CMS Publishes the 2016 Hospice Payment Rate Update

HEALTHCAREfirst to Host Webinar Regarding Hospice Changes.

On Friday July 31, 2015, CMS finalized the Fiscal Year 2016 Hospice Payment Rule. The final rule updates the payment rates for hospices for Fiscal Year (FY) 2016 and reflects the final year of the 7-year Budget Neutrality Adjustment Factor (BNAF) phase-out finalized in the FY 2010 Hospice Wage Index final rule. The update to payment rates for hospices also include changes to the hospice wage index by incorporating the new Office of Management and Budget (OMB) core-based statistical area (CBSA) definitions, changes to the aggregate cap calculation, and includes aligning the cap accounting year for both the inpatient cap and the hospice aggregate cap with the federal fiscal year starting in FY 2017. Hospices are estimated to see a 1.1% ($160 million) increase in their payments for FY 2016.

HEALTHCAREfirst will host a free regulatory webinar to discuss the changes in detail on September 3rd. Some of the changes included in the final rule are:

  • CMs has split the items into two separate effective dates:
    • 10/1/2015
        • Hospice Payment Update and Rate change*
        • Adoption of the hospice wage index with a 1-year transition period. Counties impacted will receive 50% of the rate from the current CBSA and 50% from the new OMB CBSA delineations for FY 2016.
        • Restated the clarification that providers must report all related and unrelated diagnosis on identified in the initial assessment on the claim.
        • Alignment of the Cap year
    • 1/1/2016
        • Two-tier Routine Home Care (RHC) rate that will result in a higher base payment rate for the first 60 days of hospice care and a reduced base payment rate for 61 or more days of hospice care. CMS also clarified they will count the total number of days a patient has been receiving care, separated by no more than a 60 day gap in hospice care, regardless of level of care or whether those days were billable or not. The calculation will include all hospice days that occurred prior to 1/1/2016.
        • Service Intensity Add On (SIA) for patients in their last seven days of life when certain criteria is met, which will now apply to patients in nursing facilities and skilled nursing facilities.

*FY 2016 Hospice Payment Rate for RHC for Oct. 1, 2015 – Dec. 31, 2015:
2016 Hospice Payment Rate
*FY 2016 Hospice Payment Rate for RHC for Jan. 1, 2016 – Sept. 30, 2016:
Hospice Payment Rate




*FY 2016 Hospice Payment Rate CHC, IRC, and GIP Oct. 1, 2015 – Sept. 30, 2016:
Hospice Payment Rate chart







The full Final rule can be reviewed here.