Health Law Daily FY 2019 payments to hospices will increase by 1.8 percent
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Thursday, August 2, 2018

FY 2019 payments to hospices will increase by 1.8 percent

By Susan Smith, J.D., M.A.

CMS estimates that aggregate payments to hospices in FY 2019 will increase by $340 million compared to payments in FY 2018. The hospice cap amount for the 2019 cap year will be $29,205.44, which is equal to the 2018 cap amount ($28,689.04) updated by the fiscal year (FY) 2019 hospice payment update percentage of 1.8 percent, CMS announced on August 1, 2018. The hospice final rule provides the FY 2019 wage index, payment rates, and cap amount as well as changes to Hospice Quality Reporting Program (HQRP) requirements. In addition, the regulations have been amended to recognize physician assistants as designated hospice attending physicians in addition to physicians and nurse practitioners effective January 1, 2019. The rule is effective on October 1, 2018.

Hospice care per diem rates. Medicare provides for a per diem payment in one of four prospectively-determined rate categories of hospice care: routine home care (RHC), continuous home care (CHC), inpatient respite care (IRC), and general inpatient care (GIP)). The per diem payment must include all of the hospice services and items needed to manage the beneficiary’s care, as required by Social Security Act §1861(dd)(1). The payment rate for FY 2019 for each level is:

  • RHC (days 1-60), $196.25 up from $192.78 in FY 2018;
  • RHC (days 61+), $151.41 up from $154.21 in FY 2018;
  • CHC (full rate = 24 hours of care; FY 2019 hourly rate = $41.56) $997.38 up from $976.42 in FY 2018;
  • RC, $176.01 up from $172.78 in FY 2018;
  • GIP, $758.07 up from $743.55 in FY 2018.

FY 2019 wage index. CMS adjusts the hospice wage index with updated wage data and makes the application of the updated wage data budget neutral for all four levels of hospice care. The nonlabor portion is equal to 100 percent minus the labor portion for each level of care. The labor portions of the hospice payment rates for FY 2019 are:

  • RHC, 68.71 percent;
  • CHC, 68.71 percent;
  • GIP, 64.01 percent; and
  • RC, 54.13 percent.

The FY 2019 wage index by geographic location is available on CMS website.

Payment update percentage. The hospice payment update percentage for FY 2019 will be 1.8 percent for hospices that submit the required quality data and -0.2 percent (FY 2019 hospice payment update of 1.8 percent minus 2 percentage points) for hospices that do not submit the required quality data. The hospice payment update percentage for FY 2019 is based on the inpatient hospital market basket update of 2.9 percent. Social Security Act §§1886(b)(3)(B)(xi)(II) and 1814(i)(1)(C)(v) require the inpatient hospital market basket update to be reduced by a multifactor productivity (MFP) adjustment as mandated by the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148), 0.8 percentage point for FY 2019. The inpatient hospital market basket update for FY 2019 is reduced further by 0.3 percentage point, as mandated by §3401(g) of the ACA from FY 2013 through FY 2019. The resulting hospice payment update percentage for FY 2019 is 1.8 percent.

Drug reporting options. CMS has provided hospices with two options for reporting hospice drug information. Providers may continue to report infusion pumps and drugs, with corresponding NDC information on the hospice claim as separate line items. Alternatively, hospices can submit total, aggregate durable medical equipment and drug charges on the claim. CMS encourages providers to select one consistent mechanism for reporting this data. To implement this change, CMS issued a detailed sub-regulatory change request, effective October 1, 2018, that provides further guidance (see Change Request 10573).

HIS quality reporting deadlines. CMS will implement public reporting data review and correction timeframes for data submitted using the Hospice Item Set (HIS), starting on January 1, 2019. Specifically, each data correction deadline will occur on the 15th of the calendar year (CY) month that is approximately 4.5 months after the end of each CY quarter, and hospices must submit corrections or requests for inactivation of their data for the quarter involved by this deadline. Under this policy, any modification to or inactivation of records that occur after the proposed correction deadline will not be reflected in publicly reported data on the CMS Hospice Compare Web site. Any modifications to first quarter data that are submitted to CMS after August 15th will not be reflected during any subsequent Hospice Compare refresh.

Hospice Quality Reporting Program (HQRP) measures. CMS adopted an eighth factor to consider when evaluating measures for removal from the HQRP measure set; the costs associated with a measure outweighs the benefit of its continued use in the program. CMS will remove measures based on this factor on a case-by-case basis beginning FY 2019.

Quality reporting. CMS is finalizing its proposals related to the CAHPS® (Consumer Assessment of Healthcare Providers and Systems) Hospice Survey and CMS’ Hospice Compare website as follows:

  • continue to require hospice providers to use CMS-approved vendors to conduct the CAHPS® Hospice Survey using one of the three approved modes, mail, telephone or mail with telephone follow-up;
  • continue to exempt to small hospices from data collection for the CAHPS® Hospice Survey;
  • continue offering the "newness" exemption for the CAHPS® Hospice Survey to hospices that receive their CMS Certification Number (CCN) after the data collection year starts;
  • notify providers of any future intent to publicly report a quality measure on Hospice Compare or other CMS website, including timing, through sub-regulatory means;
  • no longer directly display the seven component measures as individual measures on Hospice Compare once the Hospice Comprehensive Assessment measure is displayed;
  • display data from the Hospice Public Use Files on Hospice Compare.

Regulation changes. CMS has amended the definition of cap period (see 42 C.F.R. §418.3) to specify that the cap period means the twelve-month period ending September 30 used in the application of the cap on overall hospice reimbursement specified in 42 C.F.R.§418.309. In addition, CMS made a technical correction in §418.309 by adding a reference to the definition of cap period as defined in §418.3 and removing language setting out specific month and day information.

CMS also amended the definition of physician assistants (see 42 C.F.R. §418.3) to acknowledge that qualified physician assistants are recognized as attending physicians for Medicare hospice beneficiaries and finalized amendments to the regulations at §418.304 to include the details regarding Medicare payment for designated hospice attending physician services provided by physician assistants. The payment amount for physician assistant services when serving as the attending physician for hospice patients is 85 percent of what a physician is paid under the Medicare physician fee schedule.

For a discussion of the proposed changes to hospice payment rates and quality reporting for FY 2019 see $340M payment increase, new meaningful measure factor tops FY 2019 hospice proposal, May 8, 2018. The Proposed rule (83 FR 20934) was published on, May 8, 2018.

MainStory: TopStory ReimbursementNews BillingNews CoverageNews HospiceNews PartANews QualityNews

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