[Federal Register Volume 81, Number 151 (Friday, August 5, 2016)]
[Rules and Regulations]
[Pages 52144-52194]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-18221]



[[Page 52143]]

Vol. 81

Friday,

No. 151

August 5, 2016

Part IV





 Department of Health and Human Services





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 Centers for Medicare & Medicaid Services





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42 CFR Part 418





 Medicare Program; FY 2017 Hospice Wage Index and Payment Rate Update 
and Hospice Quality Reporting Requirements; Final Rule

  Federal Register / Vol. 81 , No. 151 / Friday, August 5, 2016 / Rules 
and Regulations  

[[Page 52144]]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

42 CFR Part 418

[CMS-1652-F]
RIN 0938-AS79


Medicare Program; FY 2017 Hospice Wage Index and Payment Rate 
Update and Hospice Quality Reporting Requirements

AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.

ACTION: Final rule.

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SUMMARY: This final rule will update the hospice wage index, payment 
rates, and cap amount for fiscal year (FY) 2017. In addition, this rule 
changes the hospice quality reporting program, including adopting new 
quality measures. Finally, this final rule includes information 
regarding the Medicare Care Choices Model (MCCM).

DATES: These regulations are effective on October 1, 2016.

FOR FURTHER INFORMATION CONTACT: Debra Dean-Whittaker, (410) 786-0848 
for questions regarding the CAHPS[supreg] Hospice Survey.
    Michelle Brazil, (410) 786-1648 for questions regarding the hospice 
quality reporting program.
    Hillary A. Loeffler, (410) 786-0456 for questions regarding hospice 
payment policy.

SUPPLEMENTARY INFORMATION: Wage index addenda will be available only 
through the internet on the CMS Web site at: (http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/Hospice/index.html.)

Table of Contents

I. Executive Summary
    A. Purpose
    B. Summary of the Major Provisions
    C. Summary of Impacts
II. Background
    A. Hospice Care
    B. History of the Medicare Hospice Benefit
    C. Services Covered by the Medicare Hospice Benefit
    D. Medicare Payment for Hospice Care
    1. Omnibus Budget Reconciliation Act of 1989
    2. Balanced Budget Act of 1997
    3. FY 1998 Hospice Wage Index Final Rule
    4. FY 2010 Hospice Wage Index Final Rule
    5. The Affordable Care Act
    6. FY 2012 Hospice Wage Index Final Rule
    7. FY 2015 Hospice Wage Index and Payment Rate Update Final Rule
    8. Impact Act of 2014
    9. FY 2016 Hospice Wage Index and Payment Rate Update Final Rule
    E. Trends in Medicare Hospice Utilization
    F. Use of Health Information Technology
III. Provisions of the Final Rule
    A. Monitoring for Potential Impacts--Affordable Care Act Hospice 
Reform
    B. FY 2017 Hospice Wage Index and Rates Update
    1. FY 2017 Hospice Wage Index
    a. Background
    b. FY 2016 Implementation of New Labor Market Delineations
    2. FY 2017 Hospice Payment Update Percentage
    3. FY 2017 Hospice Payment Rates
    4. Hospice Cap Amount for FY 2017
    C. Updates to the Hospice Quality Reporting Program
    1. Background and Statutory Authority
    2. General Considerations Used for Selection of Quality Measures 
for the HQRP
    3. Policy for Retention of HQRP Measures Adopted for Previous 
Payment Determination
    4. Previously Adopted Quality Measures for FY 2017 and FY 2018 
Payment Determination
    5. Proposed Removal of Previously Adopted Measures
    6. Proposed New Quality Measures for FY 2019 Payment 
Determinations and Subsequent Years and Concepts Under Consideration 
for Future Years
    a. Background and Considerations in Developing New Quality 
Measures for the HQRP
    b. New Quality Measures for the FY 2019 Payment Determination 
and Subsequent Years
    7. Form, Manner, and Timing of Quality Data Submission
    a. Background
    b. Previously Finalized Policy for New Facilities To Begin 
Submitting Quality Data
    c. Previously Finalized Data Submission Mechanism, Collection 
Timelines, and Submission Deadlines for the FY 2017 Payment 
Determination
    d. Previously Finalized Data Submission Timelines and 
Requirements for FY 2018 Payment Determination and Subsequent Years
    e. Previously Finalized HQRP Data Submission and Compliance 
Thresholds for the FY 2018 Payment Determination and Subsequent 
Years
    f. New Data Collection and Submission Mechanisms Under 
Consideration for Future Years
    8. HQRP Submission Exemption and Extension Requirements for the 
FY 2017 Payment Determination and Subsequent Years
    9. Hospice CAHPS[supreg] Participation Requirements for the 2019 
APU and 2020 APU
    a. Background Description of the Survey
    b. Participation Requirements To Meet Quality Reporting 
Requirements for the FY 2019 APU
    c. Participation Requirements To Meet Quality Reporting 
Requirements for the FY 2020 APU
    d. Annual Payment Update
    e. Hospice CAHPS[supreg] Reconsiderations and Appeals Process
    10. HQRP Reconsideration and Appeals Procedures for the FY 2017 
Payment Determination and Subsequent Years
    11. Public Display of Quality Measures and Other Hospice Data 
for the HQRP
    D. The Medicare Care Choices Model
IV. Collection of Information Requirements
V. Economic Analyses
VI. Federalism Analysis and Regulations Text

Acronyms

    Because of the many terms to which we refer by acronym in this 
final rule, we are listing the acronyms used and their corresponding 
meanings in alphabetical order:

APU Annual Payment Update
ASPE Assistant Secretary of Planning and Evaluation
BBA Balanced Budget Act of 1997
BIPA Benefits Improvement and Protection Act of 2000
BNAF Budget Neutrality Adjustment Factor
BLS Bureau of Labor Statistics
CAHPS[supreg] Consumer Assessment of Healthcare Providers and 
Systems
CBSA Core-Based Statistical Area
CCN CMS Certification Number
CCW Chronic Conditions Data Warehouse
CFR Code of Federal Regulations
CHC Continuous Home Care
CHF Congestive Heart Failure
CMMI Center for Medicare & Medicaid Innovation
CMS Centers for Medicare & Medicaid Services
COPD Chronic Obstructive Pulmonary Disease
CoPs Conditions of Participation
CPI Center for Program Integrity
CPI-U Consumer Price Index--Urban Consumers
CR Change Request
CVA Cerebral Vascular Accident
CWF Common Working File
CY Calendar Year
DME Durable Medical Equipment
DRG Diagnostic Related Group
ER Emergency Room
FEHC Family Evaluation of Hospice Care
FR Federal Register
FY Fiscal Year
GAO Government Accountability Office
GIP General Inpatient Care
HCFA Healthcare Financing Administration
HHS Health and Human Services
HIPAA Health Insurance Portability and Accountability Act
HIS Hospice Item Set
HQRP Hospice Quality Reporting Program
IACS Individuals Authorized Access to CMS Computer Services
ICD-9-CM International Classification of Diseases, Ninth Revision, 
Clinical Modification
ICD-10-CM International Classification of Diseases, Tenth Revision, 
Clinical Modification
ICR Information Collection Requirement
IDG Interdisciplinary Group
IMPACT Act Improving Medicare Post-Acute Care Transformation Act of 
2014
IOM Institute of Medicine
IPPS Inpatient Prospective Payment System
IRC Inpatient Respite Care

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LCD Local Coverage Determination
LOS Length of Stay
MAC Medicare Administrative Contractor
MAP Measure Applications Partnership
MCCM Medicare Care Choices Model
MedPAC Medicare Payment Advisory Commission
MFP Multifactor Productivity
MSA Metropolitan Statistical Area
MSS Medical Social Services
NHPCO National Hospice and Palliative Care Organization
NF Long Term Care Nursing Facility
NOE Notice of Election
NOTR Notice of Termination/Revocation
NP Nurse Practitioner
NPI National Provider Identifier
NQF National Quality Forum
OIG Office of the Inspector General
OACT Office of the Actuary
OMB Office of Management and Budget
PEPPER Program for Evaluating Payment Patterns Electronic Report
PRRB Provider Reimbursement Review Board
PS&R Provider Statistical and Reimbursement Report
Pub. L. Public Law
QAPI Quality Assessment and Performance Improvement
RHC Routine Home Care
RN Registered Nurse
SBA Small Business Administration
SEC Securities and Exchange Commission
SIA Service Intensity Add-on
SNF Skilled Nursing Facility
TEFRA Tax Equity and Fiscal Responsibility Act of 1982
TEP Technical Expert Panel
UHDDS Uniform Hospital Discharge Data Set
U.S.C. United States Code

I. Executive Summary

A. Purpose

    This final rule updates the hospice payment rates for fiscal year 
(FY) 2017, as required under section 1814(i) of the Social Security Act 
(the Act). This rule also finalizes new quality measures and provides 
an update on the hospice quality reporting program (HQRP) consistent 
with the requirements of section 1814(i)(5) of the Act, as added by 
section 3004(c) of the Patient Protection and Affordable Care Act (Pub. 
L. 111-148) as amended by the Health Care and Education Reconciliation 
Act (Pub. L. 111-152) (collectively, the Affordable Care Act). In 
accordance with section 1814(i)(5)(A) of the Act, starting in FY 2014, 
hospices that have failed to meet quality reporting requirements 
receive a 2 percentage point reduction to their payments. Finally, this 
final rule shares information on the Medicare Care Choices Model 
developed in accordance with the authorization under section 1115A of 
the Act for the Center for Medicare and Medicaid Innovation (CMMI) to 
test innovative payment and service models that have the potential to 
reduce Medicare, Medicaid, or Children's Health Insurance Program 
(CHIP) expenditures while maintaining or improving the quality of care.

B. Summary of the Major Provisions

    In section III.B.1 of this rule, we update the hospice wage index 
with updated wage data and make the application of the updated wage 
data budget-neutral for all four levels of hospice care. In section 
III.B.2 we discuss the FY 2017 hospice payment update percentage of 2.1 
percent. Sections III.B.3 and III.B.4 update the hospice payment rates 
and hospice cap amount for FY 2017 by the hospice payment update 
percentage discussed in section III.B.2.
    In section III.C of this rule, we discuss updates to HQRP, 
including two new quality measures as well as of the possibility of 
utilizing a new assessment instrument to collect quality data. As part 
of the HQRP, the new measures, effective April 1, 2017, will be: (1) 
Hospice Visits When Death is Imminent, assessing hospice staff visits 
to patients and caregivers in the last week of life; and (2) Hospice 
and Palliative Care Composite Process Measure, assessing the percentage 
of hospice patients who received care processes consistent with 
existing guidelines. In section III.C we will also discuss the 
enhancement of the current Hospice Item Set (HIS) data collection 
instrument to be more in line with other post-acute care settings. This 
new data collection instrument will be a comprehensive patient 
assessment instrument, rather than the current chart abstraction tool. 
Additionally, in this section we discuss our plans for sharing HQRP 
data publicly during calendar year (CY) 2016 as well as plans to 
provide public reporting via a Compare Site in CY 2017.
    Finally, in section III.D, we are providing information regarding 
the Medicare Care Choices Model (MCCM). This model is testing a new 
option for Medicare and dual eligible beneficiaries with certain 
advanced diseases who meet the model's other eligibility criteria to 
receive hospice-like support services from MCCM participating hospices 
while receiving care from other Medicare providers for their terminal 
illness. This model is designed to: (1) Increase access to supportive 
care services provided by hospice; (2) improve quality of life and 
patient/family/caregiver satisfaction; and (3) inform new payment 
systems for the Medicare and Medicaid programs.

C. Summary of Impacts

                      Table 1--Impact Summary Table
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         Provision description                      Transfers
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FY 2017 Hospice Wage Index and Payment   The overall economic impact of
 Rate Update.                             this final rule is estimated
                                          to be $350 million in
                                          increased payments to hospices
                                          during FY 2017.
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II. Background

A. Hospice Care

    Hospice care is an approach to treatment that recognizes that the 
impending death of an individual warrants a change in the focus from 
curative care to palliative care for relief of pain and for symptom 
management. The goal of hospice care is to help terminally ill 
individuals continue life with minimal disruption to normal activities 
while remaining primarily in the home environment. A hospice uses an 
interdisciplinary approach to deliver medical, nursing, social, 
psychological, emotional, and spiritual services through use of a broad 
spectrum of professionals and other caregivers, with the goal of making 
the beneficiary as physically and emotionally comfortable as possible. 
Hospice is compassionate beneficiary and family-centered care for those 
who are terminally ill. It is a comprehensive, holistic approach to 
treatment that recognizes that the impending death of an individual 
necessitates a transition from curative to palliative care.
    Medicare regulations define ``palliative care'' as ``patient and 
family-centered care that optimizes quality of life by anticipating, 
preventing, and treating suffering. Palliative care throughout the 
continuum of illness involves addressing physical, intellectual, 
emotional, social, and spiritual needs and to facilitate patient 
autonomy, access to information, and choice.'' (42 CFR 418.3) 
Palliative care is at the core of hospice philosophy and

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care practices, and is a critical component of the Medicare hospice 
benefit. Also, see Hospice Conditions of Participation final rule (73 
FR 32088 June 5, 2008). The goal of palliative care in hospice is to 
improve the quality of life of beneficiaries, and their families, 
facing the issues associated with a life-threatening illness through 
the prevention and relief of suffering by means of early 
identification, assessment, and treatment of pain and other issues that 
may arise. This is achieved by the hospice interdisciplinary group 
working with the beneficiary and family to develop a comprehensive care 
plan focused on coordinating care services, reducing unnecessary 
diagnostics, or ineffective therapies, and offering ongoing 
conversations with individuals and their families about changes in 
their condition. The beneficiary's comprehensive care plan will shift 
over time to meet the changing needs of the individual, family, and 
caregiver(s) as the individual approaches the end of life.
    Medicare hospice care is palliative care for individuals with a 
prognosis of living 6 months or less if the terminal illness runs its 
normal course. When a beneficiary is terminally ill, many health 
problems are brought on by underlying condition(s), as bodily systems 
are interdependent. In the 2008 Hospice Conditions of Participation 
final rule, we stated that the medical director or physician designee 
must consider the primary terminal condition, related diagnoses, 
current subjective and objective medical findings, current medication 
and treatment orders, and information about unrelated conditions when 
considering the initial certification of the terminal illness. (73 FR 
32176). As referenced in our regulations at Sec.  418.22(b)(1), to be 
eligible for Medicare hospice services, the patient's attending 
physician (if any) and the hospice medical director must certify that 
the individual is ``terminally ill,'' as defined in section 
1861(dd)(3)(A) of the Act and our regulations at Sec.  418.3; that is, 
the individual's prognosis is for a life expectancy of 6 months or less 
if the terminal illness runs its normal course. The certification of 
terminal illness must include a brief narrative explanation of the 
clinical findings that supports a life expectancy of 6 months or less 
as part of the certification and recertification forms, as set out at 
Sec.  418.22(b)(3).
    While the goal of hospice care is to allow the beneficiary to 
remain in his or her home environment, circumstances during the end-of-
life may necessitate short-term inpatient admission to a hospital, 
skilled nursing facility (SNF), or hospice facility for treatment 
necessary for pain control or acute or chronic symptom management that 
cannot be managed in any other setting. These acute hospice care 
services are to ensure that any new or worsening symptoms are 
intensively addressed so that the beneficiary can return to his or her 
home environment. Limited, short-term, intermittent, inpatient respite 
services are also available to the family/caregiver of the hospice 
patient to relieve the family or other caregivers. Additionally, an 
individual can receive continuous home care during a period of crisis 
in which an individual requires primarily continuous nursing care to 
achieve palliation or management of acute medical symptoms so that the 
individual can remain at home. Continuous home care may be covered on a 
continuous basis for as much as 24 hours a day, and these periods must 
be predominantly nursing care, in accordance with our regulations at 
Sec.  418.204. A minimum of 8 hours of nursing care, or nursing and 
aide care, must be furnished on a particular day to qualify for the 
continuous home care rate (Sec.  418.302(e)(4)).
    Hospices are expected to comply with all civil rights laws, 
including the provision of auxiliary aids and services to ensure 
effective communication with patients and patient care representatives 
with disabilities consistent with section 504 of the Rehabilitation Act 
of 1973 and the Americans with Disabilities Act, and to provide 
language access for such persons who are limited in English 
proficiency, consistent with Title VI of the Civil Rights Act of 1964. 
Further information about these requirements may be found at http://www.hhs.gov/civil-rights.

B. History of the Medicare Hospice Benefit

    Before the creation of the Medicare hospice benefit, hospice 
programs were originally operated by volunteers who cared for the 
dying. During the early development stages of the Medicare hospice 
benefit, hospice advocates were clear that they wanted a Medicare 
benefit that provided all-inclusive care for terminally-ill 
individuals, provided pain relief and symptom management, and offered 
the opportunity to die with dignity in the comfort of one's home rather 
than in an institutional setting.\1\ As stated in the August 22, 1983 
proposed rule titled ``Medicare Program; Hospice Care'' (48 FR 38146), 
``the hospice experience in the United States has placed emphasis on 
home care. It offers physician services, specialized nursing services, 
and other forms of care in the home to enable the terminally ill 
individual to remain at home in the company of family and friends as 
long as possible.'' The concept of a beneficiary ``electing'' the 
hospice benefit and being certified as terminally ill were two key 
components of the legislation responsible for the creation of the 
Medicare Hospice Benefit (section 122 of the Tax Equity and Fiscal 
Responsibility Act of 1982 (TEFRA), (Pub. L. 97-248)). Section 122 of 
TEFRA created the Medicare Hospice benefit, which was implemented on 
November 1, 1983. Under sections 1812(d) and 1861(dd) of the Act, we 
provide coverage of hospice care for terminally ill Medicare 
beneficiaries who elect to receive care from a Medicare-certified 
hospice. Our regulations at Sec.  418.54(c) stipulate that the 
comprehensive hospice assessment must identify the beneficiary's 
physical, psychosocial, emotional, and spiritual needs related to the 
terminal illness and related conditions, and address those needs in 
order to promote the beneficiary's well-being, comfort, and dignity 
throughout the dying process. The comprehensive assessment must take 
into consideration the following factors: The nature and condition 
causing admission (including the presence or lack of objective data and 
subjective complaints); complications and risk factors that affect care 
planning; functional status; imminence of death; and severity of 
symptoms (Sec.  418.54(c)). The Medicare hospice benefit requires the 
hospice to cover all reasonable and necessary palliative care related 
to the terminal prognosis, as described in the beneficiary's plan of 
care. The December 16, 1983 Hospice final rule (48 FR 56008) requires 
hospices to cover care for interventions to manage pain and symptoms. 
Additionally, the hospice Conditions of Participation (CoPs) at Sec.  
418.56(c) require that the hospice must provide all reasonable and 
necessary services for the palliation and management of the terminal 
illness, related conditions, and interventions to manage pain and 
symptoms. Therapy and interventions must be assessed and managed in 
terms of providing palliation and comfort without undue symptom burden 
for the hospice patient or family.\2\ In the December 16, 1983 Hospice 
final rule (48 FR 56010), regarding what is related versus

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unrelated to the terminal illness, we stated: ``. . . we believe that 
the unique physical condition of each terminally ill individual makes 
it necessary for these decisions to be made on a case by case basis. It 
is our general view that hospices are required to provide virtually all 
the care that is needed by terminally ill patients.'' Therefore, unless 
there is clear evidence that a condition is unrelated to the terminal 
prognosis, all conditions are considered to be related to the terminal 
prognosis and the responsibility of the hospice to address and treat.
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    \1\ Connor, Stephen. (2007). Development of Hospice and 
Palliative Care in the United States. OMEGA. 56(1), p. 89-99.
    \2\ Paolini, DO, Charlotte. (2001). Symptoms Management at End 
of Life. JAOA. 101(10). p. 609-615.
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    As stated in the December 16, 1983 Hospice final rule, the 
fundamental premise upon which the hospice benefit was designed was the 
``revocation'' of traditional curative care and the ``election'' of 
hospice care for end-of-life symptom management and maximization of 
quality of life (48 FR 56008). After electing hospice care, the 
beneficiary typically returns to the home from an institutionalized 
setting or remains in the home, to be surrounded by family and friends, 
and to prepare emotionally and spiritually, if requested, for death 
while receiving expert symptom management and other supportive 
services. Election of hospice care also requires waiving the right to 
Medicare payment for curative treatment for the terminal prognosis, and 
instead receiving palliative care to manage pain or other symptoms.
    The benefit was originally designed to cover hospice care for a 
finite period of time that roughly corresponded to a life expectancy of 
6 months or less. Initially, beneficiaries could receive three election 
periods: Two 90-day periods and one 30-day period. Currently, Medicare 
beneficiaries can elect hospice care for two 90-day periods and an 
unlimited number of subsequent 60-day periods; however, at the 
beginning of each period, a physician must certify that the beneficiary 
has a life expectancy of 6 months or less if the terminal illness runs 
its normal course.

C. Services Covered by the Medicare Hospice Benefit

    One requirement for coverage under the Medicare Hospice benefit is 
that hospice services must be reasonable and necessary for the 
palliation and management of the terminal illness and related 
conditions. Section 1861(dd)(1) of the Act establishes the services 
that are to be rendered by a Medicare certified hospice program. These 
covered services include: Nursing care; physical therapy; occupational 
therapy; speech-language pathology therapy; medical social services; 
home health aide services (now called hospice aide services); physician 
services; homemaker services; medical supplies (including drugs and 
biologicals); medical appliances; counseling services (including 
dietary counseling); short-term inpatient care in a hospital, nursing 
facility, or hospice inpatient facility (including both respite care 
and procedures necessary for pain control and acute or chronic symptom 
management); continuous home care during periods of crisis, and only as 
necessary to maintain the terminally ill individual at home; and any 
other item or service which is specified in the plan of care and for 
which payment may otherwise be made under Medicare, in accordance with 
Title XVIII of the Act.
    Section 1814(a)(7)(B) of the Act requires that a written plan for 
providing hospice care to a beneficiary who is a hospice patient be 
established before care is provided by, or under arrangements made by, 
that hospice program and that the written plan be periodically reviewed 
by the beneficiary's attending physician (if any), the hospice medical 
director, and an interdisciplinary group (described in section 
1861(dd)(2)(B) of the Act). The services offered under the Medicare 
hospice benefit must be available to beneficiaries as needed, 24 hours 
a day, 7 days a week (section 1861(dd)(2)(A)(i) of the Act). Upon the 
implementation of the hospice benefit, Congress expected hospices to 
continue to use volunteer services, though these services are not 
reimbursed by Medicare (see section 1861(dd)(2)(E) of the Act and 48 FR 
38149). As stated in the August 22, 1983 Hospice proposed rule, the 
hospice interdisciplinary group should comprise paid hospice employees 
as well as hospice volunteers (48 FR 38149). This expectation supports 
the hospice philosophy of holistic, comprehensive, compassionate, end-
of-life care.
    Before the Medicare hospice benefit was established, Congress 
requested a demonstration project to test the feasibility of covering 
hospice care under Medicare. The National Hospice Study was initiated 
in 1980 through a grant sponsored by the Robert Wood Johnson and John 
A. Hartford Foundations and the Centers for Medicare & Medicaid 
Services (CMS) (then, the Health Care Financing Administration (HCFA)). 
The demonstration project was conducted between October 1980 and March 
1983. The project summarized the hospice care philosophy and principles 
as the following:
     Patient and family know of the terminal condition.
     Further medical treatment and intervention are indicated 
only on a supportive basis.
     Pain control should be available to patients as needed to 
prevent rather than to just ameliorate pain.
     Interdisciplinary teamwork is essential in caring for 
patient and family.
     Family members and friends should be active in providing 
support during the death and bereavement process.
     Trained volunteers should provide additional support as 
needed.
    The cost data and the findings on what services hospices provided 
in the demonstration project were used to design the Medicare hospice 
benefit. The identified hospice services were incorporated into the 
service requirements under the Medicare hospice benefit. Importantly, 
in the August 22, 1983 Hospice proposed rule, we stated ``the hospice 
benefit and the resulting Medicare reimbursement is not intended to 
diminish the voluntary spirit of hospices'' (48 FR 38149).

D. Medicare Payment for Hospice Care

    Sections 1812(d), 1813(a)(4), 1814(a)(7), 1814(i), and 1861(dd) of 
the Act, and our regulations in part 418, establish eligibility 
requirements, payment standards and procedures, define covered 
services, and delineate the conditions a hospice must meet to be 
approved for participation in the Medicare program. Part 418, subpart 
G, provides for a per diem payment in one of four prospectively-
determined rate categories of hospice care (Routine Home Care (RHC), 
Continuous Home Care (CHC), inpatient respite care, and general 
inpatient care), based on each day a qualified Medicare beneficiary is 
under hospice care (once the individual has elected). This per diem 
payment is to include all of the hospice services needed to manage the 
beneficiary's care, as required by section 1861(dd)(1) of the Act. 
There has been little change in the hospice payment structure since the 
benefit's inception. The per diem rate based on level of care was 
established in 1983, and this payment structure remains today with some 
adjustments, as noted below:
1. Omnibus Budget Reconciliation Act of 1989
    Section 6005(a) of the Omnibus Budget Reconciliation Act of 1989 
(Pub. L. 101-239) amended section 1814(i)(1)(C) of the Act and provided 
for the following two changes in the methodology concerning updating 
the daily payment rates: (1) Effective January 1, 1990, the daily 
payment rates for RHC and other services included in

[[Page 52148]]

hospice care were increased to equal 120 percent of the rates in effect 
on September 30, 1989; and (2) the daily payment rate for RHC and other 
services included in hospice care for fiscal years (FYs) beginning on 
or after October 1, 1990, were the payment rates in effect during the 
previous Federal FY increased by the hospital market basket percentage 
increase.
2. Balanced Budget Act of 1997
    Section 4441(a) of the Balanced Budget Act of 1997 (BBA) (Pub. L. 
105-33) amended section 1814(i)(1)(C)(ii)(VI) of the Act to establish 
updates to hospice rates for FYs 1998 through 2002. Hospice rates were 
updated by a factor equal to the hospital market basket percentage 
increase, minus 1 percentage point. Payment rates for FYs from 2002 
have been updated according to section 1814(i)(1)(C)(ii)(VII) of the 
Act, which states that the update to the payment rates for subsequent 
FYs will be the hospital market basket percentage increase for the FY. 
The Act requires us to use the inpatient hospital market basket to 
determine hospice payment rates.
3. FY 1998 Hospice Wage Index Final Rule
    In the August 8, 1997 FY 1998 Hospice Wage Index final rule (62 FR 
42860), we implemented a new methodology for calculating the hospice 
wage index based on the recommendations of a negotiated rulemaking 
committee. The original hospice wage index was based on 1981 Bureau of 
Labor Statistics hospital data and had not been updated since 1983. In 
1994, because of disparity in wages from one geographical location to 
another, the Hospice Wage Index Negotiated Rulemaking Committee was 
formed to negotiate a new wage index methodology that could be accepted 
by the industry and the government. This Committee was composed of 
representatives from national hospice associations; rural, urban, large 
and small hospices, and multi-site hospices; consumer groups; and a 
government representative. The Committee decided that in updating the 
hospice wage index, aggregate Medicare payments to hospices would 
remain budget neutral to payments calculated using the 1983 wage index, 
to cushion the impact of using a new wage index methodology. To 
implement this policy, a Budget Neutrality Adjustment Factor (BNAF) was 
computed and applied annually to the pre-floor, pre-reclassified 
hospital wage index when deriving the hospice wage index, subject to a 
wage index floor.
4. FY 2010 Hospice Wage Index Final Rule
    Inpatient hospital pre-floor and pre-reclassified wage index 
values, as described in the August 8, 1997 Hospice Wage Index final 
rule, are subject to either a budget neutrality adjustment or 
application of the wage index floor. Wage index values of 0.8 or 
greater are adjusted by the BNAF. Starting in FY 2010, a 7-year phase-
out of the BNAF began (FY 2010 Hospice Wage Index final rule, (74 FR 
39384, August 6, 2009)), with a 10 percent reduction in FY 2010, an 
additional 15 percent reduction for a total of 25 percent in FY 2011, 
an additional 15 percent reduction for a total 40 percent reduction in 
FY 2012, an additional 15 percent reduction for a total of 55 percent 
in FY 2013, and an additional 15 percent reduction for a total 70 
percent reduction in FY 2014. The phase-out continued with an 
additional 15 percent reduction for a total reduction of 85 percent in 
FY 2015, an additional, and final, 15 percent reduction for complete 
elimination in FY 2016. We note that the BNAF was an adjustment which 
increased the hospice wage index value. Therefore, the BNAF phase-out 
reduced the amount of the BNAF increase applied to the hospice wage 
index value. It was not a reduction in the hospice wage index value 
itself or in the hospice payment rates.
5. The Affordable Care Act
    Starting with FY 2013 (and in subsequent FYs), the market basket 
percentage update under the hospice payment system referenced in 
sections 1814(i)(1)(C)(ii)(VII) and 1814(i)(1)(C)(iii) of the Act is 
subject to annual reductions related to changes in economy-wide 
productivity, as specified in section 1814(i)(1)(C)(iv) of the Act. In 
FY 2013 through FY 2019, the market basket percentage update under the 
hospice payment system will be reduced by an additional 0.3 percentage 
point (although for FY 2014 to FY 2019, the potential 0.3 percentage 
point reduction is subject to suspension under conditions specified in 
section 1814(i)(1)(C)(v) of the Act).
    In addition, sections 1814(i)(5)(A) through (C) of the Act, as 
added by section 3132(a) of the Affordable Care Act, require hospices 
to begin submitting quality data, based on measures to be specified by 
the Secretary of the Department of Health and Human Services (the 
Secretary), for FY 2014 and subsequent FYs. Beginning in FY 2014, 
hospices which fail to report quality data will have their market 
basket update reduced by 2 percentage points.
    Section 1814(a)(7)(D)(i) of the Act, as added by section 3132(b)(2) 
of the Affordable Care Act, requires, effective January 1, 2011, that a 
hospice physician or nurse practitioner have a face-to-face encounter 
with the beneficiary to determine continued eligibility of the 
beneficiary's hospice care prior to the 180th-day recertification and 
each subsequent recertification, and to attest that such visit took 
place. When implementing this provision, we finalized in the CY 2011 
Home Health Prospective Payment System final rule (75 FR 70435) that 
the 180th-day recertification and subsequent recertifications would 
correspond to the beneficiary's third or subsequent benefit periods. 
Further, section 1814(i)(6) of the Act, as added by section 
3132(a)(1)(B) of the Affordable Care Act, authorizes the Secretary to 
collect additional data and information determined appropriate to 
revise payments for hospice care and other purposes. The types of data 
and information suggested in the Affordable Care Act could capture 
accurate resource utilization, which could be collected on claims, cost 
reports, and possibly other mechanisms, as the Secretary determined to 
be appropriate. The data collected could be used to revise the 
methodology for determining the payment rates for RHC and other 
services included in hospice care, no earlier than October 1, 2013, as 
described in section 1814(i)(6)(D) of the Act. In addition, we were 
required to consult with hospice programs and the Medicare Payment 
Advisory Commission (MedPAC) regarding additional data collection and 
payment revision options.
6. FY 2012 Hospice Wage Index Final Rule
    When the Medicare Hospice benefit was implemented, Congress 
included an aggregate cap on hospice payments, which limits the total 
aggregate payments any individual hospice can receive in a year. 
Congress stipulated that a ``cap amount'' be computed each year. The 
cap amount was set at $6,500 per beneficiary when first enacted in 1983 
and has been adjusted annually by the change in the medical care 
expenditure category of the consumer price index for urban consumers 
from March 1984 to March of the cap year (section 1814(i)(2)(B) of the 
Act). The cap year was defined as the period from November 1st to 
October 31st. In the August 4, 2011 FY 2012 Hospice Wage Index final 
rule (76 FR 47308 through 47314) for the 2012 cap year and

[[Page 52149]]

subsequent cap years, we announced that subsequently, the hospice 
aggregate cap would be calculated using the patient-by-patient 
proportional methodology. We allowed existing hospices the option of 
having their cap calculated via the original streamlined methodology. 
As of FY 2012, new hospices have their cap determinations calculated 
using the patient-by-patient proportional methodology. The patient-by-
patient proportional methodology and the streamlined methodology are 
two different methodologies for counting beneficiaries when calculating 
the hospice aggregate cap. A detailed explanation of these methods is 
found in the August 4, 2011 FY 2012 Hospice Wage Index final rule (76 
FR 47308 through 47314). If a hospice's total Medicare reimbursement 
for the cap year exceeds the hospice aggregate cap, then the hospice 
must repay the excess back to Medicare.
7. FY 2015 Hospice Wage Index and Payment Rate Update Final Rule
    When electing hospice, a beneficiary waives Medicare coverage for 
any care for the terminal illness and related conditions except for 
services provided by the designated hospice and attending physician. 
The FY 2015 Hospice Wage Index and Payment Rate Update final rule (79 
FR 50452) finalized a requirement that requires the Notice of Election 
(NOE) be filed within 5 calendar days after the effective date of 
hospice election. If the NOE is filed beyond this 5-day period, hospice 
providers are liable for the services furnished during the days from 
the effective date of hospice election to the date of NOE filing (79 FR 
50474). Similar to the NOE, the claims processing system must be 
notified of a beneficiary's discharge from hospice or hospice benefit 
revocation. This update to the beneficiary's status allows claims from 
non-hospice providers to be processed and paid. Late filing of the NOE 
can result in inaccurate benefit period data and leaves Medicare 
vulnerable to paying non-hospice claims related to the terminal illness 
and related conditions and beneficiaries possibly liable for any cost-
sharing associated costs. Upon live discharge or revocation, the 
beneficiary immediately resumes the Medicare coverage that had been 
waived when he or she elected hospice. The FY 2015 Hospice Wage Index 
and Payment Rate Update final rule also finalized a requirement that 
requires hospices to file a notice of termination/revocation within 5 
calendar days of a beneficiary's live discharge or revocation, unless 
the hospices have already filed a final claim. This requirement helps 
to protect beneficiaries from delays in accessing needed care (Sec.  
418.26(e)).
    A hospice ``attending physician'' is described by the statutory and 
regulatory definitions as a medical doctor, osteopath, or nurse 
practitioner whom the beneficiary identifies, at the time of hospice 
election, as having the most significant role in the determination and 
delivery of his or her medical care. We received reports of problems 
with the identification of the person's designated attending physician 
and a third of hospice patients had multiple providers submit Part B 
claims as the ``attending physician,'' using a claim modifier. The FY 
2015 Hospice Wage Index and Payment Rate Update final rule finalized a 
requirement that the election form include the beneficiary's choice of 
attending physician and that the beneficiary provide the hospice with a 
signed document when he or she chooses to change attending physicians 
(79 FR 50479).
    Hospice providers are required to begin using a Hospice Experience 
of Care Survey for informal caregivers of hospice patients surveyed in 
2015. The FY 2015 Hospice Wage Index and Payment Rate Update final rule 
provided background and a description of the development of the Hospice 
Experience of Care Survey, including the model of survey 
implementation, the survey respondents, eligibility criteria for the 
sample, and the languages in which the survey is offered. The FY 2015 
Hospice Rate Update final rule also set out participation requirements 
for CY 2015 and discussed vendor oversight activities and the 
reconsideration and appeals process for entities that failed to win CMS 
approval as vendors (79 FR 50496).
    Finally, the FY 2015 Hospice Wage Index and Payment Rate Update 
final rule required providers to complete their aggregate cap 
determination not sooner than 3 months after the end of the cap year, 
and not later than 5 months after, and remit any overpayments. Those 
hospices that fail to timely submit their aggregate cap determinations 
will have their payments suspended until the determination is completed 
and received by the Medicare Administrative Contractor (MAC) (79 FR 
50503).
8. IMPACT Act of 2014
    The Improving Medicare Post-Acute Care Transformation Act of 2014 
(Pub. L. 113-185) (IMPACT Act) became law on October 6, 2014. Section 
3(a) of the IMPACT Act mandated that all Medicare certified hospices be 
surveyed every 3 years beginning April 6, 2015 and ending September 30, 
2025. In addition, section 3(c) of the IMPACT Act requires medical 
review of hospice cases involving beneficiaries receiving more than 180 
days care in select hospices that show a preponderance of such 
patients; section 3(d) of the IMPACT Act contains a new provision 
mandating that the cap amount for accounting years that end after 
September 30, 2016, and before October 1, 2025 be updated by the 
hospice payment update rather than using the consumer price index for 
urban consumers (CPI-U) for medical care expenditures.
9. FY 2016 Hospice Wage Index and Payment Rate Update Final Rule
    In the FY 2016 Hospice Rate Update final rule, we created two 
different payment rates for RHC that resulted in a higher base payment 
rate for the first 60 days of hospice care and a reduced base payment 
rate for all subsequent days of hospice care (80 FR 47172). We also 
created a Service Intensity Add-on (SIA) payment payable for services 
during the last 7 days of the beneficiary's life, equal to the CHC 
hourly payment rate multiplied by the amount of direct patient care 
provided by a registered nurse (RN) or social worker that occurs during 
the last 7 days (80 FR 47177).
    In addition to the hospice payment reform changes discussed, the FY 
2016 Hospice Wage Index and Payment Rate Update final rule implemented 
changes mandated by the IMPACT Act, in which the cap amount for 
accounting years that end after September 30, 2016 and before October 
1, 2025 is updated by the hospice payment update percentage rather than 
using the CPI-U. This was applied to the 2016 cap year, starting on 
November 1, 2015 and ending on October 31, 2016. In addition, we 
finalized a provision to align the cap accounting year for both the 
inpatient cap and the hospice aggregate cap with the FY, for FY 2017 
and later (80 FR 47186). This allows for the timely implementation of 
the IMPACT Act changes while better aligning the cap accounting year 
with the timeframe described in the IMPACT Act.
    Finally, the FY 2016 Hospice Wage Index and Payment Rate Update 
final rule clarified that hospices must report all diagnoses of the 
beneficiary on the hospice claim as a part of the ongoing data 
collection efforts for possible future hospice payment refinements. 
Reporting of all diagnoses on the hospice claim aligns with current 
coding guidelines as

[[Page 52150]]

well as admission requirements for hospice certifications (80 FR 
47142).

