[UPDATED] CMS Finalizes Hospice Special Focus Program, 36-Month Rule

The U.S. Centers for Medicare & Medicaid Services (CMS) has finalized its 2024 home health rule, including the implementation of a hospice Special Focus Program (SFP).

The rule also finalizes the proposed “36-month”rule for hospice providers. The requirement mirrors a regulation that has existed for several years for home health agencies. The final rule forbids any change in majority ownership during the 36 months after initial Medicare enrollment, including acquisitions, stock transactions or mergers.

Despite comments from stakeholders in the hospice community, CMS decided to proceed with its proposed algorithm for selecting providers for the SFP.

“We proposed to identify a subset of 10% of hospice programs based on the highest aggregate scores determined by the algorithm. The hospices selected for the SFP from the 10% would be determined by CMS,” the agency indicated in the final rule. “To identify ‘poor performance,’ we have identified several indicators, namely, survey reports with Condition-Level Deficiencies (CLDs) and complaints with substantiated allegations, and CMS Medicare data sources from the Hospice Quality Reporting Program (HQRP) (Medicare claims and Consumer Assessment of Healthcare Providers and Systems (CAHPS®).”

CMS will also examine hospices’ performance on certain Conditions of Participation (CoPs) that the agency says “directly contribute to the quality of care delivered to patients, their caregivers, and families,” according to the final rule.

Though each of the 23-hospice specific CoPs will continue to have equal weight when it comes to Medicare certification and enforcement decisions, CMS is giving “special attention” to 11 CoPs. The agency contends that a condition-level deficiency on any of these rules may indicate that a hospice is providing poor quality care.

While the hospice community has generally embraced the concept of the SFP, some raised questions about this methodology.

Each of the major national hospice industry organizations voiced concerns about the algorithm that CMS will use beginning in 2024, including LeadingAge, the National Partnership for Healthcare and Hospice Innovation (NHPI), the National Association for Home Care & Hospice (NAHC) and the National Hospice and Palliative Care Organization (NHPCO).

In August, these organizations sent a joint letter to CMS asking to delay the program to allow for the development of a new methodology.

“We support a Special Focus Program that is effectively tailored to identify and support poor performing hospices, but really there is a danger of immediately implementing a program with a flawed methodology,” Patrick Harrison, senior director of regulatory and compliance for NHPCO, previously told Hospice News. “That variable may create red herrings and fail to truly identify those who are not providing care at a level they should be.”

Last month, four members of Congress led by Reps. Beth Van Duyne (R-Texas) and Earl Blumenauer (D-Oregon) also called on CMS to delay the program and reconsider their methodology for selecting hospices.

Jimmy Panetta (D-CA) and Brad Wenstrup (R-OH) were also signatories on the letter to CMS Administrator Chiquita Brooks-LaSure and White House Office of Management and Budget Director Shalanda Young. The four lawmakers contend that the SFP, as currently designed, would not adequately identify poor performing hospices in need of the program.

Late Wednesday, NHPCO, NPHI, NAHC and LeadingAge released a combined statement opposing CMS’ decision to move forward with the algorithm.

“CMS’ decision to progress using a flawed methodology for the SFP algorithm will threaten the ability of millions of older adults and other hospice beneficiaries to access quality hospice care,” the organizations said in the statement. “In addition, the implementation of the poorly designed algorithm, which has been widely criticized by congressional leaders, technical expert panel participants, and hospice community and association leaders, will hinder a widely shared goal of improving sector quality. As a community, we are profoundly disappointed with this decision.”

Congress mandated the SFP in the Consolidated Appropriations Act of 2021, which contained language from the Helping Our Senior Population in Comfort Environments (HOSPICE) Act. CMS convened a Technical Expert Panel (TEP) to help design the program.

CMS developed the SFP in response to July 2019 reports on hospice quality from the Office of the Inspector General (OIG) in the U.S. Department of Health and Human Services (HHS).

The program will have the authority to impose enforcement remedies against hospices with poor performance based on its algorithm. Hospices flagged by the SFP also will be surveyed every six months rather than the current three-year cycle.

Among the potential enforcement actions for the SFP are monetary fines, suspended reimbursement, appointment of temporary management to bring the hospice into compliance or revocation of a provider’s Medicare certification.

CMS indicated in the rule that it would consider updates and modifications to the SFP and its algorithm in the future.

“As part of our continued monitoring, CMS will evaluate how potential SFP providers will be differentiated from providers that do not need additional attention,” the rule language stated. “As the proposed SFP improves care delivery across providers, CMS may consider changing components of the program such as the number of SFP eligible providers or the number of SFP participants if warranted.”