[Federal Register Volume 82, Number 149 (Friday, August 4, 2017)]
[Rules and Regulations]
[Pages 36638-36685]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-16294]



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Vol. 82

Friday,

No. 149

August 4, 2017

Part III





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 2018 Hospice Wage Index and Payment Rate Update 
and Hospice Quality Reporting Requirements; Final Rule

  Federal Register / Vol. 82 , No. 149 / Friday, August 4, 2017 / Rules 
and Regulations  

[[Page 36638]]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

42 CFR Part 418

[CMS-1675-F]
RIN 0938-AT00


Medicare Program; FY 2018 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) 2018. Additionally, this 
rule includes new quality measures and provides an update on the 
hospice quality reporting program.

DATES: These regulations are effective on October 1, 2017.

FOR FURTHER INFORMATION CONTACT: Debra Dean-Whittaker, (410) 786-0848 
for questions regarding the CAHPS[supreg] Hospice Survey.
    Cindy Massuda, (410) 786-0652 for questions regarding the hospice 
quality reporting program.
    For general questions about hospice payment policy, please send 
your inquiry via email to: [email protected].

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
    10. FY 2017 Hospice Wage Index and Payment Rate Update Final 
Rule
    E. Trends in Medicare Hospice Utilization
III. Provisions of the Final Rule
    A. Monitoring for Potential Impacts--Affordable Care Act Hospice 
Reform
    B. FY 2018 Hospice Wage Index and Rates Update
    1. FY 2018 Hospice Wage Index
    2. FY 2018 Hospice Payment Update Percentage
    3. FY 2018 Hospice Payment Rates
    4. Hospice Cap Amount for FY 2018
    C. Discussion Regarding Sources of Clinical Information for 
Certifying Terminal Illness
    D. Updates to the Hospice Quality Reporting Program (HQRP)
    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 Determinations
    4. Policy for Adopting Changes to Previously Adopted Measures
    5. Previously Adopted Quality Measures for FY 2018 Payment 
Determination and Future Years
    6. Removal of Previously Adopted Measures
    7. Measure Concepts Under Consideration for Future Years
    8. Form, Manner, and Timing of Quality Data Submission
    a. Background
    b. Policy for New Facilities To Begin Submitting Quality Data
    c. Previously Finalized Data Submission Mechanisms, Timelines, 
and Deadlines
    d. New Data Collection and Submission Mechanisms Under 
Consideration: Hospice Evaluation & Assessment Reporting Tool 
(HEART)
    9. Previously Adopted APU Determination and Compliance Criteria 
for the HQRP
    a. Background
    b. Previously Finalized HIS Data Submission Timelines and 
Compliance Thresholds for FY 2018 Payment Determination and 
Subsequent Years
    c. CAHPS[supreg] Participation Requirements for FY 2018 APU 
Determination and Determinations for Subsequent Years
    10. HQRP Submission Exemption and Extension Requirements for the 
FY 2019 Payment Determination and Subsequent Years
    a. Extraordinary Circumstances Exemption and Extension
    b. Volume-Based Exemption for CAHPS[supreg] Hospice Survey Data 
Collection and Reporting Requirements
    c. Newness Exemption for CAHPS[supreg] Hospice Survey Data 
Collection and Reporting Requirements
    11. CAHPS[supreg] Hospice Survey Participation Requirements for 
the FY 2020 APU and Subsequent Years
    a. Background and Description of the CAHPS[supreg] Hospice 
Survey
    b. Overview of Proposed Measures
    c. Data Sources
    i. Requirements for the FY 2020 Annual Payment Update
    ii. Requirements for the FY 2021 Annual Payment Update
    iii. Requirements for the FY 2022 Annual Payment Update
    d. Measure Calculations
    i. Composite Survey-Based Measures
    ii. Global Survey-Based Measures
    iii. Cohort
    e. Risk Adjustment
    i. Patient-Mix Adjustment
    ii. Mode Adjustment
    f. For Further Information About the CAHPS[supreg] Hospice 
Survey
    12. HQRP Reconsideration and Appeals Procedures for the FY 2018 
Payment Determination and Subsequent Years
    13. Confidential Feedback Reports
    14. Public Display of Quality Measures and Other Hospice Data 
for the HQRP
IV. Collection of Information Requirements
    A. Hospice Item Set
    B. Summary of CAHPS[supreg] Hospice Survey Information 
Collection Requirements (OMB Control Number 0938-1257)
V. Regulatory Impact Analysis
    A. Statement of Need
    B. Overall Impacts
    C. Anticipated Effects
    D. Detailed Economic Analysis
    E. Accounting Statement
    F. Reducing Regulation and Controlling Regulatory Costs
    G. Conclusion

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
CASPER Certification and Survey Provider Enhanced Reports
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
CMS Centers for Medicare & Medicaid Services
COPD Chronic Obstructive Pulmonary Disease
CoPs Conditions of Participation
CPI-U Consumer Price Index-Urban Consumers
CVA Cerebral Vascular Accident
CWF Common Working File
CY Calendar Year
DME Durable Medical Equipment
DRG Diagnostic Related Group
FEHC Family Evaluation of Hospice Care
FR Federal Register
FY Fiscal Year
GAO Government Accountability Office
GIP General Inpatient Care
HCFA Healthcare Financing Administration
HEART Hospice Evaluation & Assessment Reporting Tool

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HHS Health and Human Services
HIS Hospice Item Set
HQRP Hospice Quality Reporting Program
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
IPPS Inpatient Prospective Payment System
IRC Inpatient Respite Care
LCD Local Coverage Determination
MAC Medicare Administrative Contractor
MACRA Medicare Access and CHIP Reauthorization Act of 2015
MAP Measure Applications Partnership
MedPAC Medicare Payment Advisory Commission
MFP Multifactor Productivity
MLN Medicare Learning Network
MSA Metropolitan Statistical Area
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
PRA Paperwork Reduction Act of 1995
PRRB Provider Reimbursement Review Board
PS&R Provider Statistical and Reimbursement Report
Pub. L. Public Law
POC Plan of Care
QAPI Quality Assessment and Performance Improvement
QIO Quality Improvement Organization
QM Quality Measure
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) 2018, as required under section 1814(i) of the Social Security Act 
(the Act). This rule also discusses 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. In accordance 
with section 1814(i)(5)(A) of the Act, hospices that fail to meet 
quality reporting requirements receive a 2 percentage point reduction 
to their payments.

B. Summary of the Major Provisions

    Section III.B.1 of this final rule updates the hospice wage index 
with updated wage data and makes the application of the updated wage 
data budget neutral for all four levels of hospice care. In section 
III.B.2 of this final rule, we discuss the FY 2018 hospice payment 
update percentage of 1.0 percent. Sections III.B.3 and III.B.4 of this 
final rule update the hospice payment rates and hospice cap amount for 
FY 2018 by the hospice payment update percentage discussed in section 
III.B.2 of this final rule.
    In section III.C of this final rule, we discuss comments on the 
appropriate source(s) of the required clinical information for 
certification of a medical prognosis of a life expectancy of 6 months 
or less.
    Finally, in section III.D of this final rule, we discuss updates to 
HQRP, including changes to the Consumer Assessment of Healthcare 
Providers and Systems (CAHPS)[supreg] Hospice Survey measures as well 
as the possibility of utilizing a new assessment instrument to collect 
quality data. We also discuss the enhancements to the current Hospice 
Item Set (HIS) data collection instrument to be more in line with other 
post-acute care settings. The new data collection instrument would be a 
comprehensive patient assessment instrument, rather than the current 
chart abstraction tool. Finally, we discuss our plans for sharing HQRP 
data publicly later in calendar year (CY) 2017, as well as plans to 
provide public reporting via a Compare Site in CY 2017 and future 
years.

C. Summary of Impacts

    The overall economic impact of this final rule is estimated to be 
$180 million in increased payments to hospices during FY 2018.

II. Background

A. Hospice Care

    Hospice care is a comprehensive, holistic approach to treatment 
that recognizes that the impending death of an individual, upon his or 
her choice, 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 a collaboration 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/caregiver-centered care for those who are 
terminally ill.
    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 care practices, and is a 
critical component of the Medicare hospice benefit. For more 
information, see ``Medicare and Medicaid Programs: 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 and caregivers through early 
identification and management of pain and other issues associated with 
a life limiting condition. The hospice interdisciplinary group works 
with the beneficiary, family, and caregivers to develop a coordinated, 
comprehensive care plan; reduce unnecessary diagnostics or ineffective 
therapies; and maintain ongoing communication with individuals and 
their families about changes in their condition. The beneficiary's 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 related to the underlying condition(s), as bodily systems 
are interdependent. In the 2008 Hospice Conditions of Participation 
final rule, we stated that ``the [hospice] medical director 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)

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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 regulations at Sec.  418.22(b)(3) require that 
the certification and recertification forms include a brief narrative 
explanation of the clinical findings that support a life expectancy of 
6 months or less.
    While the goal of hospice care is to allow the beneficiary to 
remain in his or her home, circumstances during the end of life may 
necessitate short-term inpatient admission to a hospital, skilled 
nursing facility (SNF), or hospice facility for necessary pain control 
or acute or chronic symptom management that cannot be managed in any 
other setting. These acute hospice care services ensure that any new or 
worsening symptoms are intensively addressed so that the beneficiary 
can return to his or her home. Limited, short-term, intermittent, 
inpatient respite care (IRC) is also available because of the absence 
or need for relief of the family or other caregivers. Additionally, an 
individual can receive continuous home care (CHC) during a period of 
crisis in which an individual requires continuous care to achieve 
palliation or management of acute medical symptoms so that the 
individual can remain at home. Continuous home care may be covered 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. Additionally, they 
must 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/ocr/civilrights.

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 entitled ``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 well as, care for interventions to manage 
pain and symptoms, as described in the beneficiary's plan of care. 
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 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 home from an institutional 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.

[[Page 36641]]

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, the 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). 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 community based, holistic, comprehensive, and 
compassionate end-of-life care.
    Before the Medicare hospice benefit was established, the Congress 
requested a demonstration project to test the feasibility of covering 
hospice care under Medicare.\3\ 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:
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    \3\ Greer, D., Mor, V., Sherwood, S. (1983) National hospice 
study analysis plan. Journal of Chronic Diseases, Vol 36, 11, 737-
780. https://doi.org/10.1016/0021-9681(83)90069-3.
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     Patient and family know of the terminal condition.
     Further medical treatment and intervention are indicated 
only on asupportive 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 thedeath 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. Most 
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 (IRC), and general 
inpatient care (GIP)), 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 and 
items 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 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

[[Page 36642]]

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, were subject to either a budget neutrality adjustment or 
application of the wage index floor. Wage index values of 0.8 or 
greater were 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, and 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 that fail to report quality data will have their market basket 
percentage increase 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, the Congress 
included an aggregate cap on hospice payments, which limits the total 
aggregate payments any individual hospice can receive in a year. The 
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 subsequent 
cap years, we announced that subsequently, the hospice aggregate cap 
would be calculated using the patient-by-patient proportional 
methodology, within certain limits. We allowed existing hospices the 
option of having their cap calculated via the original streamlined 
methodology, also within certain limits. 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 payments for the cap year 
exceed 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).

[[Page 36643]]

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 of 
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. Over time, we have 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 as of 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 Wage Index and Payment 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 Wage Index and Payment 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 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 fiscal year 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 well as admission requirements for hospice 
certifications.
10. FY 2017 Hospice Wage Index and Payment Rate Update Final Rule
    In the FY 2017 Hospice Wage Index and Payment Rate Update final 
rule, we finalized several new policies and requirements related to the 
HQRP. First, we codified our policy that if the National Quality Forum 
(NQF) makes non-substantive changes to specifications for HQRP measures 
as part of the NQF's re-endorsement process, we will continue to 
utilize the measure in its new endorsed status, without going through 
new notice-and-comment rulemaking (81 FR 52160). We will continue to 
use rulemaking to adopt substantive updates made by the NQF to the 
endorsed measures we have adopted for the HQRP; determinations about 
what constitutes a substantive versus non-substantive change will be 
made on a measure-by-measure basis. Second, we finalized two new 
quality measures for the HQRP 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 (81 FR 52173). The data collection mechanism 
for both of these measures is the HIS, and the measures are effective 
April 1, 2017. Regarding the CAHPS[supreg] Hospice Survey, we finalized 
a policy that hospices that receive their CMS Certification Number 
(CCN) after January 1, 2017 for the FY 2019 Annual Payment Update (APU) 
and January 1, 2018 for the FY 2020 APU will be exempted from the 
Hospice CAHPS[supreg] requirements due to newness (81 FR 52182). The 
exemption is

[[Page 36644]]

determined by CMS and is for 1 year only.

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 2016. Similarly, Medicare hospice expenditures have 
risen from $2.8 billion in FY 2000 to approximately $16.5 billion in FY 
2016. 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.
    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 2016 in 
neurologically-based diagnoses, including diagnoses of Alzheimer's 
disease. Additionally, there have 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 2016, the 
most common hospice principal diagnoses were Alzheimer's disease, Heart 
Failure, Chronic Obstructive Pulmonary Disease, Lung Cancer, and Senile 
Degeneration of the Brain, which constituted approximately 30 percent 
of all claims-reported principal diagnosis codes reported in FY 2016 
(see Table 2).

             Table 2--The Top Twenty Principal Hospice Diagnoses, FY 2002, FY 2007, FY 2013, FY 2016
----------------------------------------------------------------------------------------------------------------
                                                      ICD-9/Reported principal
           Rank                                               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
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 w/         15,777               2
                                                     o Behavior. 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
----------------------------------------------------------------------------------------------------------------

[[Page 36645]]

 
                                                  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 w/         30,963               2
                                                     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 Dis.-         14,372               1
                                                     classified elsewhere.
20.......................  294.11                   Dementia In Other Diseases w/         13,687               1
                                                     Behavioral Dist..
----------------------------------------------------------------------------------------------------------------
                                                  Year: FY 2016
----------------------------------------------------------------------------------------------------------------
1........................  G30.9                    Alzheimer's disease,                 162,845              11
                                                     unspecified.
2........................  I50.9                    Heart failure, unspecified..          84,088               6
3........................  J44.9                    Chronic obstructive                   74,131               5
                                                     pulmonary disease,
                                                     unspecified.
4........................  C34.90                   Malignant Neoplasm Of Unsp            57,077               4
                                                     Part Of Unsp Bronchus Or
                                                     Lung.
5........................  G31.1                    Senile degeneration of                55,305               4
                                                     brain, not elsewhere
                                                     classified.
6........................  G20                      Parkinson's disease.........          37,245               2
7........................  I25.10                   Atherosclerotic heart                 33,647               2
                                                     disease of native coronary
                                                     art without angina pectoris.
8........................  J44.1                    Chronic obstructive                   32,851               2
                                                     pulmonary disease with
                                                     (acute) exacerbation.
9........................  G30.1                    Alzheimer's disease with              29,223               2
                                                     late onset.
10.......................  I67.2                    Cerebral atherosclerosis....          27,629               2
11.......................  C61                      Malignant neoplasm of                 24,576               2
                                                     prostate.
12.......................  N18.6                    End stage renal disease.....          22,261               1
13.......................  C18.9                    Malignant neoplasm of colon,          22,203               1
                                                     unspecified.
14.......................  I51.9                    Heart disease, unspecified..          21,868               1
15.......................  C25.9                    Malignant neoplasm of                 20,400               1
                                                     pancreas, unspecified.
16.......................  I63.9                    Cerebral infarction,                  18,546               1
                                                     unspecified.
17.......................  I67.9                    Cerebrovascular disease,              14,879               1
                                                     unspecified.
18.......................  C50.919                  Malignant neoplasm of                 14,022               1
                                                     unspecified site of
                                                     unspecified female breast.
19.......................  A41.9                    Sepsis, unspecified organism          12,723               1
20.......................  I50.22                   Chronic systolic                      12,083              1
                                                     (congestive) heart failure.
----------------------------------------------------------------------------------------------------------------
Note(s): The frequencies shown represent beneficiaries that had a least one claim with the specific ICD-9-CM/ICD-
  10 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
  2016 hospice claims data from the CCW, accessed and merged with ICD-10 codes on January 9, 2017.

    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 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 2016 hospice 
claims show that 100 percent of hospices reported one diagnosis, 86 
percent submitted at least two diagnoses, and 77 percent included at 
least three diagnoses.

III. Provisions of the Final Rule

    On May 3, 2017, we published the FY 2018 Hospice Wage Index and 
Payment Rate Update and Hospice Quality Reporting Requirements proposed 
rule in the Federal Register (82 FR 20750 through 20792) and provided a 
60 day comment period. In that proposed rule, we proposed to update the 
hospice wage index, payment rates, and cap amount for fiscal year (FY) 
2018. In addition, we

[[Page 36646]]

proposed changes to the hospice quality reporting program. 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. We received approximately 
89 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 2018 Hospice 
Payment Rate Update and Hospice Quality Reporting Requirements. 
Comments related to the paperwork burden are addressed in section IV 
``Collection of Information Requirements'' of this final rule. Comments 
related to the impact analysis are addressed in section V ``Regulatory 
Impact Analysis'' of this final rule.

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

    In the FY 2018 Hospice Wage Index and Payment Rate Update proposed 
rule (82 FR 20750), we provided a summary of analysis conducted on 
hospice length of stay, live discharge rates, skilled visits in the 
last days of life, and non-hospice spending. Additionally, we discussed 
initial analyses of data from recently revised cost reports. 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.
    The comments and our responses are set forth below.
    Comment: Many commenters expressed continued support for our plans 
to monitor the impact of hospice payment reform and suggested the use 
of monitoring results in order to better target program integrity 
efforts. Commenters suggested CMS ensure hospices with a high number of 
live discharges receive the appropriate training on hospice eligibility 
requirements, which may help reduce their number of live discharges to 
a threshold more aligned with other hospices with similar demographics. 
With regards to skilled visits during the last days of life, a few 
commenters stated that hospices continue to 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. With 
regards to the initial analysis of newly-revised cost report data, 
several commenters encouraged CMS to approach further analysis in a 
deliberate fashion, taking into account the ``newness'' of the data 
collected, further educate providers on appropriate completion of the 
cost report forms, and audit cost reports before moving forward with 
any further research. Several commenters suggested that CMS take action 
to educate other Medicare provider types to increase understanding of 
benefits coverage and claims processing after a beneficiary has elected 
hospice and encouraged Medicare systems changes that could shorten the 
time frame for updates to the beneficiary's status in all systems. 
Several commenters recommended that CMS make more data available to the 
hospice providers and other stakeholders, especially with regards to 
Part D billing, and consider clarifying the responsibilities for 
prescription medications to decrease Part D non-hospice spending.
    Response: We appreciate these comments on the ongoing analysis 
presented and we will continue to monitor hospice trends and 
vulnerabilities within the hospice benefit, while also investigating 
the means by which we can educate the provider community regarding the 
hospice benefit and appropriate billing practices. We will also 
consider these suggestions for future monitoring efforts and for 
potential policy or payment refinements. We are currently working on a 
process to allow NOEs to be submitted via electronic data interchange 
while simultaneously working on a redesign of hospice benefit period 
data in our systems. Allowing NOEs to be submitted via an electronic 
data interchange and the hospice benefit period data redesign should 
help with more timely beneficiary status updates in the Medicare 
systems.

B. FY 2018 Hospice Wage Index and Rate Update

1. FY 2018 Hospice Wage Index
    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 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 2018, the hospice wage index will be 
based on the FY 2017 hospital pre-floor, pre-reclassified 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 IRC.
    There exist 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 2008 Hospice Wage Index final rule 
(72 FR 50214), we implemented a methodology to update the hospice wage 
index for such areas. In cases where there was a rural area without 
rural hospital wage data, we use the average pre-floor, pre-
reclassified hospital wage index data from all contiguous Core-Based 
Statistical Areas (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, for rural 
Puerto Rico, we would not apply this methodology due to the distinct 
economic circumstances that exist there (for example, due to the close 
proximity to one another of almost all of Puerto Rico's various urban 
and non-urban areas, this methodology would produce a wage index for 
rural Puerto Rico that is higher than that in half of its urban areas); 
instead, we would continue to use the most recent wage index previously 
available for that area. For FY 2018, we will continue to use the most 
recent pre-floor, pre-reclassified hospital wage index value available 
for Puerto Rico, which is 0.4047.

[[Page 36647]]

    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. For FY 2018, the only CBSA without a 
hospital from which hospital wage data can be derived is 25980, 
Hinesville-Fort Stewart, Georgia.
    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 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, 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.
    On February 28, 2013, OMB issued OMB Bulletin No. 13-01, announcing 
revisions to the delineation of MSAs, Micropolitan Statistical Areas, 
and Combines Statistical Areas, and guidance on uses of the delineation 
in these areas. In the FY 2016 Hospice Wage Index and Payment Rate 
Update final rule (80 FR 47178), we adopted the OMB's new area 
delineations using a 1-year transition. Also, in the FY 2016 Hospice 
Wage Index and Payment Rate Update final rule, we stated that beginning 
October 1, 2016, the wage index for all hospice payments would be fully 
based on the new OMB delineations. The most recent bulletin (No. 15-01) 
concerning the revised delineations was published by the OMB on July 
15, 2015.
    A summary of the comments we received regarding the wage index and 
our responses to those comments appears below.
    Comment: Several commenters expressed concern that hospices in 
Montgomery County and Frederick County, Maryland, which are included in 
CBSA 43524 (Silver Spring-Frederick-Rockville, MD), are reimbursed at a 
lower rate than hospices in the greater Washington DC area that are 
included in CBSA 47894 (Washington-Arlington-Alexandria, DC-VA-MD-WV). 
The commenters request that CMS reconsider CBSA 43524 (Silver Spring-
Frederick-Rockville, MD).
    Response: We refer readers of this final rule to the FY 2016 
Hospice Wage Index and Payment Rate Update (80 FR 47179 through 47180) 
wherein we provided a detailed response to this comment.
    Comment: A commenter stated that another complicating factor 
related to the wage index value for CBSA 43524 (Silver Spring-
Frederick-Rockville, MD) is the Maryland Federal Waiver and global 
budget. In all other states, cost reports drive reimbursement for 
hospitals and accurate reporting of wages is key to reimbursement 
rates. The commenter believes that since the data on cost reports does 
not relate to their reimbursement, hospitals in Maryland have no 
incentive to report their wages accurately. The commenter asserts that 
there are two hospitals in CBSA 43524 that have not reported their 
nursing wages accurately. The cost report data drives the rates for 
post-acute Medicare services such as hospice; this difference should be 
taken into consideration.
    Response: We would like to thank the commenter for her comment. We 
disagree with the commenter's statement that hospitals in Maryland have 
no incentives for ensuring the accuracy of their cost reports and that 
the cost report data are inaccurate and not representative of the costs 
that the hospitals actually incur. Hospitals' cost reports, including 
those of hospitals in Maryland, are required to be certified by the 
Officer or Administrator of the hospital. The hospital Medicare Cost 
Report (MCR) Form (CMS-2552-10) states the following:
    ``I HEREBY CERTIFY that I have read the above statement and that I 
have examined the accompanying cost report and the Balance Sheet and 
Statement of Revenue and Expenses prepared by _____ (provider name(s) 
and number(s) for the cost report beginning ___ and ending ___ and to 
the best of my knowledge and belief, this report and statement are 
true, correct, complete and prepared from the books and records of the 
provider in accordance with applicable instructions, except as noted. I 
further certify that I am familiar with the laws and regulations 
regarding the provision of health care services, and that the services 
identified in this cost report were provided in compliance with such 
laws and regulations.''
    We also note that the hospital Medicare cost report referenced 
statement above includes the following:

    ``Misrepresentation or falsification of any information 
contained in this cost report may be punishable by criminal, civil 
and administrative action, fine and/or imprisonment under federal 
law. Furthermore, if services identified in this report were 
provided or procured through the payment directly or indirectly of a 
kickback or were otherwise illegal, criminal, civil and 
administrative action, fines and/or imprisonment may result.''