E. Trends in Medicare Hospice Utilization

    Since the implementation of the hospice benefit in 1983, and 
especially within the last decade, there has been substantial growth in 
hospice benefit utilization. The number of Medicare beneficiaries 
receiving hospice services has grown from 513,000 in FY 2000 to nearly 
1.4 million in FY 2015. Similarly, Medicare hospice expenditures have 
risen from $2.8 billion in FY 2000 to an estimated $15.5 billion in FY 
2015.\3\ Under the economic assumptions from the 2017 Mid-Session 
Review,\4\ our Office of the Actuary (OACT) projects that hospice 
expenditures are expected to continue to increase, by approximately 7 
percent annually, reflecting an increase in the number of Medicare 
beneficiaries, more beneficiary awareness of the Medicare Hospice 
Benefit for end-of-life care, and a growing preference for care 
provided in home and community-based settings.
---------------------------------------------------------------------------

    \3\ FY2000 figures from MedPAC analysis of the denominator file, 
the Medicare Beneficiary Database, and the 100 percent hospice 
claims standard analytic file from CMS (http://www.medpac.gov/documents/reports/chapter-11-hospice-services-(march-2012-
report).pdf?sfvrsn=4). FY 2015 hospice claims data from the Chronic 
Conditions Data Warehouse (CCW), accessed on June 20, 2016.
    \4\ ``Mid-Session Review: Budget of the US Government.'' Office 
of Management and Budget. July 15, 2016. https://www.whitehouse.gov/sites/default/files/omb/budget/fy2017/assets/17msr.pdf.
---------------------------------------------------------------------------

    There have also been changes in the diagnosis patterns among 
Medicare hospice enrollees. Specifically, as described in Table 2, 
there have been notable increases between 2002 and 2015 in 
neurologically-based diagnoses, including various dementia and 
Alzheimer's diagnoses. Additionally, there had been significant 
increases in the use of non-specific, symptom-classified diagnoses, 
such as ``debility'' and ``adult failure to thrive.'' In FY 2013, 
``debility'' and ``adult failure to thrive'' were the first and sixth 
most common hospice claims-reported diagnoses, respectively, accounting 
for approximately 14 percent of all diagnoses. Effective October 1, 
2014, hospice claims are returned to the provider if ``debility'' and 
``adult failure to thrive'' are coded as the principal hospice 
diagnosis as well as other ICD-9-CM (and as of October 1, 2015, ICD-10-
CM) codes that are not permissible as principal diagnosis codes per 
ICD-9-CM (or ICD-10-CM) coding guidelines. In the FY 2015 Hospice Wage 
Index and Payment Rate Update final rule (79 FR 50452), we reminded the 
hospice industry that this policy would go into effect and claims would 
start to be returned to the provider effective October 1, 2014. As a 
result of this, there has been a shift in coding patterns on hospice 
claims. For FY 2015, the most common hospice principal diagnoses were 
Alzheimer's disease, Congestive Heart Failure, Lung Cancer, Chronic 
Airway Obstruction, and Senile Dementia which constituted approximately 
35 percent of all claims-reported principal diagnosis codes reported in 
FY 2015. In Table 2 we have updated the information initially presented 
in the FY 2017 proposed rule (81 FR 25504-06).

             Table 2--The Top Twenty Principal Hospice Diagnoses, FY 2002, FY 2007, FY 2013, FY 2015
----------------------------------------------------------------------------------------------------------------
                                                          Reported principal
             Rank                       ICD-9                  diagnosis               Count        Percentage
----------------------------------------------------------------------------------------------------------------
                                                  Year: FY 2002
----------------------------------------------------------------------------------------------------------------
1.............................  162.9                 Lung Cancer...............          73,769              11
2.............................  428.0                 Congestive Heart Failure..          45,951               7
3.............................  799.3                 Debility Unspecified......          36,999               6
4.............................  496                   COPD......................          35,197               5
5.............................  331.0                 Alzheimer's Disease.......          28,787               4
6.............................  436                   CVA/Stroke................          26,897               4
7.............................  185                   Prostate Cancer...........          20,262               3
8.............................  783.7                 Adult Failure To Thrive...          18,304               3
9.............................  174.9                 Breast Cancer.............          17,812               3
10............................  290.0                 Senile Dementia, Uncomp...          16,999               3
11............................  153.0                 Colon Cancer..............          16,379               2
12............................  157.9                 Pancreatic Cancer.........          15,427               2
13............................  294.8                 Organic Brain Synd Nec....          10,394               2
14............................  429.9                 Heart Disease Unspecified.          10,332               2
15............................  154.0                 Rectosigmoid Colon Cancer.           8,956               1
16............................  332.0                 Parkinson's Disease.......           8,865               1
17............................  586                   Renal Failure Unspecified.           8,764               1
18............................  585                   Chronic Renal Failure (End           8,599               1
                                                       2005).
19............................  183.0                 Ovarian Cancer............           7,432               1
20............................  188.9                 Bladder Cancer............           6,916               1
----------------------------------------------------------------------------------------------------------------
                                                  Year: FY 2007
----------------------------------------------------------------------------------------------------------------
1.............................  799.3                 Debility Unspecified......          90,150               9
2.............................  162.9                 Lung Cancer...............          86,954               8
3.............................  428.0                 Congestive Heart Failure..          77,836               7
4.............................  496                   COPD......................          60,815               6
5.............................  783.7                 Adult Failure To Thrive...          58,303               6
6.............................  331.0                 Alzheimer's Disease.......          58,200               6
7.............................  290.0                 Senile Dementia Uncomp....          37,667               4
8.............................  436                   CVA/Stroke................          31,800               3
9.............................  429.9                 Heart Disease Unspecified.          22,170               2
10............................  185                   Prostate Cancer...........          22,086               2
11............................  174.9                 Breast Cancer.............          20,378               2
12............................  157.9                 Pancreas Unspecified......          19,082               2
13............................  153.9                 Colon Cancer..............          19,080               2

[[Page 52151]]

 
14............................  294.8                 Organic Brain Syndrome NEC          17,697               2
15............................  332.0                 Parkinson's Disease.......          16,524               2
16............................  294.10                Dementia In Other Diseases          15,777               2
                                                       w/o Behav. Dist.
17............................  586                   Renal Failure Unspecified.          12,188               1
18............................  585.6                 End Stage Renal Disease...          11,196               1
19............................  188.9                 Bladder Cancer............           8,806               1
20............................  183.0                 Ovarian Cancer............           8,434               1
----------------------------------------------------------------------------------------------------------------
                                                  Year: FY 2013
----------------------------------------------------------------------------------------------------------------
1.............................  799.3                 Debility Unspecified......         127,415               9
2.............................  428.0                 Congestive Heart Failure..          96,171               7
3.............................  162.9                 Lung Cancer...............          91,598               6
4.............................  496                    COPD.....................          82,184               6
5.............................  331.0                 Alzheimer's Disease.......          79,626               6
6.............................  783.7                 Adult Failure to Thrive...          71,122               5
7.............................  290.0                 Senile Dementia, Uncomp...          60,579               4
8.............................  429.9                 Heart Disease Unspecified.          36,914               3
9.............................  436                   CVA/Stroke................          34,459               2
10............................  294.10                Dementia In Other Diseases          30,963               2
                                                       w/o Behavioral Dist.
11............................  332.0                 Parkinson's Disease.......          25,396               2
12............................  153.9                 Colon Cancer..............          23,228               2
13............................  294.20                Dementia Unspecified w/o            23,224               2
                                                       Behavioral Dist.
14............................  174.9                 Breast Cancer.............          23,059               2
15............................  157.9                 Pancreatic Cancer.........          22,341               2
16............................  185                   Prostate Cancer...........          21,769               2
17............................  585.6                 End-Stage Renal Disease...          19,309               1
18............................  518.81                Acute Respiratory Failure.          15,965               1
19............................  294.8                 Other Persistent Mental             14,372               1
                                                       Dis.-classified elsewhere.
20............................  294.11                Dementia In Other Diseases          13,687               1
                                                       w/Behavioral Dist.
----------------------------------------------------------------------------------------------------------------
                                                  Year: FY 2015
----------------------------------------------------------------------------------------------------------------
1.............................  331.0                 Alzheimer's disease.......         196,705              13
2.............................  428.0                 Congestive heart failure,          115,111               8
                                                       unspecified.
3.............................  162.9                 Lung Cancer...............          88,404               6
4.............................  496                   COPD......................          80,655               6
5.............................  331.2                 Senile degeneration of              46,843               3
                                                       brain.
6.............................  332.0                 Parkinson's Disease.......          34,957               2
7.............................  429.9                 Heart disease, unspecified          31,906               2
8.............................  436                   CVA/Stroke................          29,172               2
9.............................  437.0                 Cerebral atherosclerosis..          26,887               2
10............................  174.9                 Breast Cancer.............          23,969               2
11............................  153.9                 Colon Cancer..............          23,844               2
12............................  185                   Prostate Cancer...........          23,293               2
13............................  157.9                 Pancreatic Cancer.........          23,127               2
14............................  585.6                 End stage renal disease...          22,990               2
15............................  491.21                Obstructive chronic                 21,493               1
                                                       bronchitis with (acute)
                                                       exacerbation.
16............................  518.81                Acute respiratory failure.          20,214               1
17............................  429.2                 Cardiovascular disease,             16,937               1
                                                       unspecified.
18............................  434.91                 Cerebral artery                    15,841               1
                                                       occlusion, unspecified
                                                       with cerebral infarction.
19............................  414.00                Coronary atherosclerosis            15,689               1
                                                       of unspecified type of
                                                       vessel.
20............................  188.9                 Bladder Cancer............          11,648              1
----------------------------------------------------------------------------------------------------------------
Note(s): The frequencies shown represent beneficiaries that had a least one claim with the specific ICD-9-CM
  code reported as the principal diagnosis. Beneficiaries could be represented multiple times in the results if
  they have multiple claims during that time period with different principal diagnoses.
Source: FY 2002 and 2007 hospice claims data from the Chronic Conditions Data Warehouse (CCW), accessed on
  February 14 and February 20, 2013. FY 2013 hospice claims data from the CCW, accessed on June 26, 2014, and FY
  2015 hospice claims data from the CCW, accessed on June 20, 2016.

    While there has been a shift in the reporting of the principal 
diagnosis as a result of diagnosis clarifications, a significant 
proportion of hospice claims (49 percent) in FY 2014 only reported a 
single principal diagnosis, which may not fully explain the 
characteristics of Medicare beneficiaries who are approaching the end 
of life. To address this pattern of single diagnosis reporting, the FY 
2015 Hospice Wage Index and Payment Rate Update final rule (79 FR 
50498) reiterated ICD-9-CM coding guidelines for the reporting of the 
principal and additional diagnoses on the hospice claim. We reminded 
providers to report all diagnoses on the hospice claim for the terminal 
illness and related conditions, including those that affect the care 
and clinical management for the beneficiary. Additionally, in the FY 
2016 Hospice Wage Index and Payment Rate Update final rule (80 FR 
47201), we provided further clarification regarding diagnosis reporting 
on hospice claims. We clarified that hospices will report all

[[Page 52152]]

diagnoses identified in the initial and comprehensive assessments on 
hospice claims, whether related or unrelated to the terminal prognosis 
of the individual, effective October 1, 2015. Analysis of FY 2015 
hospice claims show that only 37 percent of hospice claims include a 
single, principal diagnosis, with 63 percent submitting at least two 
diagnoses and 46 percent including at least three.

F. Use of Health Information Technology

    The Department of Health and Human Services (HHS) believes that the 
use of certified health IT by hospices can help providers improve 
internal care delivery practices and advance the interoperable exchange 
of health information across care partners to improve communication and 
care coordination. HHS has a number of initiatives designed to 
encourage and support the adoption of health information technology and 
promote nationwide health information exchange to improve health care. 
The Office of the National Coordinator for Health Information 
Technology (ONC) leads these efforts in collaboration with other 
agencies, including CMS and the Office of the Assistant Secretary for 
Planning and Evaluation (ASPE). In 2015, ONC released a document 
entitled ``Connecting Health and Care for the Nation: A Shared 
Nationwide Interoperability Roadmap'' (available at: https://www.healthit.gov/sites/default/files/hie-interoperability/nationwide-interoperability-roadmap-final-version-1.0.pdf), which includes a near-
term focus on actions that will enable a majority of individuals and 
providers across the care continuum to send, receive, find and use a 
common set of electronic clinical information at the nationwide level 
by the end of 2017. The 2015 Edition Health IT Certification Criteria 
(2015 Edition) builds on past rulemakings to facilitate greater 
interoperability for several clinical health information purposes and 
enables health information exchange through new and enhanced 
certification criteria, standards, and implementation specifications. 
The 2015 Edition also focuses on the establishment of an interoperable 
nationwide health information infrastructure. More information on the 
2015 Edition Final Rule is available at: https://www.healthit.gov/policy-researchers-implementers/2015-edition-final-rule

III. Provisions of the Proposed Regulations

    The proposed rule, titled ``Medicare Program; FY 2017 Hospice 
Payment Rate Update'' (81 FR 25497 through 25538), was published in the 
Federal Register on April 28, 2016, with a comment period that ended on 
June 20, 2016. In that proposed rule, we proposed to update the hospice 
wage index, payment rates, and cap amount for fiscal year (FY) 2017. In 
addition, the proposed rule proposed changes to the hospice quality 
reporting program, including new quality measures. The proposed rule 
also solicited feedback on an enhanced data collection instrument and 
described plans to publicly display quality measures and other hospice 
data beginning in the middle of 2017. Finally, the proposed rule 
included information regarding the Medicare Care Choices Model (MCCM). 
We received approximately 56 public comments on the proposed rule, 
including comments from MedPAC, hospice agencies, national provider 
associations, patient organizations, nurses, and advocacy groups.
    In this final rule, we provide a summary of each proposed 
provision, a summary of the public comments received and our responses 
to them, and the policies we are finalizing for the FY 2017 Hospice 
Payment Rate Update. Comments related to the paperwork burden are 
addressed in the ``Collection of Information Requirements'' section in 
this final rule. Comments related to the impact analysis are addressed 
in the ``Economic Analyses'' section in this final rule.

A. Monitoring for Potential Impacts--Affordable Care Act Hospice Reform

    In the FY 2017 Hospice Wage Index and Rate Update proposed rule (81 
FR 25497), we provided a summary of analysis conducted on pre-hospice 
spending, non-hospice spending, live discharge rates, and skilled 
visits in the last days of life. In addition, we also provided a 
summary of our plans to monitor for impacts of hospice payment reform. 
We will continue to monitor the impact of future payment and policy 
changes and will provide the industry with periodic updates on our 
analysis in future rulemaking and/or announcements on the Hospice 
Center Web page at: https://www.cms.gov/Center/Provider-Type/Hospice-Center.html.
    We received several comments on the analysis and CMS's plans for 
future monitoring efforts with regards to hospice payment reform 
outlined in the proposed rule, which are summarized below.
    Comment: A few commenters expressed concerns regarding whether pre-
hospice spending is an appropriate standard for comparison for post-
hospice spending for any diagnosis, including dementia. The commenters 
noted the illness trajectory of dementia is marked by a slow, 
progressive decline, differs from the illness trajectories of other 
hospice appropriate diagnoses, and results in care needs increasing and 
extending over longer periods of time. In turn, it may require higher 
spending. The commenters asked us to recognize the overall care needs 
of patients with dementia and other progressive neurological 
conditions, and the costs associated with these patients and their 
caregivers. Additionally, several commenters highlighted the challenges 
of and intensive resources required for short-stay patients, noting 
that the current payment system may not address the unique needs of 
that population.
    Several commenters suggested that CMS consider payment refinements 
that help to incentivize appropriate timing on enrollment for hospice. 
Additional commenters noted their concern regarding a potential case-
mix payment system for hospice, as the commenters believe that the 
hospice benefit differs from all other Medicare payment systems, as it 
is designed to account for the patient's full scope of Medicare needs.
    With regards to non-hospice spending during a hospice election, 
several commenters suggested that CMS take action to educate other 
Medicare provider types in order to increase understanding of benefits 
coverage and claims processing after a beneficiary has elected hospice. 
Several commenters also suggested that CMS investigate options for 
preventing other Medicare providers from billing without checking the 
Common Working File and notifying the hospice for a determination as to 
whether or not the care is related to the terminal prognosis. Several 
commenters requested that a greater level of specificity for Part D 
data be supplied to hospice providers, such that they can track where 
the billing issues originate and begin to address them. The commenters 
suggested that a coordinated system would help address the non-hospice 
spending.
    With regards to hospice live discharge rates, a few commenters 
noted concerns about the difference between two types of live 
discharges: A patient-initiated discharge or revocation versus a 
hospice-initiated discharge. The commenters suggested that analysis of 
live discharge rates should exclude the patient-initiated discharges or 
revocations. Commenters suggested that for hospice-initiated 
discharges, the reasons for such discharges should be reported so that 
hospice providers can

[[Page 52153]]

make adjustments in their admission and discharge practices.
    With regards to skilled visits during the last days of life, the 
number of visits by RNs and social workers is anticipated to increase 
during the last 7 days of a beneficiary's life as a result of the 
service intensity add[hyphen]on payment, implemented on January 1, 
2016. A few commenters stated that hospices take their cues from 
patients and families, who should always have the option to decline a 
visit. As such, decisions regarding visits made by the patient and 
family ought to be considered and/or reflected in the data.
    Finally, most commenters supported our planned analysis to monitor 
the impact of hospice payment reform and would like to use the 
monitoring results to target program integrity efforts to those 
aberrant individual providers.
    Although the analysis and monitoring efforts described in the 
proposed rule did not relate to the timely filing requirement for the 
hospice Notice of Election (NOE), nevertheless a few commenters 
expressed concern about the timely filing requirement and lost revenue 
due to data entry errors that cannot be immediately corrected. 
Commenters encouraged CMS to continue to explore the possibility of 
transmitting NOEs through Electronic Data Interchange rather than 
through direct data entry and recommended that, in the meantime, when 
the hospice files the NOE in good faith within the 5-day requirement, 
but the MAC does not accept the NOE within 5 days, the payment for 
hospice services should be allowed back to the date of election, once 
the MAC has accepted the NOE.
    Response: We appreciate these comments on the ongoing analysis 
presented and will continue to monitor hospice trends and 
vulnerabilities within the hospice benefit while also investigating 
means by which we can educate the larger provider community regarding 
appropriate billing practices. Additionally, we continue to explore 
options and strategies for addressing and responding to concerning 
behavior in the provider community. We will also consider these 
suggestions in any potential future policy and payment refinements.
    With regards to the comments received regarding the NOE timely 
filing requirement, we recognize that inadvertent NOE errors, such as 
transposed numbers or incorrect admission dates, will not trigger the 
NOE to return to the hospice for correction. The hospice must wait 
until the incorrect information is fully processed by Medicare systems 
before they can correct it, and this could cause the NOE to be late. We 
strongly encourage hospices to have quality assurance measures in place 
regarding the accuracy of the NOE information to mitigate any potential 
untimely NOEs. Our expectation is that the information provided on the 
hospice NOE is accurate and free of transcribing errors. To aid in 
reducing the impact of these situations on hospices, CMS is currently 
conducting an analysis that aims to redesign the hospice benefit period 
data in our systems.

B. FY 2017 Hospice Wage Index and Rate Update

1. FY 2017 Hospice Wage Index
a. Background
    The hospice wage index is used to adjust payment rates for hospice 
agencies under the Medicare program to reflect local differences in 
area wage levels, based on the location where services are furnished. 
The hospice wage index utilizes the wage adjustment factors used by the 
Secretary for purposes of section 1886(d)(3)(E) of the Act for hospital 
wage adjustments. Our regulations at Sec.  418.306(c) require each 
labor market to be established using the most current hospital wage 
data available, including any changes made by the Office of Management 
and Budget (OMB) to the Metropolitan Statistical Areas (MSAs) 
definitions.
    We use the previous FY's hospital wage index data to calculate the 
hospice wage index values. For FY 2017, the hospice wage index will be 
based on the FY 2016 pre-floor, pre-reclassified hospital wage index. 
This means that the hospital wage data used for the hospice wage index 
is not adjusted to take into account any geographic reclassification of 
hospitals including those in accordance with section 1886(d)(8)(B) or 
1886(d)(10) of the Act. The appropriate wage index value is applied to 
the labor portion of the payment rate based on the geographic area in 
which the beneficiary resides when receiving RHC or CHC. The 
appropriate wage index value is applied to the labor portion of the 
payment rate based on the geographic location of the facility for 
beneficiaries receiving GIP or Inpatient Respite Care (IRC).
    In the FY 2006 Hospice Wage Index final rule (70 FR 45130), we 
adopted the changes discussed in the OMB Bulletin No. 03-04 (June 6, 
2003). This bulletin announced revised definitions for MSAs and the 
creation of micropolitan statistical areas and combined statistical 
areas. The bulletin is available online at http://www.whitehouse.gov/omb/bulletins/b03-04.html. When adopting OMB's new labor market 
designations in FY 2006, we identified some geographic areas where 
there were no hospitals, and thus, no hospital wage index data, on 
which to base the calculation of the hospice wage index. In the FY 2010 
Hospice Wage Index final rule (74 FR 39386), we adopted the policy that 
for urban labor markets without a hospital from which hospital wage 
index data could be derived, all of the CBSAs within the state would be 
used to calculate a statewide urban average pre-floor, pre-reclassified 
hospital wage index value to use as a reasonable proxy for these areas. 
In FY 2016, the only CBSA without a hospital from which hospital wage 
data could be derived is 25980, Hinesville-Fort Stewart, Georgia.
    In the FY 2008 Hospice Wage Index final rule (72 FR 50214), we 
implemented a new methodology to update the hospice wage index for 
rural areas without a hospital, and thus no hospital wage data. In 
cases where there was a rural area without rural hospital wage data, we 
used the average pre-floor, pre-reclassified hospital wage index data 
from all contiguous CBSAs to represent a reasonable proxy for the rural 
area. The term ``contiguous'' means sharing a border (72 FR 50217). 
Currently, the only rural area without a hospital from which hospital 
wage data could be derived is Puerto Rico. However, our policy of 
imputing a rural pre-floor, pre-reclassified hospital wage index value 
based on the pre-floor, pre-reclassified hospital wage index (or 
indices) of CBSAs contiguous to a rural area without a hospital from 
which hospital wage data could be derived does not recognize the unique 
circumstances of Puerto Rico. In this final rule, for FY 2017, we will 
continue to use the most recent pre-floor, pre-reclassified hospital 
wage index value available for Puerto Rico, which is 0.4047.
    As described in the August 8, 1997 Hospice Wage Index final rule 
(62 FR 42860), the pre-floor and pre-reclassified hospital wage index 
is used as the raw wage index for the hospice benefit. These raw wage 
index values are then subject to application of the hospice floor to 
compute the hospice wage index used to determine payments to hospices. 
Pre-floor, pre-reclassified hospital wage index values below 0.8 are 
adjusted by a 15 percent increase subject to a maximum wage index value 
of 0.8. For example, if County A has a pre-floor, pre-reclassified 
hospital wage index value of 0.3994, we would multiply 0.3994 by 1.15, 
which equals 0.4593. Since 0.4593 is not greater than 0.8, then County 
A's hospice wage index would be 0.4593. In another example, if County B 
has a pre-floor,

[[Page 52154]]

pre-reclassified hospital wage index value of 0.7440, we would multiply 
0.7440 by 1.15 which equals 0.8556. Because 0.8556 is greater than 0.8, 
County B's hospice wage index would be 0.8.
b. FY 2016 Implementation of New Labor Market Delineations
    OMB has published subsequent bulletins regarding CBSA changes. On 
February 28, 2013, OMB issued OMB Bulletin No. 13-01, announcing 
revisions to the delineation of MSAs, Micropolitan Statistical Areas, 
and Combined Statistical Areas, and guidance on uses of the delineation 
in these areas. A copy of this bulletin is available online at: http://www.whitehouse.gov/sites/default/files/omb/bulletins/2013/b-13-01.pdf. 
This bulletin states that it ``provides the delineations of all 
Metropolitan Statistical Areas, Metropolitan Divisions, Micropolitan 
Statistical Areas, Combined Statistical Areas, and New England City and 
Town Areas in the United States and Puerto Rico based on the standards 
published on June 28, 2010, in the Federal Register (75 FR 37246 
through 37252) and Census Bureau data.'' In the FY 2016 Hospice Wage 
Index final rule (80 FR 47178), we adopted the OMB's new area 
delineations using a 1-year transition. In the FY 2016 Hospice Wage 
Index and Payment Rate Update final rule (80 FR 47178), we stated that 
beginning October 1, 2016, the wage index for all hospice payments 
would be fully based on the new OMB delineations.
    A summary of the comments we received regarding the wage index and 
our responses to those comments appears below.
    Comment: Several commenters noted their support for the full 
adoption of the new labor market delineations.
    Response: We appreciate the comments in support of the CBSA 
delineations finalized in last year's FY 2016 Hospice Wage Index and 
Payment Rate Update final rule (80 FR 47142).
    Comment: One commenter disagreed with fully basing hospice 
geographic area wage adjustments on the new OMB delineations. The 
commenter was particularly concerned with the New York City CBSA and 
the fact that the CBSA contains counties from New Jersey.
    Response: In the FY 2016 Hospice Wage Index and Rate Update final 
rule (80 FR 47178), we stated that a 1-year transition policy would 
apply to the FY 2016 payment rates and that, beginning in FY 2017, 
hospice payments would be fully-based on the new OMB delineations. In 
addition, we believe that the OMB's CBSA designations reflect the most 
recent available geographic classifications and are a reasonable and 
appropriate method of defining geographic areas for the purposes of 
wage adjusting the hospice payment rates. We do not see any compelling 
reason to deviate from the OMB designations.
    Comment: A commenter was concerned with the continued use of the 
pre-floor, pre-reclassified hospital wage index to adjust the hospice 
payment rates, because this causes continuing volatility of the hospice 
wage index from one year to the next. The commenter believes that this 
volatility is often based on inaccurate or incomplete hospital cost 
report data.
    Response: We believe that annual changes in the wage index reflect 
real variations in costs of providing care in various geographic 
locations. The wage index values are based on data submitted on the 
inpatient hospital cost reports. We utilize efficient means to ensure 
and review the accuracy of the hospital cost report data and resulting 
wage index. The hospice wage index is derived from the pre-floor, pre-
reclassified wage index, which is calculated based on cost report data 
from hospitals paid under the Inpatient Prospective Payment System 
(IPPS). All IPPS hospitals must complete the wage index survey 
(Worksheet S-3, Parts II and III) as part of their Medicare cost 
reports. Cost reports will be rejected if Worksheet S-3 is not 
completed. In addition, our Medicare contractors perform desk reviews 
on all hospitals' Worksheet S-3 wage data, and we run edits on the wage 
data to further ensure the accuracy and validity of the wage data. We 
believe that our review processes result in an accurate reflection of 
the applicable wages for the areas given.
    In addition, we believe that finalizing our proposal to adopt a 
hospice wage index standardization factor will provide a safeguard to 
the Medicare program as well as to hospices because it will mitigate 
fluctuations in the wage index by ensuring that wage index updates and 
revisions are implemented in a budget neutral manner.
    Comment: A commenter was concerned with the lack of parity between 
different health care sectors, each of which utilizes some form of a 
hospital wage index, that experience differing wage index values for 
specific geographic areas. The commenter also stated that hospital 
reclassifications create labor market distortions in areas in which 
hospice costs are not reclassified.
    Response: Several post-acute care payment systems utilize the pre-
floor, pre-reclassified hospital wage index as the basis for their wage 
indexes (for example, the Home Health Prospective Payment System (HH 
PPS), the Skilled Nursing Facility Prospective Payment System (SNF PPS) 
and the Inpatient Rehabilitation Facility Prospective Payment System 
(IRF PPS)). The statutes that govern hospice payment do not provide any 
discretion to permit a mechanism for allowing hospices to seek 
geographic reclassification. The reclassification provision is found in 
section 1886(d)(10) of the Act. Section 1886(d)(10)(C)(i) of the Act 
states, ``The Board shall consider the application of any subsection 
(d) hospital requesting that the Secretary change the hospital's 
geographic classification . . .'' This provision is only applicable to 
hospitals, as defined at section 1886(d) of the Act. In addition, we do 
not believe that using hospital reclassification data would be 
appropriate as these data are specific to the requesting hospitals and 
the data may or may not apply to a given hospice in a given instance.
    Comment: One commenter requested that CMS modify the wage index so 
that the area wage index applicable to any hospice that is located in 
an urban area of a state may not be less than the area wage index 
applicable to hospices located in rural areas in that State.
    Response: Section 4410(a) of the Balanced Budget Act of 1997 (Pub. 
L. 105-33) provides that the area wage index applicable to any hospital 
that is located in an urban area of a state may not be less than the 
area wage index applicable to hospitals located in rural areas in that 
state. This rural floor provision is specific to hospitals. Because the 
hospital rural floor applies only to hospitals, and not to hospices, we 
continue to believe the use of the previous year's pre-floor and pre-
reclassified hospital wage index results in the most appropriate 
adjustment to the labor portion of the hospice payment rates. This 
position is longstanding and consistent with other Medicare payment 
systems (SNF PPS, IRF PPS, HH PPS, etc.).
    Comment: A commenter requested that CMS explore a wholesale 
revision and reform of the hospice wage index.
    Response: We are exploring other methodologies for future reform of 
the Medicare wage index. CMS' ``Report to Congress: Plan to Reform the 
Medicare Wage Index'' was submitted by the Secretary on April 11, 2012 
and is available on our Wage Index Reform Web page at: https://
www.cms.gov/Medicare/Medicare-Fee-for-Service-

[[Page 52155]]

Payment/AcuteInpatientPPS/Wage-Index-Reform.html.
    Final Action: After considering the comments received in response 
to the proposed rule and for the reasons discussed above, we are 
finalizing our proposal to use the pre-floor, pre-reclassified hospital 
inpatient wage index as the wage adjustment to the labor portion of the 
hospice rates. For FY 2017, the updated wage data are for hospital cost 
reporting periods beginning on or after October 1, 2011 and before 
October 1, 2012 (FY 2012 cost report data).
    The wage index applicable for FY 2017 is available on the CMS Web 
site at http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/Hospice/index.html. As of FY 2012, the wage index values applicable for 
the upcoming fiscal year and subsequent fiscal years are no longer 
published in the Federal Register (77 FR 44242). The hospice wage index 
for FY 2017 will be effective October 1, 2016 through September 30, 
2017.
2. Hospice Payment Update Percentage
    Section 4441(a) of the Balanced Budget Act of 1997 (BBA) amended 
section 1814(i)(1)(C)(ii)(VI) of the Act to establish updates to 
hospice rates for FYs 1998 through 2002. Hospice rates were to be 
updated by a factor equal to the inpatient hospital market basket index 
set out under section 1886(b)(3)(B)(iii) of the Act, minus 1 percentage 
point. Payment rates for FYs since 2002 have been updated according to 
section 1814(i)(1)(C)(ii)(VII) of the Act, which states that the update 
to the payment rates for subsequent FYs must be the inpatient market 
basket percentage for that FY. The Act requires us to use the inpatient 
hospital market basket to determine the hospice payment rate update. In 
addition, section 3401(g) of the Affordable Care Act mandates that, 
starting with FY 2013 (and in subsequent FYs), the hospice payment 
update percentage will be annually reduced by changes in economy-wide 
productivity as specified in section 1886(b)(3)(B)(xi)(II) of the Act. 
The statute defines the productivity adjustment to be equal to the 10-
year moving average of changes in annual economy-wide private nonfarm 
business multifactor productivity (MFP) (as projected by the Secretary 
for the 10-year period ending with the applicable FY, year, cost 
reporting period, or other annual period) (the ``MFP adjustment''). A 
complete description of the MFP projection methodology is available on 
our Web site at: http://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/MedicareProgramRatesStats/MarketBasketResearch.html.
    In addition to the MFP adjustment, section 3401(g) of the 
Affordable Care Act also mandates that in FY 2013 through FY 2019, the 
hospice payment update percentage will be reduced by an additional 0.3 
percentage point (although for FY 2014 to FY 2019, the potential 0.3 
percentage point reduction is subject to suspension under conditions 
specified in section 1814(i)(1)(C)(v) of the Act). The hospice payment 
update percentage for FY 2017 is based on the estimated inpatient 
hospital market basket update of 2.7 percent (based on IHS Global 
Insight, Inc.'s second quarter 2016 forecast with historical data 
through the first quarter of 2016). Due to the requirements at sections 
1886(b)(3)(B)(xi)(II) and 1814(i)(1)(C)(v) of the Act, the estimated 
inpatient hospital market basket update for FY 2017 of 2.7 percent must 
be reduced by a MFP adjustment as mandated by Affordable Care Act 
(currently estimated to be 0.3 percentage point for FY 2017). The 
estimated inpatient hospital market basket update for FY 2017 is 
reduced further by 0.3 percentage point, as mandated by the Affordable 
Care Act. In effect, the hospice payment update percentage for FY 2017 
is 2.1 percent.
    Currently, the labor portion of the hospice payment rates is as 
follows: For RHC, 68.71 percent; for CHC, 68.71 percent; for General 
Inpatient Care, 64.01 percent; and for Respite Care, 54.13 percent. The 
non-labor portion is equal to 100 percent minus the labor portion for 
each level of care. Therefore, the non-labor portion of the payment 
rates is as follows: For RHC, 31.29 percent; for CHC, 31.29 percent; 
for General Inpatient Care, 35.99 percent; and for Respite Care, 45.87 
percent.
    A summary of the comments we received regarding the payment rates 
and our responses to those comments appear below.
    Comment: Several commenters noted their support of the hospice 
payment update percentage.
    Response: We appreciate the comments in support of the hospice 
payment update percentage.
    Comment: One commenter suggested the CMS eliminate the hospice 
payment update percentage to hospice payments for FY 2017, as the 
commenter maintains that payment adequacy for hospice providers is 
generally positive. Other commenters noted that the proposed hospice 
payment update percentage is not sufficient to keep pace with rising 
costs of providing hospice care and suggested that CMS revisit the 
proposed hospice payment update percentage for potential increase.
    Response: The payment update percentage to the hospice rates is 
required by statute, as previously described in detail in this section, 
and we do not have regulatory authority to alter the payment update.
    Final Action: We are implementing the hospice payment update 
percentage as discussed in the proposed rule. Based on IHS Global 
Insight, Inc.'s updated forecast, the hospice payment update percentage 
for FY 2017 will be 2.1 percent for hospices that submit the required 
quality data and 0.1 percent for hospices that do not submit the 
required quality data.
3. FY 2017 Hospice Payment Rates
    There are four payment categories that are distinguished by the 
location and intensity of the services provided. The base payments are 
adjusted for geographic differences in wages by multiplying the labor 
share, which varies by category, of each base rate by the applicable 
hospice wage index. A hospice is paid the RHC rate for each day the 
beneficiary is enrolled in hospice, unless the hospice provides 
continuous home care, IRC, or general inpatient care. CHC is provided 
during a period of patient crisis to maintain the person at home; IRC 
is short-term care to allow the usual caregiver to rest and be relieved 
from caregiving; and General Inpatient Care (GIP) is to treat symptoms 
that cannot be managed in another setting.
    As discussed in the FY 2016 Hospice Wage Index and Payment Rate 
Update final rule (80 FR 47172), we implemented two different RHC 
payment rates, one RHC rate for the first 60 days and a second RHC rate 
for days 61 and beyond. In addition, in the final rule, we adopted a 
Service Intensity Add-on (SIA) payment, when direct patient care is 
provided by a RN or social worker during the last 7 days of the 
beneficiary's life. The SIA payment is equal to the CHC hourly rate 
multiplied by the hours of nursing or social work provided (up to 4 
hours total) that occurred on the day of service. In order to maintain 
budget neutrality, as required under section 1814(i)(6)(D)(ii) of the 
Act, the new RHC rates were adjusted by a SIA budget neutrality factor.
    As discussed in the FY 2016 Hospice Wage Index and Payment Rate 
Update final rule (80 FR 47177), we will continue to make the SIA 
payments budget neutral through an annual determination of the SIA 
budget neutrality factor (SBNF), which will then be applied to the RHC 
payment

[[Page 52156]]

rates. The SBNF will be calculated for each FY using the most current 
and complete FY utilization data available at the time of rulemaking. 
For FY 2017, the budget neutrality adjustment that applies to days 1 
through 60 is calculated to be 1.0000. The budget neutrality adjustment 
that applies to days 61 and beyond is calculated to be 0.9999.
    For FY 2017, we are applying a wage index standardization factor to 
the FY 2017 hospice payment rates in order to ensure overall budget 
neutrality when updating the hospice wage index with more recent 
hospital wage data. Wage index standardization factors are applied in 
other payment settings such as under home health Prospective Payment 
System (PPS), IRF PPS, and SNF PPS. Applying a wage index 
standardization factor to hospice payments will eliminate the aggregate 
effect of annual variations in hospital wage data. We believe that 
adopting a hospice wage index standardization factor will provide a 
safeguard to the Medicare program as well as to hospices because it 
will mitigate fluctuations in the wage index by ensuring that wage 
index updates and revisions are implemented in a budget neutral manner. 
To calculate the wage index standardization factor, we simulated total 
payments using the FY 2017 hospice wage index and compared it to our 
simulation of total payments using the FY 2016 hospice wage index. By 
dividing payments for each level of care using the FY 2017 wage index 
by payments for each level of care using the FY 2016 wage index, we 
obtain a wage index standardization factor for each level of care (RHC 
days 1-60, RHC days 61+, CHC, IRC, and GIP).
    Lastly, the hospice payment rates for hospices that submit the 
required quality data will be increased by the full FY 2017 hospice 
payment update percentage of 2.1 percent as discussed in section 
III.C.3 of this final rule. The FY 2017 RHC rates are shown in Table 
11. The FY 2017 payment rates for CHC, IRC, and GIP are shown in Table 
12.

