Jim’s Notebook: 2027 Proposed Payment Rule, Hopes and Joys of a Hospice Patient

If you haven’t already, check out my recent Inside Hospice post about staying the course on diversity, equity and inclusion.

We’ve all had a busy week unpacking the 2027 proposed hospice rule that the U.S. Centers for Medicare & Medicaid Services (CMS) released on April 2.

As expected, the proposed rule contained a welcome but woefully inadequate hike to the hospice base rate at 2.4%, which doesn’t quite cover inflation and leaves providers contending with labor costs that continue to rise.

Moreover, hospices continue to compete for new hires with better capitalized health care settings like hospitals that can offer higher wages. Meager payment increases complicate hospices’ ability to remain competitive in the labor marketplace.

However, the proposal contains some potentially beneficial regulatory changes. One is the extension of hospice’s ability to do re-certifications via telehealth through Dec. 1, 2027. This update through the rulemaking process would be separate from any legislative action on the issue.

Since the pandemic, hospices have depended on telehealth re-certifications to build efficiency, free up physician time and to reach far-flung patients in rural areas, where telemedicine is particularly important due to distances between patients.

Finalizing this aspect of the rule could give hospices some peace of mind for at least a year and a half or so.

Additionally, the rule proposes regulatory changes allowing both a physician designee and the physician member of the interdisciplinary group — along with the hospice medical director — to discharge a patient from hospice care. This would give hospices a little more flexibility and could speed care transitions when appropriate, though the question remains as to whether this would result in increased live discharges, a regulatory red flag.

Another regulatory change is a little more complicated. As part of its efforts to bolster hospice program integrity, CMS is introducing a new, publicly available hospice scoring system that uses indicators of potential inappropriate utilization, quality of care and compliance concern to identify “suspicious” providers. The proposed new system is called the service and spending variation index (SSVI).

CMS maintains that nearly all care and services for individuals nearing the end of life should be delivered within the hospice setting, except in rare or unusual circumstances. However, the agency has observed a continued rise in non-hospice spending for terminally ill individuals in recent years.

To address this, CMS has developed the SSVI, which assigns hospices a score based on metrics derived from hospice claims data. These metrics include, among others:

• Non-hospice spending

• Percentage of beneficiaries discharged after a length of stay of 180 days or more

• Average minutes of care per routine home care day

• Percentage of live discharges in which beneficiaries return to the same hospice within seven days

CMS indicated that the SSVI is not a direct measure of fraud, waste or abuse, but that a higher score may indicate an elevated level of concern, potentially signaling program integrity risks or inappropriate utilization and warranting further oversight.

CMS plans to publish provider-level data and each facility’s SSVI score on its Hospice Center webpage. While most hospices are expected to receive low scores, those with higher scores may be subject to additional review to evaluate potential compliance or program integrity issues.

The agency is right to step up its work to root out fraud and poor quality providers. Consider that just one day after CMS issued the proposed rule, the DOJ announced eight people had been arrested for alleged involvement in a $50 million hospice-related fraud in – you guessed it – California. The same week, the California Attorney General lodged charges against 21 suspects in a $267 million scheme. Such news is obviously becoming all too common.

However, any initiative like this must be structured in such a way that does not penalize legitimate hospices. I’m concerned that, based on some of these metrics, that may not be the case here. Some good hospices could get caught up in the dragnet.

‘First Hospice Patient in Space’

This past week I had the pleasure of interviewing Pam Harter from California who wants to be the first hospice patient in space.

Before her illness, Harter volunteered in hospice care for 15 years. She has a rare genetic condition known as pseudoxanthoma elasticum (PXE). In June 2025, she entered hospice care and is currently receiving services from Providence at Home with Compassus in Napa, California. She lives there with her husband, Todd Harter, and they have three adult children.

Pam and I talked for a while about her aspirations to enter orbit, as well as what she valued the most about the hospice care she has received. Her answer, in a nutshell, was that hospice was enabling her to continue to live as she pleases and pursue her interests and goals even in her final days.

Here are some words from Pam that didn’t make it into the Hospice News story.

“Hospice has given me the opportunity to be comfortable, to keep on living. I like to say this line: ‘I choose passports over procedures. I had an opportunity to get [a surgery]. The doctor said, ‘We can do this, but the risk is not good.’ And if I did do the surgery back then, I probably wouldn’t leave the hospital. That’s not something I wanted to do, and I’ve done such amazing things since then.”

The thing that struck me the most during our conversation was how much we laughed. Pam has a great, strong laugh that erupted several times during the interview, even though she had to preface statements about her future plans with “if I am still alive by then.” She has so much joy to share and is so full of life to this day.

I hope her dreams of voyaging to the stars come true.

Now, it’s time to report on some hospice news.