(Alexandria, VA) — The National Alliance for Care at Home (the Alliance) today responded to the Centers for Medicare & Medicaid Services (CMS) fiscal year (FY) 2027 Hospice Wage Index and Payment Rate Update final rule, which finalizes payment and regulatory changes under the Medicare hospice benefit.
CMS finalized a 2.3% payment update to the Medicare hospice benefit, which continues to fall short of the rising labor and supply costs required to deliver high-quality hospice care. As demand for hospice services continues to grow, payment updates must more accurately reflect providers’ costs so that access to these essential services does not decline.
“CMS’s 2.3% payment update does not reflect the true cost of delivering hospice care and adds further strain to providers who are already stretched thin,” said Jennifer Sheets, CEO of the Alliance. “Compounding that pressure is a Service and Spending Variation Index built on a fundamentally flawed methodology that penalizes legitimate providers for non-hospice claims they have no visibility into nor control over, with no process to review or correct the data before it is made public. This is not a sound approach to program integrity. An inadequate payment update combined with an unreliable oversight tool creates a serious and growing burden for legitimate providers working to serve their communities.”
The Alliance remains deeply concerned about CMS’s Hospice Service and Spending Variation Index (SSVI). As stated in prior comments, provider-level SSVI data is not suitable for targeting oversight or enforcement due to fundamental validity and methodological problems, and hospices have little to no insight into claims submitted by non-hospice providers that drive these scores. The Alliance is particularly troubled that CMS finalized the SSVI without a reconsideration process or preview period, despite the hospice community’s explicit request for the chance to review and validate data before a score is made public. This concern is compounded by the rule’s new public-facing icon on the Medicare.gov Compare Tool flagging hospices for quality reporting gaps, layering a consumer-facing penalty on top of an already-contested measurement tool, with no mechanism to correct inaccurate data first. The Alliance urges CMS to exclude non-hospice spending claims and revise the SSVI in partnership with the hospice community before using it for program integrity enforcement.
The Alliance also recognizes CMS’s efforts to improve transparency for Medicare hospice beneficiaries through an election statement addendum requirement but remains concerned that the requirement to provide the addendum to all beneficiaries does not address the true driver of non-hospice spending while unnecessarily increasing hospice provider burden. CMS should enforce existing documentation and payment requirements against non-hospice billing providers and require those providers to obtain and maintain documentation supporting the medical necessity and unrelated nature of these services, items, or drugs. The Alliance also recommends that CMS address the broader operational and coverage issues that contribute to these spending patterns, including delays in hospice election data visibility and the benefit framework gap for non-covered items, services and drugs. Without these steps, the Alliance warns that a universal addendum requirement will increase burden and confusion while leaving the central payment integrity problem unresolved.
The Alliance will continue to advocate for a Medicare hospice payment system that reflects the true cost of care and a program integrity framework built on credible, evidence-based methods. We remain committed to fighting for the resources hospices need and the protections patients and families deserve.
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About the National Alliance for Care at Home
The National Alliance for Care at Home (the Alliance) is the leading authority in advancing care in the home. We envision an America where everyone has access to the highest quality, person-centered healthcare wherever they call home. Through advocacy, education, and convening, we connect providers and stakeholders to strengthen care delivery across the home-based care continuum — spanning home care, home health, hospice, palliative care, and Medicaid home and community-based services. Learn more at www.AllianceForCareAtHome.org.
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