                                                       Table 11--FY 2017 Hospice RHC Payment Rates
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                              FY 2017
                                                                                                           Wage index         hospice
                 Code                            Description                FY 2016          SBNF        standardization      payment         FY 2017
                                                                         payment rates                       factor           update       payment rates
                                                                                                                            percentage
--------------------------------------------------------------------------------------------------------------------------------------------------------
651..................................  Routine Home Care (days 1-60)..         $186.84        x 1.0000          x 0.9989         x 1.021         $190.55
651..................................  Routine Home Care (days 61+)...          146.83        x 0.9999          x 0.9995         x 1.021          149.82
--------------------------------------------------------------------------------------------------------------------------------------------------------


                            Table 12--FY 2017 Hospice CHC, IRC, and GIP Payment Rates
----------------------------------------------------------------------------------------------------------------
                                                                                      FY 2017
                                                                   Wage index         hospice
           Code                Description          FY 2016      standardization      payment         FY 2017
                                                 payment rates       factor           update       payment rates
                                                                                    percentage
----------------------------------------------------------------------------------------------------------------
652......................  Continuous Home             $944.79          x 1.0000         x 1.021         $964.63
                            Care.
                           Full Rate = 24
                            hours of care..
                           $40.19 = FY 2017
                            hourly rate..
655......................  Inpatient Respite            167.45          x 1.0000         x 1.021          170.97
                            Care.
656......................  General Inpatient            720.11          x 0.9996         x 1.021          734.94
                            Care.
----------------------------------------------------------------------------------------------------------------

    Sections 1814(i)(5)(A) through (C) of the Act require that hospices 
begin submitting quality data, based on measures to be specified by the 
Secretary. In the FY 2012 Hospice Wage Index final rule (76 FR 47320 
through 47324), we implemented a Hospice Quality Reporting Program 
(HQRP), as required by section 3004 of the Affordable Care Act. 
Hospices were required to begin collecting quality data in October 
2012, and submit that quality data in 2013. Section 1814(i)(5)(A)(i) of 
the Act requires that beginning with FY 2014 and for each subsequent 
FY, the Secretary shall reduce the market basket update by 2 percentage 
points for any hospice that does not comply with the quality data 
submission requirements with respect to that FY. The FY 2017 rates for 
hospices that do not submit the required quality data will be updated 
by the FY 2017 hospice payment update percentage of 2.1 percent minus 2 
percentage points. These rates are shown in Tables 13 and 14.

                          Table 13--FY 2017 Hospice RHC Payment Rates for Hospices That DO NOT Submit the Required Quality Data
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                              FY 2017
                                                                                                                              hospice
                                                                                                           Wage index         payment
                 Code                            Description                FY 2016          SBNF        standardization  update of 2.1%      FY 2017
                                                                         payment rates                       factor           minus 2      payment rates
                                                                                                                            percentage
                                                                                                                           points = 0.1%
--------------------------------------------------------------------------------------------------------------------------------------------------------
651..................................  Routine Home Care (days 1-60)..         $186.84        x 1.0000          x 0.9989         x 1.001         $186.82
651..................................  Routine Home Care (days 61+)...          146.83        x 0.9999          x 0.9995         x 1.001          146.89
--------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 52157]]


 Table 14--FY 2017 Hospice CHC, IRC, and GIP Payment Rates for Hospices That DO NOT Submit the Required Quality
                                                      Data
----------------------------------------------------------------------------------------------------------------
                                                                                      FY 2017
                                                                                      hospice
                                                                   Wage index         payment
           Code                Description          FY 2016      standardization  update of 2.1%      FY 2017
                                                 payment rates       factor           minus 2      payment rates
                                                                                    percentage
                                                                                   points = 0.1%
----------------------------------------------------------------------------------------------------------------
652......................  Continuous Home             $944.79          x 1.0000         x 1.001         $945.73
                            Care.
                           Full Rate = 24
                            hours of care..
                           $39.41 = FY 2017
                            hourly rate..
655......................  Inpatient Respite            167.45          x 1.0000         x 1.001          167.62
                            Care.
656......................  General Inpatient            720.11          x 0.9996         x 1.001          720.54
                            Care.
----------------------------------------------------------------------------------------------------------------

    A summary of the comments we received regarding the payment rates 
and our responses to those comments appear below.
    Comment: A commenter asked if the application of the 
standardization factor is premature or is it part of the continued 
progression of hospice reimbursement from hybrid fee-for-service/health 
maintenance organization to a full case-mix or value-based purchasing 
(VBP) system.
    Response: We believe that applying a wage index standardization 
factor to the hospice rates is appropriate. The application of the 
standardization factor will mitigate any potential effects due to the 
annual variations in hospital wage data. Moreover, this approach 
creates a level of protection for the Medicare program as well as to 
hospices, as it minimizes the impacts of any fluctuations in the wage 
index.
    Comment: Several commenters requested that the SIA Payment 
eligibility requirements be modified to include additional hospice 
services, including visits from licensed practical nurses (LPNs), music 
therapists, and other professionals providing care during the last 7 
days of life. In addition, several commenters requested that data be 
collected in order to determine if the SIA Payment increased the number 
of visits during beneficiaries' most intensive time of need for skilled 
care (specifically, the last 7 days of life).
    Response: CMS finalized the SIA payment policy in the FY 2016 
Hospice Wage Index and Payment Update final rule (80 FR 47141) and we 
did not solicit comments on a proposal to modify these policy 
parameters in the FY 2017 Hospice Wage Index and Payment Rate update 
proposed rule (81 FR 25498). However, we will continue to consider and 
monitor for potential refinements to this policy, including current 
monitoring efforts that were described in the FY 2017 Hospice Wage 
Index and Payment Rate Update proposed rule (81 FR 25498) in response 
to these policy changes, and we will take these comments into account 
as we continue to do so.
    Comment: One commenter noted that there have been issues with the 
technical implementation of the SIA payment such that payment 
adjustments are not occurring as originally intended.
    Response: While the technical implementations issues with regards 
to SIA payments have been minimal, we appreciate this comment and are 
working diligently with appropriate stakeholders to expedite the 
appropriate system remediation to ensure accurate payment to providers.
    Comment: One commenter expressed concern that the RHC rate payment 
amount for Days 61 and beyond may lead to payment inadequacy for 
patients with long lengths of stay. One commenter noted that the 
episode gap required by the two RHC rates policy implemented for FY 
2016 could have a negative impact on those hospices that accept 
patients via transfers. Moreover, the commenter noted that CMS should 
consider payment adjustments if a patient is transferred from one 
hospice to another, particularly at or near day 61 of a hospice 
episode.
    Response: We appreciate the comments and the concern for 
appropriate payment for long stay beneficiaries as well as transfer 
patients. The creation of the two RHC rates (one for days 1-60 and a 
another for days 61 and beyond) was finalized in the FY 2016 Hospice 
Wage Index and Payment Rate Update final rule (80 FR 47141), and we did 
not propose any changes for FY 2017 nor did we solicit comments on any 
future changes. In response to public comments, we stated in the FY 
2016 Hospice Wage Index and Payment Rate Update final rule that 
allowing for a higher payment for a new hospice election (or in 
transfer situations) without a gap in hospice care of greater than 60 
days goes against our intent to mitigate the incentive to discharge and 
readmit patients (or transfer patients) at or around day 60 for the 
purposes of obtaining a higher payment (80 FR 47168). With regards to 
the commenter's concern regarding reimbursement for long lengths of 
stay, we refer the commenter to the FY 2016 Hospice Wage Index and 
Payment Rate Update final rule (80 FR 47142), where we discuss the 
rationale for the creation of a higher RHC rate for days 1-60 and a 
lower rate for days 61 and beyond. In that final rule, we noted that 
hospice stays manifest in a `U-Shaped' pattern (that is, the intensity 
of services provided is higher both at admission and near death and, 
conversely, is relatively lower during the middle period of the hospice 
episode). Since hospice care is most profitable during the long, low-
cost middle portions of an episode, longer episodes have very 
profitable, long middle segments (80 FR 47161). Therefore, in order to 
better align hospice payments with service intensity during a hospice 
episode of care, we implemented a higher RHC rate for days 1-60 and a 
lower rate for days 61 and beyond, effective January 1, 2016. We also 
implemented a service intensity add-on (SIA) payment policy that 
reimburses hospices for visits performed during the last 7 days of a 
beneficiary's life (in addition to RHC per diem payments), also 
effective January 1, 2016. We will continue to monitor for and consider 
potential refinements to these policies as appropriate.
    Comment: A commenter noted that Medicaid agencies have encountered 
challenges in the implementation of the payment changes due to hospice 
reform.
    Response: We appreciate this comment and are working diligently 
with appropriate stakeholders and State Agencies to facilitate 
effective implementation of hospice payment reform.
    Final Action: We are implementing the updates to hospice payment 
rates as discussed in the proposed rule.

[[Page 52158]]

4. Hospice Cap Amount for FY 2017
    As discussed in the FY 2016 Hospice Wage Index and Payment Rate 
Update final rule (80 FR 47183), we implemented changes mandated by the 
Improving Medicare Post-Acute Care Transformation Act of 2014 (IMPACT 
Act). Specifically, for accounting years that end after September 30, 
2016 and before October 1, 2025, the hospice cap is updated by the 
hospice payment update percentage rather than using the consumer price 
index for urban consumers (CPI-U). As required by section 
1814(i)(2)(B)(ii) of the Act, the hospice cap amount for the 2016 cap 
year, starting on November 1, 2015 and ending on October 31, 2016, is 
equal to the 2015 cap amount ($27,382.63) updated by the FY 2016 
hospice payment update percentage of 1.6 percent. As such, the 2016 cap 
amount is $27,820.75.
    In the FY 2016 Hospice Wage Index and Payment Rate Update final 
rule (80 FR 47142), we finalized aligning the cap accounting year with 
the federal FY beginning in 2017. Therefore, the 2017 cap year will 
start on October 1, 2016 and end on September 30, 2017. Table 26 in the 
FY 2016 Hospice Wage Index and Payment Rate Update final rule (80 FR 
47185) outlines the timeframes for counting beneficiaries and payments 
during the 2017 transition year. The hospice cap amount for the 2017 
cap year will be $28,404.99, which is equal to the 2016 cap amount 
($27,820.75) updated by the FY 2017 hospice payment update percentage 
of 2.1 percent.
    A summary of public comments and our responses to comments on the 
hospice cap are summarized below:
    Comment: One commenter expressed concerns that the methodology used 
to calculate the hospice cap creates an incentive for rural hospices to 
inflate their utilization of the GIP level of care, as some rural 
hospices may do this to gain higher reimbursement by placing patients 
at the GIP level of care that may not qualify for that level of care.
    Response: The hospice aggregate cap is calculated based on total 
reimbursement across all levels of care. In addition, the hospice 
inpatient cap limits total payments to the hospice for inpatient care 
(general or respite). Total payments are subject to a limitation that 
total inpatient care days for Medicare patients does not exceed 20 
percent of the total days for which patients had elected hospice care. 
We urge providers to adhere to appropriate guidelines with respect to 
the hospice levels of care. We note that in a March 2016 Office of 
Inspector General (OIG) report, OIG found that hospices billed one-
third of GIP stays inappropriately, costing Medicare $268 million in 
2012. According to the report, ``hospices commonly billed for GIP when 
the beneficiary did not have uncontrolled pain or unmanaged symptoms.'' 
(http://oig.hhs.gov/oei/reports/oei-02-10-00491.asp) As such, we will 
continue to monitor the use of the various levels of care in order to 
identify any aberrant or problematic behavior.
    Final Action: We are implementing the changes to the hospice cap 
amount as discussed in the proposed rule.

C. Proposed Updates to the Hospice Quality Reporting Program (HQRP)

1. Background and Statutory Authority
    Section 3004(c) of the Affordable Care Act amended section 
1814(i)(5) of the Act to authorize a quality reporting program for 
hospices. Section 1814(i)(5)(A)(i) of the Act requires that beginning 
with FY 2014 and each subsequent FY, the Secretary shall reduce the 
market basket update by 2 percentage points for any hospice that does 
not comply with the quality data submission requirements for that FY. 
Depending on the amount of the annual update for a particular year, a 
reduction of 2 percentage points could result in the annual market 
basket update being less than 0 percent for a FY and may result in 
payment rates that are less than payment rates for the preceding FY. 
Any reduction based on failure to comply with the reporting 
requirements, as required by section 1814(i)(5)(B) of the Act, would 
apply only for the particular FY involved. Any such reduction would not 
be cumulative or be taken into account in computing the payment amount 
for subsequent FYs. Section 1814(i)(5)(C) of the Act requires that each 
hospice submit data to the Secretary on quality measures specified by 
the Secretary. The data must be submitted in a form, manner, and at a 
time specified by the Secretary.
2. General Considerations Used for Selection of Quality Measures for 
the HQRP
    Any measures selected by the Secretary must be endorsed by the 
consensus-based entity, which holds a contract regarding performance 
measurement, including the endorsement of quality measures, with the 
Secretary under section 1890(a) of the Act. This contract is currently 
held by the National Quality Forum (NQF). However, section 
1814(i)(5)(D)(ii) of the Act provides that in the case of a specified 
area or medical topic determined appropriate by the Secretary for which 
a feasible and practical measure has not been endorsed by the 
consensus-based entity, the Secretary may specify measures that are not 
so endorsed as long as due consideration is given to measures that have 
been endorsed or adopted by a consensus-based organization identified 
by the Secretary. Our paramount concern is the successful development 
of an HQRP that promotes the delivery of high quality healthcare 
services. We seek to adopt measures for the HQRP that promote person-
centered, high quality, and safe care. Our measure selection activities 
for the HQRP take into consideration input from the Measure 
Applications Partnership (MAP), convened by the NQF, as part of the 
established CMS pre-rulemaking process required under section 1890A of 
the Act. The MAP is a public-private partnership comprised of multi-
stakeholder groups convened by the NQF for the primary purpose of 
providing input to CMS on the selection of certain categories of 
quality and efficiency measures, as required by section 1890A(a)(3) of 
the Act. By February 1st of each year, the NQF must provide that input 
to CMS. Input from the MAP is located at http://www.qualityforum.org/Setting_Priorities/Partnership/Measure_Applications_Partnership.aspx. 
We also take into account national priorities, such as those 
established by the National Priorities Partnership at (http://www.qualityforum.org/npp/), the HHS Strategic Plan (http://www.hhs.gov/secretary/about/priorities/priorities.html), the National Strategy for 
Quality Improvement in Healthcare, (http://www.ahrq.gov/workingforquality/nqs/nqs2013annlrpt.htm) and the CMS Quality Strategy 
(https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/QualityInitiativesGenInfo/CMS-Quality-Strategy.html). To 
the extent practicable, we have sought to adopt measures endorsed by 
member organizations of the National Consensus Project (NCP), 
recommended by multi-stakeholder organizations, and developed with the 
input of providers, purchasers and/or payers, and other stakeholders.
3. Policy for Retention of HQRP Measures Adopted for Previous Payment 
Determinations
    For the purpose of streamlining the rulemaking process, we 
finalized our policy in the FY 2016 Hospice Wage Index final rule (80 
FR 47187) that when we adopt measures for the HQRP beginning with a 
payment

[[Page 52159]]

determination year, these measures would automatically be adopted for 
all subsequent years' payment determinations, unless we proposed to 
remove, suspend, or replace the measures. Quality measures would be 
considered for removal by CMS for reasons including, but not limited 
to:
     Measure performance among hospices was so high and 
unvarying that meaningful distinction in improvements in performance 
could no longer be made;
     Performance or improvement on a measure did not result in 
better patient outcomes;
     A measure did not align with current clinical guidelines 
or practice;
     A more broadly applicable measure (across settings, 
populations, or conditions) for the particular topic was available;
     A measure that was more proximal in time to desired 
patient outcomes for the particular topic was available;
     A measure that was more strongly associated with desired 
patient outcomes for the particular topic was available; or
     Collection or public reporting of a measure led to 
negative unintended consequences.
    For any such removal, the public would be given an opportunity to 
comment through the annual rulemaking process. However, if there were 
reason to believe continued collection of a measure raised potential 
safety concerns, we would take immediate action to remove the measure 
from the HQRP and not wait for the annual rulemaking cycle. The 
measures would be promptly removed, and we would immediately notify 
hospices and the public of such a decision through the usual CMS HQRP 
communication channels, including postings and announcements on the CMS 
HQRP Web site, Medicare Learning Network (MLN) eNews communications, 
national provider association calls, and announcements on Open Door 
Forums and Special Open Door Forums. In such instances, the removal of 
a measure would be formally announced in the next annual rulemaking 
cycle.
    To further streamline the rulemaking process, we proposed to codify 
that if measures we are using in the HQRP have non-substantive changes 
in their specifications change as part of their NQF endorsement 
process, we would continue to utilize the measure with their new 
endorsed status in the HQRP. As mentioned previously, quality measures 
selected for the HQRP must be endorsed by the NQF unless they meet the 
statutory criteria for exception under section 1814(i)(5)(D)(ii) of the 
Act. The NQF is a voluntary consensus standard-setting organization 
with a diverse representation of consumer, purchaser, provider, 
academic, clinical, and other healthcare stakeholder organizations. The 
NQF was established to standardize healthcare quality measurement and 
reporting through its consensus measure development process (http://www.qualityforum.org/About_NQF/Mission_and_Vision.aspx). The NQF 
undertakes review of: (a) New quality measures and national consensus 
standards for measuring and publicly reporting on performance, (b) 
regular maintenance processes for endorsed quality measures, (c) 
measures with time-limited endorsement for consideration of full 
endorsement, and (d) ad hoc review of endorsed quality measures, 
practices, consensus standards, or events with adequate justification 
to substantiate the review. Through NQF's measure maintenance process, 
NQF-endorsed measures are sometimes updated to incorporate changes that 
we believe do not substantially change the nature of the measure. 
Examples of such changes could be updated diagnosis or procedure codes, 
changes to exclusions to a particular patient/consumer population, or 
definitions. We believe these types of maintenance changes are distinct 
from more substantive changes to measures. Additionally, since the NQF 
endorsement and measure maintenance process is one that ensures 
transparency, public input, and discussion among representatives across 
the healthcare enterprise,\5\ we believe that the NQF measure 
endorsement and maintenance process itself is transparent, 
scientifically rigorous, and provides opportunity for public input. 
Thus, we proposed to codify at Sec.  418.312 that if the NQF makes only 
non-substantive changes to specifications for HQRP measures in the 
NQF's re-endorsement process, we would continue to utilize the measure 
in its new endorsed status. If NQF-endorsed specifications change and 
we do not adopt those changes, then we would propose the measure as an 
application. An application of a NQF-endorsed quality measure is 
utilized in instances when CMS has identified a need to use a NQF-
endorsed measure in a QRP but need to use it with one or more 
modifications to the quality measure's specifications. These 
modifications pertain to, but are not limited to, one or more of the 
following aspects of a NQF-endorsed quality measure: (a) Numerator, (b) 
denominator, (c) setting, (d) look-back period, (e) calculation period, 
(f) risk adjustment, and (g) revisions to data elements used to collect 
the data required for the measure, etc. CMS may adopt a quality measure 
for the HQRP under section 1814(i)(5)(D)(ii) of the Act, which states, 
``In the case of a specified area or medical topic determined 
appropriate by the Secretary for which a feasible and practical measure 
has not been endorsed by [the NQF], the Secretary may specify a measure 
that is not so endorsed as long as due consideration is given to 
measures that have been endorsed or adopted by a consensus organization 
identified by the Secretary.'' Reasons for not adopting changes in 
measure specifications to a measure may include any of the 
aforementioned criteria in this section, including that the new 
specification does not align with clinical guidelines or practice or 
that the new specification leads to negative unintended consequences. 
Finally, we will continue to use rulemaking to adopt substantive 
updates made by the NQF to the endorsed measures we have adopted for 
the HQRP. We continue to make these determinations about what 
constitutes a substantive versus non-substantive change on a measure-
by-measure basis. A change would be deemed substantive if the intent of 
the measure changes, the facility/setting changes, the data sources 
changes, the level of analysis changes, and/or the measure is removed. 
We will continue to provide updates about changes to measure 
specifications as a result of NQF endorsement or maintenance processes 
through the normal CMS HQRP communication channels, including postings 
and announcements on the CMS HQRP Web site, MLN eNews communications, 
national provider association calls, and announcements on Open Door 
Forums and Special Open Door Forums.
---------------------------------------------------------------------------

    \5\ ``NQF: How Endorsement Happens--National Quality Forum.'' 
2010. 26 Jan. 2016 http://www.qualityforum.org/Measuring_Performance/ABCs/How_Endorsement_Happens.aspx.
---------------------------------------------------------------------------

    Comment: CMS received two comments on our proposal to codify that 
if measures used in the HQRP undergo non-substantive changes as part of 
their NQF re-endorsement process, we would utilize the measure with 
their new endorsed status without going through a new notice-and-
comment rulemaking process. One commenter supported the proposal to 
codify this policy. Another commenter was concerned that CMS's plan to 
adopt non-substantive change(s) approved through the NQF re-endorsement 
process without a notice-and-comment rulemaking process does not allow 
providers and vendors the

[[Page 52160]]

opportunity to provide input on changes to measure specifications. 
Additionally, the commenter also had concerns that adopting non-
substantive changes to measures outside of the rulemaking process would 
limit the ability for hospices and vendors to make necessary changes to 
data collection systems to implement non-substantive updates to 
measures.
    Response: We thank commenters for their support of this proposal, 
and for their concerns raised. We agree that the opportunity for the 
public to provide input on all changes to measure specifications (both 
substantive and non-substantive) is vital to the measure development, 
endorsement, and maintenance process. We also agree with the commenter 
that vendors and the hospice community need ample time to implement 
changes to measure specifications, especially those that would warrant 
updates to Hospice Item Set (HIS) items or technical specifications. We 
would like to reassure commenters that, as stated in this rule, we will 
still propose substantive changes to measure through rulemaking. With 
regard to non-substantive measure changes that could occur as a result 
of the measure maintenance and re-endorsement process, we would like to 
clarify that the NQF processes for endorsement and maintenance of 
measures includes review by an expert Standing Committee, public and 
Member comment periods, Member voting, consideration by the Consensus 
Standards Approval Committee (CSAC), endorsement by the Board of 
Directors, and a 30-day appeals period. The NQF endorsement and 
maintenance (re-endorsement) process allows ample opportunity for NQF 
member and public input, during the measure development, endorsement 
and maintenance phases. We encourage hospices to participate in these 
NQF comment periods to offer their insights about potential impacts of 
changes to measures and measure specifications. We believe that in 
instances of non-substantive changes to measure specifications, 
maximizing the use of NQF opportunities for public input allows us to 
efficiently and expediently adopt non-substantive, but important 
changes to measures. Regarding the commenter's concern about whether 
this policy will allow providers ample time to implement and adopt non-
substantive changes, we would like to point out that when non-
substantive changes put forth by the NQF are adopted, we are not 
required to immediately implement those changes on the date of re-
endorsement by NQF. Once a non-substantive change is endorsed by NQF, 
we will consider the time necessary for providers and vendors to 
implement the change. If newly endorsed non-substantive changes require 
updates to data collection mechanisms (for example, updates to HIS 
specifications) or associated training materials, we will allow ample 
time for providers and vendors to prepare and implement such changes. 
As noted in the rule, we will communicate the endorsement of non-
substantive changes, decisions about whether to adopt non-substantive 
changes, and timeline for implementation of non-substantive changes 
through regular HQRP communication channels. Additionally, CMS welcomes 
comment on any non-substantive changes adopted under this mechanism 
through the appropriate sub-regulatory communication channels, 
including but not limited to: NQF public comment periods held as part 
of endorsement processes, feedback from providers on the Hospice 
Quality HelpDesk, and feedback from the provider community on ODFs and 
SODFs. CMS will make such comments and their responses available to the 
public under the appropriate sub-regulatory communication channels. 
Finally, we would like to note that this policy is consistent with 
similar policies in other QRPs.
    Comment: We received a few comments on our previously finalized 
policy for measure retention. These commenters encouraged CMS's 
continued consideration of whether previously adopted quality measures 
are appropriate for retention in the HQRP. Commenters encouraged CMS to 
eliminate measures that are no longer considered to effectively measure 
quality.
    Response: We thank commenters for their suggestions surrounding 
measure retention and removal. We agree that any quality measures 
proposed and retained in the HQRP should continue to provide meaningful 
data to providers and consumers on quality of care. We regularly 
conduct measure testing activities according to NQF guidelines and the 
Blueprint for the CMS Measures Management System Version 12.0 (https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/MMS/Downloads/Blueprint-120.pdf) to ensure that measures 
continue to demonstrate scientific acceptability (including reliability 
and validity) and meet the goals of the HQRP, which include 
distinguishing performance among hospices and contributing to better 
patient outcomes. As outlined in this section of the rule, we will 
propose a measure for removal if meaningful distinctions in quality of 
care can no longer be made from the measure due to high and unvarying 
performance.
    Final Action: After consideration of the comments, we are codifying 
our policy that once a quality measure is adopted, it be retained for 
use in the subsequent fiscal year payment determinations until 
otherwise stated, as proposed.
4. Previously Adopted Quality Measures for FY 2017 and FY 2018 Payment 
Determination
    As stated in the CY 2013 HH PPS final rule (77 FR 67068 through 
67133), CMS expanded the set of required measures to include additional 
measures endorsed by NQF. We also stated that to support the 
standardized collection and calculation of quality measures by CMS, 
collection of the needed data elements would require a standardized 
data collection instrument. In response, CMS developed, tested, and 
implemented a hospice patient-level item set, the HIS. Hospices are 
required to submit a HIS-Admission record and a HIS-Discharge record 
for each patient admission to hospice since July 1, 2014. In developing 
the standardized HIS, we considered comments offered in response to the 
CY 2013 HH PPS proposed rule (77 FR 41548 through 41573). In the FY 
2014 Hospice Wage Index final rule (78 FR 48257), and in compliance 
with section 1814(i)(5)(C) of the Act, we finalized the specific 
collection of data items that support the following 6 NQF-endorsed 
measures and 1 modified measure for hospice:
     NQF #1617 Patients Treated with an Opioid who are Given a 
Bowel Regimen,
     NQF #1634 Pain Screening,
     NQF #1637 Pain Assessment,
     NQF #1638 Dyspnea Treatment,
     NQF #1639 Dyspnea Screening,
     NQF #1641 Treatment Preferences,
     NQF #1647 Beliefs/Values Addressed (if desired by the 
patient) (modified).
    To achieve a comprehensive set of hospice quality measures 
available for widespread use for quality improvement and informed 
decision making, and to carry out our commitment to develop a quality 
reporting program for hospices that uses standardized methods to 
collect data needed to calculate quality measures, we finalized the HIS 
effective July 1, 2014 (78 FR 48258). To meet the quality reporting 
requirements for hospices for the FY 2016 payment determination and 
each subsequent year, we require regular and ongoing

[[Page 52161]]

electronic submission of the HIS data for each patient admission to 
hospice after July 1, 2014, regardless of payer or patient age (78 FR 
48234 through 48258). We finalized a requirement in the FY 2014 Hospice 
Wage Index final rule (78 FR 48258) that hospice providers collect data 
on all patients to ensure that all patients regardless of payer or 
patient age are receiving the same care and that provider metrics 
measure performance across the spectrum of patients.
    Hospices are required to complete and submit a HIS-Admission and a 
HIS-Discharge record for each patient admission. Hospices failing to 
report quality data via the HIS for patient admissions occurring in 
2016 will have their market basket update reduced by 2 percentage 
points in FY 2018 (beginning in October 1, 2017). In the FY 2015 
Hospice Wage Index final rule (79 FR 50485 through 50487), we finalized 
the proposal to codify the HIS submission requirement at Sec.  418.312. 
The System of Record (SOR) Notice titled ``Hospice Item Set (HIS) 
System,'' SOR number 09-70-0548, was published in the Federal Register 
on April 8, 2014 (79 FR 19341).

                     Table 15--Previously Finalized Quality Measures Affecting the FY 2017 Payment Determination and Subsequent Year
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                     Data submission
            Quality measure               NQF ID#                   Type                            Submission method                   deadlines
--------------------------------------------------------------------------------------------------------------------------------------------------------
Treatment Preferences.................        1641  Process Measure.....................  Hospice Item Set....................  Within 30 days of
Beliefs/Values Addressed..............        1647                                                                               patient admission or
                                                                                                                                 discharge (Event Date).
Pain Screening........................        1634
Pain Assessment.......................        1637
Dyspnea Screening.....................        1639
Dyspnea Treatment.....................        1638
Patients Treated with an Opioid who           1617
 are Given a Bowel Regimen.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Comment: CMS received a comment regarding the retirement of the 
seven day length of stay (LOS) exclusion for six of the care process 
measures currently implemented in the HQRP. This commenter expressed 
concern that in eliminating the LOS exclusion, provider behavior may 
shift towards focusing on completing the HIS requirements and 
compliance at the expense of addressing the needs and preferences of 
imminently dying patients. Additionally, this commenter recommended 
that CMS reconsider eliminating the LOS exclusion or risk adjust for 
hospices with an excessive number of short-stay patients for patients.
    Response: We appreciate the commenters' input on the retirement of 
the LOS exclusion specification for six of the quality measures 
currently implemented in the HQRP. Developing and adopting measures 
that are meaningful and do not lead to negative unintended consequences 
for patients or providers is important to us. At the time the measures 
were developed, technical experts recommended that short patient stays 
be excluded from those measures' denominators for assessing quality of 
care in hospices. However, no national data regarding the implications 
of the LOS exclusion was available to the Technical Expert Panel (TEP) 
at that time. CMS's contractor analyzed data from the HIS to examine 
the implications of the LOS exclusion on hospices' denominator size and 
quality measure (QM) scores. Additionally, this analysis examined the 
timing of when hospices perform the care processes assessed in the 
quality measures. These analyses were conducted using HIS-Admission and 
HIS-Discharge records for stays in July 1, 2014 through March 31, 2015. 
The results of these analyses demonstrated that the denominator sizes 
for the HQRP QMs are largely impacted by the current 7-day LOS 
exclusion used to calculate the QMs. Excluding stays with LOS less than 
7 days prevents some hospices from being included in QM score 
calculations because they do not have any qualifying patient stays. 
Therefore, removing the LOS exclusion criteria will increase the number 
of patients included in the measures, and thus the number of hospices 
that are included in the QM calculation. The impact of the LOS 
exclusions on the distribution of hospices' scores is generally small 
for all of the QMs. In addition, these analyses revealed that the care 
processes targeted by the QMs are performed on the day of, or within 
one day of, admission for the vast majority of patient stays. For 
example, among patient admissions for which a pain screening was 
administered, approximately 92 percent of screenings occurred on the 
day of admission and close to 99 percent occurred within 1 day of 
admission. This suggested that including stays of less than 7 days in 
QM calculations (that is, removing the QM LOS exclusion) could be 
appropriate and would not create a burden on hospices. In response to 
these results, the individual QMs were submitted by the measures' 
stewards to the NQF Palliative Care and End of Life Project for re-
endorsement in February 2016 and received preliminary approval. In sum, 
6 of the 7 current HIS measures that were adopted in the FY 2014 
Hospice Wage Index final rule excluded beneficiaries with a LOS of <7 
days from the denominator. However, since these measures were adopted 
in the HQRP, they have undergone their endorsement maintenance with the 
NQF. As part of the maintenance endorsement, the LOS exclusion for the 
6 HIS measures was proposed for removal. NQF has indicated initial 
support for the removal of the LOS exclusion, and pending NQF 
maintenance endorsement of the previously adopted measures, we 
anticipate that the entire set of the 7 HIS measures will no longer 
exclude any patients with LOS <7 days in future public reporting and 
use in the HQRP. We appreciate the commenters' recommendation to risk 
adjust these measures and will consider this recommendation for future 
measure development efforts.
    Comment: CMS received one comment requesting additional items or 
response options on the HIS V1.00.0 to capture instances where data 
regarding preferences or other care processes captured on the HIS are 
not available for non-verbal patients admitted to hospice who do not 
have a formal caregiver or responsible party available.
    Response: We thank the commenter for their comment. For additional 
information on how to respond to current HIS items when the patient is 
nonverbal and/or a caregiver is unavailable, we refer readers to the 
HIS Manual V1.02 available on the Hospice

[[Page 52162]]

Item Set portion of the CMS HQRP Web site: https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Hospice-Quality-Reporting/Hospice-Item-Set-HIS.html. Specifically, we refer 
readers to the HIS Manual Section F Item-Specific Tips, which specifies 
roles of responsible parties for patients unable to self-report. The 
HIS Manual states that the ``Responsible party'' refers to the legally 
responsible or authorized individual, such as the Health Care Power of 
Attorney or legal guardian. In the rare cases where there is no legal 
guardian or power of attorney identified, the hospice should use state 
law guidance to identify the appropriate surrogate decision-maker. 
Other items that require patient or caregiver input, such as the pain 
assessment items, can be completed for nonverbal patients using the 
nonverbal assessment processes described in the HIS Manual.
5. Proposed Removal of Previously Adopted Measures
    As mentioned in section III.C.3, a measure that is adopted and 
implemented in the HQRP will be adopted for all subsequent years, 
unless the measure is proposed for removal, suspension, or replacement 
by CMS. Policies and criteria for removing a measure include those 
mentioned in section III.C.3 of this proposed rule. CMS is not 
proposing to remove any of the current HQRP measures at this time. Any 
future proposals regarding removal, suspension, or replacement of 
measures will be proposed in this section of future rules.
6. Proposed New Quality Measures for FY 2019 Payment Determinations and 
Subsequent Years and Concepts Under Consideration for Future Years
a. Background and Considerations in Developing New Quality Measures for 
the HQRP
    As noted in section III.C.2 of this proposed rule, CMS's paramount 
concern is to develop quality measures that promote care that is 
person-centered, high quality, and safe. In identifying priority areas 
for future measure enhancement and development, CMS takes into 
consideration input from numerous stakeholders, including the MAP, the 
MedPAC, Technical Expert Panels (TEP), and national priorities, such as 
those established by the National Priorities Partnership, the HHS 
Strategic Plan, the National Strategy for Quality Improvement in 
Healthcare, and the CMS Quality Strategy. In addition, CMS takes into 
consideration vital feedback and input from research published by our 
payment reform contractor, as well as important observations and 
recommendations contained in the Institute of Medicine (IOM) report, 
titled ``Dying in America,'' released in September 2014.\6\ Finally, 
the current HQRP measure set is also an important consideration for 
future measure development areas; future measure development areas 
should complement the current HQRP measure set, which includes HIS 
measures and Consumer Assessment of Healthcare Providers and Systems 
(CAHPS[supreg]) Hospice Survey measures.
---------------------------------------------------------------------------

    \6\ IOM (Institute of Medicine). 2014. Dying in America: 
Improving quality and honoring individual preferences near the end 
of life. Washington, DC: The National Academies Press.
---------------------------------------------------------------------------

    As stated in the FY 2016 Hospice Wage Index final rule (80 FR 
47188), based on input from stakeholders, CMS identified several high 
priority areas for future measure development, including: A patient 
reported pain outcome measure; claims-based measures focused on care 
practices patterns, including skilled visits in the last days of life; 
responsiveness of the hospice to patient and family care needs; and 
hospice team communication and care coordination. Of the aforementioned 
measure areas, CMS has pursued measure development for two quality 
measures: Hospice Visits when Death is Imminent Measure Pair, and 
Hospice and Palliative Care Composite Process Measure-Comprehensive 
Assessment at Admission. These measures were included in CMS' List of 
Measures under Consideration (MUC) list for 2015 and discussed at the 
MAP meeting on December 14 and 15, 2015. All materials related to the 
MUC list and the MAP's recommendations for each measure can be found on 
the National Quality Forum Web site, MAP Post-Acute Care/Long-Term Care 
Workgroup Web page at: http://www.qualityforum.org/ProjectMaterials.aspx?projectID=75370. The MAP supported the direction 
of each proposed measure.
    Comment: Many comments were received about the HQRP quality 
measures and concepts under consideration for future years. Overall, 
commenters were supportive of CMS's efforts to develop a more robust 
quality reporting program that includes development of two new quality 
measures, the Hospice Visits when Death is Imminent Measure Pair, and 
Hospice and Palliative Care Composite Process Measure-Comprehensive 
Assessment at Admission. In addition to the two measures we proposed, 
regarding measure development in future years, commenters urged CMS to 
focus on meaningful quality measures and encouraged CMS to move towards 
the development of outcome measures. Several commenters noted the 
complexities associated with developing outcomes measures. These 
commenters also recommended that CMS conduct regular measure testing 
activities to ensure that all measures currently implemented in the 
HQRP are relevant and meaningful to providers and consumers. Finally, 
some commenters recommended the development of future measures of 
hospice live discharge rates. Commenters believe that such measures 
could contribute to quality information and hospice performance.
    Response: We appreciate the commenters' input and recommendations 
for future measure development areas for the HQRP. We plan to continue 
developing the HQRP to respond to the measure gaps identified by the 
MAP and others, and align measure development with the National Quality 
Strategy and the CMS Quality Strategy. We will take these comments into 
consideration in developing and implementing measures for future 
inclusion in the HQRP. We would like to assure commenters that we are 
pursuing opportunities related to the development of live-discharge 
measures through environmental scans, public engagement, and 
participation in special topic panels. We would also like to assure 
commenters that for all measures implemented in the HQRP, we regularly 
conduct measure testing activities according to the Blueprint for the 
CMS Measures Management System Version 12.0 (https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/MMS/Downloads/Blueprint-120.pdf). This ensures that measures continue to 
demonstrate scientific acceptability (including reliability and 
validity) and meet the goals of the HQRP, which include distinguishing 
performance among hospices and contributing to better patient outcomes. 
If measure testing activities reveal that a measure meets one of the 
conditions for removal that is listed in the proposed rule (measure 
performance among hospices high and unvarying, performance or 
improvement in a measure does not result in better patient outcomes, 
etc.), the measure will be considered for removal from the HQRP to 
avoid unintended consequences and to ensure that providers' data 
collection efforts are meaningful and are contributing to quality of 
care. Finally, we would like to assure commenters that we continue to 
explore opportunities to pursue