    As always, we encourage providers to fill out the Medicare cost 
reports as accurately as possible.
    Comment: A commenter stated that no hospice should receive a wage 
index below the hospital rural floor. The commenter stated that in some 
small CBSAs, hospices receive a wage index that is below the rural 
floor which severely impacts their ability to deliver high-quality 
hospice care. CMS should mandate that no hospice receive a wage index 
below the rural floor.
    Response: The hospice wage index does not contain a rural floor 
provision. 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 (for example, SNF PPS, IRF PPS, and HH PPS). The hospice floor 
is applicable to all CBSAs, both rural and urban. 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.
    Comment: A commenter requested that CMS make adjustments to the 
methodology used to calculate the wage index for rural Puerto Rico. The 
commenter stated that the proposed ruling for the FY 2018 Hospice Wage 
Index Update states that ``in cases where there was a rural area 
without rural hospital wage data, we use the average pre-floor, pre-
reclassified hospital wage index data from all contiguous Core-Based 
Statistical Areas (CBSAs), to represent a reasonable proxy for the

[[Page 36648]]

rural area.'' Currently, the only rural area without a hospital from 
which hospital wage data could be derived is Puerto Rico. The commenter 
notes that CMS chose not to use this proxy for Puerto Rico and 
continued using the most recent wage index previously available for 
that rural area. The commenter does not believe that this represents a 
``reasonable proxy for the rural area'' in comparison with other 
jurisdictions, and it still does not justify applying lower wage 
indices to urban areas in Puerto Rico.
    The commenter proposes that CMS should use the wage index defined 
for the neighboring U.S. Virgin Islands for CY 2018, as this would be 
in harmony with the policy defined for Part B GPCIs, by providing more 
consistency across the payment policies among neighboring Territories. 
Alternatively, the commenter proposes that Puerto Rico wage indices in 
Hospice care should not be lower than the average ratio of Puerto Rico 
wages to U.S. wages, using the data from the OES. The Puerto Rico 
average wage is at 58 percent of the national average, the commenter 
considers that the Hospice wage index should be at least equal to that 
ratio.
    Response: We will take these comments under consideration for any 
future policy changes that may be considered for Puerto Rico. The wage 
index value for rural Puerto Rico is increased by 15 percent in 
accordance with the hospice floor provision. There was an error in the 
Proposed FY 2018 Hospice Wage Index file. The value for rural Puerto 
Rico was listed as 0.4047. The correct value is 0.4654.
    Comment: A commenter expressed dissatisfaction with the wage index 
value for Madera County, California in relation to the wage index value 
for Fresno County, which is adjacent to Madera County.
    Response: As stated earlier in this final rule, we use OMB's 
geographic area delineations to differentiate between labor markets. 
Based on the most recent list of MSA definitions contained in OMB 
Bulletin No. 15-01, published on July 15, 2015 and available at https://www.whitehouse.gov/sites/whitehouse.gov/files/omb/bulletins/2015/15-01.pdf, Madera County is associated with a different MSA than Fresno 
County. Therefore, for payment purposes we calculate these two counties 
wage indices separately, based on data gathered from the cost reports 
of the Inpatient Prospective Payment System (IPPS) hospitals in those 
counties.
    Comment: One commenter expressed concern that the proposed FY 2018 
hospice wage index will be fully based on the new OMB geographic area 
wage delineations. The commenter was particularly concerned with the 
New York City CBSA and the fact that the CBSA contains counties from 
New Jersey where labor costs are lower.
    Response: We responded to this comment in the FY 2017 Hospice Wage 
Index and Payment Rate Update final rule (81 FR 52154). We continue to 
believe that the OMB's geographic area delineations are a reasonable 
and appropriate method of defining geographic areas for the purposes of 
wage adjusting the hospice payment rates.
    Comment: A commenter was concerned with the continued use of the 
pre-floor, pre-reclassified hospital wage index to adjust the hospice 
payment rates and states his belief that this causes continued 
volatility of the hospice wage index from one year to the next. The 
commenter believes that the volatility is often based on inaccurate or 
incomplete hospital cost report data.
    Response: We addressed this comment in the FY 2017 Hospice Wage 
Index and Payment Rate Update final rule (81 FR 52154). We continue to 
believe that the annual changes in the wage index reflect real 
variations in costs of providing care in various geographic locations. 
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. 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 our policy of utilizing a hospice 
wage index standardization factor, which was proposed and finalized in 
FY 2017 rulemaking, provides 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: We responded to this comment in the FY 2017 Hospice Wage 
Index and Payment Rate Update final rule (81 FR 52154) and believe that 
it is important to reiterate that the regulations and statutes that 
govern hospice payments do not provide 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 in 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 they may or may not apply to a given 
hospice in a given instance. In addition, several post-acute care 
payment systems utilize the pre-floor, pre-reclassified hospital wage 
index as the basis for their wage indices (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)).
    Final Decision: 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 2018, the updated wage data are for hospital cost 
reporting periods beginning on or after October 1, 2012 and before 
October 1, 2013 (FY 2013 cost report data).
    The wage index applicable for FY 2018 is available on our Web site 
at http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/Hospice/index.html. The hospice wage index for FY 2018 will be 
effective October 1, 2017 through September 30, 2018.
2. FY 2018 Hospice Payment Update Percentage
    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

[[Page 36649]]

hospice rates for FYs 1998 through 2002. Hospice rates were to be 
updated by a factor equal to the inpatient hospital market basket 
percentage increase 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 increase for that FY. 
The Act historically required us to use the inpatient hospital market 
basket as the basis for the hospice payment rate update.
    Section 3401(g) of the Affordable Care Act mandated that, starting 
with FY 2013 (and in subsequent FYs), the hospice payment update 
percentage would 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). In addition to the MFP 
adjustment, section 3401(g) of the Affordable Care Act also mandated 
that in FY 2013 through FY 2019, the hospice payment update percentage 
would 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).
    Prior to the enactment of the Medicare Access and CHIP 
Reauthorization Act of 2015 (MACRA) (Pub. L. 114-10, enacted April 16, 
2015), which amended section 1814(i)(1)(C) of the Act, the proposed 
hospice update percentage for FY 2018 would have been based on the 
estimated inpatient hospital market basket update of 2.7 percent (based 
on IHS Global Inc.'s second quarter 2017 forecast with historical data 
through the first quarter of 2017 of the 2014-based IPPS market 
basket). Due to the requirements at section 1886(b)(3)(B)(xi)(II) of 
the Act prior to enactment of the MACRA, the estimated FY 2018 
inpatient hospital market basket update of 2.7 percent would have been 
reduced by a MFP adjustment as mandated by Affordable Care Act 
(currently estimated to be 0.6 percentage point for FY 2018) and a 0.3 
percentage point reduction as mandated by section 1814(i)(1)(C)(v) of 
the Act. In effect, the hospice payment update percentage for FY 2018 
would be 1.8 percent. However, section 411(d) of the MACRA amended 
section 1814(i)(1)(C) of the Act, such that for hospice payments for FY 
2018, the market basket percentage increase is required to be 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. Beginning with cost reporting periods starting on or after 
October 1, 2014, freestanding hospice providers are required to submit 
cost data using CMS Form 1984-14 (https://www.cms.gov/Research-Statistics-Data-and-Systems/Downloadable-Public-Use-Files/Cost-Reports/Hospice-2014.html). We are currently analyzing this data for possible 
use in updating the labor portion of the hospice payment rates. Any 
changes to the labor portions will be proposed in future rulemaking and 
will be subject to public comments.
    A summary of the comments we received regarding the payment update 
and our responses to those comments appear below.
    Comment: Several commenters stated that the FY 2018 payment update 
of 1 percent is inadequate. One of the commenters stated that the 
update does not appropriately keep pace with the cost of providing 
hospice care to beneficiaries and does not match the increasing costs 
associated with data collection requirements and reporting, technology, 
workforce and training.
    Response: We appreciate the commenter's concerns; however, the 1 
percent payment update for FY 2018 is mandated by section 411(d) of the 
MACRA.
    Comment: A commenter noted that in MedPAC's March 2017 Report to 
Congress, MedPAC concluded that indicators of payment adequacy for 
hospice providers are generally positive. In 2015, the number of 
hospices increased about 2.6 percent because of continued entry of for-
profit providers. The aggregate Medicare margin was 8.2 percent in 2014 
and MedPAC projected a 2017 aggregate Medicare margin of 7.7 percent. 
Based on their assessment of these and other payment adequacy 
indicators, MedPAC concluded that hospices should be able to 
accommodate cost changes in 2018 without an update to the 2017 base 
payment rate. The commenter also acknowledged that CMS is required by 
statute to update the FY 2018 hospice payment rates by 1 percent.
    Response: We thank the commenter for noting that hospices' Medicare 
margins appear to be adequate and no update to the per diem amounts is 
needed for FY 2018. We further thank the commenter for acknowledging 
that we do not have the authority to eliminate the payment update for 
FY 2018.
3. FY 2018 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 CHC, 
IRC, or GIP. CHC is provided during a period of patient crisis to 
maintain the patient at home; IRC is short-term care to allow the usual 
caregiver to rest and be relieved from caregiving; and 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 for RHC for 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, if certain criteria 
are met. 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 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 2018, we calculated the SBNF using FY 2016 
utilization data. We examined skilled nursing and social work visit 
data for the last 7 days of life where RHC was billed and found that, 
from January 1

[[Page 36650]]

through September 30, 2016, approximately 86 percent of nursing visits 
were identified as RN visits (using G0299) and 14 percent of nursing 
visits were identified as Licensed Practical Nurse (LPN) visits (using 
G0300). Because the differentiated nursing visit G-codes were not 
implemented until January 1, 2016, for skilled nursing visits during 
the last 7 days of life where RHC was billed and that occurred between 
October 1 and December 31, 2015, we estimated that 86 percent of the 
line item visits reported using G0154 were RN and 14 percent were LPN 
using statistics generated for the 2016 time period where data were 
available. For FY 2018, the budget neutrality adjustment that would 
apply to days 1 through 60 is calculated to be 1.0017. The budget 
neutrality adjustment that would apply to days 61 and beyond is 
calculated to be 1.0005.
    In the FY 2017 Hospice Wage Index and Payment Rate Update final 
rule (81 FR 52156), we initiated a policy of applying a wage index 
standardization factor to hospice payments in order to eliminate the 
aggregate effect of annual variations in hospital wage data. In order 
to calculate the wage index standardization factor, we simulate total 
payments using the FY 2018 hospice wage index and compare it to our 
simulation of total payments using the FY 2017 hospice wage index. By 
dividing payments for each level of care using the FY 2018 wage index 
by payments for each level of care using the FY 2017 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). The wage index 
standardization factors for each level of care are shown in the tables 
below.
    Lastly, the hospice payment rates for hospices that submit the 
required quality data would be increased by the FY 2018 hospice payment 
update percentage of 1.0 percent as discussed in section III.B.2 of 
this final rule. The FY 2018 RHC rates are shown in Table 12. The FY 
2018 payment rates for CHC, IRC, and GIP are shown in Table 13.

                                   Table 12--FY 2018 Hospice RHC Payment Rates
----------------------------------------------------------------------------------------------------------------
                                                 SIA budget        Wage index         FY 2018
    Code        Description        FY 2017       neutrality     standardization       hospice         FY 2018
                                payment rates      factor            factor       payment update   payment rates
----------------------------------------------------------------------------------------------------------------
651.........  Routine Home            $190.55        x 1.0017           x 1.0000          x 1.01         $192.78
               Care (days 1-
               60).
651.........  Routine Home             149.82        x 1.0005           x 1.0001          x 1.01          151.41
               Care (days
               61+).
----------------------------------------------------------------------------------------------------------------


                            Table 13--FY 2018 Hospice CHC, IRC, and GIP Payment Rates
----------------------------------------------------------------------------------------------------------------
                                                                   Wage index         FY 2018
        Code                Description            FY 2017      standardization       hospice         FY 2018
                                                payment rates        factor       payment update   payment rates
----------------------------------------------------------------------------------------------------------------
652.................  Continuous Home Care;           $964.63           x 1.0022          x 1.01         $976.42
                       Full Rate = 24 hours
                       of care; $40.68 = FY
                       2018 hourly rate.
655.................  Inpatient Respite Care.          170.97           x 1.0006          x 1.01          172.78
656.................  General Inpatient Care.          734.94           x 1.0017          x 1.01          743.55
----------------------------------------------------------------------------------------------------------------

    Sections 1814(i)(5)(A) through (C) of the Act require that hospices 
submit 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 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 2018 rates for hospices 
that do not submit the required quality data would be updated by the FY 
2018 hospice payment update percentage of 1 percent minus 2 percentage 
points. These rates are shown in Tables 14 and 15.

      Table 14--FY 2018 Hospice RHC Payment Rates for Hospices That Do Not Submit the Required Quality Data
----------------------------------------------------------------------------------------------------------------
                                                                                      FY 2018
                                                                                      hospice
                                   FY 2017       SIA budget        Wage index     payment update      FY 2018
    Code        Description     payment rates    neutrality     standardization    of 1% minus 2   payment rates
                                                   factor            factor         percentage
                                                                                  points = -1.0%
----------------------------------------------------------------------------------------------------------------
651.........  Routine Home            $190.55        x 1.0017           x 1.0000          x 0.99         $188.97
               Care (days 1-
               60).
651.........  Routine Home             149.82        x 1.0005           x 1.0001          x 0.99          148.41
               Care (days
               61+).
----------------------------------------------------------------------------------------------------------------


[[Page 36651]]


 Table 15--FY 2018 Hospice CHC, IRC, and GIP Payment Rates for Hospices That DO NOT Submit the Required Quality
                                                      Data
----------------------------------------------------------------------------------------------------------------
                                                                                      FY 2018
                                                                                      hospice
                                                   FY 2017         Wage index     payment update      FY 2018
        Code                Description         payment rates   standardization    of 1% minus 2   payment rates
                                                                     factor         percentage
                                                                                  points = -1.0%
----------------------------------------------------------------------------------------------------------------
652.................  Continuous Home Care;           $964.63           x 1.0022          x 0.99         $957.08
                       Full Rate = 24 hours
                       of care; $39.88 = FY
                       2018 hourly rate.
655.................  Inpatient Respite Care.          170.97           x 1.0006          x 0.99          169.36
656.................  General Inpatient Care.          734.94           x 1.0017          x 0.99          728.83
----------------------------------------------------------------------------------------------------------------

4. Hospice Cap Amount for FY 2018
    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). The hospice cap amount for the 2018 
cap year will be $28,689.04, which is equal to the 2017 cap amount 
($28,404.99) updated by the FY 2018 hospice payment update percentage 
of 1.0 percent.
    A summary of the comments we received regarding the hospice cap 
amount and our responses to those comments appears below.
    Comment: One commenter noted that the hospice cap is a uniform 
amount meaning that each CBSA has the same cap amount. The commenter 
ascertains that in certain CBSAs, the hospice per diem rate is 
significantly higher than the national average. The commenter believes 
that since the cap amount does not adjust relative to CBSA, Medicare 
beneficiaries in CBSAs with higher wage indices have significantly 
fewer potential days of hospice care available to them relative to 
beneficiaries who reside in CBSAs with a lower wage indices. 
Accordingly, the commenter recommends that, in fairness to providers 
located in CBSAs with higher than average wage indices, CMS adjust the 
hospice cap amount by CBSA.
    Response: We appreciate the commenter's suggestion that CMS wage-
adjust the annual cap amount. However, the restriction set forth in 
section 1814(i)(2)(B), as amended by section 3(d) of the IMPACT Act, 
does not give us discretion to adjust the cap amount.

C. Discussion Regarding Sources of Clinical Information for Certifying 
Terminal Illness

    In accordance with the regulations at Sec.  418.20, a patient must 
be certified as terminally ill in order to be eligible to elect the 
Medicare Hospice benefit. Furthermore, hospice admission is predicated 
on the certification of terminal illness that determines eligibility. 
In reaching a decision to certify, Sec.  418.25 requires a hospice 
medical director to consider the diagnosis of the terminal condition of 
the patient, other health conditions (whether related or unrelated to 
the terminal condition), and current clinically relevant information 
supporting all diagnoses. In the FY 2018 Hospice Wage Index and Payment 
Rate Update proposed rule, we discussed a potential proposal for a 
regulatory text change at Sec.  418.25, clarifying that the 
documentation used for the initial certification must come from the 
referring physician's or acute/post-acute care facility's medical 
records (84 FR 20771). We also discussed the potential benefit of an 
initial face-to-face visit by the hospice medical director or physician 
designee, if needed, to support the clinical documentation required to 
accompany the certification of terminal illness. Although we did not 
propose this regulatory change, we requested public input on the 
possible amendment. We solicited comments on current processes used by 
hospices to ensure comprehensive clinical review to support 
certification, and encouraged submission of any alternate suggestions 
for supporting clinical documentation sources that ensure appropriate 
hospice admission.
    Comment: A few commenters expressed support for the potential 
regulations text change, and stated that they consider ``obtaining and 
analyzing medical records from the referring provider'' to be ``best 
practice.'' Additionally, commenters indicated that their processes for 
certification already include review of the referring source's clinical 
documentation, which one commenter noted includes review of ``pathology 
reports, blood work reports, x-rays, kidney function, heart function, 
PPS assessment, mental assessment, medications, goals of care, 
diagnosis, nutritional assessment, weight loss, BMI and any other 
hospital report available that would indicate the patient has 6 months 
or less to live.'' A few commenters specifically noted that the 
regulations at Sec.  418.22(b) specify that clinical information and 
other documentation that supports the patient's prognosis must 
accompany the certification and that hospices receive clinical 
information from a variety of sources; therefore, a change in the 
regulations at Sec.  418.25 is not needed.
    Response: We thank commenters for their support. We understand from 
commenters that hospices already obtain and analyze clinical 
information from a variety of sources, including referring providers, 
and we agree that the regulations at Sec.  418.22(b) require such 
information to accompany the certification of terminal illness. While 
we are not proposing a change in the regulations at this time, we plan 
to work with our Medicare Administrative Contractors (MACs) to confirm 
whether they are requesting such information when claims are selected 
for medical review and, if not, whether such information should be 
included in any additional documentation requests. We continue to 
encourage providers to use the full range of clinical documentation 
when certifying terminal illness in order to ensure physician 
engagement and accountability.
    Comment: The majority of commenters expressed concerns that 
obtaining clinical documentation from outside physicians or facilities 
would delay hospice admission and services. In addition, commenters 
expressed concern that CMS was considering requiring hospice physicians 
to perform a face-to-face visit within the 2 day

[[Page 36652]]

certification time frame in order to certify terminal illness.
    Response: The discussion in the FY 2018 Hospice Wage Index and 
Payment Rate Update proposed rule was meant only to solicit comments on 
clarifying the source of the clinical information already required to 
be reviewed by the hospice medical director upon the initial 
certification. Therefore, this clinical information can be obtained 
orally from the referring entity and documented in the patient's chart 
within the 2 day time-frame needed for certification. We stated in the 
November 22, 2005 Hospice Care Amendments final rule that the clinical 
information may initially arrive verbally and is documented in the 
patient's medical record as part of the hospice's assessment of 
eligibility for hospice. The referring entity's clinical documentation 
may arrive later for retention in the patient's medical record (70 FR 
70539). We believe that clinical information and documentation are 
critical to the certification decision and this information is needed 
for the hospice's interdisciplinary group (IDG) to develop the initial 
plan of care for the new patient and, therefore we would expect the 
information to accompany, in some fashion, the certification. Likewise, 
the requirement that the medical documentation that accompanies the 
initial written certification be obtained prior to submitting a claim 
remains unchanged and should not impede services. The hospice admission 
assessment can also accompany the initial written certification; 
however, this information should further substantiate rather than 
provide the basis for certification.
    We would also like to clarify that the hospice medical director or 
physician designee would not be required to perform a face-to-face 
visit before the third benefit period recertification, as currently 
required by the regulations at Sec.  418.22(a)(4). Rather, the intent 
of the discussion and solicitation of comments in the FY 2018 Hospice 
Wage Index and Payment Rate Update proposed rule was to determine 
whether such optional visits could be useful to augment the referral 
source's clinical documentation to support a medical prognosis of 6 
months or less.
    We appreciate and thank all commenters for providing feedback on 
this discussion. We will carefully consider all comments for any future 
rulemaking proposals, if needed, regarding the sources of clinical 
information to support the certification of terminal illness.

D. 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 year 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 a 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 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/reports/annual-reports/nqs2015annlrpt.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) (http://www.nationalconsensusproject.org/Default.aspx), recommended by multi-
stakeholder organizations, and developed with the input of providers, 
purchasers/payers, and other stakeholders.
    In the FY 2018 Hospice proposed rule (82 FR 20773 through 20774), 
we discussed accounting for social risk factors in the HQRP. We stated 
that we consider related factors that may affect measures in the HQRP. 
We understand that social risk factors such as income, education, race 
and ethnicity, employment, disability, community resources, and social 
support (certain factors of which are also sometimes referred to as 
socioeconomic status (SES) factors or socio-demographic status (SDS) 
factors) play a major role in health. One of our core objectives is to 
improve beneficiary outcomes including reducing health disparities, and 
we want to ensure that all beneficiaries, including those with social 
risk factors, receive high quality care. In addition, we seek to ensure 
that the quality of care furnished by providers and suppliers is 
assessed as fairly as possible under our programs while ensuring that 
beneficiaries have adequate access to excellent care.

[[Page 36653]]

    We have been reviewing reports prepared by the Office of the 
Assistant Secretary for Planning and Evaluation (ASPE) \4\ and the 
National Academies of Sciences, Engineering, and Medicine on the issue 
of measuring and accounting for social risk factors in CMS' quality 
measurement and payment programs, and considering options on how to 
address the issue in these programs. On December 21, 2016, ASPE 
submitted a Report to Congress on a study they were required to conduct 
under section 2(d) of the Improving Medicare Post-Acute Care 
Transformation (IMPACT) Act of 2014. The study analyzed the effects of 
certain social risk factors of Medicare beneficiaries on quality 
measures and measures of resource use used in one or more of nine 
Medicare value-based purchasing programs.\5\ The report also included 
considerations for strategies to account for social risk factors in 
these programs. In a January 10, 2017, report released by The National 
Academies of Sciences, Engineering, and Medicine, that body provided 
various potential methods for measuring and accounting for social risk 
factors, including stratified public reporting.\6\ In addition, the NQF 
undertook a 2-year trial period in which new measures, measures 
undergoing maintenance review, and measures endorsed with the condition 
that they enter the trial period were assessed to determine whether 
risk adjustment for selected social risk factors was appropriate for 
these measures. This trial entailed temporarily allowing inclusion of 
social risk factors in the risk-adjustment approach for these measures. 
The trial has concluded and NQF will issue recommendations on the 
future inclusion of social risk factors in risk adjustment for quality 
measures.
---------------------------------------------------------------------------

    \4\ https://aspe.hhs.gov/pdf-report/report-congress-social-risk-factors-and-performance-under-medicares-value-based-purchasing-programs.
    \5\ https://aspe.hhs.gov/pdf-report/report-congress-social-risk-factors-and-performance-under-medicares-value-based-purchasing-programs.
    \6\ National Academies of Sciences, Engineering, and Medicine. 
2017. Accounting for social risk factors in Medicare payment. 
Washington, DC: The National Academies Press.
---------------------------------------------------------------------------

    As we continue to consider the analyses and recommendations from 
these reports and await the recommendations of the NQF trial on risk 
adjustment for quality measures, we are continuing to work with 
stakeholders in this process. As we have previously communicated, we 
are concerned about holding providers to different standards for the 
outcomes of their patients with social risk factors because we do not 
want to mask potential disparities or minimize incentives to improve 
the outcomes for disadvantaged populations. Keeping this concern in 
mind, while we sought input on this topic previously, we continue to 
seek public comment on whether we should account for social risk 
factors in measures in the HQRP, and if so, what method or combination 
of methods would be most appropriate for accounting for social risk 
factors. Examples of methods include: Confidential reporting to 
providers of measure rates stratified by social risk factors, public 
reporting of stratified measure rates, and potential risk adjustment of 
a particular measure as appropriate based on data and evidence.
    In addition, in the proposed rule, we sought public comment on 
which social risk factors might be most appropriate for reporting 
stratified measure scores and/or potential risk adjustment of a 
particular measure. Examples of social risk factors include, but are 
not limited to, dual eligibility/low-income subsidy, race and 
ethnicity, and geographic area of residence. We also sought comments on 
which of these factors, including current data sources where this 
information would be available, could be used alone or in combination, 
and whether other data should be collected to better capture the 
effects of social risk. We will take commenters' input into 
consideration as we continue to assess the appropriateness and 
feasibility of accounting for social risk factors in the HQRP. We note 
that any such changes would be proposed through future notice and 
comment rulemaking.
    We look forward to working with stakeholders as we consider the 
issue of accounting for social risk factors and reducing health 
disparities in CMS programs. Of note, implementing any of the above 
methods would be taken into consideration in the context of how this 
and other CMS programs operate (for example, data submission methods, 
availability of data, statistical considerations relating to 
reliability of data calculations, among others), so we sought comment 
on operational considerations. We are committed to ensuring that its 
beneficiaries have access to and receive excellent care, and that the 
quality of care furnished by providers and suppliers is assessed fairly 
in our programs.
    We received many comments in response to our request for public 
comment on whether we should account for social risk factors in the 
Hospice Quality Reporting Program.
    Comment: Commenters were supportive of CMS accounting for social 
risk factors however, the majority of the commenters cautioned that 
social risk factors should be used to inform only outcome quality 
measures. Specifically, they were not supportive of identifying social 
risk factors for process measures or direct impacts of care under the 
hospice's control. Several commenters were concerned about quality 
measures for items that a hospice has minimal control over and many of 
these items are under discussion for risk adjustment.
    Regarding methodology for adjustment, overall, commenters were 
supportive of risk adjustment in general, but a few commenters 
indicated preference for stratification or peer grouping, due to the 
minimal measure-level research required and low impact on provider 
incentives to improve care when their adjusted performance is 
transparent. One commenter suggested using standard statistical 
methodology and adopting the approach used for adjusting CAHPS[supreg] 
data. Prior to conducting social risk factor stratification, however, a 
few commenters noted that they would like for CMS to evaluate and 
disseminate the testing results from the NQF and solicit provider 
comment on the results. Several commenters encouraged CMS to determine 
the feasibility and appropriateness of identifying social risk factors, 
and a couple commenters recommended involving hospice providers in 
determining appropriate social risk factors and associated outcome 
measures. One commenter recommended piloting the outcome measures with 
social risk factors in advanced care planning pilot instead of 
incorporating them with current hospice measures. However, several 
commenters expressed concern that risk adjusting may lead to the 
unintended consequences of discouraging providers from admitting 
patients with identified social risk factors, and enabling providers to 
deliver sub-optimal care to disadvantaged populations. One commenter 
noted providers wishing to maintain or improve scores on quality 
measures may consider exclusively admitting patients who will 
demonstrate positive care outcomes. Another commenter emphasized that 
patients impacted by many social risk factors require intensified, 
complex care at end of life, so CMS should not unfairly penalize 
providers when taking these patient needs and challenges into account 
in the quality measurement process. Additionally, commenters offered 
specific suggestions for types of social risk factors to identify and 
recommended ways CMS could manage the testing, data collection, and 
reporting. In commenters' discussion of suggested social risk factors, 
a few

[[Page 36654]]

commenters drew attention to how adjustment should be conducted on a 
measure-specific basis, as different social risk factors affect 
different outcomes such as caregiver satisfaction and care delivery. In 
addition to support for CMS's suggested categories of race and 
ethnicity, dual eligibility status, and geographical location, many 
commenters emphasized adjusting for family dynamics, such as the 
patient's relationship with the family, accessibility/availability of 
an adequate caregiver, history of substance abuse in the family, and 
psychosocial acuity. Other commenters promoted education level, 
literacy and health literacy levels, mental health, rurality and 
English as a second language. A few commenters highlighted adjusting 
for Medicaid-covered services in the area and income-subsidy levels. 
Some emphasized that core-based statistical area (CBSAs), geographical 
location of patient residence, and driving distance to home locations 
are important because they impact timeliness of care delivery. One 
commenter noted adequate and safe housing impacts the hospice's ability 
to deliver care. A few commenters suggested adjusting for length of 
stay, as patient needs will require differing acuities of care for 
short and long stays. One commenter requested that extraction of social 
risk factors pose low burden for providers. A few commenters discussed 
public display of data adjusted for social risk factors. One commenter 
suggested displaying both unadjusted and adjusted data in confidential 
feedback reports as a means of provider performance improvement before 
publicly reporting adjusted data to be used for determining 
reimbursement.
    Response: As we have previously stated, we are concerned about 
holding providers to different standards for the outcomes of their 
patients with social risk factors, because we do not want to mask 
potential disparities. We believe that the path forward should 
incentivize improvements in health outcomes for disadvantaged 
populations while ensuring that beneficiaries have adequate access to 
excellent care. We will consider all suggestions as we continue to 
assess each measure and the overall program. We intend to explore 
options including but not limited to measure stratification by social 
risk factors in a consistent manner across programs, informed by 
considerations of stratification methods described in the upcoming FY 
2018 Inpatient Prospective Payment System/Long-Term Care Hospital 
Prospective Payment System (IPPS/LTCH PPS) final rule, which is 
expected to publish in the Federal Register shortly after this final 
rule. We thank commenters for this important feedback and will continue 
to consider options to account for social risk factors that would allow 
us to view disparities and potentially incentivize improvement in care 
for patients and beneficiaries. We will also consider providing 
feedback to providers on outcomes for individuals with social risk 
factors in confidential reports.
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 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 us for reasons including, but not 
limited to the following:
     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 unavailable.
     A measure that was more proximal in time to desired 
patient outcomes for the particular topic was not available.
     A measure that was more strongly associated with desired 
patient outcomes for the particular topic was not available.
     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 was 
reason to believe continued inclusion of a measure in the HQRP would 
encourage delivery of care that 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 CMS HQRP Web site, listserv messages via the 
Post-Acute Care Quality Reporting Program listserv,\7\ Medicare 
Learning Network (MLN) Connects[supreg] National Provider Calls & 
Events, MLN Connects[supreg] Provider eNews. Following immediate 
removal of the measures, we would also notify the public of any such 
removal in the next annual rulemaking cycle. CMS expects immediate 
removal of a measure due to safety concerns to be an unlikely event, 
given the rigorous testing and analysis all measures undergo prior to 
adoption in the HQRP.
---------------------------------------------------------------------------

