[UPDATED] CMS 2025 Proposed Rule Signals Changes to Quality Measurement, Omits Program Integrity Actions

The 2025 proposed hospice rule is raising some questions along with payment rates.

In a proposed rule released yesterday, the U.S. Centers for Medicare & Medicaid Services (CMS) proposed a 2.6% increase in hospice per diems for 2025. The agency also proposed two new quality measures and 2025 implementation of the Hospice Outcome and Patient Evaluation (HOPE) assessment tool to replace the Hospice Item Set.

However, stakeholders in the hospice space contend that the increase is insufficient in light of continued inflation, interest rates, staffing shortages and wage hikes.

“The 2.6% proposed rate increase for hospices is not enough to support the continued delivery of hospice care amidst rising cost pressures and ongoing workforce constraints affecting hospices nationwide,” said NHPCO COO and Interim CEO, Ben Marcantonio, in a statement shared with Hospice News. “To continue providing the high level of care our patients and their families deserve, hospices require a payment rate that accurately reflects the current economic challenges. We know that hospice care has demonstrated $3.5 billion in annual savings for Medicare, which underscores the critical importance of investing in hospice to ensure continued beneficiary access to quality end-of-life care.”

Hospice care saves Medicare roughly $3.5 billion for patients in their last year of life, according to a joint report from NHPCO, the National Association for Home Care & Hospice (NAHC) and NORC at the University of Chicago.

Longer stays yielded the highest amount of savings, as much as 11%, the research found.

“NAHC is disappointed in the inadequate 2.6% payment rate update proposed by CMS. This small increase does not reflect the high costs hospices continue to face as a result of ongoing workforce shortages and inflationary cost challenges,” NAHC Vice President for Hospice Policy Davis Baird told Hospice News in an email. “More and more people are being served by hospice every year, and CMS needs to recognize the dynamic value the benefit provides – not only from the improved quality of life hospices provide, but also from the huge financial savings to Medicare that utilization of the hospice benefit drives.”

The increase will allow at least the largest hospice companies to maintain segment margins, but providers’ best bet financially is continued investment in building clinical capacity to boost volume, Brian Tanquilut, equity analyst for the investment banking firm Jefferies Financial Group, indicated in a research note. Jeffries’ analysis is focused on publicly traded companies.

But the proposal contained more than a pay increase. It also featured a series of requests for information (RFI) on issues like health equity, social determinants of health and future quality measures.

The RFIs contain further questions about the utilization of higher-cost palliative treatments under the Medicare Hospice Benefit. The agency posed similar queries in its proposed rule for 2024. The new proposal seeks greater clarity on the financial risks and costs that providers say represent barriers to providing those services, such as palliative chemotherapy, blood transfusions or dialysis, among others.

This RFI could indicate that CMS is thinking about potential changes to how it covers those advanced palliative services, according to NAHC President Bill Dombi.

“While the proposed rule may appear to be fairly innocuous,” Dombi told Hospice News in an email. “The hospice community should pay attention to the information request on high cost services as it may signal an emerging interest in payment model reform.”

The proposal, if finalized, would also update aspects of the hospice Consumer Assessment of Healthcare Providers and Systems (CAHPS) survey. This includes the addition of an email invitation to a web survey, with follow-up by mail to non-responders. It would also “shorten and simplify” the survey, according to CMS.

It would also remove three nursing home items from the survey, revise the existing Hospice Team Communication and Getting Hospice Care Training measures and add a new Care Preferences measure.

Also in the realm of quality measurement, the HOPE tool would come to fruition in 2025 after years of development and planning.

CMS has indicated that HOPE’s dual objectives are to provide data for the Hospice Quality Reporting Program through standardized data collection and to provide clinical data that may inform potential future changes to Medicare hospice payments. Field testing of this new methodology was completed late last year, and CMS has been analyzing those results.

The agency also plans to develop additional measures based on the information they will be able to collect through the tool. The agency to date has named two of those potential measures: Timely Reassessment of Pain Impact and Timely Reassessment of Non-Pain Symptom Impact.

“We are excited to see the request for information around payment for high intensity palliative services – this thinking aligns with our benefit reform proposal around concurrent care,” Katie Smith Sloan, president and CEO of LeadingAge, said in a statement. “We also want to recognize that CMS released the long-awaited [HOPE] tool. While we are still analyzing the tool, this proposal represents a major shift in the hospice quality landscape and we are hopeful that it will help our members in their mission to deliver high quality hospice care”

Wholesale changes to quality measurement will require careful attention to how they are implemented, Marcantonio indicated.

“NHPCO is closely evaluating the proposals related to the implementation of the [HOPE] assessment tool,” Marcantonio said in a statement. “The HOPE Assessment Tool represents a dramatic shift in how hospice care quality is measured and reported. We will continue working with CMS to ensure that this new tool will serve to enhance, not hinder, the delivery of compassionate, person-centered hospice care.”  

Additionally, the proposal would clarify that designated physician members of the hospice interdisciplinary team may certify patients for hospice if the medical director is unavailable.

But what is missing from the proposal is almost as noteworthy as what it contains. After a flurry of regulatory activity last year to curb fraud and improve quality, no such provisions exist in this proposed rule.

“What is missing is also notable,” continued Dombi. “CMS has not proposed any program integrity measures to address continued concerns on the surge in hospice growth in certain parts of the country despite the warning signs presented.”