The FINAL Hospice Payment Rule was released on July 31, 2015 and addresses payment reform of the routine home care (RHC) level of care by providing a payment of two separate rates. One rate will be for care provided from day 1 through day 60 of an episode of hospice care and a second rate for days 61 and later. Be sure to understand that the counting of days continues into care provided by a different hospice unless greater than 60 days has passed since the patient revoked or was discharged from the previous hospice.

One of the most comforting pieces of this regulation is that the new payment structure will not be effective until January 1, 2016, allowing systems time to prepare to deal with these changes.

Between October 1, 2015 and December 31, 2015, hospices will continue to be paid a single 2016 RHC per diem payment amount ($161.89). Effective January 1, 2016, a higher RHC rate for days 1 through 60 of a hospice episode of care ($186.84) and a lower RHC rate for days 61 and beyond ($146.83) of a hospice episode of care will replace the single RHC per diem payment rate. CMS will not count the days between hospice elections as hospice days. The patient’s episode day count will include hospice days that occurred prior to January 1, 2016.

CMS has allowed for a Service Intensity Add-on (SIA) that would be added to RHC payment for Registered Nurse (RN) and social work visits provided during the last 7 days of life. This proposed change, SIA, appears on the surface to be a great change, but will the adjustment amount be adequate and why will it not be extended to patients that are requiring these services in a nursing facility?

The SIA would be applied if the following criteria are met:

  • The day is billed as a RHC level of care day;
  • The day occurs during the last 7 days of life (and the beneficiary is discharged dead);
  • Direct patient care is provided by a RN or a social worker that day (in person); and
  • The service is not provided in a SNF/NF. Following comments of concern, this was eliminated and so the SIA will apply regardless of place of residence when care is provided.

The proposed SIA would be equal to the Continuous Home Care (CHC) hourly payment rate multiplied by the amount of direct patient care provided by a RN or social worker for up to 4 hours total per day, as long as the aforementioned criteria are met.

The charts below represent the FINAL 2016 payment rates for CHC, IRC, and GIP and the two rates for RHC. These rates would be reduced in cases where hospices fail to meet the quality reporting requirements applicable to the 2016 payment update year; the rates also do not account for the sequester.

CMS is implementing the hospice wage index with a 1-year transition period as proposed, which means that the counties impacted will receive 50% of the rate from the current CBSA and 50 percent from the new OMB CBSA delineations for 2016 effective October 1, 2015. Due to the way the transitional index is calculated, some CBSAs and statewide rural areas may have more than one transition wage index value, but each county will have only one transition wage index. In such cases, the CBSA number may not be used on the claim. Instead, a transitional wage index number must be used — these are five digits in length and begin with “50”. In 2017 hospices will cease using the transitional wage index number.

The wage index rates for 2016 reflect the full phase-out of the Budget Neutrality Adjustment Factor (BNAF), along with annual changes to the wage index values.

The HPS Blog for next week will discuss the other components of this final rule, including HQRP and the CAP calculations.

The Final Regulation can be found at the following link:

Final Regulation