    \7\ CMS, Post-Acute Care QRP listerv, available at: https://public-dc2.govdelivery.com/accounts/USCMS/subscriber/new?topic_id=USCMS_12265.
---------------------------------------------------------------------------

4. Policy for Adopting Changes to Previously Adopted Measures
    To further streamline the rulemaking process, we finalized in the 
FY 2017 Hospice Wage Index final rule (81 FR 52159) that if measures in 
the HQRP undergo non-substantive changes in specifications as part of 
their NQF re-endorsement process, we would subsequently utilize the 
measure with their new endorsed status in the HQRP without going 
through new notice-and-comment rulemaking. 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 
or the measure steward's measure maintenance process, measures are 
sometimes updated to incorporate changes that we believe do not 
substantively change the intent of the measure. Examples of such 
changes may include updated diagnosis or procedure codes or changes to

[[Page 36655]]

exclusions to the patient population or definitions. While we address 
such changes on a case-by case basis, we generally believe these types 
of maintenance changes are distinct from substantive changes to 
measures that result in what are considered new or different 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,\8\ we believe that 
the NQF measure endorsement and maintenance process itself is 
transparent, scientifically rigorous, and provides opportunity for 
public input. Thus, we finalized our proposal 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 (81 
FR 52159 through 52160). If NQF-endorsed specifications change and we 
do not adopt those changes, then we would propose the measure as a 
modification. A modification of a NQF-endorsed quality measure is 
utilized in instances when we have 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, 
``[i]n 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 the prior section, including that the new 
specification does not align with clinical guidelines or practice or 
that the new specification leads to negative unintended consequences.
---------------------------------------------------------------------------

    \8\ ``NQF: How Endorsement Happens--National Quality Forum.'' 
2010. 26 Jan. 2016 http://www.qualityforum.org/Measuring_Performance/ABCs/How_Endorsement_Happens.aspx.
---------------------------------------------------------------------------

    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 CMS HQRP Web site, listserv messages on the Post-Acute Care 
QRP listserv, MLN Connects[supreg] National Provider Calls & Events, 
MLN Connects[supreg] Provider eNews and announcements on Open Door 
Forums and Special Open Door Forums.
5. Previously Adopted Quality Measures for FY 2018 Payment 
Determination and Future Years
    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 7 NQF-
endorsed measures 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).\6\
    We finalized the following two additional measures in the FY 2017 
Hospice Wage Index final rule effective April 1, 2017. Data collected 
will, if not reported, affect payments for FY 2019 and subsequent 
years. (81 FR 52163 through 52173):

 Hospice Visits when Death is Imminent
 Hospice and Palliative Care Composite Process Measure--
Comprehensive Assessment at Admission

    We finalized the HIS effective July 1, 2014 (78 FR 48258). The HIS 
is the data collection mechanism for all of the aforementioned 
measures. To meet the quality reporting requirements for hospices for 
the FY 2016 payment determination and each subsequent year, we require 
regular and ongoing 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). For the two measures finalized 
in the FY 2017 Hospice Wage Index final rule, we require regular and 
ongoing electronic submission for each patient admission to hospice 
after April 1, 2017. 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. Table 16 provides 
a summary of measures previously finalized affecting the FY 2019 APU, 
data collection mechanism, and data submission deadline.
    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 
2017 will have their market basket update reduced by 2 percentage 
points in FY 2019 (beginning in October 1, 2018). 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 entitled ``Hospice Item Set (HIS) 
System,'' SOR number 09-70-0548, was published in the Federal Register 
on April 8, 2014 (79 FR 19341).
    The 7 NQF endorsed HIS measures adopted in FY 2014 Hospice Wage 
Index final rule successfully underwent NQF Endorsement Maintenance in 
2016.\9\ We recognize that the NQF endorsement process is an important 
part of measure development and plan to submit the two measures 
finalized in the FY 2017 Hospice Wage Index final rule for NQF 
endorsement once sufficient measure data are available and we conduct 
the analyses necessary to support NQF submission for endorsement (for 
example, reliability and validity analyses). Typically, we need at 
least 4 quarters worth of data to conduct the necessary analyses and 
establish measure reliability and validity. Because the Hospice and 
Palliative Care Composite Process Measure--Comprehensive Assessment at 
Admission did not require any new data collection and can be calculated 
using existing data, CMS's measure development contractor, RTI

[[Page 36656]]

International, has already conducted the analyses necessary to support 
submission of the measure for NQF endorsement. We have already 
submitted the Hospice and Palliative Care Composite Process Measure for 
consideration for endorsement at NQF (NQF #3235); the measure is 
currently under review. Data for the Hospice Visits when Death is 
Imminent measure pair will be collected using new items added to the 
HIS V2.00.0, effective April 1, 2017. Once data collection for the 
measure pair begins, we will need at least 4 quarters of reliable data 
to conduct the necessary analyses to support submission to NQF. We will 
also need to assess the quality of data submitted in the first quarter 
of item implementation to determine whether they can be used in the 
analyses. Pending analysis, we will submit the Hospice Visits when 
Death is Imminent measure pair to NQF for endorsement review in 
accordance with NQF project timelines and call for measures. In the FY 
2015 Hospice Wage Index final rule (79 FR 50491 through 50496), we also 
finalized the Consumer Assessment of Healthcare Providers and Systems 
(CAHPS[supreg]) Hospice Survey to support quality measures based on 
patient and family experience of care. We refer readers to section 
III.D.11 of the May 3, 2017 proposed rule (82 FR 20750 through 20792) 
for details regarding the CAHPS[supreg] Hospice Survey, including 
public reporting of selected survey measures.
---------------------------------------------------------------------------

    \9\ National Quality Forum, NQF Palliative and End-of-Life Care 
2015-2016 Report, available at: http://www.qualityforum.org/WorkArea/linkit.aspx?LinkIdentifier=id&ItemID=84242.

  Table 16--Previously Finalized Quality Measures Affecting the FY 2019
               Payment Determination and Subsequent Years
------------------------------------------------------------------------
                                                 Year the  measure was
       NQF No.            Hospice item set     first adopted  for use in
                          quality measure         APU  determination
------------------------------------------------------------------------
1641.................  Treatment Preferences  FY 2016
1647.................  Beliefs/Values         FY 2016
                        Addressed (if
                        desired by the
                        patient).
1634.................  Pain Screening.......  FY 2016
1637.................  Pain Assessment......  FY 2016
1639.................  Dyspnea Screening....  FY 2016
1638.................  Dyspnea Treatment....  FY 2016
1617.................  Patients Treated with  FY 2016
                        an Opioid Who Are
                        Given a Bowel
                        Regimen.
N/A..................  Hospice and            FY 2019
                        Palliative Care
                        Composite Process
                        Measure--Comprehensi
                        ve Assessment at
                        Admission.
N/A..................  Hospice Visits When    FY 2019
                        Death is Imminent
                        Measure Pair.
------------------------------------------------------------------------

    The comment and our response are set forth below.
    Comment: We received several comments on previously adopted quality 
measures, including measure refinement suggestions for the Hospice 
Visits when Death is Imminent Measure Pair. One commenter suggested 
that CMS include a way to capture whether visits were offered but 
declined. Another commenter noted that frequent visits by hospice staff 
may not be necessary or desired by all patients and encouraged CMS to 
include evidence of a need or desire for these visits in the measure 
specifications. We received one comment recommending risk adjustment 
for the Visits Measure Pair.
    Response: The Visits when Death is Imminent Measure Pair is a 
measure that was previously proposed and finalized in the HQRP. We 
refer readers to the FY 2017 Hospice Wage Index final rule (81 FR 52162 
through 52169) for a detailed discussion of measure specifications for 
this measure pair, including discussion of why refused visits were not 
included in measure specifications, as well as discussion on risk 
adjustment. We invite the public to submit questions or suggestions 
about previously finalized and currently implemented proposals through 
sub-regulatory communication channels, including the Hospice Quality 
Help Desk at [email protected], and through other 
communication channels such as Open Door Forums and Special Open Door 
Forums.
6. Removal of Previously Adopted Measures
    We did not propose to remove any of the current HQRP measures at 
this time. Any future proposals regarding removal, suspension, or 
replacement of measures will be proposed here in this preamble of 
future rules. As stated in section III.D.3 of the FY 2018 Hospice Wage 
Index proposed rule (82 FR 20750), a quality measure that is adopted 
and implemented in the HQRP will be retained for all subsequent years, 
unless the measure is proposed for removal, suspension, or replacement 
by CMS. Policies and criteria for removing a measure were also 
discussed.
7. Measure Concepts Under Consideration for Future Years
    Although we did not propose any HIS-based measures, we have measure 
concepts under consideration for future years. Our paramount concern is 
to develop quality measures that promote care that is person-centered, 
high quality, and safe. We continue to work with our measure 
development contractor, RTI International, to identify measure concepts 
for future implementation in the HQRP. In identifying priority areas 
for future measure enhancement and development, we take into 
consideration input from numerous stakeholders, including the MAP, the 
MedPAC, Technical Expert Panels (TEP), and national priorities, such as 
those established by the Department of Health and Human Services (HHS) 
Strategic Plan, the National Strategy for Quality Improvement in 
Healthcare, and the CMS Quality Strategy. In addition, we take into 
consideration vital feedback and input from research published by our 
payment reform contractor. 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, including current HIS measures and CAHPS[supreg] Hospice Survey 
measures, without creating unnecessary burden or redundant reporting. 
Based on input from stakeholders, we identified two high priority areas 
that will be addressed by claims-based measure development. Developing 
quality measures using claims does not require new data collection, 
thus minimizing provider burden and expediting implementation.

[[Page 36657]]

Priority Area 1: Potentially Avoidable Hospice Care Transitions
    The concept of a claims-based measure focusing on transitions of 
care was first introduced in the FY 2016 Hospice Wage Index final rule 
(80 FR 47188 through 47189). Comments received during this rule were 
overall supportive of our efforts to develop more robust quality 
measures that capture hospice performance and show links to patient and 
family outcomes. We refer readers to the FY 2016 Hospice Wage Index 
final rule (80 FR 47188 through 47189) and for additional details: 
https://www.gpo.gov/fdsys/pkg/FR-2015-08-06/pdf/2015-19033.pdf.
    Potentially avoidable hospice care transitions at end of life are 
burdensome to patients, families, and the health care system at large, 
because they are associated with adverse health outcomes, lower patient 
and family satisfaction, higher health care costs, and fragmentation of 
care delivery.10 11 12 13 14 By encouraging hospice 
providers to assess and manage patients' risk of care transitions, this 
measure concept has the potential to improve quality care at the end of 
life by reducing potentially avoidable hospice care transitions.
---------------------------------------------------------------------------

    \10\ Aldridge MDP, MBA; Epstein, Andrew J. Ph.D.; Brody, Abraham 
A. RN, Ph.D.; Lee, Eric J. MPH; Cherlin, Emily Ph.D., MSW; Bradley, 
Elizabeth H. Ph.D. The Impact of Reported Hospice Preferred 
Practices on Hospital Utilization at the End of Life Medical Care. 
2016;54(7):657-663.
    \11\ Wang S-Y, Aldridge MD, Gross CP, et al. Transitions Between 
Healthcare Settings of Hospice Enrollees at the End of Life. Journal 
of the American Geriatrics Society. 2016;64(2):314-322.
    \12\ Carlson MDA, Herrin J, Du Q, et al. Impact of Hospice 
Disenrollment on Health Care Use and Medicare Expenditures for 
Patients With Cancer. Journal of Clinical Oncology. 
2010;28(28):4371-4375.
    \13\ Teno JM, Bowman J, Plotzke M, et al. Characteristics of 
Hospice Programs With Problematic Live Discharges. Journal of Pain 
and Symptom Management. 2015;50(4):548-552.
    \14\ Prsic E, Plotzke M, Christian TJ, Gozalo P, Teno JM. A 
National Study of Live Hospice Discharges between 2000 and 2012. 
Journal of Palliative Medicine. 2016;19(9):987-990.
---------------------------------------------------------------------------

Priority Area 2: Access to Levels of Hospice Care
    The Medicare Hospice Benefit covers four levels of care to meet 
patients' and families' clinical needs: Routine home care (RHC), 
continuous home care (CHC), general inpatient care (GIP), and inpatient 
respite care. The goal of this measure concept is to assess the rates 
at which hospices provide different levels of hospice care. The measure 
has the potential to improve access to various levels of care for 
patients and caregivers. Appropriate use of CHC and GIP increases the 
likelihood of a hospice patient dying in his or her location of choice, 
decreases health resource utilization resulting in potential cost 
savings, and increases patient and caregiver 
satisfaction.15 16 Measuring use of levels of care will 
encourage hospice providers to continuously assess patient and 
caregiver needs and provide the appropriate level of care to meet these 
needs. These two measure concepts are under development, and details 
regarding measure definitions, specifications and timeline for 
implementation will be communicated in future rulemaking.
---------------------------------------------------------------------------

    \15\ Barclay, J., et al., Association of hospice patients' 
income and care level with place of death. JAMA Internal Medicine, 
2013. 173(6): p. 450-456.
    \16\ Casarett, D., et al., Does Continuous Hospice Care Help 
Patients Remain at Home? Journal of Pain and Symptom Management, 
2015. 50(3): p. 297-304.
---------------------------------------------------------------------------

    We solicited comments regarding high priority measure areas for 
future measure development including two specific measures under 
consideration related to: (1) Potentially avoidable hospice care 
transitions, and (2) access to levels of hospice care.
    The comments and our responses have been grouped below: (1) 
Comments applying to both high priority measure areas, (2) comments 
specific to the potentially avoidable hospice care transitions measure 
area, (3) comments specific to the access to levels of hospice care 
measure area, and (4) other comments and suggestions regarding future 
HQRP measure development.
    Comment: Many commenters agreed that these measure areas were 
important.
    Response: We appreciate the commenters' support of these measure 
areas as high priority areas for future HQRP measure development.
    Comment: Many commenters expressed concerns with the limitations of 
using claims data for quality measure development. Specifically, 
commenters were concerned with the limited range of data elements 
available in claims data. Many commenters stated that claims data do 
not capture sufficient information about the clinical condition of 
patients, the preferences and needs of patients and families, or 
various other factors that influence care planning and decision-making. 
Several commenters believed that claims do not provide sufficient 
information to adequately reflect hospice practice. In general, 
commenters were concerned that, in the absence of these data elements, 
providers would be unfairly penalized should these measures be 
implemented.
    Response: We recognize that administrative data are not collected 
for the purpose of quality measure development and thus, claims data 
lack certain data elements that might be important to consider in 
constructing quality measures. For example, we agree that patient and 
family preferences and clinical needs are important factors in 
determining whether a specific care transition or use of certain level 
of hospice are appropriate in a specific scenario. We acknowledge the 
limitations of claims data in capturing this information. However, we 
would like to clarify that quality measures are not intended to 
determine whether each individual experience of a care transition or 
use of a certain level of hospice care, is clinically appropriate. 
Instead, the measures will present provider-level rates of the process 
and outcome in the two proposed measure areas, comparing providers to 
their peers with relevant and available patient-level and hospice-level 
factors taken into account. Despite the inability to control for 
certain relevant factors such as patient and family preferences, these 
factors tend to distribute evenly across hospices. In other words, each 
hospice may serve patients and families with varying levels of 
preference for care. As such, the inability to control for these 
factors does not necessarily disadvantage certain hospices. Regardless, 
given the limitations of claims data noted above, we are placing 
careful emphasis on how we construct the specifications of the measure 
and are using claims data to examine the patient factors that are 
available and related to the hospice's performance in these measure 
areas. In addition, we believe that the advantages of using claims 
data, including minimized burden to providers and expedited 
implementation, outweigh the limitations of this data source. We will 
continue to consider the limitations of claims data as we develop 
specifications for these measure areas. We continue to engage 
stakeholders in developing measures that provide meaningful information 
about hospice quality. We will also continue to engage stakeholders and 
conduct analyses to inform the specifications of these measures.
    Comment: Several commenters expressed concerns with the public's 
ability to understand these measure areas and easily discern their 
connection to quality. Commenters recommended CMS to ensure that 
claims-based measures are understandable to the public prior to public 
reporting.
    Response: We appreciate the commenters' concerns regarding public 
reporting of measures that use claims as a data source. We agree that 
it is critical

[[Page 36658]]

to ensure that quality measures are understandable to the public, 
especially prior to public reporting of measures. As such, all measures 
developed and implemented in the HQRP, including claims-based measures, 
undergo rigorous user testing to ensure that they are understandable to 
providers and patients and families. For both high priority measure 
areas, we continue to engage stakeholders including a technical expert 
panel, caregiver workgroup and clinical users in measure development to 
ensure that these measures are both meaningful and understandable to 
the public. In addition, prior to public reporting of these measures, 
we will provide resources through the Hospice Compare Web site to aid 
the public in interpreting publicly displayed quality data.
    Comment: We received several comments focused on the burden 
associated with future implementation of the two high priority measure 
areas. Although most of these commenters applauded CMS for developing 
measures based on claims data because of the minimal burden for 
providers associated with their data collection and submission and 
measure calculation and reporting, one commenter encouraged CMS to 
carefully consider the burden associated with other aspects of 
implementing these measure concept areas.
    Response: We appreciate the comments regarding the burden 
associated with the two high priority measure areas. It is our goal to 
minimize burden for providers when considering any new measure for 
implementation in the HQRP. Claims-based measures require no additional 
data collection and submission and thus, minimize burden for providers. 
We recognize that the implementation of these measures may compel some 
providers to establish internal systems for monitoring care patterns 
captured by these measure concepts and are aware that some providers 
are already doing so. We will consider these internal monitoring and 
performance improvement efforts within the scope of Quality Assessment 
and Performance Improvement (QAPI) requirements and other current 
hospice conditions of participation. We believe such systems may 
facilitate the appropriate provision of care and prevent unnecessary 
transitions, thus improving quality of care provided by the hospice. 
However, we would like to remind providers that no new measures are 
being proposed in this year's rule, so there will be no additional 
burden placed on providers.
    Comment: Several commenters noted that only a small proportion of 
hospice patients are discharged alive from hospice. Similarly, they 
noted that only 2 to 3 percent of billed days in hospice are for levels 
of care other than Routine Home Care.
    Response: We recognize that the two high priority measure areas 
will capture lower-frequency events. However, studies have demonstrated 
considerable variation across hospice providers in both measures areas, 
indicating that some hospices are having a substantially higher rate of 
live discharges \17\ or provide very little or no GIP or CHC care to 
their patients compared to other providers.18 19 This 
signals performance gaps and, by developing and implementing these 
measures, we hope to capture these important quality issues. 
Additionally, low-frequency events can still reveal important quality 
issues and gaps in care that hospices should address and consumers 
should be aware of. Thus, measurement of low-frequency events is still 
important. Hospice patients are likely to need these services as their 
care needs change, especially as they approach the end of life, so 
monitoring access to these services will help encourage providers to 
continually assess patient need.
---------------------------------------------------------------------------

    \17\ Wang S-Y, Aldridge MD, Gross CP, et al. Transitions Between 
Healthcare Settings of Hospice Enrollees at the End of Life. Journal 
of the American Geriatrics Society. 2016;64(2):314-322.
    \18\ Stevenson DG, Grabowski DC, Keating NL, et al. Effect of 
ownership on hospice service use: 2005-2011. J Am Geriatr Soc. 2016 
May;64(5):1024-31. doi: 10.1111/jgs.14093. PMID: 27131344.
    \19\ Teno JM, Gozalo PL, Bynum JP, et al. Change in end-of-life 
care for Medicare beneficiaries: site of death, place of care, and 
health care transitions in 2000, 2005, and 2009. JAMA. 2013 Feb 
6;309(5):470-7. doi: 10.1001/jama.2012.207624. PMID: 23385273.
---------------------------------------------------------------------------

    Moreover, both measure concepts show relationship with patient and 
family outcomes. Care transitions from hospice including live discharge 
can result in adverse health outcomes, lower patient and family 
satisfaction, higher health care costs, and fragmentation of care 
delivery.20 21 22 23 24 In regards to the access to levels 
of hospice care measure, though only about 2 percent of days are billed 
as higher intensity levels of care (for example, CHC and GIP), a higher 
proportion of patients use at least one of these higher intensity 
levels of care at some point during their stay. Appropriate use of CHC 
and GIP increases the likelihood of a hospice patient dying in his or 
her location of choice, decreases health resource utilization resulting 
in potential cost savings, and increases patient and caregiver 
satisfaction.25 26 27 Given the potentially severe 
consequences of receiving suboptimal care in these areas, we believe 
that it is appropriate to develop these measures even though they 
capture relatively lower frequency, but important events. It is our 
goal to ensure that all hospice patients and families are receiving 
high quality of care and having their needs met.
---------------------------------------------------------------------------

    \20\ Aldridge MDP, MBA; Epstein, Andrew J. Ph.D.; Brody, Abraham 
A. RN, Ph.D.; Lee, Eric J. MPH; Cherlin, Emily Ph.D., MSW; Bradley, 
Elizabeth H. Ph.D. The Impact of Reported Hospice Preferred 
Practices on Hospital Utilization at the End of Life Medical Care. 
2016;54(7):657-663.
    \21\ Wang S-Y, Aldridge MD, Gross CP, et al. Transitions Between 
Healthcare Settings of Hospice Enrollees at the End of Life. Journal 
of the American Geriatrics Society. 2016;64(2):314-322.
    \22\ Carlson MDA, Herrin J, Du Q, et al. Impact of Hospice 
Disenrollment on Health Care Use and Medicare Expenditures for 
Patients With Cancer. Journal of Clinical Oncology. 
2010;28(28):4371-4375.
    \23\ Teno JM, Bowman J, Plotzke M, et al. Characteristics of 
Hospice Programs With Problematic Live Discharges. Journal of Pain 
and Symptom Management. 2015;50(4):548-552.
    \24\ Prsic E, Plotzke M, Christian TJ, Gozalo P, Teno JM. A 
National Study of Live Hospice Discharges between 2000 and 2012. 
Journal of Palliative Medicine. 2016;19(9):987-990.
    \25\ Barclay, J., et al., Association of hospice patients' 
income and care level with place of death. JAMA Internal Medicine, 
2013. 173(6): p. 450-456.
    \26\ Casarett, D., et al., Does Continuous Hospice Care Help 
Patients Remain at Home? Journal of Pain and Symptom Management, 
2015. 50(3): p. 297-304.
    \27\ Holland JM, Keene JR, Kirkendall A, et al. Family 
evaluation of hospice care: examining direct and indirect 
associations with overall satisfaction and caregiver confidence. 
Palliat Support Care. 2015 Aug;13(4):901-8. doi: 10.1017/
S1478951514000595. PMID: 24992378.
---------------------------------------------------------------------------

    Comment: In the context of both high priority measure areas, 
several commenters expressed concerns that these measure areas are more 
suitable as utilization measures rather than quality measures. For 
example, several commenters stated that performance measures should not 
be implemented as a means to discourage or correct undesirable 
organizational practices. Several commenters noted that information 
about these two measure areas is available via Program for Evaluating 
Payment Patterns Electronic Report (PEPPER) reports. While some 
believed Hospice PEPPER reports, alone, were sufficient to monitor 
access to levels of hospice care and potentially avoidable hospice care 
transitions, others felt that information from the PEPPER report is 
distinct from information provided by the quality measurement areas, 
and that the two quality measure areas thus represent value-added for 
the HQRP and providers.
    Response: We appreciate commenters' comments regarding the 
distinction between utilization indicators and quality measures and 
similarities between the two high priority measure

[[Page 36659]]

areas and PEPPER measures. We would like to clarify that quality 
measures are distinct from utilization indicators, such as those 
included in the PEPPER reports. Utilization measures report statistics 
on services provided and billed to Medicare, and have a primary goal of 
protecting the Medicare program. That said, certain practice areas may 
be related to the integrity of the Medicare program and have 
significant implications on patient and family care outcomes and 
experience. Developing quality measures around those areas is a more 
effective strategy to ultimately promote quality improvement. The two 
high priority measure areas described in this rule measure areas that 
have been shown in the literature to impact quality of care through 
some structure, process, or outcome of 
care.28 29 30 31 32 33 34 35 As such, these 2 measure 
concept areas have a direct link to quality of care. Each measure 
concept's relationship to quality of care is addressed in greater 
detail in section 7. Measure Concepts Under Consideration for Future 
Years of this final rule, on comments specific to the potentially 
avoidable hospice care transitions measure area, and the section on 
comments specific to the access to levels of hospice care measure area. 
We continue to solicit input from stakeholders, including a TEP, a 
hospice caregiver workgroup, and a clinical user's panel to supplement 
evidence of this link in the literature.
---------------------------------------------------------------------------