[[Page 52163]]

hospice outcome measures, and we appreciate the commenters' support for 
such development efforts.
b. New Quality Measures for the FY 2019 Payment Determination and 
Subsequent Years
    We proposed two new quality measures for the HRQP for the FY 2019 
payment determination and subsequent years: Hospice Visits when Death 
is Imminent Measure Pair, and Hospice and Palliative Care Composite 
Process Measure-Comprehensive Assessment at Admission.
(1) Proposed Quality Measure 1: Hospice Visits When Death Is Imminent 
Measure Pair
    Measure Background. This measure set addresses whether a hospice 
patient and their caregivers' needs were addressed by the hospice staff 
during the last days of life. This measure is specified as a set of 2 
measures. Measure 1 assesses the percentage of patients receiving at 
least 1 visit from registered nurses, physicians, nurse practitioners, 
or physician assistants in the last 3 days of life. Measure 2 assesses 
the percentage of patients receiving at least 2 visits from medical 
social workers, chaplains or spiritual counselors, licensed practical 
nurses, or hospice aides in the last 7 days of life. Measure 1 
addresses case management and clinical care, while Measure 2 gives 
providers the flexibility to provide individualized care that is in 
line with the patient, family, and caregiver's preferences and goals 
for care and contributing to the overall well-being of the individual 
and others important in their life.
    Measure Importance. The last week of life is typically the period 
in the terminal illness trajectory with the highest symptom burden. 
Particularly during the last few days before death, patients experience 
myriad physical and emotional symptoms, necessitating close care and 
attention from the integrated hospice team. Hospice responsiveness 
during times of patient and caregiver need is an important aspect of 
care for hospice consumers. In addition, clinician visits to patients 
at the end of life have been demonstrated to be associated with 
improved outcomes such as decreased risk of hospitalization, emergency 
room visits, hospital deaths, decreased distress for caregivers, and 
higher satisfaction with care.
    Several organizations and panels have identified care of the 
imminently dying patient as an important domain of palliative and 
hospice care and established guidelines and recommendations related to 
this high priority aspect of healthcare that affects a large number of 
people. The NQF 2006 report A Framework for Preferred Practices for 
Palliative Care Quality \7\ and the NCP Clinical Practice Guidelines 
for Quality Palliative Care \8\ recommend that signs and symptoms of 
impending death are recognized, communicated and educated, and care 
appropriate for the phase of illness is provided. The American College 
of Physicians Clinical Practice Guidelines \9\ recommend that 
clinicians regularly assess pain, dyspnea, and depression for patients 
with serious illness at the end of life. These measures address this 
high priority area by assessing hospice staff visits to patients and 
caregivers during the final days of life when patients and caregivers 
typically experience higher symptom and caregiving burdens, and 
therefore a higher need for care.
---------------------------------------------------------------------------

    \7\ National Quality Forum. A National Framework and Preferred 
Practices for Palliative and Hospice Care Quality. 2006; Available 
from: http://www.qualityforum.org/publications/2006/12/A_National_Framework_and_Preferred_Practices_for_Palliative_and_Hospice_Care_Quality.aspx.
    \8\ National Consensus Project, Clinical Practice Guidelines for 
Quality Palliative Care. 3rd edition. 2013, National Consensus 
Project: Pittsburgh, PA.
    \9\ Qaseem, A., et al., Evidence-Based Interventions to Improve 
the Palliative Care of Pain, Dyspnea, and Depression at the End of 
Life: A Clinical Practice Guideline from the American College of 
Physicians. Annals of Internal Medicine, 2008. 148(2): p. 141-146.
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    Measure Impact. The literature shows that health care providers' 
practice is responsive to quality measuring and reporting.\10\ CMS 
feels this research, while not specific to hospices, reasonably 
predicts the effect of measures on hospice provider behavior. 
Collecting information about hospice staff visits for measuring quality 
of care, in addition to the requirement of reporting visits from some 
disciplines on hospice claims, will encourage hospices to visit 
patients and caregivers and provide services that will address their 
care needs and improve quality of life during the patients' last days 
of life.
---------------------------------------------------------------------------

    \10\ Werner, R., E. Stuart, and D. Polsky, Public reporting 
drove quality gains at nursing homes. Health Affairs, 2010. 29(9): 
p. 1706-1713.
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    Performance Gap. The 2014 Abt Medicare Hospice Payment Reform 
Report indicated that 28.9 percent of Routine Home Care hospice 
patients did not receive a skilled visit on the last day of life.\11\ 
The Report defines a `skilled visit' as a visit from a nurse, social 
worker, or therapist. This percentage could be, in part, a result of 
rapid decline and unexpected death. The report revealed variation in 
receipt of visits at the end of life related to multiple factors. 
Patients who died on a weekday rather than a weekend, patients with a 
very short length of stay (5 days or less), and patients aged 84 and 
younger were more likely to receive a skilled visit in the last 2 days 
of life. Smaller hospices and hospices in operation for 5 years or less 
were slightly less likely to provide a visit at the end of life. States 
with the lowest rates of no visits in the last days of life were some 
of the more rural states (ND, WI, TN, KS, VT), whereas states with the 
highest rates of no visits were more urban (NJ, MA, OR, WA, MN).
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    \11\ Plotzke, M., et al., Medicare Hospice Payment Reform: 
Analyses to Support Payment Reform. May 2014, Abt Associates Inc. 
Prepared for Centers for Medicare and Medicaid Services: Cambridge, 
MA.
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    Existing Measures. This quality measure set will fill a gap by 
addressing hospice care provided at the end of life. No current HQRP 
measures address care beyond the hospice initial and comprehensive 
assessment period, nor do any current HQRP measures relate to the 
assessment of hospice staff visits to patients and caregivers in the 
last week of life.
    Stakeholder Support. A TEP convened by our measure development 
contractor, RTI International, on May 7 and 8, 2015, provided input on 
the measure concept. The TEP agreed that hospice visits when death is 
imminent is an important concept to measure and supported data 
collection using the HIS. A second TEP was convened October 19 and 21, 
2015, to provide input on the technical specifications of this quality 
measure pair. The TEP supported development of a measure set rather 
than a single measure, using different timeframes to measure the 
different types of care provided, and limiting the measures to patients 
receiving routine home care. The NQF MAP met on December 14 and 15, 
2015, and provided input to CMS. The MAP encouraged continued 
development of the Hospice Visits when Death is Imminent Measure Pair 
in the HQRP. More information about the MAP's recommendations for this 
measure is available at http://www.qualityforum.org/ProjectMaterials.aspx?projectID=75370. While this measure is not 
currently NQF endorsed, we recognize that the NQF endorsement process 
is an important part of measure development and plan to submit this 
measure pair for NQF endorsement.
    Form, Manner, and Timing of Data Collection and Submission. Data 
for this measure would be collected via the existing data collection 
mechanism, the HIS. CMS has proposed that 4 new items be added to the 
HIS-Discharge record to collect the necessary data elements for this 
measure. CMS expects that data collection for this quality

[[Page 52164]]

measure via the 4 new HIS items would begin no earlier than April 1, 
2017. Thus, under current CMS timelines, hospice providers would begin 
data collection for this measure for patient admissions and discharges 
occurring after April 1, 2017. Prior to the release of the new HIS data 
items, CMS will provide education and training to hospice providers to 
ensure all providers have adequate information and guidance to collect 
and submit data on this measure to CMS.
    Since the data collection mechanism is the HIS, providers would 
collect and submit data using the same processes that are outlined in 
sections III.C.7c through III.C.7e of this rule. In brief, processes in 
section III.C.7c through III.C.7e specify that data for the measure 
would be submitted to the Quality Improvement and Evaluation System 
(QIES) Assessment Submission and Processing (ASAP) system, in 
compliance with the timeliness criterion and threshold set out in 
sections III.C.7c through III.C.7e.
    For more information on the specifications and data elements for 
the measure set, Hospice Visits when Death is Imminent, we refer 
readers to the HQRP Specifications for the Hospice Item Set-based 
Quality Measures document, available on the ``Current Measures'' 
portion of the CMS HQRP Web site: https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Hospice-Quality-Reporting/Current-Measures.html. In addition, to facilitate the reporting of HIS 
data as it relates to the implementation of the new measure, we 
submitted a request for approval to OMB for the Hospice Item Set 
version 2.00.0 under the Paperwork Reduction Act (PRA) process. The new 
HIS data items that would collect this measure data are also available 
for public viewing in the PRA package available at: https://www.cms.gov/Regulations-and-Guidance/Legislation/PaperworkReductionActof1995/PRA-Listing.html.
    We received multiple comments pertaining to the Hospice Visits when 
Death is Imminent Measure Pair. The following is a summary of the 
comments we received on this topic and our responses:
    Comment: We received many comments in support of our proposal to 
implement the Hospice Visits when Death is Imminent Measure Pair. 
Commenters emphasized the importance of visits at the end of life, and 
stated that this measure pair would provide a valuable measure of 
quality. Commenters also stated that they expect this measure will 
improve quality of life during patients' final days and that this 
measure could be useful to patients, families, and the Medicare 
program. One commenter said that hospice nurses are often aware when 
death is imminent because they are skilled at recognizing the final 
stages of a terminal condition, and that most individuals and families 
are aided and reassured by visits from some disciplines at the end of 
life.
    Response: We thank the commenters for their support of the Hospice 
Visits when Death is Imminent Measure Pair in the HQRP. We agree that 
visits at the end of life are an important component of hospice care 
and that this measure can help to drive holistic, patient centered 
quality improvement. We believe that this information will be useful to 
consumers, providers, and payers.
    Comment: Some commenters questioned whether the Hospice Visits when 
Death is Imminent Measure Pair would foster better quality for hospice 
care patients and requested evidence-based research showing the link 
between hospice visits and quality. One commenter emphasized the 
important role that hospices play in helping prepare patients and 
caregivers for the end of life, and stated that if hospices provide 
high quality preparation, then patients and families may need fewer 
visits at the end of life. The commenter stated that a focus on visits 
at the end of life may take focus away from empowering patients and 
caregivers. One commenter stated that, as a process measure, this 
measure pair does not adequately reflect high quality care, and urged 
CMS to conduct further testing of the measure. One commenter cautioned 
that, while sociodemographic differences in receipt of visits may 
appear to indicate differences in quality, one must also take into 
consideration possible differences in religious beliefs and cultural 
values that may affect desire for visits. One commenter noted that 
these measures alone might not be representative of the quality of care 
that hospice beneficiaries and their families receive.
    Response: We thank the commenters for their feedback. We are 
committed to the ensuring that all quality measures implemented in the 
HQRP meet the goals of the program, which include distinguishing 
performance among hospices and contributing to better patient outcomes.
    We believe that provision of hospice visits at the end of life is 
an important component of high quality hospice care for most patients. 
The last week of life is typically the period in the terminal illness 
trajectory with the highest symptom burden and the literature supports 
hospice visits when death is imminent as a high priority in end-of-life 
care. Clinician visits to patients at the end of life have been 
demonstrated to be associated with improved outcomes such as decreased 
risk of hospitalization, emergency room visits, and hospital death; and 
higher satisfaction with care.\12\ \13\ \14\ Measurements of visits at 
the end of life are already used in the literature as quality 
indicators for end of life or hospice care.\15\ \16\ \17\ Studies 
focusing on the expectations of patients and families also demonstrate 
the importance of care and attention from the hospice team in the days 
leading up to death. Caregivers of dying patients agree overwhelmingly 
with the importance of preparation at the end of life. Hospice 
assistance, ranging from legal to logistical to emotional, is paramount 
in preparing hospice patients and their families for imminent 
death.\18\ Bereaved family members and friends from a variety of 
settings identified the provision of physical comfort and emotional 
support to dying patients and their families as fundamental aspects of 
high-quality care.\19\
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    \12\ Seow, H., Barbera, L., Howell, D., & Dy, S. M. (2010). 
Using more end-of-life homecare services is associated with using 
fewer acute care services: a population-based cohort study. Med 
Care, 48(2), 118-124. doi:10.1097/MLR.0b013e3181c162ef.
    \13\ Almaawiy, U., Pond, G. R., Sussman, J., Brazil, K., & Seow, 
H. (2014). Are family physician visits and continuity of care 
associated with acute care use at end-of-life? A population-based 
cohort study of homecare cancer patients. Palliat Med, 28(2), 176-
183. doi:10.1177/0269216313493125.
    \14\ Pivodic, L., Harding, R., Calanzani, N., McCrone, P., Hall, 
S., Deliens, L. & Gomes, B. (2015). Home care by general 
practitioners for cancer patients in the last 3 months of life: An 
epidemiological study of quality and associated factors. Palliat 
Med. doi:10.1177/0269216315589213.
    \15\ Barbera, L., Seow, H., Sutradhar, R., Chu, A., Burge, F., 
Fassbender, K., . . . Potapov, A. (2015). Quality Indicators of End-
of-Life Care in Patients With Cancer: What Rate Is Right? J Oncol 
Pract, 11(3), e279-287. doi:10.1200/jop.2015.004416.
    \16\ Gandhi, S. O. (2012). Differences between non-profit and 
for-profit hospices: patient selection and quality. Int J Health 
Care Finance Econ, 12(2), 107-127. doi:10.1007/s10754-012-9109-y.
    \17\ Lorenz, K. A., Ettner, S. L., Rosenfeld, K. E., Carlisle, 
D. M., Leake, B., & Asch, S. M. (2002). Cash and compassion: profit 
status and the delivery of hospice services. J Palliat Med, 5(4), 
507-514. doi:10.1089/109662102760269742.
    \18\ Steinhauser, K. E., Christakis, N. A., Clipp, E. C., 
McNeilly, M., McIntyre, L., & Tulsky, J. A. (2000). Factors 
considered important at the end of life by patients, family, 
physicians, and other care providers. Jama, 284(19), 2476-2482.
    \19\ Steinhauser, K. E., Christakis, N. A., Clipp, E. C., 
McNeilly, M., McIntyre, L., & Tulsky, J. A. (2000). Factors 
considered important at the end of life by patients, family, 
physicians, and other care providers. Jama, 284(19), 2476-2482.
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    The literature shows that health care providers' practices are 
responsive to

[[Page 52165]]

quality measurement and reporting.\20\ We believe that this research, 
while not specific to hospices, reasonably predicts the effect of 
measures on hospice provider behavior. Collecting information about 
hospice staff visits for measuring quality of care, in addition to the 
requirement of reporting visits from some disciplines on hospice 
claims, will encourage hospices to visit patients and caregivers and 
provide services that will address their care needs and improve quality 
of life during the patients' last days of life. While we agree that a 
greater number of visits does not always indicate higher quality care, 
based on the published literature and expert input, we believe that 
most patients benefit from some visits near the end of life. For this 
reason, this measure set is specified to measure receipt of at least 1 
clinician visit (Measure 1) and at least 2 visits from other staff 
(Measure 2), rather than measuring the total number of visits. A TEP 
held in October 19 and 21, 2015, by our contractor agreed that a 
measure of patients receiving at least a minimum number of visits would 
be a better indicator of quality than a measure of the total number of 
visits provided.
---------------------------------------------------------------------------

    \20\ Werner, R., E. Stuart, and D. Polsky, Public reporting 
drove quality gains at nursing homes. Health Affairs, 2010. 29(9): 
p. 1706-1713.
---------------------------------------------------------------------------

    We agree with the commenter that this measure pair alone may not 
provide a full representation of the quality of care that hospices 
provide. The previously finalized measures in the HQRP address care 
processes at admission, and the Hospice CAHPS survey examines caregiver 
experience retrospectively. This measure pair fills an important gap in 
the HQRP by providing a measure of quality of care provided near the 
time of death, and it is intended to be interpreted along with the 
other measures in the HQRP to reflect quality of care provided by 
hospices across several domains of care that are important to patients 
and other stakeholders. CMS also plans to analyze the relationship 
between this quality measure pair and other quality measures to support 
the validity of this measure pair (that is, the measure reflects true 
quality of care).
    Comment: One commenter expressed concern that the results of the 
Hospice Visits when Death is Imminent Measure Pair may be 
mischaracterized once they are publicly reported, if appropriate 
disclaimers are absent from the information provided. Another commenter 
requested that CMS remind measure users that patients/families have the 
right to decline services and that those declinations should not be 
considered an ``under-service'' by the hospice provider.
    Response: We thank the commenters for their feedback regarding 
interpreting these measures. We agree that it is important to educate 
both providers and consumers on how to use and interpret these quality 
measures. Prior to public reporting of this measure, we will provide 
resources through the Hospice Compare Web site to aid consumers in 
interpreting the quality metrics reported there. CMS has carefully 
considered usability by consumers throughout the measure development 
process. The measure specifications take into account usability 
feedback from a TEP, caregiver workgroup, and clinical user panel. We 
recognize that some patients may decline services and that rapid and 
unanticipated patient declines do occur; thus, a score of 100% is not 
the expectation for this measure pair.
    Comment: Some commenters stated that it is not always known when a 
patient's death is imminent. One commenter stated that there is not 
always an opportunity for hospices to provide the visits specified in 
this measure set if a patient experiences a rapid and unanticipated 
decline.
    Response: We understand that it is not always possible to 
accurately predict time of death. However, the last week of life is 
typically the period in the terminal illness trajectory with the 
highest symptom burden, especially during the last few days before 
death. We recognize that rapid and unanticipated patient declines do 
occur; thus, a score of 100 percent is not the expectation for this 
measure pair. We do expect that hospices delivering high quality care 
will be responsive to the patient and caregiver needs that arise during 
the last days of a patient's life. In order to address performance gaps 
in this measure, providers may be motivated to proactively assess 
symptom burden, resulting in improved symptom management and higher 
quality of life during the final days.
    Comment: We received some comments related to the structure of the 
Hospice Visits when Death is Imminent Measure Pair and intent of each 
measure. Some comments indicated that commenters might have 
misinterpreted the intent of this measure pair. For example, one 
commenter stated that adoption of this measure pair would in fact 
create three visit metrics, and another commenter referenced the 
calculation of a composite measure for visits at the end of life. Some 
commenters interpreted the specifications as not including visits 
addressing spiritual or psychosocial suffering in the 3 days before 
death.
    Some commenters requested clarification of the calculation of each 
of these measures and of the disciplines included in each. One 
commenter recommended that Measure 1 and Measure 2 be combined into one 
measure in order to streamline data collection. One commenter requested 
that RN visits be included in both Measure 1 and Measure 2 since some 
interventions to manage symptoms may only be provided by an RN.
    Response: We wish to clarify the intent of this measure pair. The 
Hospice Visits when Death is Imminent Measure Pair will be calculated 
and reported as two separate measures. These measures are intended to 
be interpreted as a set. For more information on the specifications and 
data elements for the measure set, Hospice Visits when Death is 
Imminent Measure Pair, we refer readers to the HQRP Specifications for 
the Hospice Item Set-based Quality Measures document, available on the 
``Current Measures'' portion of the CMS HQRP Web site: https://www.cms.gov/Medicare/Quality-Initiatives-PatientAssessment-Instruments/HospiceQuality-Reporting/CurrentMeasures.html.
    The two measures are intended to capture distinct aspects of 
hospice care at the end of life. The inclusion of registered nurses, 
physicians, nurse practitioners, and physician assistants in Measure 1 
is intended to capture the range of clinical disciplines that might 
visit a patient, depending on patient and hospice preferences, and uses 
a 3-day timeframe to reflect the active dying phase. The inclusion of 
medical social workers, chaplains or spiritual counselors, licensed 
practical nurses, and hospice aides in Measure 2 is intended to allow 
for flexible and individualized care in line with patient, family, and 
caregiver preferences. The 7-day time frame covers both the active 
dying phase and the transition period before, and thus could also 
capture important visits related to preparation for active dying. To 
clarify, the 7-day time frame is inclusive of the 3 days prior to 
death. Data collection is conducted at the discipline level in order to 
provide us with sufficient information to conduct reliability and 
validity testing and possible future measure refinement.
    Comment: We received some comments regarding the types of visits 
included in the Hospice Visits when Death is Imminent Measure Pair. 
Some commenters requested that all visits on the date of death be 
included in the measures, including postmortem visits, as this is an 
important service that hospices provide. One commenter

[[Page 52166]]

recommended that a new, separate measure could look at postmortem 
visits. Some commenters requested that phone calls or videoconferencing 
be included in the measures. One commenter stated that phone calls may 
be an especially important form of contact in rural areas. A few 
commenters requested clarification of the definition of a visit counted 
for quality purposes, and one inquired what visit duration is expected.
    Response: We thank the commenters for their feedback regarding the 
types of visits included in this measure pair. We agree that post 
mortem and bereavement visits are an important service for hospices to 
provide. However, we believe that these services are outside the scope 
of this quality measure pair, which focusses specifically on visits 
when death is imminent. These visits provided shortly prior to death 
are intended to address the increased symptom burden many patients 
experience when death is imminent and provide an opportunity for 
proactive assessment and communication.
    We recognize that some providers use phone calls to supplement care 
provided in person and that these calls can be helpful in facilitating 
ongoing care and communication. However, in agreement with a TEP and 
based on the available evidence, we consider these calls as a 
supplement to, and not a replacement for, in-person care, particularly 
when death is imminent. For this reason, phone calls are not included 
in the definition of a visit for this measure pair. Prior to 
implementation of the HIS V2.00.0, we will provide hospices with 
guidance and training materials, including an updated version of the 
HIS Manual. These training materials will further clarify the types of 
visits included in this measure pair and other item coding information.
    Comment: We received many comments regarding the disciplines 
included in each of the Hospice Visits when Death is Imminent measures. 
One commenter stated that this measure pair recognizes the value of the 
core interdisciplinary team members and maintains a holistic approach 
to care. Many commenters supported the inclusion of chaplains or 
spiritual counselors and aides in Measure 2, as they play an important 
role in the interdisciplinary team. Some commenters encouraged CMS to 
conduct further research on the types of visits provided at the end of 
life and present a clear rationale for inclusion or exclusion from this 
measure. One commenter recommended that both measures be amended to 
include any member of the hospice's interdisciplinary team.
    Many commenters requested that visits from volunteers be included 
in Measure 2. The commenters pointed out that the use of volunteers is 
a Medicare requirement for hospices, and that volunteers play an 
important role in the delivery of hospice care. One commenter indicated 
that it might be burdensome to report data on volunteer visits, but 
that inclusion of volunteers would be valuable. A couple of commenters 
requested that visits from music therapists or massage therapists be 
included in Measure 2.
    Several commenters noted that although physician assistant (PA) 
visits are included in this quality measure pair, this discipline is 
not identified by CMS as a core or non-core service of a hospice 
provider. Some of these commenters requested that PA visits be removed 
from the measure in order to align with the Conditions of Participation 
and Medicare payment practices. Some of these commenters supported the 
inclusion of PAs and recommended that their role be clarified. One 
commenter stated that since the use of PAs is limited, inclusion of PA 
visits would negatively skew the data.
    One commenter noted that a Licensed Practicing Nurse's (LPN) scope 
of practice varies from state to state, and asked that CMS consider 
removing LPN visits from the measure to make the measure more uniform 
nation-wide. One commenter expressed appreciation for the inclusion of 
LPNs and stated that the discipline is frequently used.
    Some commenters requested that bereavement coordinator or 
bereavement counselor visits be included in this measure pair. One 
commenter requested clarification of whether a visit from a provider 
contracted but not employed by a hospice program would be considered a 
visit under this measure pair.
    Response: We thank the commenters for their support of the 
disciplines included in this measure, including chaplains or spiritual 
counselors and aides. This measure pair is designed to allow hospices 
flexibility to determine the most appropriate discipline or disciplines 
to visit a patient. The inclusion of registered nurses, physicians, 
nurse practitioners, and physician assistants in Measure 1 is intended 
to capture the range of clinical disciplines that might visit a 
patient, depending on patient and family preferences and emerging care 
needs in the last days of life. Similarly, the inclusion of medical 
social workers, chaplains or spiritual counselors, licensed practical 
nurses, and hospice aides in Measure 2 is intended to allow for 
flexible and individualized care in line with patient, family, and 
caregiver preferences. This measure is not intended to require visits 
from any given discipline, but aims to allow flexibility in the types 
of visits provided. The Hospice Conditions of Participation state that 
the interdisciplinary group must include, but is not limited to, a 
doctor of medicine or osteopathy, a registered nurse, a social worker, 
and a pastoral or other counselor. Visits from all of these disciplines 
are included in this measure pair, as well as from some additional 
disciplines. We have carefully researched the topic of which 
disciplines to include in this measure pair, including an environmental 
scan, pilot test of this measure in summer 2015, TEP discussions on May 
7 and 8, 2015, and October 19 and 21, 2015, and input from our Clinical 
Users Panel and Caregiver Workgroup.
    Regarding volunteer visits, we agree that volunteers play an 
important role in high quality hospice care and that their visits are 
important to patients and families. Visits from volunteers were 
included in an early version of this measure, which pilot tested for 
feasibility in summer 2015. Many of the hospices included in the pilot 
had trouble reporting data on visits from volunteers because the 
records of volunteer visits were often stored in a separate system and 
were frequently delayed. The data was unreliable, and hospices reported 
significant reporting burden. This topic was discussed with the TEP, 
held October 19 and 21, 2015. After reviewing the results from the 
pilot test and thoroughly discussing the issues, the TEP members did 
not support including visits from volunteers in this measure pair. For 
the same reasons, the TEP advised against including complementary and 
alternative therapists such as music or massage therapists in this 
measure pair, though they do provide important services.
    Regarding physician assistant visits, although Medicare does not 
provide separate payments for visits from physician assistants, these 
services would be covered under the hospice per diem. Additionally, 
this measure is an all-payer measure and some states and other programs 
may authorize physician assistants to provide hospice care under 
separate payments. This measure pair is separate from payment and 
should focus on services provided by hospices and not be restricted by 
the terms of payment by Medicare. Therefore, the inclusion of physician 
assistants in the

[[Page 52167]]

measure specifications provides the flexibility for hospices that may 
have physician assistants to count these clinical visits as part of 
Measure 1. We wish to clarify that the absence of physician assistant 
visits will not negatively skew the data reported in this measure. 
Visits from physician assistants are one of the options included in 
Measure 1, but patients will also be included in the numerator of the 
measure if they receive a visit from a registered nurse, physician, or 
nurse practitioner.
    We thank the commenters for their feedback regarding the inclusion 
of LPNs in Measure 2. Members of our TEP agreed that LPNs provide an 
important service in hospice care that is distinct from the role of 
RNs. For this reason, we have included visits from LPNs in Measure 2 of 
this measure pair.
    We appreciate the commenters' recommendations to include 
bereavement coordinators, and agree that visits from these disciplines 
are important for many patients and families. However, we believe that 
bereavement services are outside the scope of this quality measure 
pair, which focusses specifically on visits, which may address the 
increased symptom burden many patients experience when death is 
imminent, and provide an opportunity for proactive assessment and 
communication.
    Regarding contracted hospice staff, we clarify that visits from 
contracted staff may be included in this measure pair. As defined in 
the HIS Manual V1.02, hospice staff members may include volunteers, 
contractors, and affiliates.
    Comment: Some commenters recommended changes to the Hospice Visits 
when Death is Imminent Measure Pair to further align the two measures. 
A few commenters suggested that both Measure 1 and Measure 2 be 
measured over a 7-day timeframe in order to improve consistency between 
the measures and simplify data collection for providers. A few 
commenters recommended that CMS consider altering Measure 2 such that 
it includes in the numerator patients who receive one visit from 
medical social workers, chaplains or spiritual counselors, licensed 
practical nurses or hospice aides in the final seven days of life.
    Response: We thank the commenters for their feedback on the 
specifications of the two measures in this measure pair. As currently 
specified, Measure 1 uses a 3-day timeframe and Measure 2 uses a 7-day 
timeframe. A TEP meeting held October 19 and 21, 2015, provided input 
on the timeframes. The TEP indicated that the 3-day timeframe would be 
reflective of the active dying phase, and that it would be appropriate 
to measure clinical visits provided during the active dying phase. The 
7-day time frame covers both the active dying phase and the transition 
period before, and thus could also capture important visits related to 
preparation for active dying. An analysis of Medicare claims indicates 
that most routine home care patients (94 percent) receive at least one 
skilled visit from a nurse, social worker, therapist or physician in 
the last four days of life.\21\ Because of this, there may be a ceiling 
effect for these quality measures using a longer time frame.
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    \21\ Plotzke, M. C., T.J.; Axelrod, Elizabeth; Hunt, Meaghan; 
Muma, Allison; Gozalo, Pedro; Teno, Joan. (2015). Medicare Hospice 
Payment Reform: Analysis of How the Medicare Hospice Benefit is 
Used. Retrieved from https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/Hospice/Downloads/December-2015-Technical-Report.pdf.
---------------------------------------------------------------------------

    The current specification of Measure 2 limits the numerator to 
patients who receive at least two visits from those disciplines in the 
final 7 days of life. Using two visits rather than one may also serve 
to reduce the expected ceiling effect that is likely to result from 
grouping multiple disciplines together in Measure 2.
    Comment: Many commenters pointed out that, in keeping with the 
individualized and patient-centered focus of hospice care, patients and 
families have the option of declining visits from hospice providers if 
they deem them unnecessary or unwanted. Commenters indicated that 
patients and caregivers might decline a visit for various reasons: 
Desire for privacy at the end of life, adequate preparation for the end 
of life such that additional visits are not necessary, or patient is 
receiving receipt of similar services from outside of the hospice 
provider. Some commenters recommended that revisions be made to the HIS 
Discharge form to allow a hospice to indicate that a patient or family 
was offered a visit included in either Measure 1 or Measure 2, but 
refused or deferred the visit. Some commenters recommended that 
patients who refuse an offered visit be included in the measure 
numerator, while others recommended that these patients be excluded 
from the measure pair, and a few recommended that the measures be risk 
adjusted to reflect patient refusal of services.
    Some commenters cautioned that this measure pair could result in an 
unintended consequence: Hospices might provide unnecessary or unwanted 
visits, thus undermining patient and family preferences and choice. One 
commenter cautioned that specifying when particular staff must visit 
would undermine the flexibility hospices have in customizing the plan 
of care. Some commenters pointed out that, by respecting the wishes of 
some patients to receive fewer visits, a hospice might have lower 
scores on this measure pair but that it would not reflect an issue with 
quality of care.
    Response: We thank the commenter for their feedback about patients 
and families that may refuse a visit at the end of life. In a pilot 
study conducted by our measure development contractor, hospices 
reported that information on visit refusal is available, but is 
burdensome for hospices to report. In addition, fewer than 4 percent of 
patients in the pilot study refused a visit from a given discipline, 
and no patients refused all visits offered. By including multiple 
disciplines in each measure, the Hospice Visits when Death is Imminent 
Measure Pair is designed to allow hospices flexibility to determine the 
most appropriate discipline or disciplines to visit a patient, and to 
consider patient and family preferences. A TEP held by our measure 
development contractor did not expect that there would be wide 
variation in the rate of visit refusal across hospices. The TEP 
determined that the burden of data collection would outweigh the 
benefit of excluding patients who refuse visits. For these reasons, we 
determined not to require hospices to report data on visit refusals. 
Hospices may wish to track visit refusals internally for quality 
improvement purposes. This measure pair will be tested for reliability 
and validity prior to public reporting. We recognize that some patients 
may decline services and that rapid and unanticipated patient declines 
do occur; thus, the expectation is not for hospices to score 100 
percent on this measure pair. We will take these comments into account 
during future measure development.
    Comment: Some commenters recommended using risk adjustment or 
exclusions to account for patient characteristics in the Hospice Visits 
when Death is Imminent Measure Pair. Some commenters stated that 
patients with shorter lengths of stay will likely receive different 
visits than patients with longer lengths of stay. Commenters requested 
that CMS examine any differences, and some requested that the Hospice 
Visits when Death is Imminent Measure Pair be risk adjusted or 
stratified for length of stay in hospice. Another commenter requested 
that case mix adjustment be used in the calculation of this measure 
pair.

[[Page 52168]]

    One commenter recommended that patients with a length of stay 
shorter than 5 days be excluded from Measure 2. This is the length of 
time allowed by Hospice Conditions of Participation requirements for 
the comprehensive assessments to be completed, and the commenter 
expects that some patients might not receive two visits from a medical 
social worker, chaplain or spiritual counselor, licensed practical 
nurse, or hospice aide before Day 5. Another commenter recommended that 
patients with a length of stay of three days or fewer be excluded from 
Measure 1 if the only visit received is the initial nursing assessment. 
The commenter expressed concern that for such short lengths of stay, 
the measure would function as an indicator of compliance rather than of 
quality.
    Finally, one commenter requested clarification of whether this 
measure pair would be applied across all levels of care.
    Response: We thank the commenters for their feedback. As currently 
specified, this measure set is not risk adjusted. A TEP convened by our 
measure development contractor discussed possible risk adjustment of 
this measure pair, including risk adjustment by diagnosis or length of 
stay. The TEP determined that diagnosis may not reliably predict 
symptom burden at the end of life and therefore may not reliably 
predict need for visits. The TEP members determined that it might be 
important to take length of stay into account in measure calculations. 
We will continue to consider this feedback, and will examine measure 
performance, including the potential need for risk adjustment in the 
future.
    As currently specified, Measure 1 does not include a length of stay 
exclusion, while Measure 2 excludes patients with a length of stay less 
than or equal to one day (that is, admitted and discharged on the same 
day). The rationale for excluding patients with a very short length of 
stay from Measure 2 is that Measure 2 requires two visits from select 
hospice staff, and it may be difficult or possibly inappropriate to 
provide more than one such visit for patients receiving only one day of 
hospice care. We do not exclude these patients from Measure 1 because 
Measure 1 specifies at least one clinician visit, and it is reasonable 
to expect that a hospice would provide at least one such visit, even 
for patients with a very short length of stay. It is acceptable if this 
visit is the initial nursing assessment visit. One of the goals of this 
measure pair is to increase prospective assessment of patient needs and 
timely management of symptoms prior to death, and this can be 
accomplished during the initial nursing assessment visit as well as 
other types of visits provided in the final days to patients with 
longer length of stay. We do not intend to increase burden on providers 
or patients by requiring specific types of visits to meet the goals of 
this measure. Patients with short lengths of stay are expected to have 
high symptom burden throughout their short stay and can benefit from 
hospice visits. For these reasons, patients with short lengths of stay 
are included in this measure.
    This measure pair currently includes only patients who received 
routine home care. It does not include patients who received general 
inpatient care, respite care, or continuous home care during the 
measure timeframes. Routine home care patients for whom the hospice 
receives a service intensity add-on payment are included in this 
measure, as this payment is an add-on to the routine home care rate.
    Comment: Some commenters encouraged CMS to obtain NQF endorsement 
prior to proposing new measures. One commenter expressed appreciation 
that this measure development process has included input from the 
Measure Applications Partnership (MAP).
    Response: We appreciate the commenters' input and support of the 
NQF endorsement process. Our paramount concern is the successful 
development of a HQRP that promotes the delivery of high quality 
healthcare services. We seek to adopt measures for the HQRP that 
promote patient-centered and high quality care. Our measure selection 
activities for the HQRP take into consideration input from the MAP, 
convened by the NQF, as part of the established CMS pre-rulemaking 
process required under section 1890A of the Act. The NQF MAP met on 
December 14th and 15th, 2015 and encouraged continued development of 
this measure pair. Additionally, while this measure is not currently 
NQF-endorsed, we recognize that the NQF endorsement process is an 
important part of measure development and plan to submit this measure 
for NQF endorsement. This quality measure will fill a gap by addressing 
quality of hospice care at the end of life. Furthermore, no current 
NQF-endorsed measures address hospice care when death is imminent, and 
this measure is a first step towards that goal. CMS is establishing the 
timeline for seeking NQF endorsement for this quality measure and will 
communicate this timeline to the public in future rulemaking cycles.
    Comment: One commenter asked whether CMS would correlate the 
Hospice Visits when Death is Imminent Measure Pair with the Hospice 
CAHPS results. Another commenter recommended that CMS compare outcomes 
as measured by the HIS care processes and the CAHPS survey with the 
data collected on visits at the end of life to guide refinement of this 
measure pair.
    Response: We plan to conduct reliability and validity testing of 
this measure pair as part of ongoing measure maintenance and refinement 
and to prepare for NQF endorsement. As part of those efforts, we will 
examine the correlations of the paired measures with other quality 
measures calculated from the HIS and possibly from the CAHPS.
    Comment: Some commenters indicated that data collection for the 
Hospice Visits when Death is Imminent Measure Pair would be burdensome 
for providers, and potentially duplicative of the information about 
visits reported in Medicare claims. One commenter requested that claims 
data be used to calculate this measure pair in order to reduce provider 
burden of data collection. Another commenter encouraged CMS to 
establish a claims code for spiritual counselor/chaplain visits so that 
their visits can be reviewed for reimbursement and quality 
considerations. One commenter indicated that this measure pair would be 
calculated using claims data.
    Response: We wish to clarify the data source for this measure pair. 
This measure will be calculated using data from the HIS V2.00.0, and 
will not be a claims-based measure. This HIS-based measure pair will 
expand upon information that would be available in Medicare hospice 
claims. The HIS includes data for all hospice patients, regardless of 
payment source, while claims data capture only Medicare Fee-for-service 
beneficiaries. Therefore, the use of assessment data allows the measure 
to be inclusive of all patients regardless of payer. Medicare claims 
capture visits from certain disciplines, including skilled nursing, 
medical social services, aides, physical therapy, occupational therapy, 
and speech therapy--language pathology. HIS items will capture hospice 
visits by members of additional disciplines that are not included in 
the Medicare hospice claims (for example, chaplains). Finally, visit 
information on the HIS can be assessed and reported in a timelier 
manner than Medicare claims, providing hospices with opportunities to 
review and improve care.
    Comment: Some commenters requested that sufficient time be given

