2024 Payment Rates Wage Index Standardization Factor FY 2025 Hospice Payment Update Proposed FY 2025 Payment Rates
652 Continuous Home Care Full Rate = 24 hours of care. $$1,565.46 1.0026 1.026 $1,610.34 ($67.10 per hour)
 655 Inpatient Respite Care  $507.71 0.9947 1.026  $518.15
 656 General Inpatient Care $1,145.31 0.9931 1.026  $1,166.98

Wage index changes

For FY 2025, CMS proposes the wage index would be based on the FY 2025 hospital pre-floor, pre-reclassified wage index for hospital cost reporting periods beginning on or after October 1, 2020, and before October 1, 2021 (FY 2021 cost report data).

CMS proposes adopting the most recent Office of Management and Budget (OMB) statistical area delineations, which may change the hospice wage index for some hospices across the country and Puerto Rico. 

Impacted locations are laid out in a series of eight tables in the proposed rule: 

  • Table 1 — In North Dakota, CMS proposes rural North Dakota would become a rural area without a hospital from which hospital wage data can be devised. CMS would, therefore, use contiguous core based statistical areas (CBSAs) as a proxy. The proposed wage index for FY 2025 is 0.8446 for rural North Dakota.
  • Table 2 In Connecticut, CMS proposes replacing the eight counties with the nine new “planning regions,” per the state’s request. Table 2 reflects the crosswalk.
  • Table 3 Urban counties changing to rural. A total of 53 counties (and county equivalents) currently considered urban would be considered rural beginning in FY 2025.
  • Table 4 Rural counties becoming urban. A total of 54 counties (and county equivalents) currently located in rural areas would be considered located in urban areas beginning in FY 2025.
  • Table 5 Urban areas with a CBSA name or number change. There are 57 changes.
  • Table 6 Urban areas subsumed into another CBSA. There are three counties in this situation.
  • Table 7 Counties changing CBSA. Under the new delineations, some counties would shift between existing and new CBSAs, changing the CBSAs’ constituent makeup. Also, some CBSAs have counties splitting off to become part of or form entirely new labor market areas. There are 73 counties in this situation.
  • Table 8 — Transition codes. CMS proposes beginning in FY 2025, counties with a different wage index value than the CBSA or rural area into which they are designated after the application of the 5% cap would use a wage index transition code. These special codes are five digits in length and begin with “50.” There are 32 counties that have to use specific transition codes.

Hospice Quality Reporting Program (HQRP)

MedPAC recommends 0% update

In its annual report to Congress, the Medicare Payment Advisory Commission (MedPAC) recommended a 0% update for 2025. While CMS did not take its advice, many pay attention to what MedPAC recommends.

MedPAC’s chapter on hospices included the following takeaways:

  • Between 2010 and 2022, Medicare’s spending for hospice grew substantially, increasing 5.2% per year on average, from $12.9 billion to $23.7 billion.
  • Fee for service hospice margins were 13.3% in 2021. 
  • Number of hospice providers increased by about 10% as more for-profit hospices entered the market, a continuing trend for more than a decade.
  • Percent of decedents using hospice increased to 49.1% in 2022, up from 47.3% in 2021.

HQRP background

The SNF QRP requires SNFs to meet certain reporting requirements, and SNFs may be subject to a 2% reduction in their annual update rate if the reporting requirements are not met. CMS is increasing the threshold for data completion for the Minimum Data Set (MDS) items increase beginning in FY 2026.

CMS says typically, 18% of Medicare-certified hospices are found non-compliant with the HQRP reporting requirements annually and are subject to the payment reduction in a given FY. Many face payment reductions based on failure to meet the reporting threshold of 90%. 

FY 2025 proposal

In the proposed FY 2025 rule, CMS would implement two new process measures under the HQRP—Timely Reassessment of Pain Impact and Timely Reassessment of Non-Pain Symptom Impact. CMS anticipates those beginning in FY 2028. These two new measures would use the data from the new HOPE instrument (see HOPE assessment instrument).

The proposed Timely Reassessment of Pain Impact process measure will determine how many patients assessed with moderate or severe pain impact were reassessed by the hospice within two calendar days. The proposed Timely Reassessment of Non-Pain Symptom Impact process measure will determine how many patients assessed with moderate or severe non-pain impact were reassessed by the hospice within two calendar days.

HOPE assessment instrument 

CMS finalized the Hospice Outcomes and Patient Evaluation (HOPE) tool in the FY 2020 final hospice rule and is proposing to begin collecting the HOPE standardized patient level data by October 1, 2025. HOPE would replace the HIS. 

The HOPE tool under v1.0 contains demographic, record processing, and patient-level standardized data elements to be collected by all Medicare-certified hospices for all patients over the age of 18, regardless of payer source, to support HQRP quality measures. The data elements represent domains such as administrative, preferences for customary routine activities, active diagnoses, health conditions, medications, and skin conditions. 

CMS proposes HOPE data would be collected for each patient admission at three distinct time points: admission, the hospice update visit (HUV), and discharge. 

Currently, CMS requires hospices submit 90% of all required HIS records within 30 days of the event (the patient’s admission or discharge). The 90% threshold applies to all required HIS records, which must be submitted and accepted within the 30-day submission deadline to avoid a payment penalty. 

CMS proposes to apply this same 90% threshold to HOPE admission, discharge, and two HUV records. After the HIS is phased out, hospices would need to submit 90% of all required HOPE records to support the quality measures within 30 days of the event or completion date (patient’s admission, discharge, and based on the patient's length of stay up to two HUV timepoints).

Consumer Assessment of Health Care Providers and Systems (CAHPS)

CMS proposes several changes to the CAHPS program:

HART tool to sunset

CMS has a free tool (Hospice Abstraction Reporting Tool, or HART) available for providers to use to collect hospice item set (HIS) data. CMS indicates few hospices use the tool. As such, the agency will no longer provide a free tool for standardized data collection. Beginning October 1, 2025, hospices will need to select a private vendor to collect and submit HIS data — and subsequently HOPE data — to CMS.

  • Adding an email invitation to a web survey
  • Removing one survey item regarding confusing or contradictory information from the Hospice Team Communication measure
  • Replacing the multi-item Getting Hospice Care Training measure with a new, one-item summary measure
  • Adding two new items, which will be used to calculate a new Care Preferences measure
  • Simplified wording to component items in the Hospice Team Communication, Getting Timely Care, and Treating Family Member with Respect measures
  • Removing three nursing home items and an item about moving the family member

Clarification on Conditions of Participation (CoPs), payment requirements

Responding to stakeholder feedback, CMS proposes several clarifications related to the CoPs’ election statement and various hospice payment requirements: 
  • To add the physician member of the hospice interdisciplinary group as an individual who may review the clinical information for each patient and provide written certification it’s anticipated the patient's life expectancy is six months or less if the illness runs its normal course. 
  • An update to the medical director and admission to hospice care CoPs to clarify if the medical director is unavailable, the physician designee may review the clinical information and certify the terminal illness. 
  • Clarifications on the requirements related to the election statement and notice of election (NOE) under the CoPs. CMS indicates these changes are intended to reorganize and more clearly distinguish the separate requirements for the “election statement” and the NOE.

Requests for information (RFIs)

The proposed rule also includes two RFIs. The first is on high intensity palliative care within hospice and developing a separate payment mechanism for this. The second is on health equity reporting on housing instability, food insecurity, utility challenges, and transportation. 

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CMS changes are frequent and lengthy. Our health care team follows the many changes and works with many providers to understand and implement them. 

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