    \28\ Aldridge MDP, MBA; Epstein, Andrew J. Ph.D.; Brody, Abraham 
A. RN, Ph.D.; Lee, Eric J. MPH; Cherlin, Emily Ph.D., MSW; Bradley, 
Elizabeth H. Ph.D. The Impact of Reported Hospice Preferred 
Practices on Hospital Utilization at the End of Life Medical Care. 
2016;54(7):657-663.
    \29\ Wang S-Y, Aldridge MD, Gross CP, et al. Transitions Between 
Healthcare Settings of Hospice Enrollees at the End of Life. Journal 
of the American Geriatrics Society. 2016;64(2):314-322.
    \30\ Carlson MDA, Herrin J, Du Q, et al. Impact of Hospice 
Disenrollment on Health Care Use and Medicare Expenditures for 
Patients With Cancer. Journal of Clinical Oncology. 
2010;28(28):4371-4375.
    \31\ Teno JM, Bowman J, Plotzke M, et al. Characteristics of 
Hospice Programs With Problematic Live Discharges. Journal of Pain 
and Symptom Management. 2015;50(4):548-552.
    \32\ Prsic E, Plotzke M, Christian TJ, Gozalo P, Teno JM. A 
National Study of Live Hospice Discharges between 2000 and 2012. 
Journal of Palliative Medicine. 2016;19(9):987-990.
    \33\ Barclay, J., et al., Association of hospice patients' 
income and care level with place of death. JAMA Internal Medicine, 
2013. 173(6): p. 450-456.
    \34\ Casarett, D., et al., Does Continuous Hospice Care Help 
Patients Remain at Home? Journal of Pain and Symptom Management, 
2015. 50(3): p. 297-304.
    \35\ Holland JM, Keene JR, Kirkendall A, et al. Family 
evaluation of hospice care: examining direct and indirect 
associations with overall satisfaction and caregiver confidence. 
Palliat Support Care. 2015 Aug;13(4):901-8. doi: 10.1017/
S1478951514000595. PMID: 24992378.
---------------------------------------------------------------------------

    Comment: Regarding measurement priority area 1 (Potentially 
Avoidable Hospice Care Transitions), many commenters agreed that care 
transitions at the end of life can be burdensome for patients and 
families. They noted that transitions out of hospice can often be 
prevented through diligent symptom management, patient and family 
education, and other aspects of care delivered by the hospice during 
the patient's stay. Thus, many of these commenters supported the 
importance of this measure area and its relationship to quality of 
care. Several commenters, including MedPAC, supported a measure related 
to potentially avoidable hospice care transitions. Others expressed 
concerns regarding potential measure specifications but were generally 
supportive of the concept. A few commenters recommended that CMS not 
pursue the development of this measure and shared their concerns.
    Response: We thank the commenters for their support of a future 
HQRP measure related to potentially avoidable hospice care transitions. 
We also appreciate comments offering conditional support of the 
measure, with suggestions for how to define and specify this measure 
such that it meaningfully reflects hospice quality. These suggestions, 
in addition to the concerns of those who did not support continued 
development of this measure, are addressed in detail in the paragraph 
below.
    Comment: In addition to the general comments regarding the 
limitations of claims data detailed earlier in the preamble, we also 
received comments expressing concerns about using claims as a data 
source for this measure area, specifically. Many commenters were 
concerned that patient and family needs and preferences are not 
captured in claims data and thus, the measure might penalize providers 
whose patients choose to disenroll from hospice. For example, 
commenters stated that patients may revoke the hospice benefit because 
they decide to pursue aggressive treatment for their terminal condition 
or to seek care from a hospital that is not contracted with the 
hospice. Several commenters noted that, even if a hospice provided 
adequate education to patients and families, they would still want to 
seek acute care for various reasons unrelated to the quality of care 
provided by the hospice. Several commenters emphasized that patients 
have the right to revoke the hospice benefit at any time and that these 
decisions are sometimes outside of the hospice's control. Commenters 
described other scenarios in which they believed that discharges from 
hospice and subsequent care transitions were outside the control of the 
hospice. For example, a few commenters mentioned payment and policy 
factors or local market-level factors that may trigger transitions from 
hospice to acute care. A few described instances in which a nearby 
hospital refuses to contract with them for providing GIP care, forcing 
them to discharge patients should they need GIP care. Several 
commenters believed that claims did not provide sufficient information 
to adequately reflect hospice practice. Specifically, commenters were 
concerned with using claims data to identify potentially avoidable 
hospice care transitions or distinguish between appropriate and 
inappropriate live discharges. Commenters discussed the situation in 
which a patient's clinical condition improved as an example of an 
appropriate live discharge. Several commenters requested that CMS 
provide examples of potentially avoidable hospice care transitions. 
Lastly, commenters suggested that claims data be supplemented with 
other data sources, such as the HEART tool in the future, in order to 
provide that contextual information necessary to determine whether a 
transition was appropriate or indicative of poor quality provided by a 
hospice.
    Response: As previously stated, we acknowledge the limitations of 
claims data in capturing this information and would also like to 
clarify that this measure is not intended to determine whether each 
individual care transition or live discharge is appropriate. Instead, 
the measures will present provider-level rates of the process and 
outcome in the two proposed measure areas, comparing providers to their 
peers with relevant and available patient-level and hospice-level 
factors taken into account. Given the limitations of claims data to 
measure this area, we are examining information about care patterns and 
subsequent outcomes that are available in claims data to identify 
transitions that might be reflective of suboptimal quality provided by 
a hospice during a patient's stay (that is, failure to meet the needs 
of patients and their families). These transitions represent 
disruptions in continuity of care at a time when patients and families 
are extremely vulnerable. We agree that patient and family needs and 
preferences are an important factor in determining whether a hospice 
provider should be held accountable for a care transition and the 
related outcomes and that this information is not fully captured in 
claims data. However, research has demonstrated provider- and state-
level

[[Page 36660]]

variation in proportion of hospice users experiencing care transitions, 
which signifies that market factors and hospice characteristics (that 
is, factors other than patient/family needs and preferences) influence 
transitions. We also agree that there are situations in which live 
discharges may be appropriate--for example, when a patient's clinical 
condition improves and they are no longer deemed to have a prognosis of 
6 months or less. This measure area is not intended to suggest that 
live discharge is inappropriate for any individual patient but rather, 
to identify hospices with substantially higher rates of live discharges 
followed by either death or acute care use during a short period of 
time. Substantially higher rates of live discharge with these 
subsequent outcomes may indicate that providers are not meeting patient 
needs, signaling poor quality.\36\
---------------------------------------------------------------------------

    \36\ MedPAC, Report to the Congress: Medicare Payment Policy. 
March 2017. http://www.medpac.gov/docs/defaultsource/reports/mar17_medpac_ch12.pdf?sfvrsn=0.
---------------------------------------------------------------------------

    In response to commenters' requests that we provide examples of 
potentially avoidable hospice care transitions, we would like to 
reiterate that this measure is currently in development and thus, its 
specifications have not yet been finalized. As previously stated, this 
measure is intended to address lack of continuity of care during a 
vulnerable time for patients and families. Thus, measure specifications 
will focus on live discharges from hospice followed by either death or 
acute care use during a short period of time. We will continue to 
carefully examine patterns of care for live discharge and consider them 
in measure development. We will continue to solicit and consider 
stakeholder input before finalizing measure definitions and 
specifications. The public will have the opportunity to comment on 
proposed measures and their specifications if and when these measure 
concepts are proposed in future rulemaking cycles.
    Comment: Commenters offered suggestions for how to specify a 
measure examining potentially avoidable hospice care transitions. 
Several commenters recommended that CMS to look at live discharge 
followed by readmission to hospice, hospitalization, or death within a 
short time frame. One commenter suggested incorporating data elements 
from providers transferring patients to hospice. Several commenters 
cautioned against setting a benchmark for acceptable rates of live 
discharge.
    Response: This measure is currently under development so its 
specifications have not yet been finalized. We appreciate the 
commenters' suggestions and will continue to take stakeholder input 
into consideration before finalizing measure specifications. This 
measure is intended to address lack of continuity of care by assessing 
transitions that may reflect poor quality on the part of the hospice. 
Thus, in line with the suggestions of commenters, measure 
specifications will focus on live discharges from hospice followed by 
either death or acute care use during a short period of time. We will 
carefully examine patterns of care for live discharge and consider them 
in measure development. We also appreciates commenters' concerns 
regarding the identification of a threshold or benchmark for this 
measure area. We acknowledge that some live discharges and care 
transitions are to be expected and appropriate, and agree that a 
threshold should not be set initially without careful analysis of 
national data and measure trends. We will also continue to engage 
stakeholders and conduct analyses to inform the specifications of this 
measure.
    Comment: Several commenters questioned the relationship between 
this high priority measure and quality.
    Response: We appreciate the commenters' concerns regarding this 
measure area's relationship to quality of care. The linkage between 
potentially avoidable hospice care transitions and outcomes for 
patients and families is demonstrated in the literature 
37 38 39 40 41 with evidence suggesting that substantially 
higher rates of live discharge may signal poor quality.\42\ For 
example, failures on the part of the hospice in advanced care planning, 
symptom management, responsiveness, and family education could drive 
patients and families to seek acute care. Furthermore, stakeholders 
support the importance of this measure and its relationship to quality. 
Overall, TEP members agreed on the importance of this measure concept 
and supported its continued development and future implementation. In 
addition, input solicited from hospice patients and caregivers suggests 
that this measure concept is important and meaningful to patients and 
families.
---------------------------------------------------------------------------

    \37\ Aldridge MDP, MBA; Epstein, Andrew J. Ph.D.; Brody, Abraham 
A. RN, Ph.D.; Lee, Eric J. MPH; Cherlin, Emily Ph.D., MSW; Bradley, 
Elizabeth H. Ph.D. The Impact of Reported Hospice Preferred 
Practices on Hospital Utilization at the End of Life Medical Care. 
2016;54(7):657-663.
    \38\ Wang S-Y, Aldridge MD, Gross CP, et al. Transitions Between 
Healthcare Settings of Hospice Enrollees at the End of Life. Journal 
of the American Geriatrics Society. 2016;64(2):314-322.
    \39\ Carlson MDA, Herrin J, Du Q, et al. Impact of Hospice 
Disenrollment on Health Care Use and Medicare Expenditures for 
Patients With Cancer. Journal of Clinical Oncology. 
2010;28(28):4371-4375.
    \40\ Teno JM, Bowman J, Plotzke M, et al. Characteristics of 
Hospice Programs With Problematic Live Discharges. Journal of Pain 
and Symptom Management. 2015;50(4):548-552.
    \41\ Prsic E, Plotzke M, Christian TJ, Gozalo P, Teno JM. A 
National Study of Live Hospice Discharges between 2000 and 2012. 
Journal of Palliative Medicine. 2016;19(9):987-990.
    \42\ MedPAC, Report to the Congress: Medicare Payment Policy. 
March 2017. http://www.medpac.gov/docs/defaultsource/reports/mar17_medpac_ch12.pdf?sfvrsn=0.
---------------------------------------------------------------------------

    Comment: In addition to the general concerns regarding public 
reporting of the two high priority measure areas, we received a few 
comments specific to public reporting of the potentially avoidable 
hospice care transitions measure area. One commenter expressed concerns 
regarding hospice provider access to information that would enable them 
to internally monitor their performance on this measure (that is, 
claims for acute care stays occurring after hospice live discharge; 
information allowing them to compare their performance on this measure 
to the performance of other hospices). They recommended CMS to refrain 
from public reporting until hospice providers have access to this 
information.
    Response: We appreciate the commenter's concerns regarding the 
ability of hospice providers to internally monitor their performance in 
this measure area. Though this measure would consider patient care 
transitions after hospice discharge, the intention is to capture 
performance gaps during the hospice stay that leads to the risk of 
transition. Thus, hospice's provision of high quality care during a 
patient's hospice stay should minimize the risk of those transitions. 
For example, adequate symptom management and responsiveness on the part 
of the hospice might prevent unnecessary transitions from occurring. 
Though hospice providers might not have access to claims from acute 
care stays occurring after they discharge a patient alive, this should 
not affect their ability to take steps to ensure the provision of high 
quality care to prevent these transitions and thus, should not affect 
their ability to perform well on this measure. Before the onset of any 
public reporting for any new quality measure, we provide confidential 
feedback reports (that is, Certification and Survey Provider Enhanced 
Reports (CASPER) Quality Measure (QM) reports, confidential to the 
extent permissible by federal law) to providers that allow them to 
compare their performance to national averages.

[[Page 36661]]

    Comment: Several commenters were concerned that this measure may 
result in unintended consequences for patients and families. For 
example, a few commenters worried that it may encourage providers to 
approach care decisions with less attention towards patient and family 
wishes.
    Response: We appreciate commenters' concerns regarding potential 
unintended consequences of a measure examining potentially avoidable 
hospice care transitions. With the development of any new quality 
measures, it is a priority of CMS to minimize any potential unintended 
consequences. Thus, we will work closely with the hospice industry and 
other stakeholder groups to ensure that this measure does not 
inadvertently impede a patients' choice to make a desired transition or 
have any other unintended consequence.
    Comment: Regarding measure development priority area 2 (Access to 
Levels of Hospice Care), most commenters, including MedPAC, supported 
the ``access to levels of hospice care'' measure area. Several 
commented on its potential to encourage providers to better meet the 
needs of patients and families as well as its potential usefulness for 
Medicare beneficiaries and their families. Some commenters, though they 
had concerns with potential specifications for this measure, generally 
agreed that access to levels of hospice care is an important aspect of 
hospice care for patients and families.
    Response: We thank the commenters for their support of a future 
HQRP measure related to access to levels of hospice care. We also 
appreciate comments offering conditional support of the measure, with 
suggestions for how to define and specify this measure such that it 
meaningfully reflects hospice quality. These suggestions are addressed 
in detail in the paragraph below.
    Comment: In addition to the general comments regarding the 
limitations of claims data detailed above, we also received comments 
expressing concerns about using claims as a data source for this 
measure area, specifically, commenters noted that claims data would not 
provide information about when higher intensity levels of hospice care 
were needed, such as information about patient acuity. One commenter 
stated that claims data would not reflect situations in which GIP or 
CHC were offered but refused by patients and families. Several 
commenters were concerned that claims data would not reflect instances 
in which a patient didn't receive a higher intensity level of care 
because the hospice was able to get their symptoms under control 
without escalating the patient to GIP or CHC. A few commenters worried 
that their performance on this measure might be lower because their 
hospices focused on preemptively mitigating the need for higher 
intensity levels of care through diligent symptom management and 
patient and family education. Some commenters cautioned against judging 
access to and availability of GIP and CHC by delivery of such care. 
Several commenters suggested linking claims data with survey data that 
demonstrates a hospice's ability to provide higher intensity levels of 
care (for example, contracts with inpatient facilities).
    Response: We agree that patient and caregiver needs and preferences 
for certain levels of care can impact the use of more intensive levels 
of hospice care and recognize that claims only provide information 
about what level of care was provided, not what level of care was 
needed or desired. However, research has demonstrated provider- and 
state-level variation in proportion of hospice users receiving higher 
intensity levels of hospice care, which signifies that market factors 
and hospice characteristics (that is, factors other than patient/family 
needs and preferences) influence GIP and CHC provision. This measure 
concept is not intended to suggest that a higher intensity level of 
care is appropriate or needed for any given individual; the purpose of 
this measure concept is to ensure that patients and families have 
access to these higher intensity levels of care if needed. Furthermore, 
there will be risk adjustment for this measure, which will 
statistically account for patient case-mix differences across hospices 
so that the outcome rates can be more accurately compared despite the 
differences in patient case-mix. We acknowledge the limitations of 
claims data and thus, the inability to control for certain relevant 
factors such as patient and family preferences and refusal of care. 
However, these factors tend to distribute evenly across hospices. In 
other words, each hospice may serve patients and families with varying 
level of preference for higher intensity levels of hospice care. As 
such, the inability to control for these factors does not necessarily 
disadvantage certain hospices. We encourage hospice providers to take 
measures to preemptively meet the symptom management and other needs of 
patients and applaud those who are doing so. However, we also recognize 
that there will be instances in which, despite a hospice's best 
efforts, certain patients will require higher intensity levels of 
hospice care. The focus of this measure area is to ensure that these 
patients have access to the care that they need, and to encourage 
hospices to continually assess patients and provide different levels of 
care as needed. We also thank commenters for their suggestions 
regarding supplementing claims data with other data sources. We will 
consider the benefit of doing such in the context of the potential 
burden associated with data collection and measure calculation and 
reporting. We will also consider opportunities to incorporate other 
data sources into future HQRP measure development efforts.
    Comment: Several commenters cautioned against setting a threshold 
or benchmark for GIP and CHC provision in the absence of evidence 
regarding where this threshold should lie.
    Response: We appreciate the commenters' concerns regarding the 
identification of a threshold or benchmark for this measure area. We 
agree that thresholds should not be set arbitrarily, without rigorous 
information gathering and measure testing. We will continue to engage 
stakeholders and conduct claims data analyses to inform the 
specifications of this measure.
    Comment: Several commenters questioned the relationship between 
this high priority measure area and quality.
    Response: This measure area's relationship with quality of care is 
supported by the literature. Appropriate use of CHC and GIP increases 
the likelihood of a hospice patient dying in his or her location of 
choice, decreases health resource utilization resulting in potential 
cost savings, and increases patient and caregiver 
satisfaction.43 44 45 This linkage between appropriate use 
of higher intensity levels of hospice care and outcomes for patients 
and families is further supported by a technical expert panel and other 
stakeholder groups thus far engaged in the development of this measure. 
Overall, TEP members agreed on the importance of this measure concept 
and supported its relationship to quality. Additionally, input 
solicited from hospice caregivers has suggested that this measure 
concept

[[Page 36662]]

is important and meaningful to patients and families.
---------------------------------------------------------------------------

    \43\ Barclay, J., et al., Association of hospice patients' 
income and care level with place of death. JAMA Internal Medicine, 
2013. 173(6): p. 450-456.
    \44\ Casarett, D., et al., Does Continuous Hospice Care Help 
Patients Remain at Home? Journal of Pain and Symptom Management, 
2015. 50(3): p. 297-304.
    \45\ Holland JM, Keene JR, Kirkendall A, et al. Family 
evaluation of hospice care: examining direct and indirect 
associations with overall satisfaction and caregiver confidence. 
Palliat Support Care. 2015 Aug;13(4):901-8. doi: 10.1017/
S1478951514000595. PMID: 24992378.
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    Comment: Several commenters expressed concern with the feasibility 
of certain hospices providing all four levels of care and described 
factors that may lower their performance on a measure examining access 
to higher intensity levels of hospice care. For example, some 
commenters discussed staffing challenges associated with providing CHC 
and GIP, particularly for smaller hospices. Several commenters noted 
challenges related to the CHC billing requirement that at least 8 hours 
of continuous care be provided within one calendar day. They described 
situations in which the continuous care they are providing is not 
reflected as CHC in claims data because it did not meet the 8 hour 
threshold within 1 calendar day. Others described market factors 
influencing a hospice's ability to provide GIP, including issues with 
contracting with nearby hospitals.
    Response: While we acknowledge that some hospice providers may face 
unexpected challenges in providing higher intensity levels of hospice 
care, according to the Hospice Conditions of Participation (CoPs) all 
hospice agencies regardless of size, location or other organizational 
or market characteristics must be able to provide all four levels of 
hospice care. We will continue to discuss these issues with a technical 
expert panel and other stakeholder groups and conduct analyses to 
better understand sources of variation in GIP and CHC provision across 
hospices. These discussions and analyses will inform the specifications 
for this measure. Though we do acknowledge the challenges that 
commenters raised, it is our expectation that all hospices meet the 
requirements set forth in the Hospice (CoPs) and demonstrate the 
capacity to meet the needs of patients and families.
    Comment: A few commenters expressed concerns with the access to 
levels of hospice care measure promoting overutilization of GIP and 
CHC. They added that the intent of this quality measure conflicts with 
efforts to discourage overutilization of these higher intensity, more 
costly levels of hospice care.
    Response: We appreciate these commenters raising one potential 
unintended consequence of this measure area. It is our goal to minimize 
the unintended consequences of any new quality measure. The purpose of 
this measure area is not to encourage GIP or CHC for any individual 
patient or to encourage very high rates of GIP or CHC use within 
hospices. Rather, the focus of this measure area is to assess whether 
patients have access to these levels of care if they need it, and to 
encourage hospices to continually assess patients and provide different 
levels of care as needed. With that said, we will provide educational 
opportunities for providers and the public to clearly explain the 
intent of this measure and its relationship to quality of care. 
Provider education will emphasize that the purpose of this measure is 
to promote access, not to encourage increased use of GIP or CHC for any 
given patient. We will also coordinate this measure and relevant 
utilization measures reported under the PEPPER to design a balanced 
incentive for hospices to provide the level of GIP and CHC care to meet 
patient and family needs.
    Comment: In addition to offering comments about the two high 
priority measure development areas, several commenters stated their 
general support for future HQRP measure development efforts. Commenters 
noted the importance of developing quality measures that reflect the 
holistic and comprehensive care provided by hospice and measures that 
recognize that the unit of hospice care is composed of both the patient 
and their family. Several commenters recommended CMS to turn attention 
towards the development of outcome measures for the HQRP to supplement 
current measures, many of which are process measures. Additionally, 
several commenters recommended CMS to ensure that all future measures 
are clearly defined and undergo rigorous testing prior to 
implementation in the HQRP. Commenters emphasized the importance of 
stakeholder engagement in all measure development efforts. Several 
commenters specifically noted the importance of patient and family 
engagement to develop new HQRP measures, including measures that 
capture patient experience. Several commenters suggested that CMS 
engage with NQF and the MAP in determining priority areas for future 
measurement. One commenter pointed specifically to the PEACE Project, a 
CMS project that developed a set of quality measures, with complete 
specifications, and data collection tools for use by hospice and 
palliative care providers in quality improvement, and the 2012 MAP 
Performance Measurement Coordination Strategy for Hospice and 
Palliative Care as resources from which to pull measures and measure 
concepts.
    Response: We thank the commenters for their support and suggestions 
for future quality measurement efforts as part of the HQRP. We agree 
that quality measures should capture the aspects of care that set 
hospice apart from many other types of care, including the provision of 
holistic interdisciplinary care and the recognition of both the patient 
and their family as the unit of care. Further, we agree with commenters 
that the development of outcome measures should be prioritized in 
future HQRP measure development. It is our goal to supplement existing 
HIS and CAHPS[supreg] measures to develop a more comprehensive measure 
set that captures key domains of hospice care. With the development of 
any new QRP measure, we follow a rigorous process for measure 
development which includes measure conceptualization, measure 
specification, and measure testing prior to measure implementation. 
Each of these stages of development incorporates ample opportunity for 
stakeholder engagement. We consider the perspective of clinicians, 
patients and caregivers, and other stakeholder groups integral to the 
development process. We will continue to engage with the NQF and the 
MAP to identify priority measure concepts. We would like to note that 
all measures undergo review by the MAP prior to implementation in the 
HQRP. Further, where possible, CMS seeks NQF endorsement for any new 
HQRP measures that are not already endorsed by NQF. For more details 
regarding our measure development process, please refer to the 
Blueprint for CMS Measures Management System Version 13: https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/MMS/MMS-Blueprint.html.
    Comment: Commenters offered suggestions for future measure concepts 
to consider for implementation in the HQRP including:
     Congruence of place of death and patient wishes;
     Psychological, psychiatric, and psychosocial aspects of 
care;
     Spiritual well-being;
     Bereavement services offered by a hospice;
     Volunteer services offered by a hospice;
     Occupational therapy outcomes;
     Provider commitment to credentialing their staff;
     Care planning (for example, regular review of patient and 
family goals; shared decision making);
     Timely communication of patient's goals across all 
providers;
     Cost of care; and
     Care coordination among providers.
    In addition, commenters suggested measures specific to certain 
subpopulations of hospice patients including:
     Pediatric patients;

[[Page 36663]]

     Patients with a diagnosis of Alzheimer's or Dementia;
     Patients with a short length of stay; and
     Patients receiving hospice care in a nursing facility or 
assisted living facility.
    Response: We thank the commenters for their suggestions regarding 
potential future quality measures. We agree that these are important 
areas of hospice and will consider these suggestions in future HQRP 
measure development efforts.
8. 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. 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 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, 2017, 
that provider will begin submitting HIS data for patient admissions 
occurring after November 5, 2017. 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 2019 APU, which is associated with 
patient admissions occurring January 1, 2017 through December 31, 
2017).
    This policy allows us 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, 
we finalized that new hospices begin collecting HIS quality data 
beginning on the date noted on the CCN notification letter. We believe 
this policy provides 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 our 
policy requirements for new providers with the functionality of the HIS 
data submission system (QIES ASAP).
c. Previously Finalized Data Submission Mechanisms, Timelines, and 
Deadlines
    In the FY 2015 Hospice Wage Index final rule (79 FR 50486), we 
finalized our policy requiring that hospices 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.9.b through III.C.9.c of the FY 2015 
Hospice final rule (79 FR 50486) 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 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. 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-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

[[Page 36664]]

MLN Connects[supreg] Provider e-News (E-News), and provider training.
    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 us 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), we 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. 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), we 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 after the Event Date for HIS 
Admission records and 7 days after 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, we will continue 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 CMS HQRP 
Web site, listserv messages via the Post-Acute Care QRP listserv, MLN 
Connects[supreg] National Provider Calls & Events, MLN Connects[supreg] 
Provider eNews and announcements on Open Door Forums and Special Open 
Door Forums.
    The comment and our response are below.
    Comment: We received a few comments on the previously finalized 
data submission mechanism, the HIS. One commenter offered several 
suggestions for potential revisions to the HIS V2.00.0, including 
suggested edits to items in Section A and Section J of the HIS-
Admission record. The commenter offered suggestions for response 
options or items that could be potentially eliminated, and offered 
suggestions for refinements to coding guidance provided in the HIS 
Manual for these items. Another commenter requested CMS include 
additional examples in the HIS Manual; specifically, examples that had 
greater clinical relevance for a broader range of hospice providers.
    Response: The HIS V2.00.0 was previously proposed and finalized as 
a data collection mechanism for the HQRP. We refer readers to the FY 
2017 Hospice Wage Index final rule (81 FR 52167 through 52192) for a 
detailed discussion of the HIS V2.00.0. We invite the public to submit 
questions or suggestions about previously finalized and currently 
implemented proposals through sub-regulatory communication channels, 
including the Hospice Quality Help Desk at 
[email protected], and through other communication 
channels such as Open Door Forums and Special Open Door Forums. These 
can be found at the CMS Web site: https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Hospice-Quality-Reporting/Spotlight.html. Requests such as including additional examples in the 
HIS Manual can be addressed at the Hospice Quality Help Desk. We are 
always seeking ways to make the HIS Manual more user-friendly and will 
consider adding examples that provide more clinical relevance for a 
broader range of hospice providers. By writing to the Hospice Quality 
Help Desk, we can communicate to be sure we understand the issue to 
most appropriately address it.
d. New Data Collection and Submission Mechanisms Under Consideration: 
Hospice Evaluation & Assessment Reporting Tool (HEART)
    We have 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, we have 
established the HQRP, which includes clinical quality measures from the 
HIS and patient experience of care measures from the CAHPS[supreg] 
Hospice Survey. We have also 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 discussed in the FY 2017 Hospice Wage Index final rule (81 FR 
52177), to facilitate continued progress towards the requirements set 
forth in section 3004 of the Affordable Care Act, we are in the early 
stages of the development of a new data collection mechanism for use by 
hospices. This new data collection mechanism would be a hospice patient 
assessment tool, which would serve two 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