[[Page 52169]]

prior to measure implementation of the Hospice Visits when Death is 
Imminent Measure Pair to ensure time for software vendors to develop 
new processes, and hospices to upgrade their EMR systems, train staff, 
and conduct testing. One commenter recommended that CMS delay 
initiation of data collection for this measure pair until October 1, 
2016. One commenter encouraged CMS to solicit feedback from the hospice 
industry and software vendors to determine whether necessary updates 
can be made by April 1, 2017. Other commenters recommended a period of 
data collection on the proposed measures prior to implementation of the 
measures.
    Response: We appreciate the commenters' feedback regarding the 
timeline for implementation and public reporting of this measure pair. 
We would like to clarify the implementation date proposed in this rule; 
data used for calculation of this measure pair will be collected via 
the HIS V2.00.0. The HIS V2.00.0 is undergoing review as part of a PRA 
package under OMB number 0938-1153 and will be implemented April 1, 
2017. This measure pair is proposed for the FY 2019 payment 
determination and subsequent years. The HIS V2.00.0 is currently 
available for review by software vendors and hospice providers. Some of 
the activities that are necessary prior to implementation can be done 
concurrently. For example, hospice education and training in the new 
items and data abstraction can be conducted at the same time as vendor 
development of software. As stated in section III.C.7.c, providers may 
also use the Hospice Abstraction Reporting Tool (HART) software, which 
is free to download and use. HART provides an alternative option for 
hospice providers to collect and maintain facility, patient, and HIS 
Record information for subsequent submission to the QIES ASAP system. 
We agree it is critical to establish the reliability and validity of 
the quality measures prior to public reporting. We plan to conduct data 
analysis to demonstrate the ability of the quality measures to 
distinguish the quality of services provided. More detail on public 
display is provided in section III.C.11 of this rule.
    Comment: Some commenters drew connections between the Hospice 
Visits when Death is Imminent Measure Pair and the Service Intensity 
Add-on payment. Some commenters recommended delaying implementation of 
this measure pair until the impact of the SIA payment is better 
understood. One commenter recommended that CMS use the data obtained 
for Measure 2 to update the payment of the SIA payment to include 
visits by licensed practical nurses and other disciplines. One 
commenter stated that CMS should align financial payment and quality 
measures.
    Response: We thank the commenters for their feedback regarding the 
Hospice Visits when Death is Imminent Measure Pair and the SIA. CMS 
adopted SIA payments to address the observed misalignment between 
resource use and associated Medicare payments and to improve patient 
care through the promotion of skilled visits at end of life with 
minimal claims processing systems changes. While it may be good for 
payment and quality to align when possible, this measure pair is a 
measure of quality, not of practice driven by reimbursement structure. 
We will take into consideration using measure data for further 
refinement of the SIA.
    Final Action: After consideration of the comments, we are 
finalizing our proposal to implement the Hospice Visits when Death is 
Imminent Measure Pair effective April 1, 2017. Data will be collected 
starting on such date, and will, if not reported, affect payments for 
FY 2019.
(2) Proposed Quality Measure 2: Hospice and Palliative Care Composite 
Process Measure--Comprehensive Assessment at Admission
    Measure Background. The Hospice and Palliative Care Composite 
Process Measure--Comprehensive Assessment at Admission is a composite 
measure that assesses whether a comprehensive patient assessment is 
completed at hospice admission by evaluating the number of individual 
care processes completed upon admission for each hospice patient stay. 
A composite measure, as defined by the NQF, is a combination of two or 
more component measures, each of which individually reflects quality of 
care, fashioned into a single performance measure with a single 
score.\22\ For more information on composite measure definitions, 
guiding principles, and measure evaluation criteria, we refer readers 
to the NQF Composite Performance Measure Evaluation Guidance 
Publication available at https://www.qualityforum.org/Publications/2013/04/Composite_Performance_Measure_Evaluation_Guidance.aspx. A total 
of 7 individual care processes will be captured in this composite 
measure, which include the 6 NQF-endorsed quality measures and 1 
modified NQF-endorsed quality measure currently implemented in the 
HQRP. Thus, the Hospice and Palliative Care Composite Process quality 
measure will use the current HQRP quality measures as its components. 
These individual component measures address care processes around 
hospice admission that are clinically recommended or required in the 
hospice CoPs.\23\ This measure calculates the percentage of patients 
who received all care processes at admission. To calculate this 
measure, the individual components of the composite measure are 
assessed separately for each patient and then aggregated into one score 
for each hospice.
---------------------------------------------------------------------------

    \22\ National Quality Forum. (2013). Composite Performance 
Measure Evaluation Guidance: National Quality Forum.
    \23\ Medicare and Medicaid Programs: Hospice Conditions of 
Participation, Part 418 subpart 54. Centers for Medicare and 
Medicaid Services, June 5, 2008.
---------------------------------------------------------------------------

    Measure Importance. This composite quality measure for 
comprehensive assessment at admission addresses high priority aspects 
of quality hospice care as identified by both leading hospice 
stakeholders and beneficiaries receiving hospice services. The NCP for 
Quality Palliative Care Clinical Practice Guidelines for Quality 
Palliative Care established 8 core palliative care domains, and this 
composite measure captures 4 of those domains.\24\ The 4 domains 
captured by this composite measure are the Structure and Process of 
Care Domain; the Physical Aspects of Care Domain; the Spiritual, 
Religious, and Existential Aspects of Care Domain, and the Ethical and 
Legal Aspects of Care Domain. The NCP guidelines placed equal weight on 
both the physical and psychosocial domains, emphasizing a comprehensive 
approach to patient care. For more information on the NCP domains for 
palliative care, refer to http://www.nationalconsensusproject.org/guidelines_download2.aspx. In addition, the Medicare Hospice CoPs 
require that hospice comprehensive assessments identify patients' 
physical, psychosocial, emotional, and spiritual needs and address them 
to promote the hospice patient's comfort throughout the end-of-life 
process. Furthermore, the person-centered, family, and caregiver 
perspective align with the domains identified by the CoPs and NCP, as 
patients and their families/caregivers also place value on physical 
symptom management and spiritual/psychosocial care as important factors 
at the end of

[[Page 52170]]

life.25 26 A composite measure serves to ensure all hospice 
patients receive a comprehensive assessment for both physical and 
psychosocial needs at admission.
---------------------------------------------------------------------------

    \24\ The National Consensus Project for Quality Palliative Care 
Clinical Practice Guidelines for Quality Palliative Care 3rd edition 
2013.
    \25\ Singer PA, Martin DK, Kelner M. Quality End-of-Life Care: 
Patients' Perspectives. JAMA. 1999;281(2):163-168. doi:10.1001/
jama.281.2.163.
    \26\ Steinhauser KE, Christakis NA, Clipp EC, McNeilly M, 
McIntyre L, Tulsky JA. Factors Considered Important at the End of 
Life by Patients, Family, Physicians, and Other Care Providers. 
JAMA. 2000;284(19):2476-2482. doi:10.1001/jama.284.19.2476.
---------------------------------------------------------------------------

    Measure Impact. The literature indicates that health care 
providers' practice is responsive to quality measures reported.\27\ CMS 
feels this research, while not specific to hospices, reasonably 
predicts the effect of measures on hospice provider behavior. 
Collecting information about the total number of care processes 
conducted for each patient will incentivize hospices to conduct all 
desirable care processes for each patient and provide services that 
will address their care needs and improve quality during the time he or 
she is receiving hospice care. Additionally, creating a composite 
quality measure for comprehensive assessment at admission will provide 
consumers and providers with a single measure regarding the overall 
quality and completeness of assessment of patient needs at hospice 
admission, which can then be used to meaningfully and easily compare 
quality across hospice providers and increase transparency.
---------------------------------------------------------------------------

    \27\ Werner, R., E. Stuart, and D. Polsky, Public reporting 
drove quality gains at nursing homes. Health Affairs, 2010. 29(9): 
p. 1706-1713.
---------------------------------------------------------------------------

    Performance Gap. Analyses conducted by our measure development 
contractor, RTI International, show that hospice performance scores on 
the current 7 HQRP measures are high (a score of 90 percent or higher 
on most measures); however, these analyses also revealed that, on 
average, a much lower percentage of patient stays in a hospice had 
documentation that all of these desirable care processes were completed 
at admission. Thus, by assessing hospices' performance of comprehensive 
assessment, the composite measure sets a higher standard of care for 
hospices and reveals a larger performance gap. A similar effect has 
been shown in the literature where facilities are achieving more than 
90 percent compliance with individual measures, but compliance numbers 
decrease when multiple measures are combined as one.28 29 
The performance gap identified by the composite measure creates 
opportunities for quality improvement and may motivate providers to 
conduct a greater number of high priority care processes for as many 
patients as possible upon admission to hospice.
---------------------------------------------------------------------------

    \28\ Nolan, T., & Berwick, D. M. (2006). All-or-none measurement 
raises the bar on performance. JAMA [H.W. Wilson--GS], 295(10), 
1168.
    \29\ Agency for Healthcare Research and Quality. (2004). 
National Healthcare Quality Report.
---------------------------------------------------------------------------

    Existing Measures. The Family Evaluation of Hospice Care (FEHC), 
NQF #0208, is a precursor of the Hospice CAHPS[supreg]. The surveys 
cover some similar domains. However, a major difference between them is 
the detailed requirements for survey administration of the 
CAHPS[supreg] Hospice Survey, which allow for comparison of hospice 
programs, The Hospice CAHPS[supreg] survey quality measure is not yet 
endorsed by NQF. CMS has recently submitted the CAHPS[supreg] Hospice 
Survey (experience of care) measure (NQF #2651) to be considered for 
endorsement under the Palliative and End-of-Life Care Project 2015-
2016. For more information regarding this project and the measure 
submitted, we refer readers to https://www.qualityforum.org/ProjectMeasures.aspx?projectID=80663. In addition, we refer readers to 
section III.C.9 of this rule for more information on the Hospice 
CAHPS[supreg] survey and associated quality measures. The 
CAHPS[supreg]-based quality measures submitted to NQF include patient 
and caregiver experience of care outcome measures and CMS plans to 
propose these measures as part of the HQRP measure set in future 
rulemaking cycles. A key difference between the FEHC, Hospice 
CAHPS[supreg] and the Hospice and Palliative Care Composite Process 
Measure is that the FEHC and Hospice CAHPS[supreg] focus on the 
consumer's perspective of their health agency and experience, whereas 
the Hospice and Palliative Care Composite Process Measure focuses on 
the clinical care processes that are actually delivered by the hospice 
to each patient.
    Stakeholder Support. A TEP convened by our measure development 
contractor, RTI International, on December 2, 2015, provided input on 
this measure concept. The TEP unanimously agreed that a comprehensive 
hospice composite measure is an important measure and supported data 
collection using the HIS. The NQF MAP met on December 14th and 15th, 
2015 and provided input to CMS. In their final recommendation, the MAP 
encouraged continued development of the Hospice and Palliative Care 
Composite Process Measure--Comprehensive Assessment at Admission 
measure. More information about the MAP's recommendations for this 
measure is available at http://www.qualityforum.org/ProjectMaterials.aspx?projectID=75370.
    While this measure is not currently NQF-endorsed, we recognize that 
the NQF endorsement process is an important part of measure development 
and plan to submit this measure for NQF endorsement. As noted, this 
quality measure will fill a gap by holding hospices to a higher 
standard of care and will motivate providers to conduct a greater 
number of high priority care processes for as many beneficiaries as 
possible upon admission as hospice patients. Furthermore, no current 
NQF-endorsed measures address the completion of a comprehensive care 
assessment at hospice admission.
    Form, Manner, and Timing of Data Collection and Submission. The 
data source for this measure will be currently implemented HIS items 
that are currently used in the calculation of the 7 component measures. 
These items and quality measure algorithms for the 7 component measures 
can be found in the HQRP Specifications for the Hospice Item Set-based 
Quality Measures document, which is available in the ``Downloads'' 
section of the ``Current Measures'' portion of the CMS HQRP Web site: 
https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-
Instruments/Hospice-QualityReporting/Current-Measures.html. Since the 
proposed measure is a composite measure whose components are currently 
adopted HQRP measures, no new data collection will be required; data 
for the composite measure will come from existing items from the 
existing 7 HQRP component measures. CMS proposes to begin calculating 
this measure using existing data items, beginning April 1, 2017; this 
means patient admissions occurring after April 1, 2017 would be 
included in the composite measure calculation.
    Since the composite measure components are existing HIS data items, 
providers are already collecting the data needed to calculate the 
composite measure. Data collection will continue in accordance with 
processes outlined in sections III.C.7c through III.C.7e of this rule.
    For more information on the specifications and data elements for 
the measure, Hospice and Palliative Care Composite Process Measure-
Comprehensive Assessment at Admission, we refer readers to the https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Hospice-Quality-Reporting/Current-Measures.html document, 
available on the ``Current Measures''

[[Page 52171]]

portion of the CMS HQRP Web site: https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Hospice-Quality-Reporting/Current-Measures.html.
    We received multiple comments pertaining to the Hospice and 
Palliative Care Composite Process Measure. The following is a summary 
of the comments we received on this topic and our responses.
    Comment: CMS received many comments in support of the proposed 
Hospice and Palliative Care Composite Process Measure--Comprehensive 
Assessment at Admission quality measure. Commenters appreciated that 
the measure demonstrates greater variation in hospice performance than 
the individual component measures, and that it can be used to 
differentiate performance across hospices. Commenters also appreciated 
that CMS's measure selection activities for the HQRP take into 
consideration input from stakeholders such as the Measure Applications 
Partnership (MAP). Several commenters were supportive of CMS's approach 
to quality measure development in the HQRP, specifically, the use of 
Technical Expert Panels (TEP) to obtain expert and other stakeholder 
input.
    Response: We thank commenters for their support of the proposed 
Hospice and Palliative Care Composite Process Measure--Comprehensive 
Assessment at Admission quality measure, herein after referred to as 
the `Composite QM'.
    Comment: Many comments were received regarding the retirement of 
the seven day length of stay exclusion for six of the care process 
measures that comprise the Composite QM. Commenters' primary concern 
focused on the impact of removing this exclusion on provider behavior; 
specifically, commenters suggested that eliminating the LOS exclusion 
may inappropriately incentivize providers to focus on completion and 
compliance with the HIS requirements at the expense of addressing the 
needs and preferences of imminently dying patients. Commenters noted 
that upon admission for imminently dying patients, a comprehensive 
assessment is not in the interest of patients and caregivers, nor may 
it be feasible for hospices to deliver because the focus is on 
appropriately directed to other priorities. One commenter stated that 
the level and intensity of hospices services are different for patients 
with short LOS and that the items captured in this measure are not 
reflective of quality of care for patients imminently dying. Finally, 
one commenter indicated that this measure might complicate data 
collection efforts and processes already in place at hospices, noting 
that different members of the interdisciplinary team often complete 
different sections of the HIS at different times. This commenter 
believed that hospices would therefore need to establish new data 
collection processes when addressing urgent patient/family needs should 
be the priority. In response to these concerns, commenters requested 
that provisions be made to account for patients with short LOS and 
suggested alternative approaches to do so. Namely, commenters 
recommended that CMS risk adjust or stratify for patients with a 2-day 
or less, 3-day or less, or 5-day or less LOS, while other comments 
recommended that CMS maintain the current 7-day LOS exclusion. Another 
commenter recommended that a new measure be created to capture data for 
short LOS patients, rather than including them in this measure. 
Commenters requested clarification on why the measure was not created 
with risk adjustment in its current specifications.
    Response: We appreciate the commenters' input on the Composite QM 
LOS exclusion specifications. Developing and adopting measures that 
benefit patient outcomes and do not lead to negative unintended 
consequences of the utmost importance to CMS. We would like to take 
this opportunity to respond to commenters' concerns about the impact of 
retiring the LOS exclusion, first by describing the history of the LOS 
exclusion and the reason for retiring it from the individual measures. 
As many commenters noted, 6 of the 7 component quality measure (QMs) 
exclude patient stays that are less than 7 days from the measure 
denominator. At the time the measures were developed, no national data 
regarding the implications of the LOS exclusion was available at that 
time, and technical experts recommended that short patient stays be 
excluded from those measures' denominators for assessing quality of 
care. Since the implementation of the HIS, we have performed 
descriptive analyses to examine the implications of the LOS exclusion 
on hospices' denominator size and QM scores. Additionally, this 
analysis also examined the timing of when hospices perform the care 
processes assessed in the quality measures. The results of these 
analyses demonstrated that the denominator sizes for the HQRP QMs are 
largely impacted by the current 7 day LOS exclusion used to calculate 
the QMs. Excluding stays with LOS less than 7 days result in many 
hospices not having sufficient denominator size to allow for public 
display of their quality scores. Although the LOS exclusion has a 
sizable impact on the number of hospices eligible to have their data 
publicly displayed, the impact of the LOS exclusions on the 
distribution of hospices' scores is generally small for all of the QMs. 
Therefore, removing the LOS exclusion criteria will increase the number 
of hospices eligible for public reporting while having a minimal impact 
on the QM scores. In addition, these analyses revealed that the care 
processes targeted by the QMs are performed on the day of or within one 
day of admission for the vast majority of patient stays. For example, 
among patient admissions for which a pain screening was administered, 
approximately 92 percent of screenings occurred on the day of admission 
and close to 99 percent occurred within 1 day of admission. This 
suggests that including stays of less than 7 days in QM calculations 
(that is, removing the QM LOS exclusion) may be appropriate and would 
not create a burden on hospices. In response to these results, the 
measure developer and steward submitted the individual QMs to the NQF 
Palliative Care and End of Life Project for re-endorsement in February 
2016 without the LOS exclusion. Because of the anticipated removal of 
the LOS exclusion for the current HQRP measures (component measures for 
this Composite QM), this Composite QM was proposed without the LOS 
exclusion in order to be consistent with the individual measure 
components. Our contractor convened a TEP in December 2015 to inform 
the development of the Composite QM. The TEP, presented with the 
results of the LOS analysis, strongly recommended that the Composite QM 
maintain the same measure specifications as the individual measures. 
Additionally, this TEP considered the creation of a separate measure 
specifically for short LOS patients, as recommended by a commenter, but 
ultimately agreed that such a measure would not capture comprehensive 
care for short LOS patients as the current proposed measure would. 
Furthermore, we remind commenters that because the Composite QM is 
based on the 7 current HIS measures that are already endorsed by NQF, 
risk adjustment for the Composite QM will be consistent with any risk 
adjustment created and applied for the individual measures. Any 
additional risk adjustment applied to the individual measures will 
first be developed and tested for in coordination with the NQF prior to

[[Page 52172]]

implementation. We will keep the commenters' recommendations and 
concerns regarding short LOS in mind for future development efforts and 
data analysis.
    Comment: CMS received comments regarding the contribution of this 
measure to quality of care. While commenters did not object to the 
development and implementation of this measure, many were concerned 
whether this measure is truly reflective of comprehensive care at 
admission and whether it will provide patients and families with 
meaningful information.
    Response: We appreciate the commenters' concern regarding the 
impact and relevance of the Composite QM. We are committed to the 
ensuring that all quality measures implemented in the HQRP meet the 
goals of the HQRP, which include distinguishing performance among 
hospices and improving patient outcomes. We regularly conduct measure 
testing and evaluation activities to ensure that measures continue to 
demonstrate improvements in-patient care. We would like to convey to 
commenters that a primary motivation in developing the Composite QM is 
to provide interpretable and meaningful information to consumers. We 
believe that, above and beyond information provided by the individual 
component QMs, the Composite QM accomplishes this by providing 
consumers with a single measure regarding the overall quality and 
completeness of assessment of patient needs at hospice admission, which 
can then be used to compare quality across hospice providers and 
increase transparency, while also accessing information about hospice 
performance on each of the individual measures that comprise the 
Composite QM. As also noted in this rule, the Composite QM demonstrates 
greater variation in hospice performance than individual measures. 
Hospice performance scores on the current 7 HQRP measures are high (a 
score of 90 percent or higher on most measures); however, on average, a 
much lower percentage of patient stays in a hospice had documentation 
that all 7 of these care processes were completed at admission. 
Additionally, we would like to reiterate that the Composite QM for 
comprehensive assessment at admission addresses high priority aspects 
of comprehensive quality hospice care as identified by both leading 
hospice stakeholders and beneficiaries receiving hospice services, all 
of which emphasize attention to physical, psychosocial, emotional, and 
spiritual needs of patients.
    Comment: CMS received a few comments recommending that CMS attain 
NQF endorsement of the Composite QM prior to implementation.
    Response: We appreciate the commenters' input and support of the 
NQF endorsement process. Our paramount concern is the successful 
development of a HQRP that promotes the delivery of high quality 
healthcare services. We seek to adopt measures for the HQRP that 
promote patient-centered and high quality care. Our measure selection 
activities for the HQRP take into consideration input from the Measure 
Applications Partnership (MAP), convened by the NQF, as part of the 
established CMS pre-rulemaking process required under section 1890A of 
the Act. The NQF MAP met on December 14th and 15th, 2015 and encouraged 
continued development of this measure. Additionally, while this measure 
is not currently NQF-endorsed, we recognize that the NQF endorsement 
process is an important part of measure development and plan to submit 
this measure for NQF endorsement. This quality measure will fill a gap 
by holding hospices to a higher standard of care and will motivate 
providers to conduct a greater number of high priority care processes 
for as many beneficiaries as possible upon admission as hospice 
patients--a unique contribution to hospices. Furthermore, no current 
NQF-endorsed measures address the completion of a comprehensive care 
assessment at hospice admission, and this measure is a first step 
towards that goal. We are establishing the timeline for seeking NQF 
endorsement for this quality measure and will communicate this timeline 
to the public in future rulemaking cycles.
    Comment: CMS received one comment requesting clarification on the 
logic behind including NQF #1617 Patients Treated with an Opioid Who 
Are Given a Bowel Regimen measure as a component measure of the 
proposed Composite QM. This commenter indicated that the NQF #1617 
measure does not collect data representative of comprehensive care on 
the first day of admission and, therefore, does not serve this measure 
well as a component.
    Response: We would like to clarify that the Composite QM is not 
designed to focus on care processes completed on the first day of 
admission; rather, this measure is intended to capture all 
comprehensive assessment activities around the time of hospice 
admission. This timeframe is in line with guidelines identified the 
Medicare Hospice Conditions of Participation (CoPs).\30\ The Medicare 
CoPs mandate that an initial assessment be completed within 48 hours 
after the election of hospice care and that a comprehensive assessment 
be completed no later than 5 calendar days after the election of 
hospice care is in accordance with Sec.  418.24. Therefore, by 
collecting data beyond the first day of admission, this measure aligns 
with the practices recommended by the CoPs and with national guidelines 
and clinical recommendations. The Medicare CoPs require that both the 
hospice initial and comprehensive assessments identify patients' 
physical needs and address them to promote the hospice patients' well-
being and comfort throughout the dying process. Additionally, the 
Quality Palliative Care Clinical Practice Guidelines \31\ produced by 
the National Consensus Project (NCP) established eight core palliative 
care domains, one of which emphasizes the assessment and management of 
pain and/or other physical symptoms. This measure captures care 
processes related to bowel management and opioid use. Most patients 
prescribed opioids to manage pain or other symptoms develop some degree 
of constipation after opioid initiation or dose increases. Reducing 
opioid-induced constipation can reduce patient discomfort and improve 
quality of life. Properly assessing and managing symptoms related to 
bowel management are critical components of the comprehensive 
assessment. Therefore, by including the NQF #1617 measure in this 
comprehensive assessment, we address high priority aspects of quality 
hospice care as identified by leading hospice stakeholders.
---------------------------------------------------------------------------

    \30\ Medicare and Medicaid Programs: Hospice Conditions of 
Participation, Part 418 subpart 54. Centers for Medicare and 
Medicaid Services (2008).
    \31\ Clinical Practice Guidelines for Quality Palliative Care. 
National Consensus Project for Quality Palliative Care (2013).
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    Comment: CMS received one comment recommending that the title of 
this measure, specifically the term ``at admission'', be clarified or 
replaced. The commenter believed that the use of the phrase ``at 
admission'' was misleading since it seemed to imply that the measure 
captures care processes completed on the day of admission. Since the 
composite measure in fact captures care processes completed during the 
initial and/or comprehensive assessment (which, per CoP requirements, 
must be completed within 2 and 5 days from admission, respectively), 
the commenter believed the title of the measure could be misleading 
since care processes that are components of the measure may be 
completed beyond the day of admission.

[[Page 52173]]

    Response: We would like to thank this commenter for their 
recommendation. We would like to clarify that this measure title was 
developed based on the CoP requirement for the comprehensive 
assessment. While it is true that the CoPs require the first 
comprehensive assessment to be completed within 5 days of admission, 
the CoPs also require hospices to update the comprehensive assessment 
as frequently as the condition of the patient requires, but no less 
frequently than every 15 days. Thus, we used the phrase Comprehensive 
Assessment ``at Admission'' to denote that this measure and the data it 
captures refers to care processes delivered during the first 
comprehensive assessment completed upon admission to hospice and not 
any subsequent comprehensive assessment updates.
    Comment: CMS received a few comments regarding the measure 
specifications of the Composite QM. Commenters requested clarification 
on the composite measure score calculation, construction, and 
components.
    Response: The Composite QM is a composite measure that assesses 
whether a comprehensive patient assessment is completed at hospice 
admission by evaluating whether seven critical individual care 
processes were completed upon admission for each hospice patient stay. 
A composite measure, as defined by the NQF, is a combination of two or 
more component measures, each of which individually reflects quality of 
care, into a single performance measure with a single score. For more 
information on composite measure definitions, guiding principles, and 
measure evaluation criteria, we refer readers to the NQF Composite 
Performance Measure Evaluation Guidance Publication available at 
https://www.qualityforum.org/Publications/2013/04/Composite_Performance_Measure_Evaluation_Guidance.aspx. A total of 7 
individual care processes will be captured in this Composite QM, which 
include the 6 NQF endorsed quality measures and 1 modified NQF endorsed 
quality measure currently implemented in the HQRP. This Composite QM 
calculates the percentage of patients who received all applicable care 
processes at admission. For additional details on the draft Composite 
QM specifications, we refer readers to the HQRP Specifications for HIS-
Based QM document, available on the ``Current Measures'' portion of the 
CMS HQRP Web site: https://www.cms.gov/Medicare/Quality-Initiatives-PatientAssessment-Instruments/HospiceQuality-Reporting/CurrentMeasures.html. This measure, therefore, reflects the variation 
in hospices' performance on all 7 quality measures for each patient at 
admission. We will continue the development and analyses of the 
Composite QM. Potential refinement to the measure specifications will 
be communicated with the public via HQRP communication channels, 
including postings and announcements on the CMS HQRP Web site, MLN 
eNews communications, national provider association calls, and 
announcements on Open Door Forums and Special Open Door Forums.
    Comment: CMS received a few comments recommending that CMS be 
mindful of public awareness of differences between process and outcome 
measures when creating a composite measure. Two commenters stated that 
although this measure concept is valuable and consistent with existing 
clinical guidelines, knowledge about differences in hospice measure 
types is minimal among the public. The commenter noted that the public 
might not be able to understand the relationship of hospice performance 
on the Composite QM to quality of care delivery at the hospice. 
Additionally, two commenters recommended that to aid consumer 
understanding of information from the Composite QM, CMS should 
supplement this data with information from the hospice CAHPS survey.
    Response: We appreciate the commenters' feedback on public 
usability of the Composite QM. We would like to highlight that one 
primary motivation for creating this Composite QM was to provide 
interpretable and meaningful information to consumers. We believe the 
Composite QM may be easier for consumers to understand because it 
provides the public with a single metric regarding care processes at 
admission as compared to the individual component QMs. As such, QM 
scores can be easily used to compare quality across providers and make 
informed decisions. We are committed to providing all users with the 
necessary information to understand the intent and application of 
measures in the HQRP. As with other measures, we will conduct measure 
testing and reportability analysis to determine if the Composite QM is 
appropriate for public reporting. Should we determine the Composite QM 
is appropriate for public reporting, we would take necessary steps to 
ensure that any data publicly reported is meaningful and understandable 
by the public. Such steps may include usability testing and cognitive 
interviewing. We also plan to make hospice CAHPS quality measures 
publicly available to consumers.
    Final Action: After consideration of the comments, we are 
finalizing our proposal to implement the Hospice and Palliative Care 
Composite Process Measure--Comprehensive Assessment at Admission 
effective April 1, 2017.

             Table 16--Proposed Quality Measures and Data Collection Period Affecting the FY 2019 Payment Determination and Subsequent Years
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                               Data
           Quality measure                     NQF ID No.                        Type                          Submission method          collection  to
                                                                                                                                               begin
--------------------------------------------------------------------------------------------------------------------------------------------------------
Hospice Visits when Death is Imminent  TBD......................  Process Measure...................  Hospice Item Set..................      04/01/2017
Hospice and Palliative Care Composite  TBD......................
 Process Measure.
--------------------------------------------------------------------------------------------------------------------------------------------------------

7. Form, Manner, and Timing of Quality Data Submission
a. Background
    Section 1814(i)(5)(C) of the Act requires that each hospice submit 
data to the Secretary on quality measures specified by the Secretary. 
Such data must be submitted in a form and manner, and at a time 
specified by the Secretary. Section 1814(i)(5)(A)(i) of the Act 
requires that beginning with the FY 2014 and for each subsequent FY, 
the Secretary shall reduce the market basket update by 2 percentage 
points for any hospice that does not comply with the quality data 
submission requirements for that FY.
b. Previously Finalized Policy for New Facilities To Begin Submitting 
Quality Data
    In the FY 2015 Hospice Wage Index final rule (79 FR 50488), we 
finalized a policy stating that any hospice that receives its CMS 
Certification Number (CCN) (also known as the Medicare Provider Number) 
notification letter

[[Page 52174]]

dated on or after November 1 of the preceding year involved is excluded 
from any payment penalty for quality reporting purposes for the 
following FY. This requirement was codified at Sec.  418.312.
    In the FY 2016 Hospice Wage Index final rule (80 FR 47189), we 
further clarified and finalized our policy for the timing of new 
providers to begin reporting data to CMS. The clarified policy 
finalized in the FY 2016 Hospice Wage Index final rule (80 FR 47189) 
distinguished between when new hospice providers are required to begin 
submitting HIS data and when providers will be subject to the potential 
2 percentage point annual payment update (APU) reduction for failure to 
comply with HQRP requirements. In summary, the policy finalized in the 
FY 2016 Hospice Wage Index final rule (80 FR 47189 through 47190) 
clarified that providers must begin submitting HIS data on the date 
listed in the letterhead of the CCN Notification letter received from 
CMS but will be subject to the APU reduction based on whether the CCN 
Notification letter was dated before or after November 1 of the 
reporting year involved. Thus, beginning with the FY 2018 payment 
determination and for each subsequent payment determination, we 
finalized our policy that a new hospice be responsible for HQRP quality 
data submission beginning on the date of the CCN notification letter; 
we retained our prior policy that hospices not be subject to the APU 
reduction if the CCN notification letter was dated after November 1 of 
the year involved. For example, if a provider receives their CCN 
notification letter and the date in the letterhead is November 5, 2016, 
that provider will begin submitting HIS data for patient admissions 
occurring after November 5, 2016. However, since the CCN notification 
letter was dated after November 1st, they would not be evaluated for, 
or subject to any payment penalties for, the relevant FY APU update 
(which in this instance is the FY 2018 APU, which is associated with 
patient admissions occurring 1/1/16-12/31/16).
    This policy allows CMS to receive HIS data on all patient 
admissions on or after the date a hospice receives their CCN 
notification letter, while at the same time allowing hospices 
flexibility and time to establish the necessary accounts for data 
submission before they are subject to the potential APU reduction for a 
given reporting year. Currently, new hospices may experience a lag 
between Medicare certification and receipt of their actual CCN Number. 
Since hospices cannot submit data to the QIES ASAP system without a 
valid CCN Number, CMS proposed that new hospices begin collecting HIS 
quality data beginning on the date noted on the CCN notification 
letter. We believe this policy will provide sufficient time for new 
hospices to establish appropriate collection and reporting mechanisms 
to submit the required quality data to CMS. Requiring quality data 
reporting beginning on the date listed in the letterhead of the CCN 
notification letter aligns CMS policy for requirements for new 
providers with the functionality of the HIS data submission system 
(QIES ASAP).
c. Previously Finalized Data Submission Mechanism, Collection 
Timelines, and Submission Deadlines for the FY 2017 Payment 
Determination
    In the FY 2015 Hospice Wage Index final rule (79 FR 50486), we 
finalized our policy requiring that, for the FY 2017 reporting 
requirements, hospices must complete and submit HIS records for all 
patient admissions to hospice after July 1, 2014. For each HQRP program 
year, we require that hospices submit data on each of the adopted 
measures in accordance with the reporting requirements specified in 
sections III.C.7c through III.C.7e of that rule for the designated 
reporting period. This requirement applies to previously finalized and 
adopted measures, as well as new measures proposed through the 
rulemaking process. Electronic submission is required for all HIS 
records. Although electronic submission of HIS records is required, 
hospices do not need to have an electronic medical record to complete 
or submit HIS data. In the FY 2014 Hospice Wage Index final rule (78 FR 
48258), we finalized a provision requiring that providers can use 
either the Hospice Abstraction Reporting Tool (HART) (which is free to 
download and use) or vendor-designed software to complete HIS records. 
HART provides an alternative option for hospice providers to collect 
and maintain facility, patient, and HIS Record information for 
subsequent submission to the QIES ASAP system. Once HIS records are 
complete, electronic HIS files must be submitted to CMS via the QIES 
ASAP system. Electronic data submission via the QIES ASAP system is 
required for all HIS submissions; there are no other data submission 
methods available. Hospices have 30 days from a patient admission or 
discharge to submit the appropriate HIS record for that patient through 
the QIES ASAP system. CMS will continue to make HIS completion and 
submission software available to hospices at no cost. We provided 
details on data collection and submission timing under the downloads 
section of the HIS Web site on the CMS.gov Web site at http://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Hospice-Quality-Reporting/Hospice-Item-Set-HIS.html.
    The QIES ASAP system provides reports upon successful submission 
and processing of the HIS records. The final validation report may 
serve as evidence of submission. This is the same data submission 
system used by nursing homes, inpatient rehabilitation facilities, home 
health agencies, and long-term care hospitals for the submission of 
Minimum Data Set Version 3.0 (MDS 3.0), Inpatient Rehabilitation 
Facility-patient assessment instrument (IRF-PAI), Outcome Assessment 
Information Set (OASIS), and Long-Term Care Hospital Continuity 
Assessment Record & Evaluation Data Set (LTCH CARE), respectively. We 
have provided hospices with information and details about use of the 
HIS through postings on the HQRP Web site, Open Door Forums, 
announcements in the CMS MLN Connects Provider e-News (E-News), and 
provider training.
d. Previously Finalized Data Submission Timelines and Requirements for 
FY 2018 Payment Determination and Subsequent Years
    Hospices are evaluated for purposes of the quality reporting 
program based on whether or not they submit data, not on their 
substantive performance level for the required quality measures. In 
order for CMS to appropriately evaluate the quality reporting data 
received by hospice providers, it is essential HIS data be received in 
a timely manner.
    The submission date is the date on which the completed record is 
submitted and accepted by the QIES ASAP system. In the FY 2016 Hospice 
Wage Index final rule (80 FR 47191), CMS finalized our policy that 
beginning with the FY 2018 payment determination hospices must submit 
all HIS records within 30 days of the event date, which is the 
patient's admission date for HIS-Admission records or discharge date 
for HIS-Discharge records.
    For HIS-Admission records, the submission date must be no later 
than the admission date plus 30 calendar days. The submission date can 
be equal to the admission date, or no greater than 30 days later. The 
QIES ASAP system will issue a warning on the Final Validation Report if 
the submission date is more than 30 days after the patient's admission 
date.

