HCA Comments on FY 2022 Hospice Proposed Rule

Situation Report | June 7, 2021

In comments to the U.S. Centers for Medicare and Medicaid Services (CMS) today, HCA focused on four principal areas of the proposed hospice rule for fiscal year (FY) 2022. These include:

  • CMS’s hospice utilization data analysis and spending outside of the hospice benefit and other issues.
  • Revision and rebasing of the labor shares of the hospice payment rates.
  • Adoption of the 2018 Office of Management and Budget (OMB) hospice wage index statistical area delineations and the elimination of the 5 percent cap on wage index decreases.
  • Proposed clarifying regulation text changes for the Hospice Election Statement Addendum.

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 eliminated a 5-percent cap on losses in wage index values — a safeguard that should be strengthened not eliminated 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. 

As part of CMS’s FY 2022 rule, CMS is proposing to revise and rebase the labor share for each hospice level of care using 2018 hospice cost report data. HCA has numerous observations and concerns regarding CMS’s approach. These include:

  • Concerns related to the quality of cost report data utilized by CMS to calculate the labor shares and its applicability to the hospice universe.
  • Significant limitations in the cost reporting tool and instructions for calculation of the labor-shares portion of the hospice payment rates.
  • Failure to provide background methodology and data as to how CMS calculated the “labor share standardization factor” and an inability to judge its impact on overall spending given this lack of information.

Besides commenting on CMS’s proposed text changes for the Hospice Election Statement Addendum, which we generally support, HCA also provided comments on numerous Hospice Quality Reporting Program updates. We also support CMS’s proposal to make permanent certain hospice waivers, including the use of “pseudo patients” when conducting hospice aide competency standards.