[UPDATED] CMS Proposes 2.3% Pay Raise for Hospices, Updates Conditions of Participation

The U.S. Centers for Medicare & Medicaid Services (CMS) has proposed a rule containing a Fiscal Year 2022 hospice payment rate increase of 2.3%. The agency also raised the hospice payment cap to $31,389, up from $30,683 for 2021. The rule also contains updates to quality reporting requirements and Medicare Conditions of Participation (CoPs).

A key change to the CoPs would make permanent the temporary flexibilities related to hospice aide competency evaluations standards that were instituted during the COVID-19 public health emergency. The proposed rule did not include language making other temporary waivers permanent, such as those related to telehealth, but the agency could still take such action in a separate rulemaking.

“We are very supportive of these changes as they support operational efficiencies without posing a risk to quality of care,” said Theresa Forster, vice president for hospice policy and programs for National Association for Home Care and Hospice (NAHC). “Some other issues related to telehealth must be addressed by Congress or may be able to be dealt with through subregulatory guidance.”


CMS is allowing hospices to use “pseudo patients,” meaning an individual who stands in the role of a patient or a computerized mannequin device, during competency tests for hospice aides, rather than requiring contact with actual patients as typically required under the CoPs.

A related provision would require hospices to conduct a competency evaluation related to the deficient and related skills identified during a hospice aide supervisory visit.

During the pandemic, hospices have been able to provide interdisciplinary services via telemedicine or audio as long as the patient is receiving routine home care level of care and those telemedicine services which are audio-only services are capable of meeting the patient and caregiver needs.


The $2.2 trillion CARES Act, designed to help the economy and essential industries weather the impact of the pandemic, also contained provisions related to hospice telehealth, including permitting practitioners to recertify patients via telemedicine appointments rather than face-to-face encounters.

“We are hopeful that CMS will make the hospice face-to-face encounter delivered via telehealth permanent,” said National Hospice & Palliative Care Organization President and CEO Edo Banach. “Allowing the face-to-face encounter to be conducted through telehealth has been received well by patients and families, as it is convenient, and the visit is easy to complete.”

The proposal would also rebase the labor shares of payments for the four levels of hospice care. The proposed labor share for continuous home care is 74.6%, for routine home care is 64.7%, for inpatient respite care is 60.1%, and for general inpatient care is 62.8%.

“Hospice payment rates have a labor share and non-labor share component. Currently, the labor share component is based on costs related to home health and skilled nursing facilities,” said Mollie Gurian, director for Hospice, Palliative, and Home Health Policy at the aging services organization LeadingAge. “The rule, as proposed, will rebase and revise the labor share portions of all hospice levels of care based on Medicare Cost Report data for freestanding hospices.”

According to Carole Fisher, president of the National Partnership for Hospice Innovation (NPHI), the impact of the rebasing will likely be specific to each hospice. This is largely due to geographic variations in payment rates.

“We are pleased to see that CMS has proposed a positive payment rate update,” Fisher said. “Even in light of these adjustments our not-for-profit, community-based hospice programs continue to operate under razor thin margins as they reinvest heavily back into their communities and accept patients regardless of their condition or ability to pay.”

CMS also proposed a new measure in the Hospice Quality Reporting Program called the Hospice Care Index. The measure includes 10 quality indicators calculated using claims data, which represent different aspects of hospice care.

If approved, the rule would also add hospice star ratings to Care Compare. CMS unveiled its online Care Compare tool last September. It rolled the agency’s eight quality reporting sites into a single resource. Patients, families, referral sources and payers are increasingly paying attention to these data when selecting a hospice provider to work with.

Additionally, the rule proposes the addition of the claims-based Hospice Visits in the Last Days of Life (HVLDL) measure for public reporting.

“We support the proposed 2.3% rate increase for FY 2022 and ask CMS to understand that though the nation is experiencing progress on vaccinations, hospice and palliative care providers face significant hardship as they continue to serve patients and their families during the COVID-19 pandemic,” Banach told Hospice News. “CMS should recognize this as they fulfill their commitment to support providers through regulation and the subregulatory process.”

CMS is accepting public comments on the proposed rule until June 7.