[[Page 52175]]

    For HIS-Discharge records, the submission date must be no later 
than the discharge date plus 30 calendar days. The submission date can 
be equal to the discharge date, or no greater than 30 days later. The 
QIES ASAP system will issue a warning on the Final Validation Report if 
the submission date is more than 30 days after the patient's discharge 
date.
    The QIES ASAP system validation edits are designed to monitor the 
timeliness of submission and ensure that providers' submitted records 
conform to the HIS data submission specifications. Providers are 
notified when timing criteria have not been met by warnings that appear 
on their Final Validation Reports. A standardized data collection 
approach that coincides with timely submission of data is essential to 
establish a robust quality reporting program and ensure the scientific 
reliability of the data received.
    In the FY 2016 Hospice Wage Index final rule (80 FR 47191), CMS 
also clarified the difference between the completion deadlines and the 
submission deadlines. Current sub-regulatory guidance produced by CMS 
(for example, HIS Manual, HIS trainings) states that the completion 
deadlines for HIS records are 14 days from the Event Date for HIS-
Admission records and 7 days from the Event Date for HIS-Discharge 
records. Completion deadlines continue to reflect CMS guidance only; 
these guidelines are not statutorily specified and are not designated 
through regulation. These guidelines are intended to offer clear 
direction to hospice agencies in regards to the timely completion of 
HIS-Admission and HIS-Discharge records. The completion deadlines 
define only the latest possible date on which a hospice should complete 
each HIS record. This guidance is meant to better align HIS completion 
processes with clinical workflow processes; however, hospices may 
develop alternative internal policies to complete HIS records. Although 
it is at the discretion of the hospice to develop internal policies for 
completing HIS records, CMS continues to recommend that providers 
complete and attempt to submit HIS records early, prior to the 
previously finalized submission deadline of 30 days, beginning in FY 
2018. Completing and attempting to submit records early allows 
providers ample time to address any technical issues encountered in the 
QIES ASAP submission process, such as correcting fatal error messages. 
Completing and attempting to submit records early will ensure that 
providers are able to comply with the 30 day submission deadline. HQRP 
guidance documents, including the CMS HQRP Web site, HIS Manual, HIS 
trainings, Frequently Asked Questions, and Fact Sheets, continue to 
offer the most up-to-date CMS guidance to assist providers in the 
successful completion and submission of HIS records. Availability of 
updated guidance will be communicated to providers through the usual 
CMS HQRP communication channels, including postings and announcements 
on the CMS HQRP Web site, MLN eNews communications, national provider 
association calls, and announcements on Open Door Forums and Special 
Open Door Forums.
e. Previously Finalized HQRP Data Submission and Compliance Thresholds 
for the FY 2018 Payment Determination and Subsequent Years
    To accurately analyze quality reporting data received by hospice 
providers, it is imperative we receive ongoing and timely submission of 
all HIS-Admission and HIS-Discharge records. In the FY 2016 Hospice 
Wage Index final rule (80 FR 47192), CMS finalized the timeliness 
criteria for submission of HIS-Admission and HIS-Discharge records. The 
finalized timeliness criteria was in response to input from our 
stakeholders seeking additional specificity related to HQRP compliance 
affecting FY payment determinations and, due to the importance of 
ensuring the integrity of quality data submitted.
    Last year, we finalized our policy (80 FR 47191 through 47192) that 
beginning with the FY 2018 payment determination and subsequent FY 
payment determinations, all HIS records would have to be submitted 
within 30 days of the event date, which is the patient's admission date 
or discharge date. In conjunction with this requirement, we also 
finalized our policy (80 FR 47192) to establish an incremental 
threshold for compliance over a 3-year period. To be compliant for the 
FY 2018 APU determination, hospices must submit no less than 70 percent 
of their total number of HIS-Admission and HIS-Discharge records by no 
later than 30 days from the event date. The timeliness threshold is set 
at 80 percent for the FY 2019 APU determination and at 90 percent for 
the FY 2020 APU determination and subsequent years. The threshold 
corresponds with the overall amount of HIS records received from each 
provider that fall within the established 30 day submission timeframes. 
Our ultimate goal is to require all hospices to achieve a compliance 
rate of 90 percent or more.
    To summarize, in the FY 2016 Hospice Wage Index final rule (80 FR 
47193), we finalized our policy to implement the timeliness threshold 
requirement beginning with all HIS admission and discharge records that 
occur after January 1, 2016, in accordance with the following schedule.
     Beginning January 1, 2016 to December 31, 2016, hospices 
must submit at least 70 percent of all required HIS records within the 
30 day submission timeframe for the year or be subject to a 2 
percentage point reduction to their market basket update for FY 2018.
     Beginning January 1, 2017 to December 31, 2017, hospices 
must submit at least 80 percent of all required HIS records within the 
30 day submission timeframe for the year or be subject to a 2 
percentage point reduction to their market basket update for FY 2019.
     Beginning January 1, 2018 to December 31, 2018, hospices 
must submit at least 90 percent of all required HIS records within the 
30 day submission timeframe for the year or be subject to a 2 
percentage point reduction to their market basket update for FY 2020.
    Timely submission of data is necessary to accurately analyze 
quality measure data received by providers. To support the feasibility 
of a hospice to achieve the compliance thresholds, CMS's measure 
development contractor conducted some preliminary analyses of Quarter 3 
and Quarter 4 HIS data from 2014. According to this analysis, the vast 
majority of hospices (92 percent) would have met the compliance 
thresholds at 70 percent. Moreover, 88 percent and 78 percent of 
hospices would have met the compliance thresholds at 80 percent and 90 
percent, respectively. CMS believes this analysis is further evidence 
that the compliance thresholds are reasonable and achievable by hospice 
providers.
    The current reports available to providers in the Certification and 
Survey Provider Enhanced Reports (CASPER) system do allow providers to 
track the number of HIS records that are submitted within the 30 day 
submission timeframe. Currently, submitting an HIS record past the 30 
day submission timeframe results in a non-fatal (warning) error. In 
April 2015, CMS made available 3 new Hospice Reports in CASPER, which 
include reports that can list HIS Record Errors by Field by Provider 
and HIS records with a specific error number. CMS is working on 
expanding this functionality of CASPER reports to include a timeliness 
compliance threshold report that

[[Page 52176]]

providers could run to determine their preliminary compliance with the 
timeliness compliance requirement. CMS expects these reports to be 
available by late fall of 2016.
    In the FY 2016 Hospice Wage Index final rule (80 FR 47192 through 
47193), CMS provided clarification regarding the methodology used in 
calculating the 70 percent/80 percent/90 percent compliance thresholds. 
In general, HIS records submitted for patient admissions and discharges 
occurring during the reporting period (January 1st to December 31st of 
the reporting year involved) will be included in the denominator for 
the compliance threshold calculation. The numerator of the compliance 
threshold calculation would include any records from the denominator 
that were submitted within the 30 day submission deadline. In the FY 
2016 Hospice Wage Index final rule (80 FR 47192), CMS also stated we 
would make allowances in the calculation methodology for two 
circumstances. First, the calculation methodology will be adjusted 
following the applicable reporting period for records for which a 
hospice is granted an extension or exemption by CMS. Second, 
adjustments will be made for instances of modification/inactivation 
requests (Item A0050. Type of Record = 2 or 3). Additional helpful 
resources regarding the timeliness compliance threshold for HIS 
submissions can be found under the downloads section of the Hospice 
Item Set Web site at CMS.gov at https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Hospice-Quality-Reporting/Hospice-Item-Set-HIS.html. Lastly, as further details of the data 
submission and compliance threshold are determined by CMS, we 
anticipate communicating these details through the regular CMS HQRP 
communication channels, including postings and announcements on the CMS 
HQRP Web site, MLN eNews communications, national provider association 
calls, and announcements on Open Door Forums and Special Open Door 
Forums.
    Comment: A few commenters commented on our previously finalized 
policies for form, manner, and timing of data collection. One commenter 
raised concern about the ability of hospices to comply with the 
incremental 70 percent/80 percent/90 percent timeliness compliance 
threshold in cases of natural disasters. Specifically, the commenter 
was concerned that in the case of protracted natural disasters (for 
example, Hurricane Sandy), hospice organizations may not be able to 
email CMS within the 30-day timeframe to request an extension or 
exemption as appropriate, and that, in turn, failure to submit a timely 
request for extension or exemption may put a hospice at risk of non-
compliance with the timeliness threshold. Another commenter stated they 
believed the process for HIS data collection and submission, which 
relies heavily on chart abstraction, was error-ridden and outdated. The 
commenter encouraged CMS to automate data collection and submission 
processes via electronic submission of HIS data.
    Response: We thank the commenters for their comments on our 
previously finalized policies for form, manner, and timing of data 
collection. Regarding the first commenter's concern about ability to 
submit a timely extension or exemption request to maintain compliance 
with the 70/80/90 timeliness compliance thresholds in the case of 
extended natural disasters, CMS refers readers to our previously 
finalized policies for extensions and exemptions, addressed in section 
III.C.8 of this rule. As noted in section III.C.8, in instances of 
extraordinary circumstances (like widespread natural disasters), we may 
grant an extension/exemption to hospices that have not requested them, 
which may include instances where hospices are unable to make the 
request within the 30-day timeframe due to extenuating circumstances. 
Regarding the second commenter's request for electronic data collection 
and submission processes for the HIS, we would like to clarify that, as 
noted in section III.C.7.c of this rule, electronic submission of HIS 
records is already required; no other data submission methods are 
available. Hospices are required to submit all HIS records through the 
QIES ASAP system. We also provide electronic software to hospices free 
of charge that allows hospices to complete HIS records electronically; 
alternatively, hospices may choose to use vendor-designed software to 
complete HIS records. As noted by the commenter, we believe this 
electronic process of data completion and submission minimizes burden 
on providers and helps ensure data quality through the HIS record 
validation process. We refer readers to section III.C.7.c for more 
information on mechanisms of data submission for the HIS.
f. New Data Collection and Submission Mechanisms Under Consideration 
for Future Years
    CMS has made great progress in implementing the objectives set 
forth in the quality reporting and data collection activities required 
by sections 3004 of the Affordable Care Act. To date, CMS has 
established the HQRP, which includes 7 NQF-endorsed quality measures 
that are collected via the HIS. As stated in this rule, data on these 
measures are expected to be publicly reported sometime in 2017. 
Additionally, CMS has also implemented the Hospice CAHPS[supreg] as 
part of the HQRP to gather important input on patient experience of 
care in hospice. Over the past several years, CMS has conducted data 
collection and analysis on hospice utilization and trends to help 
reform the hospice payment system. In the FY 2016 Hospice Wage Index 
final rule, we finalized payment reform measures, including changes to 
the RHC payment rate and the implementation of a Service Intensity Add-
On (SIA) payment, effective January 1st, 2016. As part of payment 
reform and ongoing program integrity efforts, we will continue ongoing 
monitoring of utilization trends for any future refinements.
    To facilitate continued progress towards the requirements set forth 
in section 3004 of the Affordable Care Act, CMS is considering 
developing a new data collection mechanism for use by hospices. This 
new data collection mechanism would be a hospice patient assessment 
instrument, which would serve 2 primary objectives concordant with the 
Affordable Care Act legislation: (1) To provide the quality data 
necessary for HQRP requirements and the current function of the HIS; 
and (2) provide additional clinical data that could inform future 
payment refinements.
    CMS believes that the development of a hospice patient assessment 
tool could offer several benefits over the current mechanisms of data 
collection for quality and payment purposes, which include the 
submission of HIS data and the submission of claims data. For future 
payment refinements, a hospice patient assessment tool would allow CMS 
to gather more detailed clinical information, beyond the patient 
diagnosis and comorbidities that are currently reported on hospice 
claims. As stated in the FY 2016 Hospice Wage Index final rule (80 FR 
47203), detailed patient characteristics are necessary to determine 
whether a case mix payment system could be achieved. A hospice patient 
assessment tool would allow CMS to capture information on symptom 
burden, functional status, and patient, family, and caregiver 
preferences, all of which will inform future payment refinements.
    While systematic assessment is vital throughout the continuum of 
care, including palliative and end-of-life care, documentation 
confirming completion

[[Page 52177]]

of systematic assessment in hospice settings is often inadequate or 
absent.\32\ The value of the introduction of structured approaches via 
a clinical assessment is well established, as it enables a more 
comprehensive and consistent way of identifying and meeting patient 
needs.\33\
---------------------------------------------------------------------------

    \32\ McMillan, S., Small, B., & Haley, W. (2011). Improving 
Hospice Outcomes through Systematic Assessment: A Clinical Trial. 
Cancer Nursing, 34(2), 89-97.
    \33\ Bourbonnais, F.F., Perreault, A., & Bouvette, M. (2004). 
Introduction of a pain and symptom assessment tool in the clinical 
setting--lessons learned. Journal of Nursing Management, 12(3), 194-
200.
---------------------------------------------------------------------------

    Moreover, symptoms are the leading reason that people seek medical 
care in the first place and frequently serve as the basis for 
establishing a diagnosis. Measures of physical function and disease 
burden have been used to identify older adults at high-risk for excess 
health care utilization, disability, or mortality.\34\ Currently, data 
collected on claims includes line-item visits by discipline, General 
Inpatient Care (GIP) visit reporting to hospice patients in skilled 
nursing facilities or hospitals, post-mortem visits, injectable and 
non-injectable drugs and infusion pumps. Industry representatives have 
communicated to CMS that required claims information is not 
sufficiently comprehensive to accurately reflect the provision and the 
cost of hospice care.
---------------------------------------------------------------------------

    \34\ Sha, M., Callahan, C., Counsell, S., Westmoreland, G., 
Stump, T., Kroenke, K. (2005). Physical symptoms as a predictor of 
health care use and mortality among older adults. 118, 301-306.
---------------------------------------------------------------------------

    For quality data collection, a hospice patient assessment 
instrument would support the goals of the HQRP as new quality measures 
are developed and adopted. Since the current quality data collection 
tool (HIS) is a chart abstraction tool, not a hospice patient 
assessment instrument, CMS is limited in the types of data that can be 
collected via the HIS. Instead of retrospective data collection 
elements, a hospice patient assessment tool would include data elements 
designed to be collected concurrent with provision of care. As such, 
CMS believes a hospice patient assessment tool would allow for more 
robust data collection that could inform development of new quality 
measures that are meaningful to hospice patients, their families and 
caregivers, and other stakeholders.
    Finally, a hospice patient assessment tool that provides clinical 
data that is used for both payment and quality purposes would align the 
hospice benefit with other care settings that use similar approaches, 
such as nursing homes, inpatient rehabilitation facilities, and home 
health agencies which submit data via the MDS 3.0, IRF-PAI, and OASIS, 
respectively.
    CMS envisions the hospice patient assessment tool itself as an 
expanded HIS. The hospice patient assessment tool would include current 
HIS items, as well as additional clinical items that could be used for 
payment refinement purposes or to develop new quality measures. The 
hospice patient assessment tool would not replace existing requirements 
set forth in the Medicare Hospice CoPs (such as the initial nursing and 
comprehensive assessment), but would be designed to complement data 
that are collected as part of normal clinical care. If such a patient 
assessment were adopted, the new data collection effort would replace 
the current HIS, but would not replace other HQRP data collection 
efforts (that is, the Hospice CAHPS[supreg] survey), nor would it 
replace regular submission of claims data. CMS envisions that patient 
assessment data would be collected upon a patient's admission to and 
discharge from any Medicare-certified hospice provider; additional 
interim data collection efforts are also possible. Should CMS develop 
and implement a hospice patient assessment tool, CMS would provide 
several training opportunities to ensure providers are able to comply 
with any new requirements.
    CMS is not proposing a hospice patient assessment tool at this 
time; we are still in the early stages of development of an assessment 
tool to determine if it would be feasible to implement under the 
Medicare Hospice Benefit. In the development of such a hospice patient 
assessment tool, CMS will continue to receive stakeholder input from 
MedPAC and ongoing input from the provider community, Medicare 
beneficiaries, and technical experts. It is of the utmost importance to 
CMS to develop a hospice patient assessment tool that is scientifically 
rigorous and clinically appropriate, thus we believe that continued and 
transparent involvement of stakeholders is critical. Additionally, it 
is of the utmost importance to CMS to minimize data collection burden 
on providers; in the development of any hospice patient assessment 
tool, CMS will ensure that patient assessment data items are not 
duplicative or overly burdensome to providers, patients, caregivers, or 
their families.
    We received multiple comments pertaining to a potential hospice 
patient assessment tool to collect quality, clinical and other data 
with the ability to be used to inform future payment refinement 
efforts. The following is a summary of the comments we received on this 
topic and our responses.
    Comment: CMS received many comments about the potential new data 
collection mechanism--a comprehensive, standardized hospice patient 
assessment instrument--under consideration for future years. Overall, 
the vast majority of commenters were supportive of CMS's efforts to 
develop a patient assessment tool. Commenters believed that a patient 
assessment tool capturing information on symptom burden, functional 
status, and patient, family, and caregiver preferences has the 
potential to more accurately inform future payment refinements and 
quality measure development based on the needs of the populations 
served. Commenters noted that the development of a patient assessment 
tool would be an integral step in improving care management and 
coordination across settings, providing standardized data on the 
services that patients and families receive to better understand the 
complex patient characteristics. One of the commenters, MedPAC, 
supported the development of a patient assessment instrument, noting 
its potential value in capturing more meaningful quality data, as well 
as providing more detailed clinical information that might be useful 
for payment policy.
    Commenters offered several suggestions for CMS to consider in 
moving forward with the development of a patient assessment tool. 
Suggestions focused on two main themes: (1) Considerations for the 
content of any patient assessment tool (2) considerations for the 
process used by CMS to develop and test a patient assessment tool. 
Beyond these two themes, commenters also listed other considerations, 
including cross-setting considerations (experience with other 
assessment tools and relationship to the IMPACT Act), burden and costs, 
use for future payment refinements, and general concerns.
    Regarding considerations for the content of a patient assessment 
tool, overall, commenters emphasized the unique nature and care goals 
of hospice, urging CMS to bear in mind these complexities in the 
development of a patient assessment. Specifically, commenters stated 
that the patient assessment tool should reflect the holistic nature of 
hospice care delivery to the patient and their loved ones and should 
include physical, psychosocial, and spiritual components. Commenters 
also noted that the unit of care in hospice is the patient and family, 
and that the initial and ongoing assessment, as well as care planning 
and

[[Page 52178]]

interventions, address the holistic care needs of both the patient and 
family. Commenters urged CMS not to limit the focus of a patient 
assessment tool to the clinical, ``head-to-toe'' nursing assessment, 
since care plans in hospice are often ``more personal than medical'' 
with emphasis on the patient's family and environment. Similarly, 
commenters pointed out the interdisciplinary nature of hospice, and 
recommended that any patient assessment tool include information from 
the entire hospice team. In consideration of all of these factors, 
commenters ultimately urged CMS to develop data elements that are 
relevant and meaningful to hospice practice.
    In addition to comments about the nature and goals of hospice care, 
several commenters also had specific content suggestions for CMS to 
consider in the development of a patient assessment tool:
     Several commenters recommended that the assessment tool 
recognize the patient's right to refuse or defer offered services and 
the importance of an individualized plan of care.
     Several commenters recommended that the assessment tool 
accommodate care delivered in various settings, including nursing 
homes, assisted living facilities, hospitals, hospice facilities, and 
the patient's home.
     Several commenters recommended that the assessment tool 
allow for modified assessment of patients who are imminently dying to 
facilitate a focus on the urgent and immediate needs of the patient and 
family. Commenters noted that for imminently dying patients, the focus 
is the management of symptoms and the family's emotions, not 
necessarily a detailed medical history and physical assessment of the 
patient.
     Several commenters noted that the assessment tool should 
preserve the integrity of the hospice philosophy by allowing hospice 
interdisciplinary team members to individualize assessments and care 
based on their best clinical judgment. Additionally, commenters 
recommended that CMS not place overly restrictive limits on members of 
the interdisciplinary team that are permitted to complete the 
assessment tool. Commenters recommended that CMS allow several 
disciplines to contribute patient information and goals on the 
assessment, noting that this was a limitation of other assessment 
tools.
     One commenter recommended that CMS collect assessment data 
beyond the admission and discharge time points discussed in the 
proposed rule (81 FR 25528). The commenter noted the importance of 
measuring care throughout the entire stay, not just at admission and 
discharge.
     Commenters recommended that any outcome measure derived 
from the assessment be risk-adjusted.
     A couple of commenters suggested that any ``Reason for 
Discharge'' item(s) on the assessment tool differentiate the reason 
behind any live discharges (for example, revoked vs. moved out of 
service area).
     One commenter recommended CMS consider the International 
Classification of Function (ICF), in the development of a patient 
assessment tool. The commenter noted that the ICF provides a scientific 
basis for understanding health and health-related states as well as 
outcomes, related to both physical as well as social determinants, and 
could be a way to determine appropriate outcomes more quickly. Finally, 
the commenter noted that the ICF is already integrated into the ICD-10 
and ICD-11 taxonomy internationally.
     Another commenter recommended that CMS align any new 
hospice assessment tool with the National Consensus Project for Quality 
Palliative Care Clinical Practice Guidelines for Quality Palliative 
Care.
    Commenters had several suggestions regarding the process for 
development of any patient assessment tool. The majority of comments on 
the process for assessment tool development focused on systematically 
and comprehensively gathering input from hospice providers and other 
stakeholders with respect to what is appropriate and relevant to 
include in the assessment tool. Commenters offered specific suggestions 
of ways to involve the provider community, including CMS-convened 
technical expert panels (TEP) that include representation from 
hospices, physicians, and other members of the hospice 
Interdisciplinary Team (IDT). In addition to TEPs, one commenter 
suggested that CMS consider extending opportunities for input beyond 
TEPs and employ widespread processes for gathering provider input. 
Commenters also had suggestions for testing and refinement of a patient 
assessment tool. Commenters recommended piloting the tool with a wide 
variety of hospices, to ensure that the assessment tool is tested with 
variation in hospice size, rurality, state regulatory environments, and 
organization type (that is, hospital based, freestanding, those with 
inpatient facilities vs. those who contract for inpatient care, etc.). 
Commenters recommended a pilot testing process that is thorough and 
includes a dry-run period or phased-in implementation approach. 
Finally, commenters encouraged CMS to provide thorough and ongoing 
education and support for hospices as the patient assessment tool is 
implemented. Commenters specifically requested that educational 
materials include clear definitions of patient assessment items and 
data collection procedures.
    Several commenters also discussed their experience with assessment 
tools in other care settings (for example, the OASIS in home health and 
the MDS in nursing homes). Some commenters expressed concerns about 
potential overreliance on existing assessment instrument items citing 
the difference in care goals between hospice and other post-acute care 
settings. These commenters emphasized the importance of creating an 
assessment tool tailored to the unique needs of hospice. On the other 
hand, commenters also urged CMS to create an assessment tool that is 
aligned and consistent with other assessment tools to facilitate care 
coordination and planning across the care continuum.
    A few commenters offered considerations on potential burden and 
costs of a new assessment instrument. Commenters urged CMS to pursue 
efforts that would limit administrative burden, reduce redundancy, and 
ensure the use of definitions consistent with other assessment tools. 
Commenters noted that the assessment would likely be completed by 
different staff than those who are currently completing the HIS-
Admission and HIS-Discharge records and that the assessment would 
likely be more time-intensive than the current HIS. Commenters urged 
CMS to consider increased costs to providers and to take into 
consideration the time and resources necessary to complete the 
assessment.
    One commenter suggested that CMS--as appropriate--consider 
harmonizing measures from the IMPACT Act. The commenter noted that such 
harmonization would facilitate communication among providers and to 
measure the care of patient populations across setting measures. With 
respect to use of the patient assessment for future payment 
refinements, a few commenters noted the importance of rigorous testing 
of assessment items for inter-rater reliability and validity.
    Beyond the support and suggestions offered, some commenters did 
raise concerns about a patient assessment tool. Commenters cautioned 
against a patient assessment tool that would lead to ``checklist'' 
assessments and undue restrictions on patient eligibility and the 
freedom to employ clinical judgment. Finally, one commenter had 
concerns about the flexibility of electronic medical record systems to 
capture

[[Page 52179]]

assessment items in a structured and minimally burdensome manner.
    Response: First, we thank the commenters for their support of the 
development of a patient assessment tool. We agree that development of 
a patient assessment tool is a critical next step in refining quality 
data collection efforts and to inform future refinements to the hospice 
payment system. Second, we greatly appreciate the thoughtful input and 
recommendations from the hospice community. We believe the initial 
input from our stakeholders regarding the content and process for 
development of a patient assessment tool is aligned with our vision and 
guiding principles for moving forward with developing this new data 
collection mechanism. We would like to assure the provider community 
that we wholeheartedly agree with commenters regarding the unique 
nature of hospice care, and we intended to keep the hospice philosophy 
as the foundation of the patient assessment tool. We seek to develop an 
assessment tool that reflects the distinctive aspects of hospice care, 
including the palliative, rather than curative, focus of hospice care. 
We agree with the points raised by commenters about the overall focus 
of an assessment tool and aims to develop a tool that addresses the 
holistic nature of hospice, incorporating important medical, 
psychosocial, spiritual, and other aspects of care that are important 
for patients and their caregivers. We also appreciate commenters' 
specific suggestions regarding the content of a patient assessment tool 
including the need for a flexible assessment, which would incorporate 
input from various members of the IDT and accommodate circumstances 
unique to hospice such as care of the imminently dying and patient/
caregivers' right to decline services or treatment.
    With respect to commenters' suggestions about the process for 
development of a patient assessment tool, we would again like to thank 
the hospice community for their detailed input and careful 
consideration. Again, we would like to assure the provider community 
that it is our intent to use a development process that is transparent 
and includes multiple opportunities for stakeholder input. Feedback 
from the provider community is vital to the development of a patient 
assessment tool that is meaningful and not unduly burdensome on 
providers. As noted by commenters and discussed in this rule, CMS plans 
to hold TEPs to inform the development, testing, and refinement of the 
patient assessment. CMS also plans to provide other opportunities for 
stakeholders to provide input through venues such as special open door 
forums and other regular HQRP communication channels. We are committed 
to a development process that will ensure rigorous and iterative 
testing of the patient assessment tool in hospices with varying 
organizational characteristics, patient populations, settings of care 
delivery, and levels of care. We recognize the emphasis that we will 
need to place on thorough testing and analysis of items for reliability 
and validity, particularly for purposes of any future payment 
refinements. Finally, we agree that ongoing training and education will 
be vital, and we will ensure access to regular HQRP education and 
outreach outlets, such as training webinars, manuals and access to 
various Helpdesks.
    We also appreciate commenters' suggestions on cross-setting 
harmonization and for sharing their experience with assessment tools in 
other care settings. We would like to assure commenters that we 
recognize the unique nature of hospice care; it is not our intent to 
develop an assessment tool that inappropriately relies on items from 
existing tools, such as the Minimum Data Set (MDS) and Outcome and 
Information Assessment Information Set (OASIS). We will work diligently 
with the provider community to gather information on current assessment 
practices in hospice and to ensure that a hospice assessment tool would 
capture the goals of hospice care and be complementary to current 
clinical practice. Regarding the commenters' suggestion to harmonize 
assessment items and resulting quality measure with the IMPACT Act 
quality measures, we appreciate the commenter's suggestion and will 
take it under consideration for future measure and assessment 
development.
    Finally, with respect to concerns raised by commenters about costs 
and administrative burden, as stated in the rule, it is our goal to 
minimize data collection burden on providers and ensure that patient 
assessment items are not duplicative or overly burdensome to providers, 
patients, or their families. We believe that regular, ongoing input 
from the provider community will aide in the development of an 
assessment that is not overly burdensome. We expect that development of 
the patient assessment will take into account the ongoing movement 
toward use of certified EHRs and other interoperable health IT across 
all patient settings. We expect that our consultations with providers 
and with technical experts including health IT experts will include 
assessing and taking advantage of opportunities to develop and deploy 
the instrument in a way that integrates with hospice work flows and 
with the potential of health IT to help providers improve care, 
communication and coordination across the interdisciplinary care team 
while reducing burden on clinicians and other care team members by 
streamlining data collection and management. In addition, any patient 
assessment tool would be submitted to OMB as required by the Paperwork 
Reduction Act, the purpose of which is to ensure that Federally-
sponsored data collection efforts pose no undue burden on the public.
    We appreciate the input from the public regarding the development 
of a patient assessment tool for hospice. We will continue to inform 
our stakeholders on any progress and proposals regarding the patient 
assessment tool through future rulemaking cycles.
8. HQRP Submission Exemption and Extension Requirements for the FY 2017 
Payment Determination and Subsequent Years
    In the FY 2015 Hospice Wage Index final rule (79 FR 50488), we 
finalized our proposal to allow hospices to request, and for CMS to 
grant, exemptions/extensions for the reporting of required HIS quality 
data when there are extraordinary circumstances beyond the control of 
the provider. When an extension/exemption is granted, a hospice will 
not incur payment reduction penalties for failure to comply with the 
requirements of the HQRP. For the FY 2016 payment determination and 
subsequent payment determinations, a hospice may request an extension/
exemption of the requirement to submit quality data for a specified 
time period. In the event that a hospice requests an extension/
exemption for quality reporting purposes, the hospice would submit a 
written request to CMS. In general, exemptions and extensions will not 
be granted for hospice vendor issues, fatal error messages preventing 
record submission, or staff error.
    In the event that a hospice seeks to request an exemptions or 
extension for quality reporting purposes, the hospice must request an 
exemption or extension within 30 days of the date that the 
extraordinary circumstances occurred by submitting the request to CMS 
via email to the HQRP mailbox at 
[email protected]. Exception or extension requests 
sent to CMS through any other channel will not be considered valid. The 
request for an exemption or extension must contain all of the finalized 
requirements as outlined on our Web site at https://www.cms.gov/
Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Hospice-

[[Page 52180]]

Quality-Reporting/Extensions-and-Exemption-Requests.html.
    If a hospice is granted an exemption or extension, timeframes for 
which an exemption or extension is granted will be applied to the new 
timeliness requirement so such hospices are not penalized. If a hospice 
is granted an exemption, we will not require that the hospice submit 
any quality data for a given period of time. By contrast, if we grant 
an extension to a hospice, the hospice will still remain responsible 
for submitting quality data collected during the timeframe in question, 
although we will specify a revised deadline by which the hospice must 
submit these quality data.
    This process does not preclude us from granting extensions/
exemptions to hospices that have not requested them when we determine 
that an extraordinary circumstance, such as an act of nature, affects 
an entire region or locale. We may grant an extension/exemption to a 
hospice if we determine that a systemic problem with our data 
collection systems directly affected the ability of the hospice to 
submit data. If we make the determination to grant an extension/
exemption to hospices in a region or locale, we will communicate this 
decision through routine CMS HQRP communication channels, including 
postings and announcements on the CMS HQRP Web site, MLN eNews 
communications, national provider association calls, and announcements 
on Open Door Forums and Special Open Door Forums.
9. Hospice CAHPS[supreg] Participation Requirements for the 2019 APU 
and 2020 APU
    National Implementation of the Hospice CAHPS[supreg] Survey started 
January 1, 2015 as stated in the FY 2015 Hospice Wage Index and Payment 
Rate Update final rule (79 FR 50452). The CAHPS[supreg] Hospice Survey 
is a component of CMS' Hospice Quality Reporting Program that 
emphasizes the experiences of hospice patients and their primary 
caregivers listed in the hospice patients' records. Readers who want 
more information are referred to our extensive discussion of the 
Hospice Experience of Care Survey in the Hospice Wage Index FY 2015 
final rule for a description of the measurements involved and their 
relationship to the statutory requirement for hospice quality reporting 
(79 FR 50450 also refer to 78 FR 48261).
a. Background and Description of the Survey
    The CAHPS[supreg] Hospice Survey is the first national hospice 
experience of care survey that includes standard survey administration 
protocols that allow for fair comparisons across hospices. Consistent 
with many other CMS CAHPS[supreg] surveys that are publicly reported on 
CMS Web sites, CMS will publicly report hospice data when at least 12 
months of data are available, so that valid comparisons can be made 
across hospice providers in the United States, in order to help 
patients, family, friends, and caregivers choose the right hospice 
program.
    The goals of the CAHPS[supreg] Hospice Survey are to:
     Produce comparable data on hospice patients' and 
caregivers' perspectives of care that allow objective and meaningful 
comparisons between hospices on domains that are important to 
consumers.
     Create incentives for hospices to improve their quality of 
care through public reporting of survey results.
     Hold hospice care providers accountable by informing the 
public about the providers' quality of care.
    Details regarding CAHPS[supreg] Hospice Survey national 
implementation, and survey administration as well as participation 
requirements, exemptions from the survey requirement, hospice patient 
and caregiver eligibility criteria, fielding schedules, sampling 
requirements, and the languages in which is questionnaire, are 
available on the CAHPS[supreg] Web site, www.HospiceCAHPSsurvey.org and 
in the Quality Assurance Guidelines (QAG) manual, which is also on the 
same site and is available for download. Measures from the survey will 
be submitted to the NQF for endorsement.
b. Participation Requirements To Meet Quality Reporting Requirements 
for the FY 2019 APU
    To meet participation requirements for the FY 2019 APU, hospices 
must collect survey data on an ongoing monthly basis from January 2017 
through December 2017 (inclusive). Data submission deadlines for the 
2019 APU can be found in Table 17. The data must be submitted by the 
deadlines listed in Table 17 by the hospice's authorized approved CMS 
vendor.
    Hospices provide lists of the patients who died under their care to 
form the sample for the Hospice CAHPS[supreg] Survey. We emphasize the 
importance of hospices providing complete and accurate information to 
their vendors in a timely manner. Hospices must contract with an 
approved Hospice CAHPS[supreg] Survey vendor to conduct the survey on 
their behalf. The hospice is responsible for making sure their vendor 
meets all data submission deadlines. Vendor failure to submit data on 
time will be the responsibility of the hospice.

  Table 17--CAHPS[supreg] Hospice Survey Data Submission Dates FY 2018
                    APU, FY 2019 APU, and FY 2020 APU
------------------------------------------------------------------------
  Sample months (that is, month of death)     Quarterly data submission
                    \1\                             deadlines \2\
------------------------------------------------------------------------
                               FY 2018 APU
------------------------------------------------------------------------
January-March 2016 (Q1)...................  August 10, 2016.
April-June 2016 (Q2)......................  November 9, 2016.
July-September 2016 (Q3)..................  February 8, 2017.
October-December 2016 (Q4)................  May 10, 2017.
------------------------------------------------------------------------
                               FY 2019 APU
------------------------------------------------------------------------
January-March 2017 (Q1)...................  August 9, 2017.
April-June 2017 (Q2)......................  November 8, 2017.
July-September 2017 (Q3)..................  February 14, 2018.
October-December 2017 (Q4)................  May 9, 2018.
------------------------------------------------------------------------
                               FY 2020 APU
------------------------------------------------------------------------
January-March 2018 (Q1)...................  August 8, 2018.

[[Page 52181]]

 
April-June 2018 (Q2)......................  November 14, 2018.
July-September 2018 (Q3)..................  February 13, 2019.
October-December 2018 (Q4)................  May 8, 2019.
------------------------------------------------------------------------
1 Data collection for each sample month initiates 2 months following the
  month of patient death (for example, in April for deaths occurring in
  January).
 
2 Data submission deadlines are the second Wednesday of the submission
  months, which are Augst, November, February, and May.