[[Page 36665]]

(2) provide additional clinical data that could inform future payment 
refinements. In the FY 2017 Hospice Wage Index final rule (81 FR 
52143), we solicited input from the public on the development of a 
hospice patient assessment tool that would collect quality, clinical, 
and other data with the ability to be used to inform future payment 
refinement efforts. Overall, feedback from the public was supportive of 
the move towards a standardized patient assessment instrument, and 
commenters offered some guiding principles for CMS to keep in mind in 
the development of a patient assessment tool, given the unique nature 
of hospice care. For a detailed discussion of the public comments and 
responses, as well as our guiding principles and motivation behind the 
development of a hospice patient assessment tool, we refer readers to 
the FY 2017 (81 FR 52143). As noted in the FY 2017 Hospice Wage Index 
final rule, we envision 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 also 
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 and comprehensive assessment), but would be designed to 
complement data that are collected as part of high-quality clinical 
care. The new data collection effort would replace the current HIS, but 
would not replace other HQRP data collection efforts (that is, the 
CAHPS[supreg] Hospice Survey), nor would it replace regular submission 
of claims data. We envision 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.
    We did not propose a hospice patient assessment tool at this time; 
we are still in the early stages of development of an assessment tool 
to determine the appropriate content and feasibility of such a tool. As 
such, we have made progress over the past year in the development of a 
hospice patient assessment tool, preliminarily called the Hospice 
Evaluation & Assessment Reporting Tool (HEART). CMS's measure 
development contractor, RTI International, has begun preliminary HEART 
development activities, including: Conducting environmental scans and 
engaging clinical experts to determine which domains of care are 
important to capture in a hospice patient assessment; posting a 
national provider call and forming a Clinical Committee comprised of 
hospice organizations from across the United States to participate in 
the early development of an assessment; and collaborating within CMS to 
assess various stakeholder needs and encourage collaboration within CMS 
and across other HHS agencies. As we move forward with the development 
of the HEART patient assessment tool, we will continue to keep the 
public informed of our progress and solicit input as we establish and 
finalize domains of care to include in the assessment, and as we move 
towards specific item wording and development. Once we move past the 
preliminary phases of development and conceptualization, we will 
communicate a timeline for the HEART development, testing, and proposed 
implementation in future rulemaking cycles.
    As mentioned in the FY 2017 Hospice Wage Index final rule (81 FR 
52143), it is important for CMS to develop a hospice patient assessment 
tool that is scientifically rigorous and clinically appropriate for the 
hospice population, thus we believe that continued and transparent 
involvement of stakeholders is critical. We will continue to receive 
stakeholder input from MedPAC and ongoing input from the provider 
community, Medicare beneficiaries, and technical experts. Additionally, 
it is important for CMS to minimize data collection burden on providers 
in the development of HEART. We will ensure that hospice patient 
assessment data items are not duplicative or overly burdensome to 
providers, patients, caregivers, or their families. We will also work 
with the public and other stakeholders to ensure that HEART takes into 
account the unique aspects of hospice care delivery including symptom 
burden and psychosocial needs, patient and family preferences, care of 
imminently dying patients, and the complexity of providing hospice care 
in multiple settings and at multiple intensity levels.
    The comments and our responses are set forth below.
    Comment: Many commenters were supportive of the continued 
development of a patient assessment tool, HEART. Commenters believed 
that--beyond currently available CMS data sources--a tool such as HEART 
would enable a broader picture of the quality of care provided by 
hospice agencies, as well as a more comprehensive picture of patient 
need and service delivery. Commenters also agreed with CMS that this 
enhanced patient assessment tool could be useful for quality purposes 
and potential payment purposes. MedPAC supported HEART, noting that a 
patient assessment instrument would gather more detailed clinical 
information on hospice patients (for example, patients' symptom 
burden), facilitate the development of more meaningful quality 
measures, and be helpful for payment policy purposes. Many commenters 
offered their support to CMS in the development of HEART, noting that 
transparent involvement of stakeholders would be crucial for ensuring 
HEART is scientifically rigorous, clinically appropriate, addresses the 
needs of individual patients, and sets the foundation for data 
collection that more accurately reflects the needs of patients served. 
In addition to voicing general support for HEART, commenters also 
offered several suggestions and considerations for CMS to keep in mind 
as we move forward with the development of HEART. Suggestions focused 
on the following themes: Intended use of HEART, Content of HEART, 
Processes for HEART development, HEART Policies and Procedures, and 
Burden. Beyond these major themes, commenters also offered suggestions 
for HEART's relationship to quality and payment and cross-setting 
considerations.
    Response: First, we thank commenters for their support of the 
development of a patient assessment tool, HEART. We agree that enhanced 
data collection would further the goals of the HQRP and the Medicare 
Hospice Benefit by providing data that could be useful for development 
of future quality measures and potential future payment refinements. 
Second, we appreciate the input and recommendations from the hospice 
community. The input received from commenters are invaluable as we move 
forward with the development of HEART; we look forward to continued 
collaboration with our stakeholders and the hospice community. We 
address specific comments received in greater detail in paragraph 
below.
    Comment: CMS received a few comments regarding the utility of HEART 
and CMS's vision for how HEART would be used for quality and payment 
purposes. A couple of commenters recommend CMS to ``move cautiously'', 
particularly in the area of payment refinement. One commenter suggested 
that CMS make a concerted effort to--in future rulemaking cycles--
separate payment refinements from the expanded quality data that HEART 
would offer.

[[Page 36666]]

    Response: We would like to take this opportunity to further clarify 
our vision for HEART and HEART's ultimate utility. At this time, we 
envision HEART as a patient assessment tool that would replace the HIS. 
HEART would provide richer data to offer a broader, more comprehensive 
picture of quality of care received by hospice patients and their 
families. We believe HEART may provide data that could inform future 
payment refinements, we would like to clarify that HEART's role in 
future payment refinements is not definite. We realize that before a 
patient assessment can be used for payment purposes, it must undergo 
rigorous testing to investigate whether data items are reliable and 
valid predictors of resource utilization. We acknowledge and appreciate 
that extensive testing of HEART data items will need to occur before we 
can make a final determination about whether HEART will prove useful in 
informing future payment refinements. This analysis would be in 
addition to the analyses that will be conducted to determine the 
scientific soundness of the data items themselves, as well as in 
addition to analyses conducted to inform the development of future 
quality measures. Thus, at this time, we cannot say definitively 
whether HEART will be used for payment refinements. Furthermore, any 
changes to the hospice payment methodology would be subject to the 
rulemaking process, which allows for public comment on any payment 
proposal. Although this is a potential use of the data, until extensive 
analysis and testing is conducted, we cannot make a final determination 
on the role HEART may play in future payment refinements. We would also 
like to take this opportunity to reassure the public of our timeline 
for development and testing of HEART. We appreciate the need to use a 
rigorous process in the development of testing and HEART; we assure the 
public that we will work on a timeline that allows for iterative 
testing and refinements, and provides ample opportunity to solicit the 
feedback of technical experts and the hospice community. Further 
details on our timeline and processes for development and testing of 
HEART are discussed further on in the preamble.
    Comment: Many commenters offered recommendations on the content of 
HEART. Many commenters noted the unique nature of hospice care and 
offered considerations for designing HEART to ensure it would reflect 
the comprehensive and holistic aspects of hospice care. Specifically, 
commenters recommended that CMS ensure HEART: (1) Reflects the holistic 
and comprehensive nature of hospice care, including physical, 
psychosocial, and spiritual components; (2) recognizes the importance 
of an individualized approach to care; (3) includes the patient and 
family's right to refuse or defer offered services; (4) accommodates 
the delivery of care in various settings, including nursing homes, 
assisted living facilities, hospitals, hospice facilities, and the 
patient's home; and (5) recognizes that the assessment must be 
interdisciplinary. These commenters also encouraged CMS to ensure that 
data gathered through HEART is easily and readily usable for 
development of and updates to the plan of care. In addition to 
accommodating the facets of care noted above, a few commenters 
discussed the importance of ensuring flexibility in HEART to 
accommodate care of the imminently dying patient. Commenters noted that 
patients who are imminently dying at the time of admission to hospice 
need the hospice to immediately address high priority patient and 
family needs; completing assessment forms such as HEART could interfere 
with providing immediate clinical and psychosocial support for 
vulnerable patients and families who are facing imminent death. One 
commenter believed that requiring completion of all HEART data 
elements, regardless of patient status, would obligate hospices to 
complete regulatory requirements at the expense of addressing urgent 
patient and family needs for patients who are close to death upon 
admission to hospice. This commenter believed hospices should have the 
discretion to complete only those aspects of assessment that are most 
critical to the needs of the patient and family, and that to promote 
this discretion, CMS should allow flexibility in completing HEART items 
for these patients. CMS received a couple of comments regarding the 
inclusion of standardized tools in HEART. One commenter was supportive 
of including validated, standardized instruments in HEART (for example, 
standardized pain scales, symptom management assessment tools). This 
commenter believed that the inclusion of standardized tools would 
reduce duplication with assessments that hospices already complete as 
part of usual care. On the other hand, another commenter cautioned 
against prescribing the use of specific validated, standardized tools. 
This commenter believed that it would be important for CMS to preserve 
the integrity of the hospice philosophy by allowing hospice clinicians 
to individualize assessments and care based on clinical judgment, and 
that prescribing specific standardized tools may restrict clinical 
judgment and practice. One commenter recommended including HEART data 
elements that would capture social risk factors. Another commenter 
suggested CMS to include patient preferences in HEART data elements.
    Response: We appreciate commenters' considerations on what should 
be included in the content of HEART. We wholeheartedly agree with 
commenters regarding the unique nature of hospice care, and we will 
continue to keep the hospice philosophy as the foundation of the HEART 
patient assessment. We seek to develop an assessment that reflects the 
distinctive aspects of hospice care, including the team-based, multi-
disciplinary approach that is essential to hospice. We agree with the 
points raised by commenters about the overall focus of HEART and aims 
to develop a tool that addresses the holistic nature of hospice, 
incorporating medical, psychosocial, spiritual, and other aspects of 
care that are important for patients and their caregivers. We also 
appreciate commenters' specific suggestions regarding 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 patients who are imminently dying, patients' and caregivers' 
right to decline services or treatment, and the fact that hospice is 
delivered in multiple settings. We appreciate commenters' suggestions 
about including items to capture other important facets of care, 
including suggestions about the inclusion of standardized tools, the 
suggestion to incorporate patient preference into HEART, and the 
suggestion to consider data collection on social risk factors. We will 
keep these considerations in mind as we move forward with HEART 
development.
    Comment: CMS received many suggestions from commenters regarding 
the process for continued development of HEART. All of these commenters 
encouraged CMS to engage stakeholders and the hospice community in the 
development process, and appreciated CMS's commitment to a transparent 
and collaborative development process. Commenters believed that 
extensive stakeholder engagement would lead to meaningful data that is 
truly reflective of quality of care delivered by hospices. Due to the 
magnitude, complexity, and importance of HEART, one commenter 
encouraged CMS to go beyond traditional opportunities for input (for 
example, TEPs) and employ widespread

[[Page 36667]]

processes for gathering provider input. Another commenter encouraged 
CMS to broaden the definition of relevant stakeholders and include EMR 
vendors as a stakeholder in the HEART development process. This 
commenter believed that many of the difficulties encountered in 
implementation of new requirements stem from the complexity of 
integrating data collection into EMR systems, and that inclusion of EMR 
vendors in the development process may result in a smoother 
implementation of HEART. In addition to offering suggestions for 
stakeholder engagement, many commenters offered suggestions for testing 
and refinement of HEART. Several commenters encouraged CMS to use an 
iterative testing approach; commenters encouraged CMS to conduct 
several phased pilot tests, which would allow for the iterative and 
ongoing refinement of HEART. A few commenters recommended CMS include a 
range of hospice agencies in pilot tests, including hospices of varying 
sizes, locations, and organizational structure. One commenter asked if 
CMS could share any progress or materials on the development of HEART, 
such as the structure of the assessment. Finally, many commenters 
offered their support to CMS throughout the development process, 
volunteering to provide feedback and participate in pilot initiatives.
    Response: We are appreciative commenters continued support and 
engagement throughout the development process; and we look forward to 
opportunities for continued collaboration and input. We have already 
begun to engage the public and other stakeholders in our development 
process. We have formed a Clinical Committee comprised of hospice 
organizations from across the United States, and we have begun 
conversations with hospice clinical experts and other stakeholders with 
CMS and across HHS. We look forward to continuing these discussions and 
engaging in additional opportunities for stakeholder input. We agree 
that input from the hospice industry will be invaluable and assure 
commenters that our process for development and testing of HEART will 
allow ample opportunity to refine and improve HEART based on 
stakeholder input. We plan to hold TEPs to inform the development, 
testing, and refinement of the patient assessment. We also plan to 
provide other opportunities for stakeholders to provide input through 
venues such as Special Open Door Forums and other regular HQRP 
communication channels. We will also consider additional mechanisms for 
soliciting input from the public to further enhance opportunities for 
input.
    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. As with the development of 
patient assessment instruments in other care settings, tentative 
development processes may include holding TEPs to gather input from 
hospice clinicians and researchers, conducting small-scale pilot tests 
to determine feasibility of a patient assessment instrument for 
hospice, conducting a larger, national test to establish reliability 
and validity of items and determine appropriate use of each item, 
providing ongoing opportunities for input and engagement from the 
hospice community. Only after completion of a thorough development 
process over the next several years would CMS consider proposing HEART 
through rulemaking for implementation in the HQRP. We believe our 
tentative development process to be aligned with commenters' 
recommendations for a thorough and iterative testing approach, allowing 
ample opportunity for the refinement of HEART prior to implementation. 
Further details on HEART development and testing will be communicated 
in future rulemaking cycles and through sub-regulatory communication 
channels. We will also announce opportunities for stakeholder input and 
participation regularly through sub-regulatory communication channels 
(for example, MLN eNews ListServs, ODFs, SODFs). Regarding the 
commenter's request for information on the current draft version of 
HEART, we are still in the early, initial phases of HEART development; 
we look forward to sharing our progress with the provider community as 
developments become available.
    Comment: Several commenters offered suggestions to CMS regarding 
policies and procedures for HEART data collection and submission, 
including feedback on data collection intervals, modes and timing for 
data collection and submission, and implementation of HEART. Commenters 
had differing opinions as to whether HEART data should be collected at 
admission and discharge only, or if data should be collected at 
additional interim time points beyond admission and discharge. 
Commenters who supported interim data collection efforts noted the 
importance of measuring care throughout a patient's stay to fully 
understand quality of care delivered to patients over the course of 
their length of stay. Commenters who supported admission and discharge 
data collection believed interim data collection efforts only would 
prove overly burdensome for providers. Regarding data completion and 
submission, one commenter encouraged CMS to implement data collection 
and submission timeframes that are reasonable and clear.
    Several commenters offered suggestions regarding the implementation 
of HEART. Commenters encouraged CMS to provide advanced notice prior to 
any final implementation date in order to allow ample time for 
infrastructure and IT system development, as well as clinician 
training. Several commenters recommended CMS use a phased 
implementation or dry run approach, which would ensure adequate time 
(that is, at least 1 year) for EMR vendors to incorporate HEART into 
their software; for hospices to initiate and thoroughly test HEART data 
collection processes; and, to train staff and ensure competency in use. 
One commenter noted that issues experienced with the implementation of 
prior HQRP data collection efforts (for example, NQF #0209 measure) 
might have been alleviated with longer implementation and dry run 
periods. Several commenters underscored the importance of adequately 
training clinicians and other staff on HEART data collection, coding 
rules, and definitions to ensure accurate data collection. These 
commenters recommended CMS to provide ample and ongoing educational 
opportunities to support HEART implementation. Commenters encouraged 
CMS to include clear definitions for each data element included in 
HEART. These commenters believed that clear definitions that are 
readily understood are imperative to the success of any patient 
assessment data collection effort. One commenter noted that although 
CMS training materials for the HIS are thorough and comprehensive, 
proving useful for staff responsible for HIS data submission, the level 
of detail included in CMS materials is often too great for clinical 
staff. This commenter recommended that, in addition to providing 
traditional educational and training materials, CMS consider developing 
streamlined educational materials geared towards clinical staff. 
Finally, a few commenters touched on the information technology (IT) 
burden related to potential implementation of HEART. These commenters 
noted the

[[Page 36668]]

time and effort associated with upgrading EMR vendor systems and 
training staff on functionality of updated systems. One commenter 
recommended CMS to ``include sufficient protections for small 
hospices'' and keep in mind how IT burden affects these organizations. 
This commenter also suggested that CMS ensure new quality reporting 
requirements are tenable for small hospice programs, given their 
limited health IT resources.
    Response: We appreciate commenters' input on processes and policies 
for HEART data collection and submission. We appreciate commenters' 
feedback on intervals for HEART data collection, as well as commenters' 
recommendations regarding data collection and submission timeframes, 
systems for data submission, and timeline for implementation of HEART. 
We agree that having data submission timeframes and policies that align 
with clinical workflow and are clear to providers is very important. We 
also agree that a longer or phased implementation approach could help 
facilitate a smooth transition to HEART and minimize burden, allowing 
ample time for upgrading IT and EMR systems, with minimal disruption of 
provider workflow and increased quality of data submitted. We also 
agree that educational materials and ample opportunity for training--
including clear and understandable definitions for each data element--
will be critical to the success of HEART. Finally, we understand and 
appreciate commenters' concerns about the complexity of upgrading EMR 
and IT systems to accommodate new data collection efforts. With respect 
to commenters' suggestions about clear and understandable definitions 
for each data element, our hope is that our phased, iterative pilot 
testing approach will offer rich information on how hospices interpret 
HEART data elements, yielding definitions that are reflective of the 
reality of hospice care and are readily understood by providers. 
Regarding commenters' concerns about health IT and the complexity of 
upgrading EMR systems, we understand the concerns about the time 
required for vendors to upgrade EMR systems and for hospices to be 
trained. In addition, we would like to note that we anticipate making 
data completion and submission software available to providers at no 
cost so that providers can complete and submit HEART data free of 
charge, without the need to purchase an EMR or vendor software. This 
would be analogous to the HART and QIES ASAP systems currently used for 
HIS data completion and submission.
    Comment: Although commenters were generally supportive of HEART, 
many commenters cautioned CMS against the creation of a patient 
assessment that would be overly burdensome. Commenters applauded CMS's 
commitment to the development of a tool that is minimally burdensome 
and not duplicative. In their comments related to burden, commenters 
discussed the consideration of burden to the hospice provider, as well 
as potential burden to the patient and family. Commenters encouraged 
CMS to be cognizant of potential burden that additional data collection 
could place on patients and families. Commenters stated that the 
initial portion of a patient's stay in hospice is a time when 
clinicians and staff are developing a relationship with the patient and 
family and noted that in usual practice, hospices must balance the 
collection of important data necessary to deliver care with the need to 
not overwhelm the patient and family unit during this time. One 
commenter noted that this consideration is even more critical when 
caring for an imminently dying patient. This commenter believed that 
standardized data collection has the potential to be burdensome to the 
patient and family and delay initiation of timely care to address high 
priority needs. Commenters encouraged CMS to keep this balance in mind 
when developing HEART.
    Regarding burden to the provider, commenters cautioned CMS against 
designing an assessment that would be overly burdensome for providers, 
noting that the move to a more comprehensive patient assessment would 
require investments in chart review and other data completion 
activities. One commenter recommended CMS to accurately account for any 
potential increases in burden and cost in calculations of burden and 
costs of regulatory impacts. Commenters mentioned collaboration with 
the provider community and efficiencies from EMR software as potential 
ways to reduce burden. One commenter raised the relationship between 
HEART and existing CoP requirements and. questioned how CMS envisioned 
this tool being minimally burdensome when CMS stated in the proposed 
rule that HEART would not replace initial or comprehensive assessment 
requirements.
    Finally, several commenters noted the tradeoff between time spent 
on assessment tools and regulatory requirements and time spent 
delivering care and addressing patient and family needs. Commenters 
recommended CMS to ensure that HEART data elements are overall 
meaningful and contribute to care planning, and cautioned CMS against 
the creation of a patient assessment tool that would simply be an 
exercise in ``filling out forms'' and ``checking off boxes''. 
Commenters noted that time spent completing HEART would be time spent 
away from providing direct care and implored CMS to keep this tradeoff 
in mind in the development of HEART.
    Response: We appreciate commenters concerns about burden of data 
collection efforts for both hospice providers and for hospice patients 
and their families. Regarding burden to patients and families, we agree 
with commenters that HEART should not impose burden on patients and 
families, especially during this early time in hospice care, and in 
instances where hospice patients are admitted close to death. It is our 
objective to ensure that HEART aligns with clinical practices so that 
collection of data for HEART poses no additional burden on patients and 
families beyond what hospices collect as part of usual care delivery. 
To ensure this objective is met, we will solicit clinician and patient 
and family caregiver input as part of HEART development process. 
Finally, we recognize the potential tradeoff between data collection 
and reporting requirements and time spent with the patient and family 
delivering care. CMS will keep this tradeoff at the forefront of HEART 
development to ensure that HEART does not detract from the primary 
mission of hospice care.
    Regarding burden to hospice providers, we are not including HEART 
in this rule, so there is no additional burden associated with this 
rule. Once the HEART assessment has been tested and is proposed in 
rulemaking, CMS will provide a PRA package and burden estimates. As 
noted in this rule, the HEART assessment would replace the current HIS 
reporting requirement, meaning HEART would not represent an additional 
reporting requirement for hospices. Although HEART would not replace 
current CoP requirements for the initial and comprehensive assessment, 
CMS's intent is to design HEART in a way that is complementary to the 
initial and comprehensive assessment to minimize burden on providers. 
Similar to how CoP requirements for the initial and comprehensive 
assessment do not require hospices to use specific formats, we envision 
HEART having similar levels of flexibility for providers. We believe 
that a flexible patient assessment tool that allows for clinician 
judgment will help minimize burden

[[Page 36669]]

and duplication of existing requirements. Moreover, any patient 
assessment tool proposed through rulemaking would undergo OMB and PRA 
review and approval, the purpose of which is to ensure required data 
collection efforts do not impose undue burden on the public.
    We will continue to collaborate with stakeholders and will ensure 
that any patient assessment is minimally burdensome and not 
duplicative. We consider the perspective of clinicians and patients, 
and caregivers integral to the development process and will provide 
ample opportunity for stakeholder input to ensure any assessment tool 
is clinically appropriate and minimally burdensome. Moreover, burden 
will be a focus of the pilot data collection efforts in order to ensure 
we are appropriately assessing burden of data collection.
    Comment: CMS received a few comments about HEART's relationship to 
quality and payment, and what providers should or should not be held 
accountable for. With respect to HEART's relationship to quality and 
the development of future quality measures using HEART data, one 
commenter stated that CMS should not hold providers accountable for 
outcomes of care that are not feasible for all hospice patients. For 
example, the commenter felt that providers should not be held 
accountable or penalized for occurrence of skin wounds at the end of 
life because organ failure and skin breakdown is a normal part of the 
dying process. Similarly, the commenter also suggested CMS not hold 
providers accountable for decreases in function and activities of daily 
living since this is an expected trajectory among hospice patients. 
Finally, the commenter requested that CMS not hold providers to 
achieving complete symptom control because this is not feasible in all 
patients. Another commenter encouraged CMS to appropriately risk adjust 
any outcomes generated from HEART data to appropriately reflect 
patients' right to refuse services, short lengths of stay in hospice, 
and instances where attending physicians refuse to sign orders that 
align with the patient preferences. This commenter also encouraged CMS 
to capture preference-concordant care as an outcome measure in HEART.
    Several commenters addressed HEART's relationship to resource 
utilization and payment, offering suggestions to CMS as to how 
assessment data might be useful for future payment refinements. One 
commenter discussed data that HEART would need to capture if CMS moved 
to a case-mix payment methodology. The commenter noted that hospices 
should be paid higher rates for patients needing higher levels of 
services, including patients who have pain or other symptoms that are 
difficult to manage, and patients with wounds who need higher levels of 
skilled care. The commenter suggested that CMS not set a payment rate 
lower than the rate hospices receive under current payment policy. 
MedPAC recommended CMS to ensure that elements of HEART were not unduly 
subject to provider manipulation if HEART data was to be used for 
payment purposes.
    Response: We appreciate commenters' feedback and suggestions about 
HEART's relationship to quality. We will take these suggestions into 
consideration for future rulemaking and the continued development of 
HEART and any associated quality measures. We recognize and agree with 
the commenter that some outcomes of care are not achievable for dying 
patients and will work to ensure that any future outcome measures are 
appropriate for the hospice population. We also appreciate the 
commenter's suggestion to consider preference-concordant care as a 
future quality domain in HEART, as well as the suggestion to 
appropriately risk-adjust any future outcome measures generated from 
HEART data.
    We also thank commenters for their suggestions regarding HEART's 
relationship to resource utilization and payment. As noted earlier in 
the preamble, we will need to complete extensive analysis before we 
determine what--if any--utility HEART will have for future payment 
refinements. That said, we recognize that resource utilization in 
hospice is unique and is most often linked to patient symptomology and 
service needs rather than diagnosis. As such, it is our paramount 
concern to develop a patient assessment tool that appropriately 
reflects the needs of patients and services provided by hospices to 
meet those needs. We will continue to involve stakeholders, including 
hospice organizations and clinicians, in the development process to 
ensure this objective is met. We also recognize the importance of 
developing patient assessment data elements that are scientifically 
rigorous and are not easily manipulated by providers. We will ensure 
that any data elements included in HEART undergo rigorous testing and 
validation prior to implementation.
    Comment: Several commenters also discussed cross-setting issues 
with respect to HEART. Commenters suggested that CMS consider how HEART 
would fit in with efforts to develop other patient assessment 
instruments for other post-acute care settings (for example, IRFs, 
SNFs, home health, and LTCHs). Commenters encouraged CMS to balance the 
need between developing uniform and consistent post-acute care 
assessment tools that would include post-acute settings and hospice, 
with the need to ensure HEART is reflective of the unique aspects of 
hospice care. Although commenters recognized cross-setting 
standardization and coordination as an opportunity to develop cohesive 
patient assessments that enable better longitudinal plans of care and 
integration across the care continuum, commenters also stressed the 
importance of ensuring that HEART reflect the interdisciplinary and 
unique aspects of hospice care. One commenter also encouraged CMS to 
incorporate HEART into the CMS Data Element Library (DEL).
    Response: We appreciate the commenters' suggestions on cross-
setting issues. We 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 used in 
other quality reporting programs for different patient populations. 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. At the same time, we also 
agree that HEART is an opportunity to coordinate and harmonize with 
measure and data elements from other care settings, where applicable. 
Although hospice was not a care setting included in the IMPACT Act, we 
are coordinating within CMS to ensure HEART promotes continuity of care 
across the post-acute care continuum where feasible and appropriate.
9. Previously Adopted APU Determination and Compliance Criteria for the 
HQRP
a. Background
    The HQRP is currently designed as a ``pay-for-reporting'' system, 
meaning that it is the act of submitting data that determines 
compliance with HQRP requirements. Performance level is not a 
consideration when determining market basket updates/APU. Reporting 
compliance is determined by successfully fulfilling both the Hospice 
CAHPS[supreg] Survey requirements and the HIS data submission 
requirements.

