The Centers for Medicare & Medicaid Services (CMS) has issued a proposed rule to update regulations affecting Medicare hospice services.

Payments to Medicare-participating hospices are estimated to decrease by 1.1% in Fiscal Year (FY) 2010.  The decrease in payments would save Medicare $2.9 billion over five years. 

Hospice expenditures are estimated to be about $13 billion in 2010 for more than 3,000 for-profit and not-for-profit hospices across the country.

The Medicare Payment Advisory Commission (MedPAC) reports that hospice expenditures are projected to grow at a rate that outpaces those projected for hospitals, skilled nursing facilities, physician services, or home health care. 

The rule also proposes to adopt a MedPAC recommendation that would increase accountability in the physician hospice certification and recertification process.  MedPAC found an increasing proportion of hospice patients with stays exceeding 180 days and significant variation in hospice length of stay. 

Therefore, CMS is proposing that hospice physicians who certify or recertify a beneficiary as terminally ill write a short narrative on the certification form.  The narrative would briefly describe the clinical evidence supporting a life expectancy of six months or less. 

The Medicare hospice benefit is intended to assist terminally ill patients, with a prognosis of six months or less if the disease runs its normal course, to remain in their homes. The focus of care shifts from curative to palliative care for relief of pain and symptom management.

Payment is made to a hospice for each day that an individual elects the benefit. 

The number of Medicare-certified hospices has increased significantly since 1997, up by over 70%.  The number of Medicare beneficiaries in hospice care has also grown rapidly, from just over 400,000 in 1998 to close to a million in 2007.

This proposed rule also solicits comments on a number of potential policy changes for the future.  In order to increase accountability in the recertification process, the rule seeks comment on requiring a physician or nurse practitioner to visit every hospice patient after 180 days on the benefit, and every benefit period thereafter.

This proposed rule also solicits comments on broader payment reform, such as alternate methods to calculate the hospice aggregate cap. 

This proposed rule was published in the Federal Register on April 24, 2009.  Comments are due 60 days after publication, or by June 22, 2009.  The proposed rule is available online at http://edocket.access.gpo.gov/2009/pdf/E9-9417.pdf