    Hospices that have fewer than 50 survey-eligible decedents/
caregivers in the period from January 1, 2016 through December 31, 2016 
are exempt from CAHPS[supreg] Hospice Survey data collection and 
reporting requirements for the FY 2019 payment determination. To 
qualify, hospices must submit an exemption request form. This form will 
be available in first quarter 2017 on the CAHPS[supreg] Hospice Survey 
Web site http://www.hospiceCAHPSsurvey.org. Hospices that want to claim 
the size exemption are required to submit to CMS their total unique 
patient count for the period of January 1, 2016 through December 31, 
2016. The due date for submitting the exemption request form for the FY 
2019 APU is August 10, 2017.
    CMS proposed that hospices that received their CCN after January 1, 
2017 are exempted from the FY 2019 APU Hospice CAHPS[supreg] 
requirements due to newness. This exemption will be determined by CMS. 
The exemption is for 1 year only.
c. Participation Requirements To Meet Quality Reporting Requirements 
for the FY 2020 APU
    To meet participation requirements for the FY 2020 APU, hospices 
must collect survey data on an ongoing monthly basis from January 2018 
through December 2018 (inclusive). Data submission deadlines for the 
2020 APU can be found in Table 17. The data must be submitted by the 
deadlines in Table 17 by the hospice's authorized approved CMS vendor.
    Hospices that have fewer than 50 survey-eligible decedents/
caregivers in the period from January 1, 2017 through December 31, 2017 
are exempt from CAHPS[supreg] Hospice Survey data collection and 
reporting requirements for the FY 2020 payment determination. To 
qualify, hospices must submit an exemption request form. This form will 
be available in first quarter 2018 on the CAHPS[supreg] Hospice Survey 
Web site http://www.hospiceCAHPSsurvey.org. Hospices that want to claim 
the size exemption are required to submit to CMS their total unique 
patient count for the period of January 1, 2017 through December 31, 
2017. The due date for submitting the exemption request form for the FY 
2020 APU is August 10, 2018.
    CMS proposed that hospices that received their CCN after January 1, 
2018 are exempted from the FY 2020 APU Hospice CAHPS[supreg] 
requirements due to newness. This exemption will be determined by CMS. 
The exemption is for 1 year only.
d. Annual Payment Update
    The Affordable Care Act requires that beginning with FY 2014 and 
each subsequent fiscal year, the Secretary shall reduce the market 
basket update by 2 percentage points for any hospice that does not 
comply with the quality data submission requirements for that fiscal 
year, unless covered by specific exemptions. Any such reduction will 
not be cumulative and will not be taken into account in computing the 
payment amount for subsequent fiscal years. In the FY 2015 Hospice Wage 
Index final rule, we added the CAHPS[supreg] Hospice Survey to the 
Hospice Quality Reporting Program requirements for the FY 2017 payment 
determination and determinations for subsequent years.
     To meet the HQRP requirements for the FY 2018 payment 
determination, hospices would collect survey data on a monthly basis 
for the months of January 1, 2016 through December 31, 2016 to qualify 
for the full APU.
     To meet the HQRP requirements for the FY 2019 payment 
determination, hospices would collect survey data on a monthly basis 
for the months of January 1, 2017 through December 31, 2017 to qualify 
for the full APU.
     To meet the HQRP requirements for the FY 2020 payment 
determination, hospices would collect survey data on a monthly basis 
for the months of January 1, 2018 through December 31, 2018 to qualify 
for the full APU.
e. Hospice CAHPS[supreg] Reconsiderations and Appeals Process
    Hospices are required to monitor their respective Hospice 
CAHPS[supreg] Survey vendors to ensure that vendors submit their data 
on time. The hospice CAHPS[supreg] data warehouse provides reports to 
vendors and hospices, including reports on the status of their data 
submissions. Details about the reports and emails received after data 
submission should be referred to the Quality Assurance Guidelines 
Manual. If a hospice does not know how to retrieve their reports, or 
lacks access to the reports, they should contact Hospice CAHPS[supreg] 
Technical Assistance at [email protected] or call them at 1-
844 -472 -4621. Additional information can be found on page 113 of the 
Hospice CAHPS[supreg] Quality Assurance Guidelines manual Version 2.0 
which is available on the Hospice CAHPS[supreg] Web site, 
www.hospicecahpssurvey.org.
    In the FY 2017 payment determination and subsequent years, 
reporting compliance is determined by successfully fulfilling both the 
Hospice CAHPS[supreg] Survey requirements and the HIS data submission 
requirements. Providers would use the same process for submitting a 
reconsideration request that are outlined in section III.C.10 of this 
rule.
    We received multiple comments pertaining to the Hospice 
CAHPS[supreg] Survey. The following is a summary of the comments we 
received on this topic and our responses.
    Comment: One commenter expressed concern about the length of the 
survey and described it as a tool that is 36 pages in length and 
fraught with arduous stipulations of its delivery. In addition, the 
commenter stated that it would be very difficult for CMS to monitor 
compliance with how hospices are portraying the survey and described 
the survey as cumbersome for bereaved families to complete.
    Response: The Hospice CAHPS Survey consists of a total of 47

[[Page 52182]]

questions, some of which are only asked when the patient received 
services in a specific setting. The Hospice CAHPS Survey has fewer 
questions than NHPCO's well-known Family Evaluation of Hospice Care 
(FEHC) survey, which has 54 items. We offer a 36-page document on the 
CAHPS Survey Web site that contains survey materials 
(www.hospicecahpssurvey.org). The document packages three copies of the 
questionnaire, each set up for a different optical scanning program. 
This is offered for the convenience of the survey vendors. Vendors will 
use only one of these versions. In addition, the file includes some 
sample letters for vendors' use. We have implemented detailed 
specifications for the survey vendors to follow. This ensures 
standardization of survey administration procedures across vendors. 
Standardization is important for accurate data quality and to ensure 
that the data from different vendors is comparable for public 
reporting. While it is true that we have no way to monitor the way 
hospices are portraying the survey, we offer guidelines in the Quality 
Assurance Guidelines manual on the survey Web site 
(www.hospicecahpssurvey.org). We rely on the professionalism of the 
providers to cooperate with the survey's requirements.
    The commenter also states that the survey is burdensome for 
bereaved families to complete. We thank the commenters for their 
comments; we have not received complaints from respondents regarding 
the survey being burdensome. Responses are voluntary and at the 
discretion of the person receiving the survey. If they find the survey 
too burdensome, they simply do not need to respond.
    Comment: A few commenters stated that it is unclear whether public 
reporting will use only the eligible HIS quality measures or will also 
use the Hospice CAHPS results. Commenters claim that the inclusion of 
Hospice CAHPS results is essential if Hospice Compare is to provide a 
meaningful reflection of hospice care quality.
    Response: We thank the commenters for their comments. We are 
currently building the infrastructure for the new Hospice Compare site 
and are evaluating the best method to include both the Hospice Item Set 
measures and the results of the Hospice CAHPS Survey.
    Comment: One commenter made the point that, for smaller hospices, 
Hospice CAHPS data is likely to be more vulnerable to variations 
numerator size and variability than comparable data for larger 
hospices.
    Response: We agree that smaller hospices may be subject to greater 
variability than large ones. We plan to report an eight-quarter rolling 
average for Hospice CAHPS public reporting. For the initial report, we 
may include fewer quarters, but we will build up to eight quarters and 
continue on an ongoing basis. These plans are intended to 
counterbalance concerns about variability of the data while at the same 
time including as many hospices as possible on the Compare site.
    Comment: One commenter recommended that CMS conduct analysis to 
determine how CAHPS results are affected by survey eligibility 
requirements and response rates. Specifically, they express concern 
about the relationship between Hospice CAHPS data and the data that 
would be obtained if survey eligibility rules were modified.
    Response: We thank the commenter for their comments. When a sample 
is taken, it is a random sample to represent the care of all eligible 
hospice patients. We do exclude patients who have been in hospice care 
for fewer than 48 hours since their caregivers do not have enough 
experience to evaluate the care provided by the hospice. We intend to 
conduct a variety of special and ongoing analyses of Hospice CAHPS 
data, as well as other related data available to the agency, including 
analyses of how non-responders differ from responders to determine if 
we need to control for non-response bias. Generally, the adjustment is 
already completed for differences in the mix of patients across 
providers also controls for any non-response bias. We will, however, 
continue to monitor how eligibility requirements and response rates 
impact the character of the data reported and whether changes in 
requirements need to be made.
    Comment: A few commenters commented that hospices not included in 
public reporting might be disadvantaged.
    Response: As mentioned previously, we are aware that hospices might 
want to be included in the Hospice Compare Web site. We are increasing 
the number of quarters included in the rolling average that will be 
reported on the public reporting site. The goal of this process is to 
make it possible for a larger proportion of hospices to be included on 
the site, while at the same time limiting the variability of the 
results for smaller hospices.
    Comment: One commenter requested that CMS use two individual 
questions from the survey, the hospice rating item and the 
``willingness to recommend'' item, on the Hospice Compare Web site.
    Response: We plan to include both the hospice rating question and 
the willingness to recommend question as part of the Hospice CAHPS data 
reported on Hospice Compare.
    Final Action: After consideration of comments, we are finalizing 
our proposals that hospices that receive their CCN after January 1, 
2017 for the FY 2019 APU and January 1, 2018 for the FY 2020 APU are 
exempted from the Hospice CAHPS[supreg] requirements due to newness.
10. HQRP Reconsideration and Appeals Procedures for the FY 2017 Payment 
Determination and Subsequent Years
    In the FY 2015 Hospice Wage Index final rule (79 FR 50496), we 
notified hospice providers on how to seek reconsideration if they 
received a noncompliance decision for the FY 2016 payment determination 
and subsequent years. A hospice may request reconsideration of a 
decision by CMS that the hospice has not met the requirements of the 
Hospice Quality Reporting Program for a particular period.
    We clarified that any hospice that wishes to submit a 
reconsideration request must do so by submitting an email to CMS 
containing all of the requirements listed on the HQRP Web site at 
http://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Hospice-Quality-Reporting/Reconsideration-Requests.html. 
Electronic email sent to [email protected] is the 
only form of submission that will be accepted. Any reconsideration 
requests received through any other channel including the United States 
Postal Service or phone will not be considered as a valid 
reconsideration request. We codified this process at Sec.  418.312(h). 
In addition, we codified at Sec.  418.306(b)(2) that beginning with FY 
2014 and each subsequent FY, the Secretary shall reduce the market 
basket update by 2 percentage points for any hospice that does not 
comply with the quality data submission requirements for that FY and 
solicited comments on all of the proposals and the associated 
regulations text at Sec.  418.312 and in Sec.  418.306 in section VI. 
Official instructions regarding the payment reduction reconsideration 
process can be located under the Regulations and Guidance, 
Transmittals, 2015 Transmittals Web site at https://www.cms.gov/
Regulations-and-Guidance/Guidance/Transmittals/2015-Transmittals-Items/

[[Page 52183]]

R52QRI.html?DLPage=1&DLEntries=10&DLSort=4&DLSortDir=descending.
    In the past, only hospices found to be non-compliant with the 
reporting requirements set forth for a given payment determination 
received a notification from CMS of this finding along with 
instructions for requesting reconsideration in the form of a United 
States Postal Service (USPS) letter. In the FY 2016 Hospice Wage Index 
final rule (80 FR 47198), we stated that we would use the QIES CASPER 
reporting system as an additional mechanism to communicate to hospices 
regarding their compliance with the reporting requirements for the 
given reporting cycle. We will implement this additional communication 
mechanism via the QIES CASPER timeliness compliance reports referenced 
in section III.C.7e of this final rule. As stated in section III.C.7e 
of the rule, these QIES CASPER reports will be automated reports that 
hospices will be able to generate at any point in time to determine 
their preliminary compliance with HQRP requirements, specifically, the 
timeliness compliance threshold for the HIS. We believe the QIES CASPER 
timeliness compliance reports meet CMS's intent of developing a method 
to communicate as quickly, efficiently, and broadly as possible with 
hospices regarding their preliminary compliance with reporting 
requirements. We will continue to send notification of noncompliance 
via delivery of a letter via the United States Postal Service. 
Requesting access to the CMS systems is performed in 2 steps. Details 
are provided on the QIES Technical Support Office Web site at https://www.qtso.com/hospice.html. Providers may access the CMS QIES Hospice 
Users Guides and Training by going to the QIES Technical Support Office 
Web site and selecting Hospice and then selecting the CASPER Reporting 
Users Guide at https://www.qtso.com/hospicetrain.html. Additional 
information about how to access the QIES CASPER reports will be 
provided prior to the availability of these new reports.
    We proposed to disseminate communications regarding the 
availability of hospice compliance reports in CASPER files through CMS 
HQRP communication channels, including postings and announcements on 
the CMS HQRP Web site, MLN eNews communications, national provider 
association calls, and announcements on Open Door Forums and Special 
Open Door Forums. We further proposed to publish a list of hospices who 
successfully meet the reporting requirements for the applicable payment 
determination on the CMS HQRP Web site https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Hospice-Quality-Reporting/index.html. We proposed updating the list after 
reconsideration requests are processed on an annual basis. We clarified 
that the published list of compliant hospices on the CMS HQRP Web site 
would include limited organizational data, such as the name and 
location of the hospice. Finalizing the list of compliant providers for 
any given year is most appropriately done after the final determination 
of compliance is made. It is our intent for the published list of 
compliant hospices to be as complete and accurate as possible, giving 
recognition to all providers who were compliant with HQRP requirements 
for that year. Finalizing the list after requests for reconsideration 
are reviewed and a final determination of compliance is made allows for 
a more complete and accurate listing of compliant providers than 
developing any such list prior to reconsideration. Developing the list 
after the final determination of compliance has been made allows 
providers whose initial determination of noncompliance was reversed to 
be included in the list of compliant hospices for that year. We believe 
that finalizing the list of compliant hospices annually after the 
reconsideration period will provide the most accurate listing of 
hospices compliant with HQRP requirements.
11. Public Display of Quality Measures and Other Hospice Data for the 
HQRP
    Under section 1814(i)(5)(E) of the Act, the Secretary is required 
to establish procedures for making any quality data submitted by 
hospices available to the public. Such procedures shall ensure that a 
hospice program has the opportunity to review the data that is to be 
made public for the hospice program prior to such data being made 
public. The Secretary shall report quality measures that relate to 
hospice care provided by hospice programs on the CMS Web site.
    We recognize that public reporting of quality data is a vital 
component of a robust quality reporting program and are fully committed 
to developing the necessary systems for transparent public reporting of 
hospice quality data. We also recognize that it is essential that the 
data made available to the public be meaningful and that comparing 
performance between hospices requires that measures be constructed from 
data collected in a standardized and uniform manner. Hospices have been 
required to use a standardized data collection approach (HIS) since 
July 1, 2014. Data from July 1, 2014 onward is currently being used to 
establish the scientific soundness of the quality measures prior to the 
onset of public reporting of the 7 quality measures implemented in the 
HQRP. We believe it is critical to establish the reliability and 
validity of the quality measures prior to public reporting to 
demonstrate the ability of the quality measures to distinguish the 
quality of services provided. To establish reliability and validity of 
the quality measures, at least four quarters of data will be analyzed. 
Typically, the first 1 or 2 quarters of data reflect the learning curve 
of the facilities as they adopt standardized data collection 
procedures; these data often are not used to establish reliability and 
validity. We began data collection in CY 2014; the data from CY 2014 
for Quarter 3 (Q3) was not used for assessing validity and reliability 
of the quality measures. We analyzed data collected by hospices during 
Quarter 4 (Q4) CY 2014 and Q1 through Q3 CY 2015. Preliminary analyses 
of HIS data show that all 7 quality measures that can be calculated 
using HIS data are eligible for public reporting (NQF #1634, NQF #1637, 
NQF #1639, NQF #1638, NQF #1641, modified NQF #1647, NQF #1617). Based 
on analyses conducted to establish reportability of the measures, 71 
percent through 90 percent of all hospices would be able to participate 
in public reporting, depending on the measure. For additional details 
regarding analysis, we refer readers to the Measure Testing Executive 
Summary document available on the ``Current Measures'' section of the 
CMS HQRP Web site: https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Hospice-Quality-Reporting/Current-Measures.html. Although analyses show that many hospices perform well 
on the 7 measures from the HIS measure set, the measures still show 
variation, especially among hospices with suboptimal performance, 
indicating that these measures are still meaningful for comparing 
quality of care across hospice providers. In addition to conducting 
quantitative analysis to establish scientific acceptability of the HIS 
measures, CMS's measure development contractor conducted interviews 
with family and caregivers of hospice patients. The purpose of these 
interviews was to determine what information patients and caregivers 
would find useful in selecting hospices, as well as gathering input 
about patient and caregiver experience with hospice

[[Page 52184]]

care. Results from these interviews indicate that all 7 HIS quality 
measures provide consumers with useful information. Interview 
participants stated that quality measure data would be especially 
helpful in identifying poor quality outliers that inform beneficiaries, 
families, caregivers, and other hospice stakeholders.
    To inform which of the HIS measures are eligible for public 
reporting, CMS's measure development contractor, RTI International, 
examined the distribution of hospice-level denominator size for each 
quality measure to assess whether the denominator size is large enough 
to generate the statistically reliable scores necessary for public 
reporting. This goal of this analysis is to establish the minimum 
denominator size for public reporting, which is referred to as 
``reportability'' analysis. Reportability analysis is necessary since 
small denominators may not yield statistically meaningful QM scores. 
Thus, for other quality reporting programs, such as Nursing Home 
Compare,\35\ CMS sets a minimum denominator size for public reporting, 
as well as the data selection period necessary to generate the minimum 
denominator size. Reportability analysis showed that calculating and 
publicly displaying measures based on 12 months of data would allow for 
sufficient measure denominator size. Having ample denominator size 
ensures that quality measure scores that are publicly reported are 
reliable and stable; a minimum sample size of 20 stays is commonly 
applied to assessment-based quality measures in other reporting 
programs. The 12-month data selection period produced significantly 
larger mean and median sample sizes among hospices, which will generate 
more reliable quality measure scores. Additionally, our analysis 
revealed that when applying a minimum sample size of 20 stays, using 
rolling 12 months of data to create QMs would only exclude about 10 
percent through 29 percent of hospices from public reporting, depending 
on the measure. For more information on analyses conducted to determine 
minimum denominator size and data selection period, we refer readers to 
the Reportability Analysis Section of the Measure Testing Executive 
Summary, available on the ``Current Measures'' portion of the CMS HQRP 
Web site: https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Hospice-Quality-Reporting/Current-Measures.html.
---------------------------------------------------------------------------

    \35\ ``CMS Nursing Home Quality Initiative--Centers for Medicare 
. . .'' 2011. 25 Jan. 2016 https://www.cms.gov/nursinghomequalityinits/45_nhqimds30trainingmaterials.asp.
---------------------------------------------------------------------------

    Based on reportability analysis and input from other stakeholders, 
we have determined that all 7 HIS measures are eligible for public 
reporting. Thus, we plan to publicly report all 7 HIS measures on a CMS 
Compare Web site for hospice agencies. For more details on each of the 
7 measures, including information on measure background, justification, 
measure specifications, and measure calculation algorithms, we refer 
readers to the HQRP QM User's Manual, which is available on the 
downloads portion of the Current Measures CMS HQRP Web site: https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Hospice-Quality-Reporting/Current-Measures.html. Individual 
scores for each of the 7 HIS measure scores would be reported on a new 
publicly available CMS Hospice Compare Web site. Current reportability 
analysis indicates that a minimum denominator size of 20 based on 12 
rolling months of data would be sufficient for public reporting of all 
HIS quality measures. Under this methodology, hospices with a quality 
measure denominator size of smaller than 20 patient stays would not 
have the quality measure score publicly displayed since a quality 
measure score on the basis of small denominator size may not be 
reliable. We will continue to monitor quality measure performance and 
reportability and will adjust public reporting methodology in the 
future if needed.
    Reportability analysis is typically conducted on a measure-by-
measure basis. We would like to clarify that any new measure adopted as 
part of the HQRP will undergo reportability analysis to determine: (1) 
If the measure is eligible for public reporting; and (2) the data 
selection period and minimum denominator size for the measure. Results 
of reportability analyses conducted for new measures will be 
communicated through future rulemaking.
    In addition, the Affordable Care Act requires that reporting be 
made public on a CMS Web site and that providers have an opportunity to 
review their data prior to public reporting. We are currently 
developing the infrastructure for public reporting and will provide 
hospices an opportunity to review their quality measure data prior to 
publicly reporting information about the quality of care provided by 
Medicare-certified hospice agencies throughout the nation. These 
quality measure data reports or ``preview reports'' will be made 
available in the CASPER system prior to public reporting and will offer 
providers the opportunity to review their quality measure data prior to 
public reporting on the CMS Compare Web site for hospice agencies. 
Under this process, providers would have the opportunity to review and 
correct data they submit on all measures that are derived from the 
Hospice Item Set. Reports would contain the provider's performance on 
each measure calculated based on HIS submission to the QIES ASAP 
system. The data from the HIS submissions would be populated into 
reports with all data that have been submitted by the provider. CMS 
will post preview reports with sufficient time for providers to be able 
to submit, review data, make corrections to the data, and view their 
data. Providers are encouraged to regularly evaluate their performance 
in an effort to ensure the most accurate information regarding their 
agency is reflected.
    We also plan to make available additional provider-level feedback 
reports, which are separate from public reporting and will be for 
provider viewing only, for the purposes of internal provider quality 
improvement. As is common in other quality reporting programs, quality 
reports would contain feedback on facility-level performance on quality 
metrics, as well as benchmarks and thresholds. For the CY 2015 
Reporting Cycle, several new quality reporting provider participation 
reports were made available in CASPER. Providers can access a detailed 
list and description of each of the 12 reports currently available to 
hospices on the QIES Web site, under the Training & Education 
Selections, CASPER Reporting Users Guide at https://www.qtso.com/hospicetrain.html. We anticipate that providers would use the quality 
reports as part of their Quality Assessment and Performance Improvement 
(QAPI) efforts.
    Furthermore, to meet the requirement for making such data public, 
we are developing a CMS Hospice Compare Web site, which will provide 
valuable information regarding the quality of care provided by 
Medicare-certified hospice agencies throughout the nation. Consumers 
would be able to search for all Medicare approved hospice providers 
that serve their city or zip code (which would include the quality 
measures and CAHPS[supreg] Hospice Survey results) and then find the 
agencies offering the types of services they need, along with provider 
quality information. Based on the efforts necessary to build the 
infrastructure for public reporting, we anticipate that public 
reporting of the eligible HIS quality measures on the CMS Compare Web 
site for hospice

[[Page 52185]]

agencies will begin sometime in the spring/summer of CY 2017. To help 
providers prepare for public reporting, we will offer opportunities for 
stakeholder engagement and education prior to the rollout of a Hospice 
Compare site. We will offer outreach opportunities for providers 
through the MLN eNews, Open Door Forums and Special Open Door Forums; 
we will also post additional educational materials regarding public 
reporting on the CMS HQRP Web site. Finally, we will offer training to 
all hospice providers on the systems and processes for reviewing their 
data prior to public reporting; availability of trainings will be 
communicated through the regular CMS HQRP communication channels, 
including postings and announcements on the CMS HQRP Web site, MLN 
eNews communications, national provider association calls, and 
announcements on Open Door Forums and Special Open Door Forums.
    Like other CMS Compare Web sites, the Hospice Compare Web site 
will, in time, feature a quality rating system that gives each hospice 
a rating of between 1 and 5 stars. Hospices will have prepublication 
access to their own agency's quality data, which enables each agency to 
know how it is performing before public posting of data on the Hospice 
Compare Web site. Public comments regarding how the rating system would 
determine a hospice's star rating and the methods used for 
calculations, as well as a proposed timeline for implementation will be 
announced via regular CMS HQRP communication channels, including 
postings and announcements on the CMS HQRP Web site, MLN eNews 
communications, provider association calls, and announcements on Open 
Door Forums and Special Open Door Forums. We will announce the timeline 
for development and implementation of the star rating system in future 
rulemaking.
    Lastly, as part of our ongoing efforts to make healthcare more 
transparent, affordable, and accountable for all hospice stakeholders, 
the HQRP is prepared to post hospice data on a public data set, the 
Data.Medicare.gov Web site, and directory located at https://data.medicare.gov. This site includes the official datasets used on the 
Medicare.gov Compare Web sites provided by CMS. In addition, this data 
will serve as a helpful resource regarding information on Medicare-
certified hospice agencies throughout the nation. In an effort to move 
toward public reporting of hospice data, we will initially post 
demographic data of hospice agencies that have been registered with 
Medicare. This list will include high-level demographic data for each 
agency including, provider name, address, phone numbers, ownership 
type, CMS Certification Number (CCN), profit status, and date of 
original CMS certification. The posting of this new hospice data 
directory occurred on June 14, 2016. Information can be located at 
https://data.medicare.gov/data/hospice-directory. Additional details 
regarding hospice datasets will be announced via regular CMS HQRP 
communication channels, including postings and announcements on the CMS 
HQRP Web site, MLN eNews communications, national provider association 
calls, and announcements on Open Door Forums and Special Open Door 
Forums. In addition, we have provided the list of CASPER/ASPEN and 
Regional Office coordinators in the event the Medicare-certified agency 
is either not listed in the database or the characteristics/
administrative data (name, address, phone number, services, or type of 
ownership) are incorrect or have changed. To continue to meet Medicare 
enrollment requirements, all Medicare providers are required to report 
changes to their information in their enrollment application as 
outlined in the Provider-Supplier Enrollment Fact Sheet Series located 
at https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNProducts/downloads/MedEnroll_InstProv_FactSheet_ICN903783.pdf.
    Comment: CMS received several comments that were supportive of 
public reporting of hospice quality measures. Commenters noted that 
they were in favor of CMS's efforts to publicly report hospice quality 
data to support the timely and transparent reporting of HQRP data. One 
commenter shared that public reporting of valid and reliable quality 
data demonstrates value, underpins compliance, and provides structure 
for hospice care. Several commenters did have suggestions, 
recommendations, and concerns about specific aspects of the public 
display of hospice quality measure data. These specific comments are 
summarized below.
    Response: We appreciate the commenters' support of public reporting 
of hospice quality measures. We address commenters' specific concerns 
with respect to public reporting reports below.
    Comment: CMS received a few comments expressing concerns that many 
hospice providers have high scores on the current HIS measures and some 
Hospice CAHPS measures. The potential lack of variation in scores for 
these measures may make differentiating between hospice providers' 
performance challenging for consumers. Given the limited range of 
scores, commenters thought that presenting data as rankings or 
percentiles may present results in a way that does not provide valuable 
information to consumers. One commenter suggested that CMS consider 
risk-adjusting quality measures reported on the Compare Web site.
    Response: We agree that all publicly reported data should be 
presented in a manner that is meaningful and understandable to the 
general public. We will take steps and use recognized practices to 
ensure that any publicly reported data is displayed in an appropriate 
and meaningful manner. We are developing the format and content for 
public display of quality measure data on the Hospice Compare site. We 
appreciate the commenters input on how to most meaningfully display 
quality measure data and will take these suggestions into consideration 
as we finalize the format of public reporting (that is, whether to 
report scores or the percentiles for each quality measure (QM)).
    Regarding commenters' concerns about the lack of variation in 
current HIS measure scores, the overall distribution and variability of 
the seven currently adopted HIS QMs is an indicator that most hospices 
are providing the required and recommended care to the majority of the 
patients around hospice admission, demonstrating overall high quality 
of care. However, the seven measures demonstrate room for improvement. 
Analysis conducted by our measure development contractor demonstrates 
that a low percentage of hospices have perfect scores for most measures 
and a small percentage of hospices have very low scores. We believe 
this is valuable and important information to communicate to consumers 
as well as to providers to motivate quality improvement. Additionally, 
we are working on the specific format for publicly reporting these 7 
QMs and will take commenters' suggestions into consideration. We agree 
that given the skewed distribution, presenting hospice scores in 
formats like percentiles may provide misleading information. Presenting 
hospices' quality scores may provide information that is more 
straightforward for consumers and providers. Finally, input that we 
have received from hospice caregivers will also inform our strategy for 
public reporting of quality measure data. Our measure development 
contractor interviewed hospice caregivers about public display of 
quality data and what

[[Page 52186]]

types of data would be most meaningful to consumers. In these 
interviews, respondents supported the continued data collection and 
reporting of the individual HIS measures, noting that information on 
the individual measures is valuable to consumers. Respondents also 
noted that although overall performance on the 7 HIS measures is high, 
public display of these scores would still be meaningful as a way to 
identify low-performing hospices.
    With respect to the commenter's suggestion to risk adjust quality 
measures reported on the Hospice Compare Web site, we would like to 
point out that both the current HIS measure set (NQF #1634, NQF #1637, 
NQF #1639, NQF #1638, NQF #1617, NQF #1641 and NQF #1647) and Hospice 
CAHPS quality measures are currently under review by the National 
Quality Forum (NQF) for maintenance endorsement and endorsement, 
respectively. NQF criteria for review and endorsement includes 
consideration of risk adjustment. As stated in section III.C.3 of this 
rule, it is CMS's intent to implement endorsed quality measures, using 
the specifications as endorsed by the NQF.
    Comment: A few commenters suggested that CMS provide quarterly 
benchmark data to hospices for at least 1 year in advance of publicly 
reporting the data. Commenters believed the benchmark data would 
demonstrate to individual hospices how they perform compared to all 
hospices on the existing measures and allow opportunity for improvement 
prior to the onset of public reporting. One commenter shared that 
hospices have found stable benchmark scores for comparison to be far 
more useful for setting goals and tracking performance improvement.
    Response: We appreciate the commenters' suggestion to provide 
quarterly benchmark data. As we previously stated, we plan to make 
available additional provider-level feedback reports prior to public 
reporting; these reports will help hospices with their quality 
assessment and performance improvement efforts. As is common in other 
quality reporting programs, these reports would provide feedback on 
facility-level performance on quality metrics, as well as national 
benchmarks. Additionally, national means of the HIS quality measures, 
based on Q4 2014 through Q3 2015 HIS data, are reported in the Hospice 
Quality Reporting Program: Executive Summary of Measure Testing and 
Validation, available on the ``Current Measures'' portion of the CMS 
HQRP Web site: https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Hospice-Quality-Reporting/Current-Measures.html.
    Comment: One commenter urged CMS to not only showcase quality 
measures from HIS and Hospice CAHPS, but also demonstrate the scope and 
level of services provided by different hospice programs. The commenter 
stated that while hospices are required to be able to provide certain 
services, patient and family access to these services varies, 
especially for the non-clinical services. In addition, this commenter 
stated that there is variation in how well hospices meet the 
requirements. Moreover, the commenter stated that and a lack of 
enforcement allowed lower quality programs to minimally comply with 
requirements, if at all. For example, many hospice programs send 
mailings to families on bereavement; while this technically meets the 
bereavement requirements under the benefit; other hospices offer and 
provide robust, individualized bereavement support. The commenter 
thought that it would be important for consumers to have information 
about these services to help them select a hospice.
    Response: We appreciate the commenter's recommendation to report 
quality metrics and hospice information beyond HIS and Hospice CAHPS 
measures. We recognize that information regarding the scope and level 
services provided would be valuable to consumers and hospice providers; 
however, we note that such information may not be readily available to 
us through billing records or other reporting mechanisms, and we are 
cognizant of the burden additional reporting could place on providers. 
We will take this recommendation into consideration as we move forward 
with the development for future HQRP measures.
    Comment: The majority of commenters supported the minimum 
denominator size for public reporting. Although commenters were 
generally supportive of this requirement, some commenters had concerns 
about the possible negative impact on small hospices for which quality 
information is not included in public reporting due to not meeting the 
minimum denominator size. Commenters noted that hospices who do not 
meet the threshold of 20 stays for the HIS-based QMs or the size 
exemption for Hospice CAHPS[supreg] Survey, which is less than 50-
survey eligible patients in the previous year, would not be included in 
all or part of public reporting. Commenters raised concerns that a lack 
of displayed data on Hospice Compare may disadvantage these smaller 
providers. Commenters believed that consumers using Hospice Compare to 
search for a provider might disregard hospices that do not have some or 
all of their data displayed due to size issues, and that, in turn, 
consumers may be more likely to seriously consider only those hospices 
for which quality information is presented. One commenter expressed 
concerns that there are some important statistical considerations, in 
addition to denominator size, that should be addressed in creating a 
means for public display of hospice quality data. Specifically, the 
commenter noted that a small denominator that meets the minimum 
denominator size is more sensitive to fluctuations in the numerator 
than a large denominator. Smaller hospices are likely to have smaller 
denominators and are more vulnerable to numerator size and variability 
than larger hospices. The commenters suggested that CMS create a means 
to counterbalance the potential negative consequences for those 
hospices for which quality information is not included in public 
reporting.
    Response: We thank the commenters for their support of our 
recommendation to set a minimum denominator size for public reporting. 
We appreciate commenters sharing concerns regarding the possible 
negative impact on small hospices. To establish the minimum denominator 
size, we examined the national hospice-level denominator size for the 
HIS quality measures. The determination of the minimum denominator size 
balanced the necessity of yielding statistically meaningful QM scores 
and the goal of allowing as many hospices to have their quality measure 
scores publicly displayed as possible. To be consistent with other 
quality reporting programs' public reporting policies, we set a minimum 
denominator size for public reporting of quality measures, as well as 
the data selection period necessary to generate the minimum denominator 
size. The minimum denominator size is determined based on a hospice's 
patient stays over a 12-month period. Analysis conducted by RTI 
International shows that only about 10 percent of hospices would not 
have accumulated 20 patient stays to have any HIS quality measure 
publicly displayed. RTI's analysis also shows that quality measures 
calculated based on 12 months of data are stable and robust against 
fluctuation. These results were summarized in the Measure Testing 
Executive Summary document referenced in this section of the rule and 
posted on the ``Current Measures'' portion of the CMS HQRP Web site:

[[Page 52187]]

https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Hospice-Quality-Reporting/Current-Measures.html. On the 
Hospice Compare Web site, CMS plans to indicate in some manner (for 
example, through a footnote or some other statement) instances where 
data is not displayed due to denominator size issues. We believe this 
will minimize any potential negative impact on small providers and 
signal to consumers that in such instances, the lack of data is a 
result of the hospice having too few admissions to allow for reporting 
of a valid quality measure, and is not in and of itself an indicator of 
hospice quality. Finally, we will take the commenters suggestion 
regarding creating a means to counterbalance the potential negative 
consequences for small hospices as we move forward with the development 
and launch of Hospice Compare.
    Comment: CMS received several comments regarding data sources that 
would be included in the launch of Hospice Compare. Overall, commenters 
offered two main considerations. First, commenters brought up concerns 
about the limitations of HIS data for consumer decision-making. Second, 
commenters requested clarification from and encouraged CMS to include 
Hospice CAHPS data in the launch of Hospice Compare. Regarding the 
first concern, commenters noted that HIS data alone might provide 
inadequate information to aid in consumer decision-making. Commenters 
noted that all HIS measures are process of care measures and, as such, 
do not address important issues such as whether the patient/family was 
treated with respect or felt supported by the hospice team. They 
strongly recommended that the Hospice CAHPS results be reported along 
with HIS measures to provide consumers with the most meaningful and 
comprehensive picture of quality of care. Finally, commenters 
encouraged CMS to provide appropriate disclaimers about the hospice 
quality data and information, outlining the limitations of the data and 
its utility.
    Response: We appreciate the commenters' feedback on public 
reporting of HIS and Hospice CAHPS data. We agree with commenters that 
HIS and Hospice CAHPS data are complementary and, together, provide a 
more meaningful and comprehensive view of quality of care provided by 
hospices. As noted in section III.C.9 of this rule, we plan to include 
both HIS and Hospice CAHPS data in the launch of Hospice Compare. 
Reporting both data sources will address commenters' concerns and 
mirrors the approach for public reporting used in other CMS Compare 
sites. We will communicate additional plans for the public reporting of 
hospice quality data through the usual CMS HQRP communication channels, 
including postings and announcements on the CMS HQRP Web site, MLN 
eNews communications, national provider association calls, and 
announcements on Open Door Forums and Special Open Door Forums.
    Comment: A few commenters expressed concerns that consumers will 
not understand the difference between a process measure and an outcome 
measure and be able to draw conclusions about the experience of hospice 
care from just the composite process measure. One commenter shared that 
CMS needs to provide education and resources to help the public 
understand what the measures mean.
    Response: We agree that any publicly reported data should be 
presented in a manner that is meaningful and understandable by the 
public. We intend to take steps and use recognized practices to ensure 
that any publicly reported data is displayed in an appropriate and 
meaningful manner. We intend to work with our Web site development 
contractor to ensure that the Hospice Compare site has been tested for 
usability, readability, and navigation, and that consumers and 
stakeholders are continuously involved and have opportunities for input 
throughout the development process. We will write in plain language, 
with awareness of variations in health and general literacy, and 
solicit input from key stakeholders and technical experts in the 
development of the presentation of publicly available quality data.
    Comment: CMS received a few comments regarding concerns about the 
publicly reported HIS measures because they are constructed using HIS 
data that is self-reported by hospice providers. Commenters had 
concerns about the validity of this data and encouraged CMS to 
determine methods to monitor the veracity of the data being submitted. 
Commenters noted that the launch of Hospice Compare might create 
perverse incentives for hospices to submit false data to avoid 
unfavorable scores being publicly reported on the Compare Web site.
    Response: We acknowledge commenters' concerns regarding the 
validity of self-reported HIS measures. Publicly reported quality 
measure data relies on the submission of valid and reliable data at the 
patient level. Our measure development contractor conducts ongoing 
testing and validation of the quality measure data to identify data 
irregularities and trends. We will consider additional validation 
processes for future rulemaking cycles.
    Comment: CMS received a few comments expressing providers' desire 
to review data prior to publication. One commenter inquired about the 
process for correcting data errors.
    Response: We appreciate the commenters' interest in reviewing data 
prior to public reporting. We would like to take this opportunity to 
clarify the processes available to providers for reviewing and making 
changes to HIS data, and for previewing QM scores prior to public 
display. First, as outlined in the HIS Manual, providers have the 
opportunity to make corrections to HIS data through HIS record 
modification and inactivation processes. HIS record modifications and 
inactivations are available if a provider finds an error in HIS data 
that has been submitted and accepted by the QIES ASAP system. Further 
details on processes for modifications and inactivations are available 
in Chapter 3 of the HIS Manual, available on the HIS portion of the CMS 
HQRP Web site: https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Hospice-Quality-Reporting/Hospice-Item-Set-HIS.html. It is vital for providers to correct any errors in HIS 
data to ensure information in the QIES ASAP system accurately reflects 
the patient's hospice record and HIS-related care processes delivered 
to the patient; this initial corrections process for errors in HIS data 
helps ensure QM scores and any publicly displayed data are accurate.
    In addition to modification and inactivation processes available in 
QIES ASAP, as we previously stated, we are currently developing the 
infrastructure to provide hospices with the opportunity to view their 
quality measure data via CASPER provider-level feedback reports. These 
internal provider-level feedback reports will provide hospices an 
initial opportunity to review QM score data in CASPER. Provider-level 
feedback reports are confidential and separate from the public 
reporting processes. The purpose of provider-level feedback reports is 
to provide hospices with QM score data that can be used at the 
individual facility level and for internal quality improvement. We are 
planning for release of the QM provider-level feedback reports sometime 
in December of 2016. Availability of the new CASPER QM reports will be 
communicated to providers through the usual CMS HQRP communication 
channels, including postings and announcements on the CMS HQRP Web 
site, MLN eNews communications,

[[Page 52188]]

national provider association calls, and announcements on Open Door 
Forums and Special Open Door Forums.
    Finally, we will ensure providers have the opportunity to preview 
QM score data to be displayed on Hospice Compare, prior to public 
posting of the data. Prior to public reporting, quality measure data 
``preview'' reports will be made available in CASPER system. Hospices 
will have a 30-day preview period prior to public display during which 
they can preview the performance information on their measures that 
will be made public. The ``preview'' reports will be made available 
using the Certification and Survey Provider Enhanced Reporting (CASPER) 
System because hospices are familiar with this system. In line with 
other PAC QRPs, hospices will have 30 days to review this information, 
beginning from the date on which they can access the preview report. 
Corrections to the underlying data would not be permitted during this 
time; however, hospices would be able to ask for a correction to their 
measure calculations during the 30-day preview period. If we determine 
that the measure, as it is displayed in the preview report, contains a 
calculation error, we would suppress the data on the public reporting 
Web site, recalculate the measure and publish the corrected rate at the 
time of the next scheduled public display date. This process is 
consistent with informal processes used in the Hospital IQR and other 
PAC programs. Technical details for how and when providers may contest 
their measure calculations, as well as the process for submitting a 
suppression request will be conveyed through the usual CMS HQRP 
communication channels.
    Comment: CMS received a comment in support of the initiative to 
make available additional provider-level feedback reports in the CASPER 
reporting system. The commenter requested CMS consider additional 
reports to display quality metric scores that would be available 2 days 
after HIS records are submitted and accepted by the QIES ASAP system.
    Response: We appreciate the commenter's support of the initiative 
to provide additional provider-level feedback reports in CASPER. We 
agree that providing timely feedback to hospice providers is a critical 
step in the process of quality improvement since providers need data 
about their performance to inform QAPI and other performance 
improvement efforts. We will continue to refine the provider-level 
feedback reports to make timely data available to providers within the 
CASPER system.
    Comment: One commenter expressed concerns regarding consumers 
leaving anonymous negative comments or grievances on the Hospice 
Compare Web site. The commenter noted that there is no manner for the 
hospice to respond to or rebut negative comments or grievances.
    Response: We would like to thank the commenters for taking the time 
to convey their concerns regarding consumers leaving anonymous negative 
comments or grievances on the Hospice Compare Web site. Consumers will 
only be able to search for hospice providers and review quality data; 
they will not be able to post comments or grievances on the CMS Hospice 
Compare Web site.
    Comment: Though commenters were generally supportive of public 
reporting of quality data, several commenters expressed concerns over 
the methodology for the star rating system to be used in the future as 
part of the Hospice Compare Web site. One commenter urged CMS to be 
conservative and cautious about the use of star ratings when applied to 
Hospice CAHPS data because patient and family experience with care data 
is typically positively skewed. A few commenters cautioned CMS against 
evaluating hospice providers along a bell curve rather than on a 
grading scale when developing star ratings for hospice providers. They 
shared that the use of a bell curve creates confusion for consumers and 
may misrepresent the quality of the care provided by hospices. 
Commenters encouraged CMS to develop a star-rating methodology that 
incorporates both HIS and Hospice CAHPS data. A few commenters 
suggested that CMS provide sufficient time for stakeholders to review 
the star ratings model. One commenter voiced concerns about star-rating 
methodologies used in other care settings and recommended CMS take into 
consideration lessons learned about unintended consequences when 
developing the hospice star rating system. One commenter recommended 
that CMS take a criterion approach to constructing the CMS Hospice 
Compare Web site and determining the methodology to be used for 
calculating star ratings. Another commenter stated that any star rating 
system developed should reflect care provided by the entire 
interdisciplinary team and should be risk adjusted to account for 
individualized care, short lengths of stay and patient right to refuse 
care.
    Response: We appreciate the thorough and detailed input on the 
development of a Hospice Compare Web site and the future development of 
a star rating system for hospices. We would like to assure commenters 
that it is of paramount concern to develop a star rating methodology 
that is valid, is reliable, and presents quality data that is 
meaningful to stakeholders. As with the development of star methodology 
in other care programs, we will allow continued opportunities for the 
provider community and other stakeholders to comment on and provide 
input to the proposed rating system. In addition to regular HQRP 
communication channels, we will solicit input from the public regarding 
star methodology through special listening sessions, invitation to 
submit comments via a Help Desk mailbox, Open Door Forums, a Technical 
Expert Panel, and other opportunities. Additionally, we will benefit 
from lessons learned from the development and implementation of star 
ratings in other QRPs to help guide the hospice star rating initiative.