[[Page 36670]]

b. Previously Finalized HIS Data Submission Timelines and Compliance 
Thresholds for 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), we finalized the timeliness 
criteria for submission of HIS-Admission and HIS-Discharge records. The 
finalized timeliness criteria were 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.
    As stated in that rule, 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 the 
timeliness criteria for submission of HIS-Admission and HIS-Discharge 
records, in the FY 2016 Hospice Wage Index final rule (80 FR 47192) we 
also finalized a policy 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 HIS-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 and 
thereafter, 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.
    In July of 2016, we released the Hospice Timeliness Compliance 
Threshold Report in the Certification and Survey Provider Enhanced 
Reports (CASPER) system. This report allows providers with a QIES ASAP 
User ID to check their preliminary compliance with the 70/80/90 
timeliness compliance threshold described above. For more information 
on the Hospice Timeliness Compliance Threshold Report, we refer readers 
to the Timeliness Compliance Threshold Fact Sheet, 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 and Chapter 3 of the CASPER User's Manual, 
available on the QTSO Web site: https://www.qtso.com/hospicetrain.html.
    In the FY 2016 Hospice Wage Index final rule (80 FR 47192 through 
47193), we 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), we also stated that 
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 HIS Web 
page 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 CMS HQRP Web site, listserv messages via the 
Post-Acute Care QRP listserv, MLN Connects [supreg] National Provider 
Calls & Events, MLN Connects [supreg] Provider eNews and announcements 
on Open Door Forums and Special Open Door Forums.
c. CAHPS[supreg] Participation Requirements for FY 2018 APU 
Determination and Determinations for Subsequent 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 FY APU years (79 FR 50491).
    In the FY 2017 Hospice Wage Index final rule, we finalized that to 
meet the HQRP requirements for the FY 2018, FY 2019 and FY 2020 APU 
payment determinations, 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 FY 2018 APU; 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 FY 2019 APU, and hospices would collect 
survey data on a monthly basis for the months of January 1, 2018 
through December 31, 2018 for the full FY 2020 APU (81 FR 25529 through 
25530). In the May 2017 proposed rule we proposed that in order to meet 
the HQRP requirements for the FY 2021 APU payment determination, 
hospices would collect survey data on a monthly basis for the months of 
January 1, 2019 through December 31, 2019 to qualify for the FY 2021 
APU. In addition, we proposed that in order to meet the HQRP 
requirements for the FY 2022 APU payment determination, hospices would 
collect survey data on a monthly basis for the months of January 1, 
2020 through December 31, 2020 to qualify for the FY 2022 APU.

[[Page 36671]]

10. HQRP Submission Exemption and Extension Requirements for the FY 
2019 Payment Determination and Subsequent Years
a. Extraordinary Circumstances Exemption and Extension
    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. Such extraordinary circumstances may include, but are not 
limited to, acts of nature or other systemic issues with our data 
systems. We further finalized that hospices must request such an 
exemption or extension within 30 days of the date that the 
extraordinary circumstances occurred. In certain instances, however, it 
may be difficult for hospices to timely evaluate the impact of 
extraordinary circumstances within 30 calendar days. For other quality 
reporting programs such as the Hospital Inpatient Quality Reporting (81 
FR 57182), Inpatient Rehabilitation Facility Quality Reporting Program 
(81 FR 52125) and the Long term Care Hospital Quality Reporting Program 
(81 FR 25205), we have reevaluated our policy and subsequently 
finalized through rulemaking an extension of that period of time to 90 
calendar days. Therefore, we proposed to extend the deadline for 
submitting an exemption or extension request to 90 calendar days from 
the qualifying event which is preventing a hospice from submitting 
their quality data for the HQRP. We believe that extending the deadline 
to 90 calendar days would allow hospices more time to determine whether 
it is necessary and appropriate to submit an exemption or extension 
request and to provide a more comprehensive account of the qualifying 
event in their request form to CMS. For example, if a hospice has 
suffered damage due to a hurricane on January 1st, it would have until 
March 31st to submit a request form to CMS via email to the HQRP 
mailbox at [email protected].
    Further, while we finalized our policy in the past for exception/
extension for the submission of the HIS data, we proposed to extend 
this policy beyond the submission of the HIS date to submission of the 
CAHPS[supreg] Hospice Survey data, given that multiple data submission 
processes could be impacted by the same qualifying event. Therefore, we 
proposed for FY 2019 payment determination and subsequent payment 
determinations to extend the period of time a hospice may have to 
submit a request for an extension or exception for quality reporting 
purposes from 30 calendar days to 90 calendar days after the date that 
the extraordinary circumstances occurred, by submitting a request to 
CMS via email to the HQRP mailbox at 
[email protected]. Exemption or extension requests 
sent to us 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-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 HIS and/or 
CAHPS[supreg] Hospice Survey 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 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 the various means, including the CMS HQRP Web site, 
listserv messages via the Post-Acute Care QRP listserv, MLN 
Connects[supreg] National Provider Calls & Events, MLN Connects[supreg] 
Provider eNews and announcements on Open Door Forums and Special Open 
Door Forums.
    We solicited comments on these proposals. The comments and our 
responses are set forth below.
    Comment: Commenters were unanimously supportive of CMS's proposal 
to extend the deadline for submitting an exemption or extension request 
to 90 calendar days from the qualifying event which is preventing a 
hospice from submitting their quality data for the HQRP. One commenter 
believed the change in policy will enable hospice agencies to have more 
time to determine whether an emergency may warrant an extension or 
exemption request. Another commenter believed the change in policy will 
enhance fairness where acts of nature or a systemic problem on part of 
CMS's data collection system prevents compliance. One commenter 
requested clarification about form for submitting requests for 
exemption and extensions; specifically, what the appropriate mode of 
submission of exemption and extension requests is.
    Response: We appreciate the commenters' support for the proposal to 
extend the submission deadline from 30 to 90 days. We agree that the 
change will be helpful for providers and maximize compliance and 
participation in the HQRP. Regarding the commenter's request for 
clarification on our policies for exemption and extension, including 
mode of submission of these requests, as noted in this rule, we accept 
requests for exemption and extension via email to the HQRP 
Reconsiderations mailbox at [email protected]. 
Procedures for exemptions and extensions are further outlined on the 
CMS HQRP Web site here: https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Hospice-Quality-Reporting/Extensions-and-Exemption-Requests.html.
    Final Action: We are finalizing our proposal to implement the 
change in deadline from 30 to 90 days for hospices requesting an 
exemption or extension for the FY 2019 payment determination and 
subsequent payment determinations.
b. Volume-Based Exemption for CAHPS[supreg] Hospice Survey Data 
Collection and Reporting Requirements
    We previously finalized a volume-based exemption for CAHPS[supreg] 
Hospice Survey Data Collection and Reporting requirements in the FY 
2017 Final Rule (81 FR 52143). Hospices that have fewer than 50 survey 
eligible decedents/caregivers in the period from January 1, 2017 
through December 31, 2017 are eligible to apply for an exemption from 
CAHPS[supreg] Hospice Survey data collection and reporting requirements 
for the FY 2020 payment determination (corresponds to the CY 2018 data 
collection period). To qualify, hospices must submit an exemption 
request form for the FY 2020 APU. The exemption request form is 
available on the official CAHPS[supreg] Hospice Survey Web site http://www.hospiceCAHPSsurvey.org. Hospices that intend to claim the size 
exemption are required to submit to

[[Page 36672]]

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 December 31, 2018. Small hospices 
that meet the exemption for size criteria for FY 2020 must complete an 
exemption form for FY 2020. Exemptions for size are active for 1 year 
only. If a hospice continues to meet the eligibility requirements for 
this exemption in future FY APU periods, the organization needs to 
request the exemption annually for every applicable FY APU period.
    Hospices that have fewer than 50 survey eligible decedents/
caregivers in the period from January 1, 2018 through December 31, 2018 
are eligible to apply for an exemption from CAHPS[supreg] Hospice 
Survey data collection and reporting requirements for the FY 2021 
payment determination. Hospices that intend to claim the size exemption 
are required to submit to CMS their total unique patient count for the 
period of January 1, 2018 through December 31, 2018. The due date for 
submitting the exemption request form for the FY 2021 APU is December 
31, 2019. Small hospices that meet the exemption for size criteria for 
FY 2021 must complete an exemption form for FY 2021.
    Hospices that have fewer than 50 survey eligible decedents/
caregivers in the period from January 1, 2019 through December 31, 2019 
are eligible to apply for an exemption from CAHPS[supreg] Hospice 
Survey data collection and reporting requirements for the FY 2022 
payment determination. Hospices that intend to claim the size exemption 
are required to submit to CMS their total unique patient count for the 
period of January 1, 2019 through December 31, 2019. The due date for 
submitting the exemption request form for the FY 2022 APU is December 
31, 2020. If a hospice continues to meet the eligibility requirements 
for this exemption in future FY APU periods, the organization should 
request the exemption annually for every applicable FY APU period.
c. Newness Exemption for CAHPS[supreg] Hospice Survey Data Collection 
and Reporting Requirements
    We previously finalized a one-time newness exemption for hospices 
that meet the criteria (81 FR 52181). Accordingly, hospices that are 
notified about their Medicare CCN after January 1, 2018 are exempted 
from the FY 2020 APU CAHPS[supreg] Hospice Survey requirements due to 
newness. No action is required on the part of the hospice to receive 
this exemption. The newness exemption is a one-time exemption from the 
survey. Likewise, hospices notified about their Medicare CCN after 
January 1, 2019, are exempted from the FY 2021 APU CAHPS[supreg] 
Hospice Survey and hospices notified about their Medicare CCN after 
January 1, 2020, are exempted from the FY 2022 APU CAHPS[supreg] 
Hospice Survey requirements.
11. CAHPS[supreg] Hospice Survey Participation Requirements for the FY 
2020 APU and Subsequent Years
    The CAHPS[supreg] Hospice Survey of CMS' Hospice Quality Reporting 
Program is used to collect data on the experiences of hospice patients 
and the primary caregivers listed in their hospice records. Readers who 
want more information are referred to our extensive discussion of the 
Hospice Experience of Care prior to our proposal for the public 
reporting of measures should refer to 79 FR 50452 and 78 FR 48261.
a. Background and Description of the CAHPS[supreg] Hospice Survey
    The CAHPS[supreg] Hospice Survey is the first standardized national 
survey available to collect information on patients' and informal 
caregivers' experience of hospice care. Patient-centered experience 
measures are a key component of the CMS Quality Strategy, emphasizing 
patient-centered care by rating experience as a means to empower 
patients and their caregivers and improving the quality of their 
care.\46\ In addition, the survey introduces standard survey 
administration protocols that allow for fair comparisons across 
hospices.
---------------------------------------------------------------------------

    \46\ CMS National Quality Strategy 2016. Available at: https://www.cms.gov/medicare/quality-initiatives-patient-assessment-instruments/qualityinitiativesgeninfo/downloads/cms-quality-strategy.pdf.
---------------------------------------------------------------------------

    Details regarding CAHPS[supreg] Hospice Survey national 
implementation, survey administration, participation requirements, 
exemptions from the survey's requirements, hospice patient and 
caregiver eligibility criteria, fielding schedules, sampling 
requirements, survey instruments, and the languages that are available 
for the survey, are all available on the official CAHPS[supreg] Hospice 
Survey Web site, www.HospiceCAHPSsurvey.org and in the CAHPS[supreg] 
Hospice Survey Quality Assurance Guidelines (QAG), which is posted on 
the Web site.
b. Overview of Proposed Measures
    The CAHPS[supreg] Hospice Survey was developed in line with the 
U.S. Department of Health and Human Services' Transparency Initiative 
to measure patient experience. Unlike the Hospital CAHPS[supreg] Survey 
deployed in 2006 (71 FR 48037 through 48039) and other subsequent 
CAHPS[supreg] surveys, the CAHPS[supreg] Hospice Survey is administered 
after the patient is deceased and queries the decedent's primary 
caregiver regarding the patient and family experience of care. National 
implementation of the CAHPS[supreg] Hospice Survey commenced January 1, 
2015 as stated in the FY 2015 Hospice Wage Index and Payment Rate 
Update final rule (79 FR 50452).
    The survey consists of 47 questions and is available (using the 
mailed version) in English, Spanish, Chinese, Russian, Portuguese, 
Vietnamese, Polish, and Korean. It covers topics such as access to 
care, communications, getting help for symptoms, and interactions with 
hospice staff. The survey also contains two global rating questions and 
asks for self-reported demographic information (race/ethnicity, 
educational attainment level, languages spoken at home, among others). 
The CAHPS[supreg] Hospice Survey measures received NQF endorsement on 
October 26th, 2016 (NQF number 2651). Measures derived from the 
CAHPS[supreg] Hospice Survey include six multi-item (composite) 
measures and two global ratings measures under NQF 2651. We proposed to 
adopt these eight survey-based measures for the CY 2018 data collection 
period and for subsequent years. We believe these survey-based measures 
will be useful in assessing aspects of hospice care where the family/
primary caregiver is the most useful or only source of information, and 
to allow meaningful and objective comparisons between hospice 
providers. The six CAHPS[supreg] Hospice Survey composite survey-based 
measures are:
     Hospice Team Communication;
     Getting Timely Care;
     Treating Family Member with Respect;
     Getting Emotional and Religious Support;
     Getting Help for Symptoms; and
     Getting Hospice Care Training.
    Each of the six composite survey-based measures consists of two or 
more questions. The two global survey-based measures are:
     Rating of Hospice; and
     Willingness to Recommend Hospice.
    The two global survey-based measures comprise a single question 
each and ask the primary caregiver of the decedent to rate the care 
provided by the hospice facility and his or her willingness to 
recommend the hospice to family and friends. More information about 
these measures can be found on the official CAHPS[supreg] Hospice 
Survey Web site, www.HospiceCAHPSsurvey.org and in

[[Page 36673]]

the CAHPS[supreg] Hospice Survey Quality Assurance Guidelines (QAG), 
which is posted on the Web site.
    The eight survey-based measures we proposed were included on the CY 
2016 MUC \47\ list, and reviewed by the MAP.\48\ They are as follows:
---------------------------------------------------------------------------

    \47\ CMS, List of Measures Under Consideration for December 1, 
2016. Available at: https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/QualityMeasures/Downloads/Measures-under-Consideration-List-for-2016.pdf.
    \48\ The National Quality Forum. MAP 2016-2017 Preliminary 
Recommendations. National Quality Forum, 2016 Recommendations for 
Measures Under Consideration, Jan. 2017. Available at: http://www.qualityforum.org/map/.

 CAHPS[supreg] Hospice Survey: Rating of Hospice (MUC ID: 
MUC16-31).
 CAHPS[supreg] Hospice Survey: Hospice Team Communications 
(MUC16-32).
 CAHPS[supreg] Hospice Survey: Willingness to Recommend (MUC16-
33).
 CAHPS[supreg] Hospice Survey: Getting Hospice Care Training 
(MUC16-35).
 CAHPS[supreg] Hospice Survey: Getting Timely Care (MUC16-36).
 CAHPS[supreg] Hospice Survey: Getting Emotional and Religious 
Support (MUC16-37).
 CAHPS[supreg] Hospice Survey: Getting Help for Symptoms 
(MUC16-39)
 CAHPS[supreg] Hospice Survey: Treating Family Member with 
Respect (MUC16-40)

    The MAP supported rulemaking for all eight ``patient-reported'' 
measures derived from the CAHPS[supreg] Hospice Survey. We received no 
comments about these items and therefore, we are adopting these 
measures as final for CY 2018.
c. Data Sources
    As discussed in the CAHPS[supreg] Hospice Survey Quality Assurance 
Guidelines V3.0 (QAG V3.0) (http://www.hospicecahpssurvey.org/en/quality-assurance-guidelines/), the survey has three administration 
methods: Mail-only, telephone only, and mixed mode (mail with telephone 
follow-up of non-respondents). We previously finalized the 
participation requirements for the FY 2018 and FY 2019 Annual Payment 
Updates (80 FR 47194). To summarize, to meet the CAHPS[supreg] Hospice 
Survey requirements for the HQRP, we proposed that hospice facilities 
must contract with a CMS-approved vendor to collect survey data for 
eligible patients on a monthly basis and report that data to CMS on the 
hospice's behalf by the quarterly deadlines established for each data 
collection period. The list of approved vendors is available at: http://www.hospicecahpssurvey.org/en/approved-vendor-list.
    Hospices are required to provide lists of the patients who died 
under their care, along with the associated primary caregiver 
information, to their respective survey vendors to form the samples for 
the CAHPS[supreg] Hospice Survey. We emphasize the importance of 
hospices providing complete and accurate information to their 
respective survey vendors in a timely manner. Hospices must contract 
with an approved CAHPS[supreg] Hospice Survey vendor to conduct the 
survey on their behalf. Hospices are responsible for making sure their 
respective survey vendors meet all data submission deadlines. Vendor 
failures to submit data on time are the responsibility of the hospices.
i. Requirements for the FY 2020 Annual Payment Update
    To meet participation requirements for the FY 2020 annual payment 
update (APU), Medicare-certified hospices must collect CAHPS[supreg] 
Hospice Survey data on an ongoing monthly basis from January 2018 
through December 2018 (all 12 months) in order to receive their full 
payment for the FY 2020 APU. All data submission deadlines for the FY 
2020 APU are in Table 17. CAHPS[supreg] Hospice Survey vendors must 
submit data by the deadlines listed in Table 17 for all APU periods 
listed in the table and moving forward. There are no late submissions 
permitted after the deadlines, except for extraordinary circumstances 
beyond the control of the provider as discussed above.

Table 17--CAHPS[supreg] Hospice Survey Data Submission Dates for the APU
                    in FY 2020, FY 2021, and FY 2022
------------------------------------------------------------------------
 Sample months (that is, month of death     Quarterly data submission
                  \1\)                            deadlines \2\
------------------------------------------------------------------------
                               FY 2020 APU
------------------------------------------------------------------------
January-March 2018 (Q1)................  August 8, 2018.
April-June 2018 (Q2)...................  November 14, 2018.
July-September 2018 (Q3)...............  February 13, 2019.
October-December 2018 (Q4).............  May 8, 2019.
------------------------------------------------------------------------
                               FY 2021 APU
------------------------------------------------------------------------
January-March 2019 (Q1)................  August 14, 2019.
April-June 2019 (Q2)...................  November 13, 2019.
July-September 2019 (Q3)...............  February 12, 2020.
October-December 2019 (Q4).............  May 13, 2020.
------------------------------------------------------------------------
                               FY 2022 APU
------------------------------------------------------------------------
January-March 2020 (Q1)................  August 12, 2020.
April-June 2020 (Q2)...................  November 12, 2020 \3\.
July-September 2020 (Q3)...............  February 10, 2021.
October-December 2020 (Q4).............  May 12, 2021.
------------------------------------------------------------------------
\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 the months August, November, February, and May.
\3\ Second Wednesday is Veterans Day Holiday.

ii. Requirements for the FY 2021 Annual Payment Update
    To meet participation requirements for the FY 2021 APU, Medicare-
certified hospices must collect CAHPS[supreg] Hospice Survey data on an 
ongoing monthly basis from January 2019 through December 2019 (all 12 
months) in order to receive their full payment for the FY 2021 APU. All 
data submission deadlines for the FY 2021 APU are in Table 17. 
CAHPS[supreg] Hospice Survey vendors must submit data by the deadlines 
listed in Table 17 for all APU periods listed in the table and moving

[[Page 36674]]

forward. There are no late submissions permitted after the deadlines, 
except for extraordinary circumstances beyond the control of the 
provider as discussed above.
iii. Requirements for the FY 2022 Annual Payment Update
    To meet participation requirements for the FY 2022 APU, Medicare-
certified hospices must collect CAHPS[supreg] Hospice Survey data on an 
ongoing monthly basis from January 2020 through December 2020 (all 12 
months) in order to receive their full payment for the FY 2022 APU. All 
data submission deadlines for the FY 2022 APU are in Table 17. 
CAHPS[supreg] Hospice Survey vendors must submit data by the deadlines 
listed in Table 17 for all APU periods listed in the table and moving 
forward. There are no late submissions permitted after the deadlines, 
except for extraordinary circumstances beyond the control of the 
provider as discussed above.
d. Measure Calculations
    As noted above, we proposed to adopt six composite CAHPS[supreg] 
Hospice Survey-based measures and two global survey-based measures. As 
with other measures adopted for HQRP, a hospice's performance for a 
given payment determination year will be based upon the successful 
submission of data required in accordance with the administrative, 
form, manner and timing requirements established for the program. 
Therefore, hospices' substantive scores on the CAHPS[supreg] Hospice 
Survey-based measures will not affect whether they are subject to the 
2.0 percentage point payment reduction for hospices that fail to report 
data required to be submitted. Rather, the 2.0 percentage point 
reduction will be applied based on whether the data were submitted in 
accordance with our requirements.
    We proposed that CAHPS[supreg] Hospice Survey scores for a given 
hospice be displayed as ``top box'' scores, with the national average 
top-box score for participating hospices provided for comparison. Top-
box scores reflect the proportion of caregiver respondents that endorse 
the most positive response(s) to a given measure, such as the 
proportion that rate the hospice a 9 or 10 out of 10 on a 0 to 10 
scale, or the proportion that report that they ``always'' received 
timely care. The top-box numerator for each question within a measure 
is the number of respondents that endorse the most positive response(s) 
to the question. The denominator includes all respondents eligible to 
respond to the question, with one exception. The exception is the 
Getting Hospice Care Training measure; for this measure, the measure 
score is calculated only among those respondents who indicated that 
their family member received hospice care at home or in an assisted 
living facility.
    For additional information on the specifications of these measures, 
including details regarding top-box scoring methodology and mode and 
case-mix adjustment, please refer to the CAHPS[supreg] Hospice Survey 
Web page at http://www.hospicecahpssurvey.org/en/.
i. Composite Survey-Based Measures
    Unadjusted hospice scores on each composite CAHPS[supreg] Hospice 
Survey-based measure would be calculated by determining the proportion 
of ``top-box'' responses for each question within the composite and 
averaging these proportions over all the questions in the composite 
measure. For example, to assess hospice performance on the composite 
measure CAHPS[supreg] Hospice Survey--Hospice Team Communication, we 
would calculate the proportion of top-box responses for each of the 
measure's six questions, add those proportions together, and divide by 
the number of questions in the composite measure (in this case, six).
    As a specific example, we take a theoretical hospice facility that 
had 50 surveys completed and received the proportions of ``top-box'' 
responses through sample calculations:

 25 ``top-box'' responses out of 50 total responses on Question 
One
 40 ``top-box'' responses out of 50 total responses on Question 
Two
 50 ``top-box'' responses out of 50 total responses on Question 
Three
 35 ``top-box'' responses out of 50 total responses on Question 
Four
 45 ``top-box'' responses out of 50 total responses on Question 
Five
 40 ``top-box'' responses out of 50 total responses on Question 
Six

    Based on the above responses, we would calculate that hospice's 
unadjusted measure score for public reporting as follows:

Publicly Reported Score. = ((0.5 + 0.8 + 1 + 0.7 + 0.9 + 0.8))/6)

    This calculation would give this example hospice an unadjusted 
score of 0.78 or 78 percent for the Hospice Team Communication measure 
for purposes of public reporting. We note that an adjusted hospice 
score would be calculated by adjusting the score for each question for 
differences in the characteristics of decedents and caregivers across 
hospices and for mode, and then averaging across questions within the 
measure as described here. Further detailed information regarding 
scoring and risk adjustment can be found at the CAHPS[supreg] Hospice 
Survey Web site (http://www.hospicecahpssurvey.org/en/technical-specifications/).
ii. Global Survey-Based Measures
    We proposed to adopt two global CAHPS[supreg] Hospice Survey 
measures. CAHPS[supreg] Hospice Survey--Rating of Hospice asks the 
primary caregiver of the decedent to rate the care provided by the 
hospice on a scale of 0 to 10, and CAHPS[supreg] Hospice Survey--
Willingness to Recommend asks about the caregiver's willingness to 
recommend the hospice to family and friends on a scale of ``Definitely 
No'' to ``Definitely Yes''. Unadjusted hospice performance on each of 
the two global CAHPS[supreg] Hospice Survey-based measures would be 
calculated by the proportion of respondents providing high-value 
responses (that is, a 9 to 10 rating or ``Definitely Yes'') to the 
survey questions over the total number of respondents. For example, if 
a hospice received 45 ratings of 9 or 10 points out of 50 responses, 
this hospital would receive a 0.9 or 90 percent unadjusted score, which 
would then be adjusted for differences in the characteristics of 
decedents and caregivers across hospices and modes.
iii. Cohort
    The CAHPS[supreg] Hospice Survey is administered to all eligible 
patients/caregivers--or a random sample thereof--who meet the 
eligibility criteria. Eligible patients, regardless of insurance or 
payment, can participate.
    For purposes of each survey-based measure captured in the 
CAHPS[supreg] Hospice Survey, an ``eligible patient'' is a decedent 18 
years or older:
     With death at least 48 hours following last admission to 
hospice care.
     for whom there is a caregiver of record.
     whose caregiver is someone other than a non-familial legal 
guardian.
     for whom the caregiver has a United States or United 
States Territory home address.
    Patients who are still alive or whose admission to the hospice 
resulted in a live discharge, are not eligible to participate in the 
survey. In addition, decedents/caregivers who initiate or voluntarily 
request that the hospice not reveal the patient's identity; and/or not 
survey the patient/caregiver (``no publicity patients/caregivers'') are 
excluded from the sample.

