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MIR-2006-12AB, December 2006
MLN Matters. . .Information for Medicare Providers
(Issued by the Centers for Medicare & Medicaid Services) |
Update to the Hospice Payment Rates, Hospice Cap, Hospice Wage Index and the Hospice Pricer for FY 2007
Note: This article was revised to reflect that CR5254 was revised on October 27, 2006. The CR release date, transmittal number, and Web address for accessing CR5254 were changed. All other information remains the same. |
Provider Types Affected
Hospices billing Medicare regional home health intermediaries (RHHIs) for hospice services
Provider Action Needed
This instruction provides the Medicare annual update information for hospices.
Background
The law governing the payment for hospice care requires annual updates to the hospice payment rates. Section 1814(i)(1)(C)(ii) of the Social Security Act (the Act) stipulates that the payments for hospice care for fiscal years after 2002 will increase by the market basket percentage increase for the fiscal year (FY). This payment methodology has been codified in regulations found at 42 CFR §418.306(a)(b).
Hospice Payment Rates
The FY 2007 payment rates will be the FY 2006 payment rates, increased by 3.4 percentage points, which is the total market basket percentage increase forecasted for FY 2007. The FY 2007 hospice payment rates are effective for care and services furnished on or after October 1, 2006, through September 30, 2007.
The national payment rates for revenue codes 651, 652, 655, and 656 for October 1, 2006 through September 30, 2007 are listed in the following table:
Code |
Description |
Rate |
Wage Component Subject to Index |
Non-Weighted Amount |
651 |
Routine Home Care |
$130.79 |
$89.87 |
$40.92 |
652 |
Continuous Home Care Full Rate = 24 hours of care $31.81 hourly rate |
$763.36 |
$524.50 |
$238.86 |
655 |
Inpatient Respite Care |
$135.30 |
$73.24 |
$62.06 |
656 |
General Inpatient Care |
$581.82 |
$372.42 |
$209.40 |
Hospice Cap
The Hospice Cap is updated annually in accordance with §1814(i)(2)(B) of the Act and provides for an increase (or decrease) in the hospice cap amount. Specifically, the cap amount is increased or decreased, for accounting years after 1984, by the same percentage as the percentage increase or decrease, respectively, in the medical care expenditure category of the Consumer Price Index for all Urban Consumers.
The latest hospice cap amount for the cap year ending October 31, 2006 is $20,585.39. Reference to the hospice cap is discussed further in the Pub.100-04, Medicare Claims Processing Manual, Chapter 11, Processing Hospice Claims, section 80.2. (See Additional Information section for the Web address.)
Hospice Wage Index
The Hospice Wage Index is used to adjust payment rates to reflect local differences in wages according to the revised wage index. The Hospice Wage Index is updated annually in accordance with recommendations made by a negotiated rulemaking advisory committee as published in the Federal Register on August 8, 1997. 42 CFR §418.306(C) requires that the updated hospice wage index be published annually as a notice in the Federal Register.
The Hospice Wage Index notice will be effective October 1, 2006, and published in the Federal Register before that date. The revised wage index and payment rates will be incorporated in the hospice Pricer and forwarded to the RHHIs following publication of the notice.
As discussed in the FY 2006 Hospice Wage Index Final Rule, for FY 2006 only, a blended wage index value, comprised of 50 percent of the wage index had the Metropolitan Statistical Area (MSA) designations remained in effect and 50 percent of the wage index under the Core Based Statistical Area (CBSA) designations, was used. Thus, the special codes employed in FY 2006 are not in effect for FY 2007.
Note: Hospice providers should split claims if dates of service span separate fiscal years; that is, services begin in September and continue into October, when the new rates are effective. If a hospice does not split a claim and the services on one claim span two fiscal years, the entire claim will be processed using the earlier fiscal year rates, and the Medicare RHHI will make no subsequent adjustment on such claims. |
Implementation
The implementation date for this instruction is October 2, 2006, and the FY2007 rates apply to claims with dates on or after October 1, 2006, through September 30, 2007.
Additional Information
If you have questions, please contact your Medicare RHHI at their toll-free number which may be found at http://www.cms.hhs.gov/MLNProducts/downloads/CallCenterTollNumDirectory.zip on the CMS Web site.
For complete details, please see the official instruction issued to your RHHI regarding this change. That instruction may be viewed by going to http://www.cms.hhs.gov/Transmittals/downloads/R1094CP.pdf  on the CMS Web site.
The hospice payment rate and cap are discussed further in the Pub.100-04, Medicare Claims Processing Manual, Chapter 11, Processing Hospice Claims, Section 30.2, and Section 80.2. This information may be reviewed at http://www.cms.hhs.gov/manuals/downloads/clm104c11.pdf on the CMS Web site.
Disclaimer
This article was prepared as a service to the public and is not intended to grant rights or impose obligations. This article may contain references or links to statutes, regulations, or other policy materials. The information provided is only intended to be a general summary. It is not intended to take the place of either the written law or regulations. We encourage readers to review the specific statutes, regulations and other interpretive materials for a full and accurate statement of their contents.
MLN Matters Number: MM5254 Revised
Pub. 100-4, Transmittal# R1094CP, CR# 5254
Related CR Release Date: October 27, 2006
Effective Date: October 1, 2006
Implementation Date: October 2, 2006
Attention Hospices!
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