D. The Medicare Care Choices Model

    We want to remind the provider community that the Medicare Care 
Choices Model (MCCM) is testing a new option for Medicare beneficiaries 
with certain advanced diseases to receive hospice-like support services 
from MCCM hospices while receiving care from other Medicare providers 
for their terminal condition. This 5 year model is being tested to 
encourage greater and earlier use of the Medicare and Medicaid hospice 
benefit to determine whether it can improve the quality of life and 
care received by Medicare beneficiaries, increase beneficiary, family, 
and caregiver satisfaction, and reduce Medicare or Medicaid 
expenditures. Participation in the model is limited to Medicare and 
dual eligible beneficiaries with advanced cancers, chronic obstructive 
pulmonary disease, congestive heart failure, and Human Immunodeficiency 
Virus/Acquired Immune Deficiency Syndrome who qualify for the Medicare 
or Medicaid hospice benefit and meet the eligibility requirements of 
the model. The model includes more than 130 hospices from 39 states 
across the country and is projected to serve 100,000 beneficiaries by 
2020. The first cohort of MCCM participating hospices began providing 
services under the model in January 2016, and the second cohort will 
begin to provide services under the model in January 2018. The last 
patient will be accepted into the model 6 months before the December 
31, 2020 model end date.
    For more information, see the MCCM Web site: https://innovation.cms.gov/initiatives/Medicare-Care-Choices/.

[[Page 52189]]

IV. Collection of Information Requirements

    Under the Paperwork Reduction Act of 1995, we are required to 
provide 60-day notice in the Federal Register and solicit public 
comment before a collection of information requirement is submitted to 
the Office of Management and Budget (OMB) for review and approval. To 
fairly evaluate whether an information collection should be approved by 
OMB, section 3506(c)(2)(A) of the Paperwork Reduction Act of 1995 
requires that we solicit comment on the following issues:
     The need for the information collection and its usefulness 
in carrying out the proper functions of our agency.
     The accuracy of our estimate of the information collection 
burden.
     The quality, utility, and clarity of the information to be 
collected.
     Recommendations to minimize the information collection 
burden on the affected public, including automated collection 
techniques.
    We solicited public comment on each of the following information 
collection requirements (ICRs).

A. Information Collection Requirements

    Section 1814(i)(5)(C) of the Act requires that each hospice submit 
data to the Secretary on quality measures specified by the Secretary. 
Such data must be submitted in a form, manner, and at a time specified 
by the Secretary. In the FY 2014 Hospice Wage Index final rule (78 FR 
48257), and in compliance with section 1814(i)(5)(C) of the Act, we 
finalized the specific collection of data items that support the 
following six NQF-endorsed measures and one modified measure for 
hospice:
     NQF #1617 Patients Treated with an Opioid who are Given a 
Bowel Regimen,
     NQF #1634 Pain Screening,
     NQF #1637 Pain Assessment,
     NQF #1638 Dyspnea Treatment,
     NQF #1639 Dyspnea Screening,
     NQF #1641 Treatment Preferences,
     NQF #1647 Beliefs/Values Addressed (if desired by the 
patient) (modified).
    Data for the aforementioned 7 measures is collected via the HIS. 
Data collection for the 7 NQF-endorsed measures via the HIS V1.00.0 was 
approved by the Office of Management and Budget April 3, 2014 (OMB 
control number 0938-1153--Hospice Quality Reporting Program). As 
outlined in this final rule, we continue data collection for these 7 
NQF-endorsed measures.
    In this final rule, we finalized the implementation of two new 
measures. The first measure is the Hospice and Palliative Care 
Composite Process Measure--Comprehensive Assessment at Admission. Seven 
individual care processes will be captured in this composite measure, 
which includes the six NQF-endorsed quality measures and one modified 
NQF-endorsed quality measure currently implemented in the HQRP. Thus, 
the Hospice and Palliative Care Composite Process quality measure will 
use the current HQRP quality measures as its components. The data 
source for this measure will be currently implemented HIS items that 
are currently used in the calculation of the 7 component measures. 
Since the measure is a composite measure created from components, which 
are currently adopted HQRP measures, no new data collection will be 
required; data for the composite measure will come from existing items 
from the existing 7 HQRP component measures. CMS will begin calculating 
this measure using existing data items, beginning April 1, 2017; this 
means patient admissions occurring on or after April 1, 2017 will be 
included in the composite measure calculation.
    The second measure is the Hospice Visits when Death is Imminent 
Measure Pair. Data for this measure will be collected via the existing 
data collection mechanism, the HIS. Four new items will be added to the 
HIS-Discharge record to collect the necessary data elements for this 
measure. CMS expects that data collection for this quality measure via 
the 4 new HIS items will begin no earlier than April 1, 2017. Thus, 
under current CMS timelines, hospice providers will begin data 
collection for this measure for patient admissions and discharges 
occurring on or after April 1, 2017.
    The HIS V2.00.0 will fulfill the data collection requirements for 
the 7 currently adopted NQF measures and the 2 new measures. The HIS 
V2.00.0 contains:
     All items from the HIS V1.00.0, which are necessary to 
calculate the 7 adopted NQF measures (and thus the composite measure), 
plus the HIS V1.00.0 administrative items necessary for patient 
identification and record matching,
     One new item for measure refinement of the existing 
measure NQF #1637 Pain Assessment,
     New items to collect data for the Hospice Visits when 
Death is Imminent measure pair,
     New administrative items for patient record matching and 
future public reporting of hospice quality data.
    Hospice providers will submit an HIS-Admission and an HIS-Discharge 
for each patient admission. Using HIS data for assessments submitted 
October 1, 2014 through September 30, 2015, we have estimated that 
there will be approximately 1,248,419 discharges across all hospices 
per year and, therefore, we would expect that there should be 1,248,419 
Hospice Item Sets (consisting of one admission and one discharge 
assessment per patient) submitted across all hospices yearly. Over a 
three-year period, we expect 3,745,257 Hospice Item Sets across all 
hospices. There were 4,259 certified hospices in the U.S. as of January 
2016; \36\ we estimate that each individual hospice will submit on 
average 293 Hospice Item Sets annually, which is approximately 24 
Hospice Items Sets per month or 879 Hospice Item Sets over 3 years.
---------------------------------------------------------------------------

    \36\ Quality Improvement and Evaluation System (QIES) List of 
Hospice Providers, January 2016.
---------------------------------------------------------------------------

    The Hospice Item Set consists of an admission assessment and a 
discharge assessment. As noted above, we estimate that there will be 
1,248,419 hospice admissions across all hospices per year. Therefore, 
we expect there to be 2,496,838 Hospice Item Set assessment submissions 
(admission and discharge assessments counted separately) submitted 
across all hospices annually, which is 208,070 across all hospices 
monthly, or 7,490,514 across all hospices over three years. We further 
estimate that there will be 586 Hospice Item Set submissions by each 
hospice annually, which is approximately 49 submissions monthly or 
1,759 submissions over three years.
    For the Admission Hospice Item Set, we estimate that it will take 
14 minutes of time by a clinician, such as a Registered Nurse, at an 
hourly wage of $67.10 \37\ to abstract data for Admission Hospice Item 
Set. This would cost the facility approximately $15.66 for each 
admission assessment. We further estimate that it will take 5 minutes 
of time by clerical or administrative staff person, such as a medical 
data entry clerk or medical secretary, at an hourly wage of $32.24 \38\ 
to upload the Hospice Item Set data into the CMS system. This would 
cost each facility approximately $2.69 per assessment. For the 
Discharge Hospice Item Set, we estimate that it

[[Page 52190]]

will take 9 minutes of time by a clinician, such as a nurse, at an 
hourly wage of $67.10 to abstract data for Discharge Hospice Item Set. 
This would cost the facility approximately $10.07. We further estimate 
that it will take 5 minutes of time by clerical or administrative 
staff, such as a medical data entry clerk or medical secretary, at an 
hourly wage of $32.24 to upload data into the CMS system. This would 
cost each facility approximately $2.69. The estimated cost for each 
full Hospice Item Set submission (admission assessment and discharge 
assessment) is $31.10.
---------------------------------------------------------------------------

    \37\ The adjusted hourly wage of $67.10 per hour for a 
Registered Nurse was obtained using the mean hourly wage from the 
U.S. Bureau of Labor Statistics, $33.55. This mean hourly wage is 
adjusted by a factor of 100 percent to include fringe benefits. See 
http://www.bls.gov/oes/current/oes291141.htm.
    \38\ The adjusted hourly wage of $32.24 per hour for a Medical 
Secretary was obtained using the mean hourly wage from the U.S. 
Bureau of Labor Statistics, $16.12. This mean hourly wage is 
adjusted by a factor of 100 percent to include fringe benefits. See 
http://www.bls.gov/oes/current/oes436013.htm.
---------------------------------------------------------------------------

    We estimate that the total nursing time required for completion of 
both the admission and discharge assessments is 23 minutes at a rate of 
$67.10 per hour. The cost across all hospices for the nursing/clinical 
time required to complete both the admission and discharge Hospice Item 
Sets is estimated to be $32,111,417 annually, or $96,334,252 over 3 
years, and the cost to each individual hospice is estimated to be 
$7,539.66 annually, or $22,618.98 over 3 years. The estimated time 
burden to hospices for a medical data entry clerk to complete the 
admission and discharge Hospice Item Set assessments is 10 minutes at a 
rate of $32.24 per hour. The cost for completion of the both the 
admission and discharge Hospice Item Sets by a medical data entry clerk 
is estimated to be $6,708,171 across all hospices annually, or 
$20,124,514 across all hospices over 3 years, and $1,575.06 to each 
hospice annually, or $4,725.17 to each hospice over 3 years.
    The total combined time burden for completion of the Admission and 
Discharge Hospice Item Sets is estimated to be 33 minutes. The total 
cost across all hospices is estimated to be $38,819,589 annually or 
$116,458,766 over 3 years. For each individual hospice, this cost is 
estimated to be $9,114.72 annually or $27,344.16 over 3 years. See 
Table 18 for breakdown of burden and cost by assessment form.

                                                       Table 18--Summary of Burden Hours and Costs
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                      OMB       Number of                            Burden per         Total annual      Hourly labor cost   Total cost
      Regulation section(s)       Control No.  respondents  Number of responses   response (hours)     burden (hours)     of reporting ($)       ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Hospice Item Set Admission          0938-1153        4,259  1,248,419 per year.  0.233 clinician     395,333 hours.....  Clinician at        $22,900,166
 Assessment.                                                                      hours; 0.083                            $67.10 per hour;
                                                                                  clerical hours.                         Clerical staff at
                                                                                                                          $32.24 per hour.
Hospice Item Set Discharge          0938-1153        4,259  1,248,419 per year.  0.150 clinician     291,298 hours.....  Clinician at         15,919,423
 Assessment.                                                                      hours; 0.083                            $67.10 per hour;
                                                                                  clerical hours.                         Clerical staff at
                                                                                                                          $32.24 per hour.
3-year Total....................    0938-1153        4,259  7,490,514..........  0.55 hours........  2,059,891 hours...  Clinician at        116,458,766
                                                                                                                          $67.10 per hour;
                                                                                                                          Clerical staff at
                                                                                                                          $32.24 per hour.
--------------------------------------------------------------------------------------------------------------------------------------------------------

C. Submission of PRA-Related Comments

    We have submitted a copy of this final rule to OMB for its review 
of the rule's information collection and recordkeeping requirements. 
These requirements are not effective until they have been approved by 
the OMB.
    To obtain copies of the supporting statement and any related forms 
for the collections discussed above, please visit CMS's Web site at 
https://www.cms.gov/RegulationsandGuidance/Legislation/PaperworkReductionActof1995/PRAListing.html, or call the Reports 
Clearance Office at 410-786-1326.
    We invited public comments on these potential information 
collection requirements. If you wish to comment, please submit your 
comments electronically as specified in the ADDRESSES section of this 
final rule and identify the rule (CMS-1652-F) the ICR's CFR citation, 
CMS ID number, and OMB control number.
Public Comments Received for PRA Package (CMS Form Number--CMS-R-245)
    Comment: CMS received one supportive comment indicating that the 
additional data sought by CMS for the calculation of the Hospice Visits 
when Death is Imminent Measure Pair does not represent a significant 
burden on providers and may result in useful information. Other 
commenters stated that CMS's burden estimates underestimate the costs 
of completing the HIS. One commenter stated that the typical admission 
assessment time is 45 minutes to 1 hour, and that staff travel can 
significantly increase costs. Another commenter stated that the costs 
of training and operational processes to support valid data abstraction 
should be included in the burden estimate.
    Response: We thank the commenters for their feedback regarding the 
burden of the HIS V2.00.0, and the support of the new items used to 
collect data for the Hospice Visits when Death is Imminent Measure 
Pair. Regarding the cost estimates for the HIS Admission form, the HIS 
is a set of data elements that can be used to calculate 7 NQF endorsed 
quality measures and 2 new measures adopted in this rule. The HIS is 
not a patient assessment that would be directly administered to the 
patient and/or family or caregivers during the initial assessment or 
comprehensive assessment visit. Since the HIS is not intended to 
replace the initial/comprehensive assessment, the PRA burden estimates, 
by definition, do not include the time spent assessing the patient. HIS 
PRA burden estimates are intended to reflect only the time needed to 
complete HIS items, independent of clinical time spent assessing the 
patient. Similarly, PRA burden estimates include the Annualized Cost to 
the Federal Government related to the HIS V2.00.0 for provider 
training, preparation of HIS V2.00.0 manuals and materials, receipt and 
storage of data, data analysis, and upkeep of data submission software. 
In order to mitigate costs of operational processes, providers may use 
the Hospice Abstraction Reporting Tool (HART) software, which is free 
to download and use, to collect and maintain facility, patient, and HIS 
Record information for subsequent submission to the QIES

[[Page 52191]]

ASAP system. Burden estimates for completing the HIS data items were 
based on the HIS V1.00.0 and HIS V2.00.0 pilot tests. We recognize 
additional activities and efforts will be required to implement and use 
the HIS V2.00.0 as part of the quality reporting program. We agree that 
it is important for hospices to learn about and understand the new HIS, 
and we plan to provide hospices with training resources to facilitate 
implementation of the HIS.
    Comment: One commenter stated that the addition of new items to the 
HIS Discharge record will require vendor software development and 
testing, hospice implementation, education and training, and internal 
validation. The commenter stated that the target implementation date of 
April 1, 2017 may not provide adequate time for implementation.
    Response: We appreciate the commenter's feedback regarding the 
timeline for implementation and of the HIS V2.00.0. The HIS V2.00.0 is 
undergoing review as part of a PRA package under OMB number 0938-1153 
and will be implemented April 1, 2017. We believe the April 1, 2017 
implementation date will allow sufficient time for providers to update 
their clinical documentation systems and train staff on new HIS items. 
The timeline for implementation of the HIS V2.00.0 is consistent with 
the timeline from prior years when the HIS V1.00.0 was implemented. We 
expect training and implementation activities to take considerably less 
time for the HIS V2.00.0 compared to the HIS V1.00.0 since the HIS 
V2.00.0 can capitalize on existing infrastructures used by stakeholders 
for the HIS V1.00.0 and contains only 17 new item components (compared 
to the 60 item components that were implemented in the HIS V1.00.0). 
Moreover, we encourage providers to begin preparations for HIS V2.00.0 
implementation as soon as possible. The HIS V2.00.0 is currently 
available for review by software vendors and hospice providers. Some of 
the activities that are necessary prior to implementation can be done 
concurrently. For example, hospice education and training on the new 
items and data abstraction can be conducted at the same time as vendor 
development of software.
    We are aware of the effort hospices and vendors will have to make 
to prepare for implementation of the HIS. The HIS pilot showed that 
implementing the HIS is feasible and that hospices are most likely 
already collecting the information needed to complete the HIS data 
items. A draft version of the HIS technical data specifications was 
posted on the CMS Web site on May 19, 2016. Thus, vendors have been 
provided with more than adequate time to develop products for their 
clients. We expect vendors to begin reviewing the draft technical data 
specifications as soon as they are posted. We encourage vendors to 
submit questions and comments to the HIS technical email box: 
[email protected]. Software vendors should not be 
waiting for final technical data specifications to be posted to begin 
development of their own products. Therefore, we believe that vendors 
have been provided with adequate time and resources to meet the April 
1, 2017 implementation date of the HIS. For providers that currently 
use a vendor-designed software to complete HIS records, if a provider 
has concerns about the timeliness of release of HIS V2.00.0 items in 
vendor-designed software, CMS reminds providers that alternative means 
of completing HIS records (HART software) are available to all 
providers free of charge. Although electronic submission of HIS records 
is required, hospices do not need to have an electronic medical record 
to complete or submit HIS data. In the FY 2014 Hospice Wage Index, 
final rule (78 FR 48258) we finalized that to complete HIS records 
providers can use either the HART software, which is free to download 
and use, or vendor-designed software. HART provides an alternative 
option for hospice providers to collect and maintain facility, patient, 
and HIS Record information for subsequent submission to the QIES ASAP 
system. Once HIS records are complete, electronic HIS files must be 
submitted to CMS via the QIES ASAP system. Electronic data submission 
via the QIES ASAP system is required for all HIS submissions; there are 
no other data submission methods available. Hospices have 30 days from 
a patient admission or discharge to submit the appropriate HIS record 
for that patient through the QIES ASAP system. We will continue to make 
HIS completion and submission software available to hospices at no 
cost. We provided details on data collection and submission timing 
under the downloads section of the HIS Web page on the CMS.gov Web site 
at http://www.cms.gov/Medicare/Quality-Initiatives-Patient-AssessmentInstruments/Hospice-Quality-Reporting/Hospice-Item-Set-HIS.html.
    Comment: One commenter stated that although the burden associated 
with the HIS assessment may not be unduly burdensome, the collective 
burden of various reporting requirements makes a large fiscal impact on 
hospices.
    Response: We thank the commenters for taking the time to convey 
their concerns about the burden and cost of data collection for the 
HQRP and other regulatory requirements. We attempted to reduce the 
regulatory burden of our quality reporting programs to the greatest 
extent possible. The estimated burden for completing the HIS V2.00.0 
can be viewed here: (https://www.cms.gov/Regulations-and-Guidance/Legislation/PaperworkReductionActof1995/PRA-Listing.html). 
Specifically, CMS estimates 19 minutes per response for the Admission 
HIS and 14 minutes per response for the Discharge HIS. Details 
regarding the estimate can be found at http://cms.gov/Regulations-and-Guidance/Legislation/PaperworkReductionActof1995/PRA-Listing.html. 
Comments concerning the accuracy of the time estimate(s) or suggestions 
for improving the HIS can be directed to: CMS, 7500 Security Boulevard, 
Attn: PRA Reports Clearance Officer, Mail Stop C4-26-05, Baltimore, 
Maryland 21244-1850. With respect to the commenter's concern about 
additional expenses incurred as part of quality reporting, any 
additional costs incurred as part of quality reporting programs should 
be reported on the cost reports. Cost report data may be considered in 
future payment reform.
    Comment: One commenter stated that the addition of the J0905 Pain 
Active Problem item to the HIS V2.00.0 would be burdensome to hospice 
providers since it requires an update to the Admission HIS 
documentation and the item will not be used in calculation of the Pain 
Assessment measure. The commenter suggested adding the item when a 
Patient Reported Outcome Pain Measure is implemented or when a Hospice 
Patient Assessment Instrument is developed.
    Response: We thank the commenter for their comments regarding the 
new item J0905, Pain Active problem. CMS would like to clarify our 
reasoning and intent behind the addition of the J0905 Pain Active 
Problem item. Since the HIS V1.00.0 was implemented on July 1, 2014, 
CMS has received an overwhelming amount of feedback from the provider 
community regarding the items in Section J: Pain of the HIS V1.00.0 
(J0900. Pain Screening and J0910. Comprehensive Pain Assessment). These 
items correspond to the National Quality Forum (NQF) #1634 Pain 
Screening quality measure and the NQF #1637 Pain Assessment quality 
measure, respectively. NQF #1634 calculates the percentage of

[[Page 52192]]

patients who were screened for pain within two days of admission. 
Patients who screen positive for pain are included in the denominator 
for NQF #1637, which measures the percentage of patients who screened 
positive for pain who received a comprehensive pain assessment within 1 
day.
    Under current specifications for NQF #1634 and NQF #1637, if a 
patient is not in pain at the time of the first screening, that patient 
is not included in the denominator for NQF #1637--even if pain is an 
active problem for the patient. As such, if a patient is not in current 
pain at the time of the first pain screening, HIS V1.00.0 skip patterns 
direct providers to skip Item J0910, the comprehensive pain assessment 
item. RTI received feedback from the provider community that the 
measure specifications and associated skip pattern between J0900 and 
J0910 do not align with clinical practice, as clinicians will often 
complete a comprehensive pain assessment for patients when pain is an 
active problem but the patient is not in pain at the time of the 
screening. Providers further noted that some vendor-designed software 
built HIS skip patterns into clinical documentation systems and the 
skip pattern between J0900 and J0910 was thus restricting the ability 
of clinicians to document comprehensive assessments that were conducted 
per clinical best practice but not required for the purposes of the HIS 
pain quality measures. Due to these factors, CMS has received feedback 
from the provider community to consider changing items in the pain 
section to align HIS pain items with current clinical practice.
    Thus, directly in response to feedback from providers, CMS added 
the J0905 Pain Active Problem item to the HIS V2.00.0. We believe this 
addition will actually reduce burden on providers since it is better 
aligned with current clinical practice. The addition of J0905 also 
better aligns items in the pain section with items in Section J: 
Respiratory Status. CMS plans to analyze data from J0905 to inform 
future potential refinements to the NQF-endorsed pain quality measures.
    ICR-related comments are due October 4, 2016.

V. Economic Analyses

A. Regulatory Impact Analysis

1. Introduction
    We have examined the impacts of this final rule as required by 
Executive Order 12866 on Regulatory Planning and Review (September 30, 
1993), Executive Order 13563 on Improving Regulation and Regulatory 
Review (January 18, 2011), the Regulatory Flexibility Act (RFA) 
(September 19, 1980, Pub. L. 96-354), section 1102(b) of the Act, 
section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA, March 
22, 1995; Pub. L. 104-4), and the Congressional Review Act (5 U.S.C. 
804(2)).
    Executive Orders 12866 and 13563 direct agencies to assess all 
costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). Executive 
Order 13563 emphasizes the importance of quantifying both costs and 
benefits, of reducing costs, of harmonizing rules, and of promoting 
flexibility. A regulatory impact analysis (RIA) must be prepared for 
major rules with economically significant effects ($100 million or more 
in any 1 year). This final rule has been designated as economically 
significant under section 3(f)(1) of Executive Order 12866 and thus a 
major rule under the Congressional Review Act. Accordingly, we have 
prepared a regulatory impact analysis (RIA) that, to the best of our 
ability, presents the costs and benefits of the rulemaking. This final 
rule was also reviewed by OMB.
2. Statement of Need
    This final rule meets the requirements of our regulations at Sec.  
418.306(c), which requires annual issuance, in the Federal Register, of 
the hospice wage index based on the most current available CMS hospital 
wage data, including any changes to the definitions of Core-Based 
Statistical Areas (CBSAs), or previously used Metropolitan Statistical 
Areas (MSAs). This final rule will also update payment rates for each 
of the categories of hospice care described in Sec.  418.302(b) for FY 
2017 as required under section 1814(i)(1)(C)(ii)(VII) of the Act. The 
payment rate updates are subject to changes in economy-wide 
productivity as specified in section 1886(b)(3)(B)(xi)(II) of the Act. 
In addition, the payment rate updates may be reduced by an additional 
0.3 percentage point (although for FY 2014 to FY 2019, the potential 
0.3 percentage point reduction is subject to suspension under 
conditions specified in section 1814(i)(1)(C)(v) of the Act). In 2010, 
the Congress amended section 1814(i)(6) of the Act with section 3132(a) 
of the Affordable Care Act. The amendment authorized the Secretary to 
revise the methodology for determining the payment rates for routine 
home care and other services included in hospice care, no earlier than 
October 1, 2013. In the FY 2016 Hospice Wage Index and Rate Update 
final rule (80 FR 47164), we finalized the creation of two different 
payment rates for RHC that resulted in a higher base payment rate for 
the first 60 days of hospice care and a reduced base payment rate for 
days 61 and over of hospice and created a SIA payment, in addition to 
the per diem rate for the RHC level of care, equal to the CHC hourly 
payment rate multiplied by the amount of direct patient care provided 
by an RN or social worker that occurs during the last 7 days of a 
beneficiary's life, if certain criteria are met. Finally, section 3004 
of the Affordable Care Act amended the Act to authorize a quality 
reporting program for hospices, and this rule discusses changes in the 
requirements for the hospice quality reporting program in accordance 
with section 1814(i)(5) of the Act.
3. Overall Impacts
    We estimate that the aggregate impact of this final rule will be an 
increase of $350 million in payments to hospices, resulting from the 
hospice payment update percentage of 2.1 percent. The impact analysis 
of this final rule represents the projected effects of the changes in 
hospice payments from FY 2016 to FY 2017. Using the most recent data 
available at the time of rulemaking, in this case FY 2015 hospice 
claims data, we apply the current FY 2016 wage index and labor-related 
share values to the level of care per diem payments and SIA payments 
for each day of hospice care to simulate FY 2016 payments. Then, using 
the same FY 2015 data, we apply the FY 2017 wage index and labor-
related share values to simulate FY 2017 payments. Certain events may 
limit the scope or accuracy of our impact analysis, because such an 
analysis is susceptible to forecasting errors due to other changes in 
the forecasted impact time period. The nature of the Medicare program 
is such that the changes may interact, and the complexity of the 
interaction of these changes could make it difficult to predict 
accurately the full scope of the impact upon hospices.
4. Detailed Economic Analysis
    The FY 2017 hospice payment impacts appear in Table 19. We tabulate 
the resulting payments according to the classifications in Table 19 
(for example, facility type, geographic region, facility ownership), 
and compare the difference between current and proposed payments to 
determine the overall impact.

[[Page 52193]]

    The first column shows the breakdown of all hospices by urban or 
rural status, census region, hospital-based or freestanding status, 
size, and type of ownership, and hospice base. The second column shows 
the number of hospices in each of the categories in the first column.
    The third column shows the effect of the annual update to the wage 
index. This represents the effect of using the FY 2017 hospice wage 
index. The aggregate impact of this change is zero percent, due to the 
hospice wage index standardization factor. However, there are 
distributional effects of the FY 2017 hospice wage index.
    The fourth column shows the effect of the hospice payment update 
percentage for FY 2017. The 2.1 percent hospice payment update 
percentage for FY 2017 is based on an estimated 2.7 percent inpatient 
hospital market basket update, reduced by a 0.3 percentage point 
productivity adjustment and by a 0.3 percentage point adjustment 
mandated by the Affordable Care Act, and is constant for all providers.
    The fifth column shows the effect of all the changes on FY 2017 
hospice payments. It is projected that aggregate payments will increase 
by 2.1 percent, assuming hospices do not change their service and 
billing practices in response.
    As illustrated in Table 19, the combined effects of all the 
proposals vary by specific types of providers and by location. For 
example, due to the changes in this rule, the estimated impacts on FY 
2017 payments range from a 1.1 percent increase for hospices providing 
care in the rural West North Central region to a 2.8 percent increase 
for hospices providing care in the rural Pacific region.

                               Table 19--Projected Impact to Hospices for FY 2017
----------------------------------------------------------------------------------------------------------------
                                                                                     Proposed
                                                     Number of     Updated wage       hospice      FY 2017 total
                                                     providers       data (%)         payment       change (%)
                                                                                    update (%)
(1)                                                     (2)             (3)             (4)             (5)
----------------------------------------------------------------------------------------------------------------
All Hospices....................................           4,177             0.0             2.1             2.1
Urban Hospices..................................           3,179             0.0             2.1             2.1
Rural Hospices..................................             998            -0.1             2.1             2.0
Urban Hospices--New England.....................             138             0.4             2.1             2.5
Urban Hospices--Middle Atlantic.................             252             0.2             2.1             2.3
Urban Hospices--South Atlantic..................             422            -0.1             2.1             2.0
Urban Hospices--East North Central..............             399            -0.1             2.1             2.0
Urban Hospices--East South Central..............             162            -0.1             2.1             2.0
Urban Hospices--West North Central..............             220            -0.5             2.1             1.6
Urban Hospices--West South Central..............             616            -0.2             2.1             1.9
Urban Hospices--Mountain........................             313            -0.3             2.1             1.8
Urban Hospices--Pacific.........................             618             0.6             2.1             2.7
Urban Hospices--Outlying........................              39            -0.7             2.1             1.4
Rural Hospices--New England.....................              23            -0.4             2.1             1.7
Rural Hospices--Middle Atlantic.................              42            -0.2             2.1             1.9
Rural Hospices--South Atlantic..................             136             0.2             2.1             2.3
Rural Hospices--East North Central..............             141             0.1             2.1             2.2
Rural Hospices--East South Central..............             129            -0.1             2.1             2.0
Rural Hospices--West North Central..............             186            -1.0             2.1             1.1
Rural Hospices--West South Central..............             184            -0.1             2.1             2.0
Rural Hospices--Mountain........................             107            -0.2             2.1             1.9
Rural Hospices--Pacific.........................              47             0.7             2.1             2.8
Rural Hospices--Outlying........................               3            -0.2             2.1             1.9
0-3,499 RHC Days (Small)........................             912             0.0             2.1             2.1
3,500-19,999 RHC Days (Medium)..................           2,004             0.0             2.1             2.1
20,000+ RHC Days (Large)........................           1,261             0.0             2.1             2.1
Non-Profit Ownership............................           1,071             0.1             2.1             2.2
For Profit Ownership............................           2,553            -0.1             2.1             2.0
Govt Ownership..................................             160             0.5             2.1             2.6
Other Ownership.................................             393            -0.1             2.1             2.0
Freestanding Facility Type......................           3,184             0.0             2.1             2.1
HHA/Facility-Based Facility Type................             993             0.2             2.1             2.3
----------------------------------------------------------------------------------------------------------------
Source: FY 2015 hospice claims data from the Standard Analytic Files for CY 2014 (as of June 30, 2015) and CY
  2015 (as of March 31, 2016).
Region Key:
New England=Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, Vermont; Middle
  Atlantic=Pennsylvania, New Jersey, New York; South Atlantic=Delaware, District of Columbia, Florida, Georgia,
  Maryland, North Carolina, South Carolina, Virginia, West Virginia; East North Central=Illinois, Indiana,
  Michigan, Ohio, Wisconsin; East South Central=Alabama, Kentucky, Mississippi, Tennessee; West North
  Central=Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, South Dakota; West South Central=Arkansas,
  Louisiana, Oklahoma, Texas; Mountain=Arizona, Colorado, Idaho, Montana, Nevada, New Mexico, Utah, Wyoming;
  Pacific=Alaska, California, Hawaii, Oregon, Washington; Outlying=Guam, Puerto Rico, Virgin Islands.

5. Alternatives Considered
    Since the hospice payment update percentage is determined based on 
statutory requirements, we did not consider not updating hospice 
payment rates by the payment update percentage. The 2.1 percent hospice 
payment update percentage for FY 2017 is based on a 2.7 percent 
inpatient hospital market basket update for FY 2017, reduced by a 0.3 
percentage point productivity adjustment and by an

[[Page 52194]]

additional 0.3 percentage point. Payment rates since FY 2002 have been 
updated according to section 1814(i)(1)(C)(ii)(VII) of the Act, which 
states that the update to the payment rates for subsequent years must 
be the market basket percentage for that FY. Section 3401(g) of the 
Affordable Care Act also mandates that, starting with FY 2013 (and in 
subsequent years), the hospice payment update percentage will be 
annually reduced by changes in economy-wide productivity as specified 
in section 1886(b)(3)(B)(xi)(II) of the Act. In addition, section 
3401(g) of the Affordable Care Act mandates that in FY 2013 through FY 
2019, the hospice payment update percentage will be reduced by an 
additional 0.3 percentage point (although for FY 2014 to FY 2019, the 
potential 0.3 percentage point reduction is subject to suspension under 
conditions specified in section 1814(i)(1)(C)(v) of the Act).
    We considered not adopting a hospice wage index standardization 
factor. However, as discussed in section III.C.1 of this final rule, we 
believe that adopting a hospice wage index standardization factor would 
provide a safeguard to the Medicare program, as well as to hospices, 
because it will mitigate changes in overall hospice expenditures due to 
annual fluctuations in the hospital wage data from year-to-year by 
ensuring that hospice wage index updates and revisions are implemented 
in a budget neutral manner. We estimate that if the hospice wage index 
standardization factor is not finalized, total payments in a given year 
would increase or decrease by as much as 0.3 percent or $50 million.
6. Accounting Statement
    As required by OMB Circular A-4 (available at http://www.whitehouse.gov/omb/circulars/a004/a-4.pdf), in Table 20, we have 
prepared an accounting statement showing the classification of the 
expenditures associated with the provisions of this final rule. Table 
20 provides our best estimate of the possible changes in Medicare 
payments under the hospice benefit as a result of the policies in this 
final rule. This estimate is based on the data for 4,177 hospices in 
our impact analysis file, which was constructed using FY 2015 claims 
available as of March 31, 2016. All expenditures are classified as 
transfers to hospices.

 Table 20--Accounting Statement: Classification of Estimated Transfers,
                         From FY 2016 to FY 2017
                             [in $Millions]
------------------------------------------------------------------------
                Category                             Transfers
------------------------------------------------------------------------
           FY 2017 Hospice Wage Index and Payment Rate Update
------------------------------------------------------------------------
Annualized Monetized Transfers..........  $350 *
From Whom to Whom?                        Federal Government to Medicare
                                           Hospices.
------------------------------------------------------------------------
* The net increase of $350 million in transfer payments is a result of
  the 2.1 percent hospice payment update percentage compared to payments
  in FY 2016.

7. Conclusion
    We estimate that aggregate payments to hospices in FY 2017 would 
increase by $350 million, or 2.1 percent, compared to payments in FY 
2016. We estimate that in FY 2017, hospices in urban and rural areas 
would experience, on average, a 2.1 percent and a 2.0 percent increase, 
respectively, in estimated payments compared to FY 2016. Hospices 
providing services in the urban Pacific and rural Pacific regions would 
experience the largest estimated increases in payments of 2.7 percent 
and 2.8 percent, respectively. Hospices serving patients in rural areas 
in the West North Central region would experience the lowest estimated 
increase of 1.1 percent in FY 2017 payments.

B. Regulatory Flexibility Act Analysis

    The RFA requires agencies to analyze options for regulatory relief 
of small businesses if a rule has a significant impact on a substantial 
number of small entities. The great majority of hospitals and most 
other health care providers and suppliers are small entities by meeting 
the Small Business Administration (SBA) definition of a small business 
(in the service sector, having revenues of less than $7.5 million to 
$38.5 million in any 1 year), or being nonprofit organizations. For 
purposes of the RFA, we consider all hospices as small entities as that 
term is used in the RFA. HHS's practice in interpreting the RFA is to 
consider effects economically ``significant'' only if they reach a 
threshold of 3 to 5 percent or more of total revenue or total costs. 
The effect of the final FY 2017 hospice payment update percentage 
results in an overall increase in estimated hospice payments of 2.1 
percent, or $350 million. Therefore, the Secretary has determined that 
this final rule will not create a significant economic impact on a 
substantial number of small entities.
    In addition, section 1102(b) of the Act requires us to prepare a 
regulatory impact analysis if a rule may have a significant impact on 
the operations of a substantial number of small rural hospitals. This 
analysis must conform to the provisions of section 604 of the RFA. For 
purposes of section 1102(b) of the Act, we define a small rural 
hospital as a hospital that is located outside of a metropolitan 
statistical area and has fewer than 100 beds. This final rule only 
affects hospices. Therefore, the Secretary has determined that this 
final rule will not have a significant impact on the operations of a 
substantial number of small rural hospitals.

C. Unfunded Mandates Reform Act Analysis

    Section 202 of the Unfunded Mandates Reform Act of 1995 also 
requires that agencies assess anticipated costs and benefits before 
issuing any rule whose mandates require spending in any 1 year of $100 
million in 1995 dollars, updated annually for inflation. In 2016, that 
threshold is approximately $146 million. This final rule is not 
anticipated to have an effect on State, local, or tribal governments, 
in the aggregate, or on the private sector of $146 million or more.

VI. Federalism Analysis

    Executive Order 13132, Federalism (August 4, 1999) requires an 
agency to provide federalism summary impact statement when it 
promulgates a proposed rule (and subsequent final rule) that has 
federalism implications and which imposes substantial direct 
requirement costs on State and local governments which are not required 
by statute. We have reviewed this final rule under these criteria of 
Executive Order 13132, and have determined that it will not impose 
substantial direct costs on state or local governments.

    Dated: July 18, 2016.
Andrew M. Slavitt,
Acting Administrator, Centers for Medicare & Medicaid Services.
    Dated: July 25, 2016.
Sylvia M. Burwell,
Secretary, Department of Health and Human Services.
[FR Doc. 2016-18221 Filed 7-29-16; 4:15 pm]
 BILLING CODE 4120-01-P