[[Page 36675]]

e. Risk Adjustment
    The CAHPS[supreg] Hospice Survey measures assess activities that 
are fully under the control of hospice care professionals and/or 
hospice organizations. In order to ensure fair comparisons in public 
reporting, we believe it is necessary and appropriate to adjust for 
factors that are not directly related to hospice performance, such as 
patient mix, for these CAHPS[supreg] Hospice Survey measures. The 
survey based measures are adjusted for decedent and caregiver 
characteristics (including the lag time between patient death and 
survey response; decedent's age, payer for hospice care, decedent's 
primary diagnosis, decedent's length of final episode of hospice care, 
caregiver's education, decedent's relationship to caregiver, 
caregiver's preferred language and language in which the survey was 
completed, and caregiver's age) known to be associated with systematic 
difference in survey responses.
i. Patient-Mix Adjustment
    Previous research, on both CAHPS[supreg] surveys and other types of 
surveys, has identified respondent characteristics that are not under 
the control of the entities being assessed but tend to be related to 
survey responses. Hence, variations in the proportion of respondents 
with such characteristics will be associated with variations in survey 
responses that are unrelated to the actual quality of hospice care. To 
ensure that comparisons between hospices reflect differences in 
performance rather than differences in patient and/or caregiver 
characteristics, publicly reported hospice scores will be adjusted for 
variations of such characteristics across hospices. This adjustment is 
performed using a linear regression model applied to all data within a 
quarter, with indicator variables for each hospice and each 
characteristic as an independent variable in the model.
ii. Mode Adjustment
    We conducted an experiment to determine whether survey mode 
adjustments were needed to fairly compare CAHPS[supreg] Hospice Survey 
scores. The experiment found that mode adjustments are needed. Publicly 
reported CAHPS[supreg] Hospice Survey scores will be adjusted for the 
mode of survey administration, which affects scores but is not related 
to quality of hospice care (Authorized survey modes are: mail-only, 
telephone-only, and mail with telephone follow up, also called mixed 
mode.). Mode adjustment is performed prior to patient-mix adjustment; a 
mode adjustment value is added/subtracted (depending on the mode) to 
each response to the survey by mail-only mode or mixed mode. Responses 
obtained using telephone-only mode are not adjusted since this is the 
reference mode. As a result of the risk adjustment methodologies 
proposed here, the final percentages may vary from the unadjusted 
percentage as calculated in the examples provided above.
f. For Further Information About the CAHPS[supreg] Hospice Survey
    We encourage hospices and other entities to learn more about the 
survey on www.hospicecahpssurvey.org. For direct questions, please 
contact the CAHPS[supreg] Hospice Survey Team at 
[email protected] or telephone 1-844-472-4621.
    The comments and our responses are set forth below.
    Comment: One commenter stated that: ``typically anything that is 
impacted significantly by patient perception--subjective measures 
regarding quality of an end of life process are probably not going to 
be meaningful. Combined with low health literacy surrounding dying/end 
of life and then tying these measures to the hospice payment structure 
is probably damaging. Patients and their families probably receive all 
of their knowledge about the dying process from hospices themselves, 
and since that topic is quite deep to begin with, and the emotional 
state of many families and patients is not one that is prepared to 
learn in their circumstances, their responses to their surroundings/the 
proceedings of hospice probably do not reflect the actual care they are 
receiving.''
    Response: We believe that patient experience surveys constitute a 
useful element in quality reporting programs. Our Hospice CAHPS[supreg] 
survey was designed using interviews with caregivers, providers and 
other interested professionals to include questions that address the 
domains of interest to the caregiving public. Survey results, combined 
with other measures such as the HIS, can provide a more rounded view of 
hospice quality. Hospices can, and we believe do, use CAHPS[supreg] 
results to help them with quality improvement.
    Comment: Several commenters expressed reservations about the 
timeframe for reporting CAHPS[supreg] Hospice Survey results publicly 
on Hospice Compare. Commenters thought the data would be too outdated 
and that it would not reflect adjustments and quality improvement 
efforts by the hospices.
    Response: We are currently planning on reporting scores using a 
rolling average over the most recent eight quarters. We are trying to 
balance two competing goals. First, we want to present reliable data. 
Second, we want to include as large a proportion of hospices as 
possible on the Hospice Compare site. Small sample sizes tend to be 
less reliable than larger ones. This means that displaying data for 
hospices with only a few completed surveys results in providing less 
reliable data. On the other hand, if we only report results with large 
numbers of completes, a great many hospices will not appear on the 
Compare site at all. We tried to avoid both problems by elongating the 
amount of time we are using to report the data. We hoped this would 
produce larger numbers of completed surveys for the smaller hospices, 
thus allowing them to be reported with more reliable data. We are 
willing to consider other options and would welcome more input from 
hospices.
    Comment: One commenter suggested that CMS look at ways to 
ameliorate the age of the publicly reported data by ``appropriately 
weighting the current data and separately weight the older data or not 
include it at all. Further exploration is needed to include patient/
respondent characteristics that may have an impact on the CAHPS[supreg] 
survey responses, including issues that are not currently specified for 
use in the risk adjustment of CAHPS[supreg] responses.''
    Response: We will explore options, if any, offered by weighting 
schemes for the publicly reported data. We assume the commenter would 
want the newest data weighted more heavily than older data. We are also 
willing to continue to examine patient and respondent characteristics 
that may be suitable for case mix adjustment. Remember that case mix 
variables must be variables that are beyond the control of the hospice.
    Comment: Another commenter suggested that CMS consider using a six 
month analysis with the most current data for the reporting of 
CAHPS[supreg] results. The commenter was concerned that the eight-
quarter rolling reporting period for CAHPS[supreg] results could be 
misleading to the public as organization improvement would not be seen 
for an extended period and not reflect current performance.
    Response: We will continue to review the decision to use an eight-
quarter average. We are aware that there are several potential pitfalls 
with survey data. One of the characteristics of small samples is that 
the results may shift greatly month to month because of one or a few 
outliers among respondents. As

[[Page 36676]]

a result, including small hospices with small samples sizes on the 
Compare site also creates the risk of misleading the public. On the 
other hand, we are reluctant to restrict the Hospice Compare site to 
large hospices. We welcome more input from hospices on this issue.
    Comment: One commenter suggested that CMS consider displaying two 
sets of data on Hospice Compare, one for eight quarters of data and one 
for four quarters of data, which would address concerns about the age 
of the data.
    Response: We thank the commenter for this suggestion. We are aware 
of the concerns about the age of the data. We believe displaying two 
sets of CAHPS[supreg] data would make the CAHPS[supreg] pages on 
Hospice Compare more complex and might confuse members of the public.
    Comment: One commenter stated that analysis of missing data for the 
CAHPS[supreg] Hospice Survey is needed to determine how well the survey 
results represent the totality of hospice care quality and assist 
hospices with the interpretation of survey results for quality 
improvement programs.
    Response: Our analysis of CAHPS[supreg] Hospice Survey data suggest 
that adjustment for differences in case mix, as is done when 
calculating CAHPS[supreg] Hospice Survey measure scores, adequately 
addresses nonresponse bias associated with these case mix 
characteristics.
    Comment: CMS should conduct ongoing analysis of the demographics 
and other characteristics (for example, age, gender, diagnosis, 
geographic area, care setting, etc.) for those patients whose 
caregivers (a) are not included in Hospice CAHPS[supreg] 
administration; or (b) do not complete a survey. This information at a 
minimum should be shared with hospice providers so it can be used to 
inform their quality improvement efforts and development of strategies 
to improve survey response rates. CMS should also consider including 
these results in Hospice Compare to provide consumers with an idea of 
the degree that Hospice CAHPS[supreg] survey respondents may differ 
from themselves.
    Response: We are conducting ongoing analyses of the characteristics 
of decedents for whom CAHPS[supreg] Hospice Surveys are completed, and 
is considering a variety of means for sharing this information with 
hospices.
    Comment: One commenter said that caregiver involvement in care 
should be included in case mix adjustment of the CAHPS[supreg] Hospice 
Survey measures.
    Response: Case-mix adjustment addresses factors that are 
systematically associated with differences in how caregivers respond to 
the CAHPS[supreg] Hospice Survey, and that are not in the control of 
the hospice. Hospice activities may influence the degree of caregiver 
involvement.
    Comment: One commenter noted that the 47 CAHPS[supreg] hospice 
survey questions do not address the care planning and/or patient and 
family/family caregiver shared decision making. The commenter also 
noted that the CAHPS[supreg] survey does ask related questions, but 
only after the death of the patient.
    Response: We chose to make Hospice CAHPS[supreg] a survey of 
caregivers that occurs after the death of the patient, in order to 
obtain information about the entire trajectory of hospice care, not 
just the care upon which the patient was themselves able to respond. As 
the commenter noted, the survey does ask questions related to care 
planning and shared-decision making. When developing the questions for 
the survey we focused on domains that caregivers told us were important 
to them. We are willing to consider other questions for inclusion in 
the survey and will think further about care planning and shared 
decision making in the future.
    Comment: One commenter mentioned that there are no questions about 
the ``extent to which the family was able to satisfactorily or 
confidently engage in the care or support of their terminally ill 
family member.''
    Response: We are willing to consider items for inclusion in the 
survey. We think the subject raised by the comment would be related to 
how often hospice training resulted in the caregiver being confident in 
caring for or support of a terminally ill patient.
    Comment: One commenter supported ``that CAHPS[supreg] Hospice 
Survey scores for a given hospice be displayed as ``top-box'' scores, 
with the national average top-box score for participating hospices 
provided for comparison. This will allow hospice providers to 
understand their measures and identify areas for improvement.''
    Response: We are planning to include national average top box 
scores for CAHPS[supreg] on Hospice Compare.
    Comment: One commenter suggested that CMS incorporate additional 
information into the Hospice Compare Web site. Specifically, they 
recommended helping the users understand what the hospice benefit 
entails. They also suggested that the site provide advice on how to use 
quality reports to choose hospices.
    Response: We are designing the Hospice Compare site to provide 
users with information about the hospice benefit. We are also testing 
the site to make sure it is understandable to the public. We will 
provide information about how the data are calculated and what it 
includes when the hospice data is published on Hospice Compare. We 
anticipate this occurring in the Winter of 2018.
    Comment: One commenter said, ``It would be wonderful if there were 
comments and explanations that tell the story of what the HIS and data 
elements were saying. A summary of sorts?''
    Response: We appreciate the commenter's suggestion and will 
consider for the future, including a guide or legend that describes the 
measures. We agree that stakeholders would find this useful.
    Comment: One commenter raised a concern about some of the national 
benchmarking scores for CAHPS[supreg], asking if it is a valid measure 
when the national benchmark scores are all low in one area. The 
commenter also asked if anyone is evaluating these survey items.
    Response: We are not certain what the commenter means by 
``benchmark scores are all low in one area.'' It is unclear if the 
commenter means a geographic area or a topic area. Hospice usage and 
quality can and does vary by geographic region. The questions included 
in the Hospice CAHPS[supreg] survey are thoroughly reviewed by the 
Agency for Healthcare Research and Quality (AHRQ) and other healthcare 
and research professionals. The CAHPS Hospice Survey was awarded use of 
the CAHPS trademark after extensive review by AHRQ's CAHPS[supreg] 
Consortium. Measures from the survey were reviewed and endorsed by the 
National Quality Forum (NQF #2651). The questions were also reviewed by 
the multi-stakeholder MAP, which guides the selection of measures for 
HHS.
    Comment: One commenter raised the issue of fairness regarding 
hospices that are not included in Hospice Compare due to their small 
volume of patients served and their length of service.
    Response: We are aware of the issue as it impacts inclusion in 
Hospice Compare. This is the major rationale for showing eight quarters 
of data--it allows us to display more reliable data for more hospices. 
We welcome further advice on how best to handle the fairness issue 
while at the same time providing accurate information to the public. We 
also welcome alternative suggestions for a solution to this issue.
    Comment: One commenter noted, ``Families often tell hospice 
providers they do not understand why they were sent a second 
CAHPS[supreg] survey. They state that they either complete the second 
survey or assume we sent it by mistake. Many question the program's

[[Page 36677]]

organizational skills. The instructions/process sent with the surveys 
needs to be clearer for bereaved family members.''
    Response: We will work with vendors to make sure that caregivers 
know why they received a second survey. Much of the time the reason is 
that the caregiver's completed survey is sent late enough that we are 
into a second wave of mailings to ``non-respondents.'' The 
questionnaires cross in the mail.
12. HQRP Reconsideration and Appeals Procedures for the FY 2018 Payment 
Determination and Subsequent Years
    In the FY 2015 Hospice 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 HQRP 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: 
https://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 (USPS) or phone will not be considered as a valid 
reconsideration request. In the FY 2017 final rule (81 FR 52143) we 
further clarified that providers should submit reconsideration requests 
of decision by CMS that the hospice has not met the CAHPS[supreg] 
Hospice Survey requirements using the same process (81 FR 52181). 
(Details about the reports and emails received after data submission 
are in the CAHPS[supreg] Hospice Quality Assurance Guidelines, which is 
available on the official CAHPS[supreg] Hospice Survey Web site, 
www.hospicecahpssurvey.org). 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 of this final rule. 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/2017-Transmittals.html.
    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 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 have implemented this additional communication mechanism via 
the CASPER Hospice Timeliness Compliance Threshold Report previously 
discussed in the FY 2017 Hospice Wage Index proposed rule at 81 FR 
25527 and 25528. We will continue to send notification of noncompliance 
via delivery of a letter via the USPS. We previously finalized our 
proposal (80 FR 47198) to publish a list of hospices who successfully 
meet the reporting requirements for the applicable payment 
determination on the CMS HQRP Web site. The list of providers found to 
be compliant with the FY 2017 APU requirements can be found on the CMS 
HQRP Web site here: https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Hospice-Quality-Reporting/HQRP-Requirements-and-Best-Practices.html.
13. Confidential Feedback Reports
    As part of our effort to promote use of standardized quality data 
to improve quality of care, in December 2016, we made available two new 
provider feedback reports: The Hospice-Level Quality Measure Report and 
the Patient Stay-Level Quality Measure Report. These confidential 
feedback reports are available to each hospice using the CASPER system, 
and are part of the class of CASPER reports known as Quality Measure 
(QM) Reports. These reports are separate from public reporting and are 
for provider viewing only (to the extent permissible under federal 
law), for the purposes of internal provider quality improvement. These 
reports are on-demand and thus enable hospice providers to view and 
compare their performance to the national average for a reporting 
period of their choice.
    Hospices are able to view their data and information at both the 
hospice and patient stay levels for their HIS-based quality measures. 
The CASPER hospice-level QM Reports contain information such as the 
numerator, denominator, hospice-level QM score, and national average. 
The CASPER patient stay-level QM Reports show whether each patient stay 
is counted toward each quality measure. The HIS based QMs reported in 
both reports include:

     NQF #1641 Treatment Preferences
     NQF #1647 Beliefs/Values
     NQF #1634 Pain Screening
     NQF #1637 Pain Assessment
     NQF #1639 Dyspnea Screening
     NQF #1638 Dyspnea Treatment
     NQF #1617 Bowel Regimen

    For more information on the CASPER QM Reports, we refer readers to 
the CASPER QM Factsheet on the HQRP Web site at https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Hospice-Quality-Reporting/HQRP-Requirements-and-Best-Practices.html. This fact 
sheet contains detailed information about each CASPER QM report 
currently available, the data included in the reports, and how 
providers can use the reports as part of their Quality Assessment and 
Performance Improvement (QAPI) efforts. For technical information on 
the reports and how to access the CASPER QM Reports, we refer readers 
to: https://www.qtso.com/hospicetrain.html.
    As new HIS measures are implemented in the HQRP, we will continue 
to expand the functionality of the QM reports to allow providers to 
view data on additional HIS measures. We will announce refinements and 
additions to the QM reports through sub-regulatory communication 
channels and in future rulemaking cycles.
    We also proposed to provide hospices with preview reports of their 
data prior to the quarterly publication of CAHPS[supreg] Hospice Survey 
data on the Compare site. The reports will be provided through the 
CASPER reporting system. Each hospice will receive only its own, 
individual reports.
14. 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. These procedures shall ensure that a 
hospice has the opportunity to review the data that is to be made 
public for the hospice prior to such data being made public. The 
Secretary shall report quality measures that relate to hospice

[[Page 36678]]

care provided by hospice programs on a publicly available CMS Web site.
    In the FY 2017 Hospice final rule, we discussed our analysis of HIS 
data to inform which measures were eligible for public reporting and 
reportability analysis to determine data selection period and minimum 
denominator size for measures to be publicly reported. Based on 
analysis results, we determined that all 7 HIS quality measures adopted 
for the FY 2016 and beyond (NQF #1634, NQF #1637, NQF #1639, NQF #1638, 
NQF #1641, NQF #1647, NQF #1617), calculated based on a rolling 12-
month data selection period, to be eligible for public reporting with a 
minimum denominator size of 20 patient stays. For additional details on 
these analyses, we refer readers to the FY 2017 Hospice final rule (81 
FR 52183 through 52184).
    In the FY 2017 Hospice final rule, we also clarified policies for 
reportability analyses for new measures. As stated in the FY 2017 
Hospice final rule, new measures will undergo reportability analysis to 
determine (1) appropriateness for public reporting and (2) appropriate 
data selection period. In accordance with discussion in the prior 
year's rule, we will use the same analytic approach used in previous 
reportability analyses to determine data selection period and minimum 
denominator size for the Hospice and Palliative Care Composite Process 
Measure--Comprehensive Assessment at Admission. We will begin 
reportability analyses for the Hospice Visits When Death is Imminent 
Measure Pair once data for the measure are available. Results of 
reportability analyses conducted for these new measures will be 
communicated through future rulemaking.
    To meet the Affordable Care Act's requirement for making quality 
measure data public, we are developing a CMS Hospice Compare Web site, 
which will allow consumers, providers and stakeholders to search for 
all Medicare-certified hospice providers and view their information and 
quality measure scores. We anticipate that public reporting of HQRP 
data on the CMS Compare Web site will begin August 2017. To help 
providers prepare for public reporting, we will offer opportunities for 
stakeholder engagement and education prior to the rollout of a CMS 
Hospice Compare site. We will offer outreach opportunities for 
providers through CMS HQRP Public reporting Web page: https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Hospice-Quality-Reporting/Hospice-Quality-Public-Reporting.html, listserv messages via the Post-Acute Care QRP listserv, 
MLN Connects[supreg] National Provider Calls & Events, MLN 
Connects[supreg] Provider eNews and announcements on Open Door Forums 
and Special Open Door Forums. Finally, we will offer educational 
support and outreach to all hospice providers on the systems and 
processes for reviewing their data prior to public reporting; 
availability of educational support and outreach opportunities will be 
communicated through the listed channels above.
    We will provide hospices an opportunity to preview their quality 
measure data prior to publicly reporting information. 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 preview their quality measure data prior to public 
reporting on the CMS Hospice Compare Web site. We will provide hospices 
30 days to review the preview report beginning from the date on which 
they can access the report. Hospices will have an opportunity to 
request review of their data by CMS during the 30 day preview period if 
they believe that errors in data submitted to CMS may have resulted in 
incorrect measure scores and can submit proof along with a plan 
describing how the errors will be corrected. We will review these 
requests and if we confirm that the errors have affected the measures 
and agree to correct the measure, we will suppress the measure on the 
Hospice Compare Web site for one time only and display the corrected 
measure during the subsequent quarterly refresh of the Compare Web 
site. When the preview reports are ready for providers to access, 
anticipated August 2017 prior to the release of Hospice Compare, we 
will post the policies and procedures for providers to submit requests 
for reviewing of their data by CMS on the CMS HQRP Web site: https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Hospice-Quality-Reporting/Hospice-Quality-Public-Reporting.html. CMS encourages hospices to use CASPER QM Reports (see 
section III.D.14 of the FY 2018 proposed rule) to review their HIS 
quality measures after they submit the HIS data to CMS. If hospices 
determine that erroneous data have been submitted, they should submit 
either of these two types of HIS records: Modify existing record or 
inactivate existing record to correct their data. HIS data corrected 
before the data are frozen for the creation of the preview reports will 
be reflected in the preview reports.
    We proposed to begin public reporting of CAHPS[supreg] Hospice 
Survey measures in 2018. Specifically, we proposed to publicly report 
data in winter CY 2018 on all eight CAHPS[supreg] Hospice Survey 
measures. Scores would be displayed based on eight rolling quarters of 
data and would initially use CAHPS[supreg] Hospice Survey data 
collected from caregivers of patients who died while receiving hospice 
care between April 1, 2015 and March 31, 2017. We proposed that the 
display of these scores be updated quarterly, and that scores be 
displayed only for those hospices for which there are 30 or more 
completed questionnaires during the reporting period. Scores will not 
be displayed for hospices with fewer than 30 completed questionnaires 
during the reporting period.
    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 the CMS HQRP Web page, listserv messages via the Post-
Acute Care QRP listserv, MLN Connects[supreg] National Provider Calls & 
Events, MLN Connects[supreg] Provider eNews 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, we have posted a hospice directory and quality data on a 
public data set located at https://data.medicare.gov. 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 have initially posted demographic 
data of hospice agencies that have been registered with Medicare. This 
list includes high-level demographic data for each agency, including 
provider name, address, phone numbers, ownership type, CCN, profit 
status, and date of original CMS certification. The posting of this 
hospice data directory

[[Page 36679]]

occurred on June 14, 2016, and will be refreshed quarterly. Information 
can be located at https://data.medicare.gov/data/hospice-directory. 
Additionally, we have posted two hospice data files containing national 
level aggregate quality data regarding seven HIS quality measures and 
CAHPS[supreg] Hospice Survey measures in December 2016. These data 
files are a one-time release with a goal to make quality data available 
prior to the release of the Hospice Compare in August 2017. Additional 
details regarding hospice datasets will be announced via the CMS HQRP 
Web page, listserv messages via the Post-Acute Care QRP listserv, MLN 
Connects[supreg] National Provider Calls & Events, MLN Connects[supreg] 
Provider eNews and announcements on Open Door Forums and Special Open 
Door Forums. In addition, we have provided the list of CASPER/ASPEN 
contacts, Regional Office and State coordinators in the event that a 
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. Once the Hospice Compare 
Web site is released in August 2017, https://data.medicare.gov will 
post the official datasets used on the Medicare.gov Compare Web sites 
provided by CM.
    The comments and our responses are set forth below.
    Comment: CMS received several comments that were supportive of 
public reporting of hospice quality measures. Commenters noted that 
they were in favor of CMS' efforts to publicly report hospice quality 
data to support the timely and transparent reporting of HQRP data to 
hospice beneficiaries, their families and caregivers, providers, and 
other stakeholders. One commenter shared that the public reporting of 
hospice quality data was essential to achieving industry goals of 
delivering the right care, to the right patient, at the right time. 
Several commenters had suggestions, recommendations, and concerns about 
specific aspects of the public display of HIS 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 the public display of quality measures in our responses 
below.
    Comment: One commenter expressed concern that hospices not included 
in public reporting due to not meeting the minimum denominator size for 
public reporting, may be disadvantaged. This commenter believed that 
the lack of data on the Hospice Compare Web site may disadvantage these 
smaller providers as consumers may unfairly assume that the lack of 
publicly displayed data indicates lower quality providers. The 
commenter believed that this may raise an issue of fairness, whereby 
those hospices without publicly displayed quality data may be 
negatively impacted by consumers who misinterpret missing data as an 
indicator of quality in and of itself and choose not to receive 
services from these providers. To mitigate this issue, the commenter 
suggested that CMS develop a means to counterbalance the potential 
negative consequences for these hospices for which quality information 
is not publicly displayed.
    Response: We appreciate the commenter sharing concerns regarding 
the possible negative impact of the minimum denominator size on small 
hospices. The minimum denominator size of 20 patient stays for HIS data 
was established through extensive data analysis to ensure that QM 
scores were statistically meaningful and reliable. The determination of 
the minimum denominator size balanced the necessity of yielding 
statistically meaningful QM scores and the goal of allowing as many 
hospices as possible to have their QM scores publicly displayed. 
Analysis conducted by RTI International shows that only about 10 
percent of hospices would not have accumulated enough patient stays to 
have their HIS quality measures publicly displayed. The results of this 
data analysis are summarized in the Measure Testing Executive Summary 
document posted 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 order to counterbalance any potential negative impact of some 
hospices not having their measure data publicly displayed, we plan to 
clearly indicate on the Hospice Compare Web site instances where data 
is not displayed due to a small denominator size. We believe that this 
will signal to consumers that, in such instances, the lack of data is 
not an indication of poor quality but rather a result of the hospice 
having too few admissions to allow for reporting of a reliable QM. This 
approach is consistent with other quality reporting programs. We will 
also consider future education and outreach activities to educate 
consumers about the minimum denominator size for public reporting to 
inform the public that a lack of publicly displayed data does not 
necessarily indicate of poor quality.
    Comment: One commenter noted that many providers have high scores 
on the current HIS-based QMs and that the limited range of scores could 
make it difficult for consumers to differentiate between high and low 
quality providers. The commenter suggested that publicly displayed data 
be presented as a rating or in another similar format.
    Response: We agree that many hospice providers are performing well 
on the HIS-based QMs. The overall distribution and variability of the 
scores of the seven HIS QMs that will be publicly displayed initially 
indicate that most hospices are completing the important care processes 
for most hospice patients around hospice admission. However, there is 
still noticeable room for improvement. Analysis completed by RTI 
International shows that a low percentage of hospices have perfect 
scores for most measures and a small percentage of hospices have very 
low scores. To view the results of these analyses please see the 
Measure Testing Executive Summary document posted on the ``Current 
Measures'' portion of the CMS HQRP Web site at: https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Hospice-Quality-Reporting/Current-Measures.html. In preparation for public 
reporting, CMS's measure development contractor, RTI International, 
interviewed hospice caregivers. Interviews with these caregivers found 
that public display of these measures would be useful in avoiding low-
performing providers. Additionally, publicly reporting these measures 
inform consumers the important care processes that they should expect 
upon hospice admission.
    Finally, the Hospice Compare Web site will likely feature a quality 
rating system that gives each hospice a rating such as between 1 and 5 
stars. This will help supplement the measure scores by presenting the 
data as a rating. We will announce the timeline for the development and 
implementation of the star rating system in future rulemaking.
    Comment: CMS received a few comments raising concerns about 
consumers' understanding of quality measure data reported on the 
Hospice Compare Web site. They recommended that CMS ensure that all 
information posted to the Web site is meaningful

