What Hospice Agencies Should Know

The Hospice Care Accountability, Reform, and Enforcement Act (Hospice CARE), submitted by Rep. Blumenauer, proposes the most substantial changes to the Medicare hospice benefit in decades. The proposed bill would amend title XVIII of the Social Security Act to restructure payment while adding hospice program integrity provisions to deter fraud and abuse.

The bill reflects reforms proposed by hospice industry leaders, as well as additional input from HHS, the OIG, MedPAC, and the GAO. If passed, it would have major implications for various aspects of hospice operations, such as election and certification of terminal illness requirements. Below is a summary of the changes.

Moratorium on New Enrollments

The Act would place a moratorium on new hospice enrollments for five years. It gives HHS the authority to make exceptions for areas with insufficient access, based on criteria such as availability of hospice services, unmet need, wait times, and substandard care.  

The moratorium stems from concerns about fraudulent enrollment of new hospices, particularly in Arizona, California, Nevada, and Texas. Industry leaders have expressed concern about the broad, untargeted nature of a nationwide moratorium, as well as the lack of a clear methodology for making exceptions.

Prepayment Reviews

The Act would also implement prepayment medical reviews of routine home care beyond 90 days on service for hospices with aberrant billing patterns or outlier utilization patterns, such as longer lengths of stay and a higher proportion of revocations or live discharges.  

Industry leaders have expressed concern that 90-day reviews are inconsistent with the Medicare hospice benefit being a six month benefit and may deter providers from serving patients with diagnoses likely to result in longer stays due to concerns about audits or denials. Another concern is the lack of information about what constitutes “aberrant billing patterns.”

Certifications of Terminal Illness

To curb inappropriate admissions, the bill would prohibit physicians employed by, contracted with, or having a financial interest in a hospice from certifying that hospice’s patients as terminally ill for the first benefit period. This part of the bill has raised concerns about limiting access to hospice care, since non-hospice physicians often may not be comfortable certifying terminal illness. Hospice leaders and advocacy groups have voiced concerns that this would limit patients’ access to some of the people most qualified to provide end of life care. They also cite physician shortages and the fact that many patients don’t have primary care doctors or community physicians willing to serve as hospice attending physicians. The bill would also expand the ability to certify patients as terminally ill to nurse practitioners and physician assistants—a change that has received widespread support.

Hospice Election

Because electing hospice entails giving up Medicare Part A benefits, patients who are fraudulently enrolled in hospice can lose access to necessary medical care. To address this issue, the Act would expand the non-covered services addendum to the election statement, which currently is only required when the patient requests it. It would also add a new requirement to provide patients with an EOB within 15 days, stating the date of the election, the name of the hospice, contact information, the name of the certifying provider, the toll-free number for the MAC, and how to report fraud.  

Critics argue that the proposed specific language about fraud could trigger suspicion and that similar language is not required on EOBs for other providers. Advocacy groups have suggested that fraudulently enrolled patients should receive a new MBI and should not bear the burden of reporting fraudulent providers. Additionally, since a quarter of hospice patients die within five days, the new rule would send EOBs to many grieving families. 

Recertification

The bill outlines a new requirement for face-to-face visits prior to all recertification periods and excludes telehealth. This adds a new face-to-face visit at 90 days, before recertifying for the second benefit period. Hospice leaders have questioned the cost versus the benefit of imposing new operational burdens on all hospices when the majority do not abuse the system.

Payment Reform

One frequent criticism of the per diem hospice payment structure is that it compensates hospices regardless of whether the patient received a visit or care on a given day—which can be at odds with providing quality care. The Hospice CARE Act would introduce new blended routine home care per diem and per visit rates to better compensate hospices for providing in person care. Reimbursement for visits would have a frequency limit, which advocacy groups feel could conflict with patients’ best interests, pointing out that it runs contrary to the philosophy behind value-based care and capitation models.

Currently, Medicare covers respite care for no more than five consecutive days at a time but allows respite care more than once within a benefit period. The bill would limit respite to 5 days in each benefit period. Hospice leaders note that caregiver needs do not correlate with benefit periods, and the change could limit needed assistance. The Act adds a new type of transitional respite care, covering up to 15 days while patients transition from a hospital to a home setting.

The bill also removes payment for home health aide and homemaker services occurring in the SNF setting, a change that advocacy groups say may not be in the patient’s best interests as it does not consider the unique needs of hospice patients or widespread staffing shortages at nursing homes.

By 2027 the Act would also curtail payment to hospices not submitting quality data. According to Hospice News, roughly 20 percent of hospice agencies do not submit quality data. Hospice leaders have voiced concerns that cutting off all Medicare payments could pose an existential threat to hospices who make an error or miss a deadline, versus the willfully noncompliant. The Act also changes rate increase methodology. Industry leaders point out that using Medicare cost reports for rate adjustments is a flawed method since the cost report does not capture all costs.

Revalidation, Surveys, and Ownership

The Act would require revalidation of all existing hospice programs enrolled in Medicare, which would require additional surveys. The blanket nature of this provision has raised concerns that CMS may not have adequate resources to effectively implement it. Critics point to survey backlogs and question whether the government has the capacity to operationalize the new requirement.

The bill calls for a report to Congress on hospice ownership trends and cost report data by type of ownership. CMS would have to post ownership information publicly. Hospice leaders have voiced concerns that CMS data currently contains errors without a clear process for correcting them. Also, a change of ownership rule went into effect earlier this year to prevent changes in ownership during the first three years of Medicare enrollment. Some suggest that it’s too early to evaluate the impact of the existing rule, which may negate the need for further regulation.

The Takeaway

In summary, the Hospice CARE Act contains broad and significant changes with profound impacts to operations and reimbursement. The proposed changes would impact hospice EMR systems, hospice billing, scheduling and resource allocation, compliance, and data and analytics. Hospice agencies should monitor the bill as it moves through the legislative process, ensure their concerns are heard, and be prepared to adapt accordingly.

Related blogs:

1. What are the key performance indicators for hospice agencies?
2. What are the top strategies to grow your hospice referrals?
3. What are the crucial skills for home health and hospice hiring?
4. Selecting the best caregiver for end-of-life care