Jim’s Notebook: CMS’ Crackdown on Non-Hospice Spending

Photo credit: stevepb

I am excited to travel to Iceland this week! I am stoked to visit some Viking historical sites, among many other things.

By heritage, I am mostly descended from a few Native American tribes as well as the Vikings who settled in Ireland and Scotland, and I love exploring the history of these cultures. I read a lot of history books overall. The subject was my second academic love after writing and language.

So, as I am sure you all know by now, the 2027 final hospice rule from the U.S. Centers for Medicare & Medicaid Services (CMS) dropped last Thursday. Per usual this led to a mad scramble at the end of the day to get the news out. We strive to get stories like this out to our Hospice News subscribers within 15 minutes and then update them as we gather more information.

The rule was something of a doozy, as CMS seems to be trying to hold providers accountable for something that is not really – or at least not entirely -- a hospice problem.

That would be non-hospice spending. CMS made a big deal out of this in the rule with two new provisions that could intensify scrutiny on providers and increase regulatory burden in a tight reimbursement environment.

One of these is the creation of a service and spending variation index (SSVI), a new scoring system that uses nine claims-based measures to evaluate hospice utilization and non-hospice spending. CMS said the index is intended to identify hospices that may warrant greater education and regulatory oversight.

According to the agency, data collected through the SSVI will be used to inform beneficiary decision-making, support data analysis and strengthen program integrity efforts.

The rule would also require hospices to provide all patients and, where applicable, their representatives, with an addendum to the hospice election statement at the time of election. Under current policy, hospices are only required to furnish the addendum upon request.

While this non-hospice spending issue may indeed be a serious problem, this is not hospices’ fault. In many cases, they may not even know that the patient has sought services elsewhere, and they generally are not the ones who do the billing for these “unrelated” treatments.

CMS’ position is that the hospice benefit is structured in such a way that spending on non-hospice services should be negligible for patients approaching the end of life. But it’s concerning that, if spending on non-hospice spending has indeed increased, CMS is framing this trend, at least in this final rule, as a compliance concern almost exclusively.

The reasons why such spending has risen could be multi-faceted -- for example, changes in hospice patient acuity could be a factor. Furthermore, there is an underlying assumption that a hospice should manage a patient’s care well enough to avoid non-hospice spending near the end of life, but patient choice, medical emergencies or coding decisions made by non-hospice providers are just a few of the factors that could be contributing to a rise in non-hospice spending.

I hope that this effort from CMS provides a more complete picture of the often complex web of care that is delivered for hospice patients, and distinguishes between hospice failures and other drivers of increased spending.

Like Indiana Jones said in one of my favorite movies, “They are digging in the wrong place.”

I think the fact that CMS went this route is misguided and disappointing. But as always, I’d love to hear from the Inside Hospice community. What do you think of the final payment rule, and the non-hospice spending provisions in particular? Drop a comment!