[[Page 36680]]

and easily understandable to the general public. Commenters suggested 
that supplemental information, including general descriptions of the 
Medicare hospice benefit and consumer-friendly explanations of the HIS 
data be included on the Hospice Compare Web site to provide context for 
interpretation of publicly reported quality data. Furthermore, one 
commenter suggested CMS engage patients, caregivers, providers, and 
other stakeholders in the development process for the Hospice Compare 
Web site to ensure that the data presented are meaningful and 
actionable.
    Response: We appreciate commenters' suggestions on information to 
include on the Hospice Compare Web site. We will take these into 
consideration as we continue to develop the Web site. We are committed 
to ensuring that all publicly reported data is presented in an 
appropriate and meaningful manner to the public. As such, we are 
working with our Web site development contractor to ensure that the 
Hospice Compare Web site will be tested for usability, readability, and 
navigation before its launch in August 2017. Consumers and stakeholders 
are continuously involved and are having opportunities for input 
throughout the development process. Text on the Hospice Compare Web 
site will comply with the Plain Writing Act of 2010. In addition to 
complying with the Plain Language Act, we are also taking into account 
variations in health and general literacy, and are soliciting input 
from key stakeholders and technical experts in the development and 
presentation of publicly available data.
    Comment: A commenter raised concerns that public reporting of 
quality measures could lead to negative unintended consequences for 
hospice providers, such as reduced referrals.
    Response: We appreciate the commenter's concerns about potential 
negative implications of public reporting of quality data. It is our 
hope that the public display of hospice-level data will provide an 
incentive to providers to identify areas of improvement and develop 
performance improvement plans to improve the quality of care delivered 
to their patients and their performance on quality measures. By 
developing performance improvement plans around areas for improvement, 
hospices can help minimize negative impacts on referrals. We will 
continue to carefully consider any potential unintended consequences of 
public reporting as we develop and report future HIS-based measures.
    Comment: A few commenters expressed concerns that data reported in 
the inaugural release of the Hospice Compare Web site would be 
incorrect, and cited two main reasons for potential inaccuracies in 
data. One commenter believed that provider knowledge gaps about measure 
specifications could lead to errors in coding of HIS items and, 
subsequently, errors in measure scores and the display of incorrect 
measure data. The commenter encouraged CMS to identify knowledge gaps 
and quickly provide education to correct these misunderstandings so 
that inaccurate data (that is, data that is not reflective of actual 
care processes taking place but rather of inaccurate coding of HIS 
items) is not reported on Hospice Compare. A second reason that 
commenters provided was that there was insufficient time to preview HIS 
data submissions prior to public reporting. These commenters believed 
that hospices did not have sufficient time to correct data during the 
30-day preview period.
    Response: We appreciate commenters taking time to express their 
concerns about the accuracy of publicly reported data. We agree that it 
is of the upmost importance that data presented on the Web site is 
accurate and that providers have all the information and training 
necessary to accurately report HIS-based quality measure scores. We 
encourage providers to submit questions about measure specifications, 
coding guidance for HIS items, public reporting, and the preview period 
to the Hospice Quality Help Desk at 
[email protected]. We monitor common types of 
questions submitted to the Help Desk and use this information to 
determine potential knowledge gaps that should be the focus of regular 
outreach and education efforts. Such regular education efforts and 
clarifications in coding guidance for the HIS are communicated to 
providers on a regular basis through quarterly Question & Answer 
documents, Help Desk guidance, spotlights and announcements, and MLN 
eNews Listservs. We encourage providers to regularly check the CMS HQRP 
Web page for these educational materials. We routinely communicate 
updates about measure specifications and/or HIS items through these 
educational and communication outlets.
    To prevent the public display of incorrect HIS measure data, we 
encourage hospices to use their CASPER QM reports (see section III.D.13 
of the FY 2018 Hospice proposed rule) to regularly review their HIS 
quality measure scores. If hospices determine that erroneous data have 
been submitted, providers should use the HIS record modification and 
inactivation processes, as outlined in the HIS Manual available on the 
``Hospice Item Set (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. 
Hospice providers can submit modification and inactivation requests up 
to 36 months from the target date of any given HIS record. Regular 
monitoring of CASPER QM reports will help ensure that erroneous data 
are identified early and errors can be corrected in a timely manner. In 
addition to using QM reports as a mechanism for identifying errors, we 
also encourages hospices to proactively prevent errors in submitted 
data by ensuring that staff and clinicians are trained on the latest 
coding guidance, and that quality assurance and monitoring processes 
are in place to prevent the submission of incorrect data. We would like 
to note that HIS data corrected after the data are frozen for the 
creation of the Provider Preview Reports will not be reflected in the 
upcoming Hospice Compare Web site update, but will be displayed in the 
subsequent quarterly update. Because of this, we encourage providers to 
implement quality assurance and monitoring processes and check CASPER 
QM reports frequently.
    Once the preview reports are generated, the underlying data cannot 
be corrected. If a hospice disagrees with the QM scores presented in 
their preview report, the hospice will have the opportunity to request 
review of their data by CMS during the 30-calendar day preview period. 
We will review these requests and if CMS agrees that the data is 
incorrect, the data will be suppressed for one quarter and the 
corrected data will be posted during the subsequent quarterly refresh 
of the Compare site. The process for CMS review of data is posted on 
the ``Hospice Quality Public Reporting'' portion of the CMS HQRP Web 
site: https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Hospice-Quality-Reporting/Hospice-Quality-Public-Reporting.html. The 30-calendar day preview period for Hospice 
Compare is consistent with preview periods in other quality reporting 
programs and has been sufficient in other settings. We encourage 
providers to sign up for the Post-Acute Care QRP listserv for more 
information about preview report roll-out and the preview period. We 
will take concerns about the length of the preview period into 
consideration for

[[Page 36681]]

future updates to public reporting of quality data.
    Comment: CMS received several comments in support of the future 
development of a star rating system for the Hospice Compare Web site. 
Commenters provided several suggestions on creating a star rating 
system that would be useful to consumers and providers. A majority of 
commenters were opposed to a normative approach to calculating star 
ratings where ratings are placed on a bell curve. They believed that 
this approach would be confusing to consumers and not truly indicative 
of hospice performance. Commenters preferred a criterion approach for 
star ratings where CMS would establish benchmarks and calculate ratings 
based on hospice performance in relation to the established quality 
benchmark. Other commenters suggested that the star ratings include 
criteria beyond measure scores, such as patient/family satisfaction, 
financial performance, geographic indicators, and specialized services 
provided by the hospice.
    Response: We appreciate commenters' detailed input on the 
development of a star rating methodology for hospice. While we have not 
set a date for implementing such a system, it is of paramount concern 
to us to develop a star rating methodology that is valid, reliable, and 
meaningful to consumers. We will alert our stakeholders once we are 
closer to entering that phase. We will provide continued opportunities 
for the provider community and other stakeholders to comment on and 
provide input to development of a star a proposed rating system. In 
addition to regular HQRP communication channels, we expect to solicit 
input from the public regarding star rating methodology through 
communication channels which may include special listening sessions, 
Open Door Forums, a TEP, and other opportunities. Additionally, we will 
benefit from lessons learned from the development and implementation of 
the star ratings in other quality reporting programs to help guide 
development of star ratings for hospice. Finally, we will announce the 
timeline for development and implementation of Hospice star ratings in 
future rulemaking, which will provide additional opportunity for 
stakeholders to provide public feedback on any proposed star rating 
methodology.

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. In 
order 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.
    Unless noted otherwise, all salary information is from the Bureau 
of Labor Statistics (BLS) Web site at http://www.bls.gov/oes and 
includes a fringe benefits package worth 100 percent of the base 
salary. The mean hourly wage rates are based on May, 2015 BLS data for 
each discipline.
    Section 1814(i)(5)(C) of the Act requires that each hospice submit 
data to the Secretary on quality measures specified by the Secretary. 
This data must be submitted in a form and manner, and at a time 
specified by the Secretary.
    We solicited public comment and received no comments on each of 
these issues for the following sections of this document that contain 
information collection requirements (ICRs) and are finalizing them.

A. Hospice Item Set (OMB Control Number 0938-1153)

    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 7 NQF 
endorsed measures 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).
    We finalized the following two additional measures in the FY 2017 
Hospice Wage Index final rule affecting FY 2019 payment determinations 
(81 FR 52163 through 52173):

 Hospice Visits when Death is Imminent
 Hospice and Palliative Care Composite Process Measure--
Comprehensive Assessment at Admission

    Data for the aforementioned 9 measures is collected via the HIS as 
discussed in the FY 2017 Hospice Wage Index final rule (81 FR 52189) 
and covered under OMB control number 0938-1153. The HIS V2.00.0 was 
approved by the Office of Management and Budget on April 17, 2017 under 
control number 0938-1153. We are not making any new updates or 
additional collections of information in this rule in regards to the 
Hospice Item Set or its constituent quality measures.

B. Summary of CAHPS[supreg] Hospice Survey Information Collection 
Requirements (OMB Control Number 0938-1257)

    National Implementation of the Hospice Experience of Care Survey 
(CAHPs Hospice Survey) data measures are covered under OMB control 
number 0938-1257 and is summarized here for convenience. We have 
implemented patient experience surveys in a number of settings 
including Medicare, Medicare Advantage, and Part D Prescription Drug 
Plans, hospitals, and home health agencies. Other CAHPS[supreg] surveys 
exist for hemodialysis facilities, nursing homes, and physician 
practices. The hospice survey differs from most other CMS patient 
experience surveys because its target population is bereaved family 
members or close friends of patients who died in hospice care. Family 
members and friends are the best source of information regarding the 
entire trajectory of hospice care. In addition, many hospice patients 
are very ill and unable to answer survey questions.
    Surveys are administered by CMS-approved survey vendors hired by 
hospice providers to conduct the survey on their behalf. The survey 
vendor may collect data in one of three modes: Mail-only, telephone-
only, or mixed mode (mail with telephone follow-up). The sample 
consists of bereaved family members or close friends of patients who 
died while receiving hospice care (1) at home, (2) in a nursing home, 
or (3) an inpatient setting (that is, freestanding inpatient unit or 
acute care hospital). The questionnaire is composed of 47 items.
    The estimated annualized burden hours and costs to respondents for 
the national implementation of the CAHPS[supreg] Hospice Survey are 
shown in Tables 18 and 19. Based on participation in national 
implementation in the CAHPS[supreg] Hospice Survey from Quarter 2 2015 
through Quarter 1 2016, we assume that

[[Page 36682]]

3,414 hospices will administer the survey to an average of 278.7 cases. 
Thus, we estimate that the CAHPS[supreg] Hospice Survey will be 
administered to a maximum of 951,482 individuals each year for the 
duration of the collection period covered by this application for the 
purposes of national implementation. As not all sampled cases will 
complete the survey, this estimate reflects the maximum burden 
possible. The estimated number of responses is based on actual hospice 
participation in national implementation of the CAHPS[supreg] Hospice 
Survey. Table 18 shows the estimated annualized burden for the 
respondents' time to participate in the national implementation data 
collection. The survey contains 47 items and is estimated to require an 
average administration time of 10.4 minutes in English (at a pace of 
4.5 items per minute) and 12.5 minutes in Spanish (assuming 20 percent 
more words in the Spanish translation), for an average response time of 
10.47 minutes or 0.174 hours (assuming that 1 percent of survey 
respondents complete the survey in Spanish). These burden and pace 
estimates are based on CMS' experience with the CAHPS[supreg] Hospice 
Survey and surveys of similar length that were fielded with Medicare 
beneficiaries. As indicated below, the annual total burden hours for 
survey participants are estimated to be 165,959.57 for the continued 
national implementation of the survey.

    Table 18--Estimated Annualized Burden Hours for Respondents: National Implementation of the CAHPS[supreg]
                                                 Hospice Survey
----------------------------------------------------------------------------------------------------------------
                                                                     Number of
                 Survey version                      Number of     responses per     Hours per     Total burden
                                                    respondents     respondent       response          hours
----------------------------------------------------------------------------------------------------------------
CAHPS[supreg] Hospice Survey....................         951,482               1           0.174      165,959.57
                                                 ---------------------------------------------------------------
    Total.......................................         951,482               1           0.174      165,959.57
----------------------------------------------------------------------------------------------------------------

Table 19 shows the cost burden to respondents associated with their 
time to complete a survey as part of national implementation. The 
annual total cost burden is estimated to be $7,710,481.60. This 
estimate is higher than the $3,034,789.70 estimated in the prior OMB 
filing, due to the increased number of hospices participating (and 
correspondingly, the increased number of respondents), as well as an 
increase in the average hourly rate.

               Table 19--Estimated Annualized Cost Burden for Respondents: National Implementation
----------------------------------------------------------------------------------------------------------------
                                                     Number of     Total burden   Average hourly    Total cost
                    Form name                       respondents        hours        wage rate *       burden
----------------------------------------------------------------------------------------------------------------
CAHPS[supreg] Hospice Survey....................         951,482      165,959.57        * $46.46   $7,710,481.60
rrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrr
    Total.......................................         951,482      165,959.57         * 46.46    7,710,481.60
----------------------------------------------------------------------------------------------------------------
* Source: Data from the U.S. Bureau of Labor Statistics' May 2015 National Occupational Employment and Wage
  Estimates for all salary estimates (http://www.bls.gov/oes). This figure includes a 100% fringe benefit on an
  average wage of $23.23. Retrieved April 10, 2017.

V. Regulatory Impact Analysis

A. 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 2018 as required under section 1814(i)(1)(C)(ii)(VII) of the Act. 
Section 411(d) of the Medicare Access and CHIP Reauthorization Act of 
2015 (MACRA) amended section 1814(i)(1)(C) of the Act such that for 
hospice payments for FY 2018, the market basket percentage increase 
shall be 1 percent. 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.

B. Overall Impacts

    We estimate that the aggregate impact of the payment provisions in 
this final rule will result in an increase of $180 million in payments 
to hospices, resulting from the hospice payment update percentage of 
1.0 percent. The impact analysis of this final rule represents the 
projected effects of the changes in hospice payments from FY 2017 to FY 
2018. Using the most recent data available at the time of rulemaking, 
in this case FY 2016 hospice claims data, we apply the current FY 2017 
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 
2017 payments. Then, using the same FY 2016 data, we apply the FY 2018 
wage index and labor-related share values to simulate FY 2018 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.
    We have examined the impacts of this 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 (September 19, 1980, 
Pub. L. 96-354), section 1102(b) of the Social Security Act, section 
202 of the Unfunded Mandates Reform Act of 1995 (March 22, 1995; Pub. 
L. 104-4), Executive Order 13132 on Federalism (August 4,

[[Page 36683]]

1999), the Congressional Review Act (5 U.S.C. 804(2) and Executive 
Order 13771 on Reducing Regulation and Controlling Regulatory Costs 
(January 30, 2017).
    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). Section 
3(f) of Executive Order 12866 defines a ``significant regulatory 
action'' as an action that is likely to result in a rule: (1) Having an 
annual effect on the economy of $100 million or more in any 1 year, or 
adversely and materially affecting a sector of the economy, 
productivity, competition, jobs, the environment, public health or 
safety, or state, local or tribal governments or communities (also 
referred to as ``economically significant''); (2) creating a serious 
inconsistency or otherwise interfering with an action taken or planned 
by another agency; (3) materially altering the budgetary impacts of 
entitlement grants, user fees, or loan programs or the rights and 
obligations of recipients thereof; or (4) raising novel legal or policy 
issues arising out of legal mandates, the President's priorities, or 
the principles set forth in the Executive Order.
    A regulatory impact analysis (RIA) must be prepared for major rules 
with economically significant effects ($100 million or more in any 1 
year). We estimate that this rulemaking is ``economically significant'' 
as measured by the $100 million threshold, and hence also a major rule 
under the Congressional Review Act. Accordingly, we have prepared a RIA 
that, to the best of our ability presents the costs and benefits of the 
rulemaking.

C. Anticipated Effects

    The Regulatory Flexibility Act (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 greater than 5 percent of 
providers reach a threshold of 3 to 5 percent or more of total revenue 
or total costs. The effect of the FY 2018 hospice payment update 
percentage results in an overall increase in estimated hospice payments 
of 1.0 percent, or $180 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.
    Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA) 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 2017, that 
threshold is approximately $148 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 $148 million or more.
    Executive Order 13132 establishes certain requirements that an 
agency must meet when it promulgates a proposed rule (and subsequent 
final rule) that imposes substantial direct requirement costs on state 
and local governments, preempts state law, or otherwise has Federalism 
implications. 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.
    If regulations impose administrative costs on private entities, 
such as the time needed to read and interpret this final rule, we 
should estimate the cost associated with regulatory review. Due to the 
uncertainty involved with accurately quantifying the number of entities 
that will review the rule, we assume that the total number of unique 
commenters on the published proposed rule will be the number of 
reviewers of this final rule. We acknowledge that this assumption may 
understate or overstate the costs of reviewing this final rule. It is 
possible that not all commenters reviewed the proposed rule in detail, 
and it is also possible that some reviewers chose not to comment on the 
proposed rule. For these reasons we thought that the number of comments 
received on the proposed rule would be a fair estimate of the number of 
reviewers of this final rule. We also recognize that different types of 
entities are in many cases affected by mutually exclusive sections of 
this final rule, and therefore for the purposes of our estimate we 
assume that each reviewer reads approximately 50 percent of the rule. 
Using the wage information from the BLS for medical and health service 
managers (Code 11-9111), we estimate that the cost of reviewing this 
rule is $105.16 per hour, including overhead and fringe benefits 
(https://www.bls.gov/oes/current/oes_nat.htm). Assuming an average 
reading speed, we estimate that it would take approximately 1.6 hours 
for the staff to review half of this rule. For each hospice that 
reviews the rule, the estimated cost is $168.26 (1.6 hours x $105.16). 
Therefore, we estimate that the total cost of reviewing this regulation 
is $15,143.40 ($168.26 x 90 reviewers).
    A summary of the comments we received on the RIA and our responses 
to those comments are set forth below.
    Comment: A commenter disagreed with CMS' assertion the proposed 
rule will not create a significant economic impact on a substantial 
number of small entities. The commenter believes that the impact of the 
overall increase will not be felt proportionally across hospices. Small 
hospices will face significant financial hardships, especially those 
with fewer data collection resources, who would be subject to the 2 
percent penalty for inadequate quality data submission. The commenter 
encouraged CMS to provide a more detailed analysis of the impact on 
hospices, especially small and rural hospices.
    Response: Hospices are estimated to receive a 1 percent increase in 
payments in FY 2018. Based on our analysis, we concluded that the 
policies in the proposed rule would not result in an estimated total 
adverse impact of 3 to 5 percent or more on Medicare revenue for 
greater than 5 percent of hospices. The 1 percent payment update is 
statutorily-mandated by MACRA (Pub. L. 114-10, enacted April 16, 2015). 
Furthermore, we believe that Table 20 sufficiently describes the impact 
on rural hospices as well as small hospices (as measured by the number 
of RHC days).

[[Page 36684]]

    Comment: A commenter agreed that if regulations impose 
administrative costs on private entities, such as the time needed to 
read and interpret the proposed rule, CMS should estimate the cost 
associated with regulatory review. The commenter stated that CMS should 
not assume that the number of commenters equates to the number of 
reviewers. Many individual hospices, especially smaller hospices, may 
not submit an individual comment but instead will collaborate with 
their professional associations to provide comments. However, each 
hospice still thoroughly reviews, engages in background research, 
interprets and assesses the impact of proposals on current practice, as 
well as how practices may need to shift if proposals are finalized, in 
order to engage in those collective processes to prepare a comment 
letter.
    Response: We thank the commenter for proving feedback on the 
methodology used to determine the costs associated with regulatory 
review. We will take the comment under consideration for any future 
refinements to the methodology used to determine the costs of 
regulatory review. As noted previously, we already take many of these 
costs into account.

D. Detailed Economic Analysis

    The FY 2018 hospice payment impacts appear in Table 20. We tabulate 
the resulting payments according to the classifications in Table 20 
(for example, facility type, geographic region, facility ownership), 
and compare the difference between current and future payments to 
determine the overall impact.
    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 2018 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 2018 hospice wage index.
    The fourth column shows the effect of the hospice payment update 
percentage for FY 2018. The FY 2018 hospice payment update percentage 
of 1 percent is mandated by section 1814(i)(1)(C) of the Act, as 
amended by section 411(d) of the MACRA.
    The fifth column shows the effect of all the changes on FY 2018 
hospice payments. It is projected that aggregate payments will increase 
by 1.0 percent, assuming hospices do not change their service and 
billing practices.
    As illustrated in Table 20, 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 
2018 payments range from a 0.9 percent decrease for hospices providing 
care in the rural outlying region to a 1.7 percent increase for 
hospices providing care in the urban Pacific region.

                               Table 20--Projected Impact to Hospices for FY 2018
----------------------------------------------------------------------------------------------------------------
                                                                                      FY 2018
                                                     Number of     Updated wage       hospice      FY 2018 total
                                                     providers       data (%)     payment update    change (%)
                                                                                        (%)
(1)                                                          (2)             (3)             (4)             (5)
----------------------------------------------------------------------------------------------------------------
All Hospices....................................           4,355             0.0             1.0             1.0
Urban Hospices..................................           3,381             0.0             1.0             1.0
Rural Hospices..................................             974             0.1             1.0             1.1
Urban Hospices--New England.....................             134            -0.7             1.0             0.3
Urban Hospices--Middle Atlantic.................             252             0.1             1.0             1.1
Urban Hospices--South Atlantic..................             430            -0.3             1.0             0.7
Urban Hospices--East North Central..............             407            -0.1             1.0             0.9
Urban Hospices--East South Central..............             159             0.0             1.0             1.0
Urban Hospices--West North Central..............             233            -0.2             1.0             0.8
Urban Hospices--West South Central..............             662             0.0             1.0             1.0
Urban Hospices--Mountain........................             327            -0.1             1.0             0.9
Urban Hospices--Pacific.........................             736             0.7             1.0             1.7
Urban Hospices--Outlying........................              41            -0.6             1.0             0.4
Rural Hospices--New England.....................              23             0.0             1.0             1.0
Rural Hospices--Middle Atlantic.................              40             0.6             1.0             1.6
Rural Hospices--South Atlantic..................             135             0.1             1.0             1.1
Rural Hospices--East North Central..............             141             0.2             1.0             1.2
Rural Hospices--East South Central..............             124            -0.1             1.0             0.9
Rural Hospices--West North Central..............             181             0.2             1.0             1.2
Rural Hospices--West South Central..............             180             0.1             1.0             1.1
Rural Hospices--Mountain........................             101             0.2             1.0             1.2
Rural Hospices--Pacific.........................              46             0.3             1.0             1.3
Rural Hospices--Outlying........................               3            -1.9             1.0            -0.9
0-3,499 RHC Days (Small)........................           1,004             0.2             1.0             1.2
3,500-19,999 RHC Days (Medium)..................           2,017             0.1             1.0             1.1
20,000+ RHC Days (Large)........................           1,334             0.0             1.0             1.0
Non-Profit Ownership............................           1,059             0.0             1.0             1.0
For Profit Ownership............................           2,735             0.1             1.0             1.1
Government Ownership............................             155            -0.3             1.0             0.7
Other Ownership.................................             406            -0.2             1.0             0.8
Freestanding Facility Type......................           3,379             0.0             1.0             1.0
HHA/Facility-Based Facility Type................             976             0.0             1.0             1.0
----------------------------------------------------------------------------------------------------------------
Source: FY 2016 hospice claims from the Chronic Condition Data Warehouse (CCW) Research Identifiable File (RIF)
  in June 2017.
Region Key:

[[Page 36685]]

 
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.

E. Accounting Statement

    As required by OMB Circular A-4 (available at http://www.whitehouse.gov/omb/circulars/a004/a-4.pdf), in Table 21, we have 
prepared an accounting statement showing the classification of the 
expenditures associated with the provisions of this final rule. Table 
21 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 4,355 hospices in 
our impact analysis file, which was constructed using FY 2016 claims 
available in June 2017. All expenditures are classified as transfers to 
hospices.

  Table 21--Accounting Statement: Classification of Estimated Transfers
                   and Costs, From FY 2017 to FY 2018
------------------------------------------------------------------------
                 Category                             Transfers
------------------------------------------------------------------------
Annualized Monetized Transfers............  $180 million *
From Whom to Whom?........................  Federal Government to
                                             Medicare Hospices.
------------------------------------------------------------------------
* The net increase of $180 million in transfer payments is a result of
  the 1.0 percent hospice payment update compared to payments in FY
  2017.

F. Reducing Regulation and Controlling Regulatory Costs

    Executive Order 13771, entitled ``Reducing Regulation and 
Controlling Regulatory Costs,'' was issued on January 30, 2017 (82 FR 
9339, February 3, 2017). It has been determined that this final rule is 
a transfer rule that does not impose more than de minimis costs as 
described above and thus is not a regulatory or deregulatory action for 
the purposes of Executive Order 13771.

G. Conclusion

    We estimate that aggregate payments to hospices in FY 2018 will 
increase by $180 million, or 1.0 percent, compared to payments in FY 
2017. We estimate that in FY 2018, hospices in urban and rural areas 
will experience, on average, 1.0 percent and 1.1 percent increases, 
respectively, in estimated payments compared to FY 2017. Hospices 
providing services in the urban Pacific and rural Middle Atlantic 
regions will experience the largest estimated increases in payments of 
1.7 percent and 1.6 percent, respectively. Hospices serving patients in 
urban areas in the New England region will experience, on average, the 
lowest estimated increase of 0.3 percent in FY 2018 payments.
    In accordance with the provisions of Executive Order 12866, this 
regulation was reviewed by the Office of Management and Budget.

    Dated: July 25, 2017.
Seema Verma,
Administrator, Centers for Medicare & Medicaid Services.
    Dated: July 27, 2017
Thomas E. Price,
Secretary, Department of Health and Human Services.
[FR Doc. 2017-16294 Filed 8-1-17; 4:15 pm]
 BILLING CODE 4120-01-P