HCA Comments on FY 2021 Hospice Proposed Rule 

Situation Report | June 15, 2020

In comments to the U.S. Centers for Medicare and Medicaid Services (CMS) last week, HCA focused on three principal areas of the proposed hospice rule for fiscal year (FY) 2021: hospice wage index updates and revisions based on new Core-Based Statistical Area (CBSA) designations published by the Office of Management and Budget (OMB) in 2018; CMS’s proposed elimination of the Service Intensity Add-on (SIA) budget neutrality factor; and upcoming changes to the hospice election statement, along with a new addendum requirement.  

In the comments, HCA Vice President for Finance and Management Patrick Conole reasserted HCA’s request for “wholesale revision and reform” of the pre-floor, pre-reclassified wage index which is “wholly inadequate for adjusting hospice and home health costs.”  

CMS has included a 5-percent cap on losses in wage index values — a welcome safeguard that should be strengthened even further, to a 3-percent cap on losses, in order to ease the impact of wage index revisions and “protect hospice providers who are already operating with negative or razor-thin operating margins,” we write.  

In the interest of simplifying the payment calculations, CMS is proposing to eliminate the SIA budget neutrality factor beginning with FY 2021. Given the change, we urge CMS to monitor visits in the final week of life — when the SIA applies — to determine if CMS’s proposal should be revisited based on the data, especially if recent increases in the hourly rate for Continuous Home Care (CHC) and new Hospice Compare measures (i.e., “hospice visits when death is imminent”) may ultimately alter SIA utilization.  

The biggest share of our comments address questions and concerns about the timing and content of the modified election statement and election statement addendum requirements. Given that the model versions were released for review at the height of the COVID-19 pandemic — and would become effective in October, when some health experts predict a second wave of COVID-19 — we’ve called on CMS to delay the implementation date for at least a full year. The delay should also be timed to the end of the COVID-19 public health emergency, similar to the way CMS has indexed its implementation delays for OASIS-E and other previously scheduled policy changes.  

This delay is further justified by many procedural and content questions outlined in our comments.