MHA Extended Care Services
Hospice

Regulatory Information

From: Casey Blumenthal
Sent: Thursday, August 20, 2009 11:47 AM
To: DL-Hospice-All
Subject: FY2010 Final Wage Index and Payment Rates

CMS has released the updated payment rates and cap amount in the Aug. 14 Transmittal 1796, Change Request (CR) 6606. The full language is available in the attached transmittal. 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 (SSA) stipulates that the payments for hospice care for fiscal years after 2002 will increase by the market basket percentage increase for the FY 2010. This payment methodology has been codified in regulations found at 42 CFR §418.306(a)(b).

The rates will be increased by 2.1 percentage points, the total market basket percentage increase forecasted for FY 2010. However, the phased-in elimination of the hospice budget neutrality adjustment factor (BNAF)will reduce this by -0.7% (10% of the BNAF phase-out) for an increase of 1.4% in the FY 2010 hospice payments. The new rates are effective for services provided on or after Oct. 1, 2009 through Sept. 30, 2010. Interestingly enough, wage index rates for Montana went up!

The hospice cap is updated annually in accordance with §1814(i)(2)(B) of the SSA 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 hospice cap amount for the year ending Oct. 31, 2009 is $23,014.50. Reference to the hospice cap is discussed further in Pub100.04 – Medicare Claims Processing Manual, Chapter 11 – Processing Hospice Claims, Section 80.2 (also attached).

The annual hospice payment updates will be implemented through the Hospice Pricer software found in the intermediary standard systems. The new Pricer module will not contain any new calculation logic, but will simply apply the existing calculation to the updated payment rates shown below. An updated table will be installed in the module, to reflect the FY 2010 hospice wage index. The input and output records of the Pricer module will not be changed. No billing changes are required of hospices to receive the updated rates.

FY 2010 Hospice Payment Rates

As noted above, the FY 2010 payment rates will be the FY 2009 rates, increased by 2.1 percentage points. The FY 2010 hospice payment rates are effective for care and services furnished on or after Oct. 1, 2009, through Sept. 30, 2010.

Hospice Wage Index

These national rates are adjusted by the RHHI as follows: A wage amount subject to the index and a non-weighted component. The wage amount component is adjusted (multiplied) by the wage index for the location of the place of service for all levels of care. The adjusted wage component is then added to the non-weighted component. This is the payment rate for the year.The revised wage index and payment rates will be incorporated in the hospice Pricer and forwarded to the intermediaries following publication of the wage index final rule.

Split Claims Recommended

As the new rates take effect Oct. 1, 2009, Hospices are advised to split claims if the dates of service span the separate fiscal years.

Once I get my hands on a spreadsheet w/the new values in it, I will send it your way...

Attachment 1 of 3 - FY2010 Hospice Wage Index - Final Rule

Attachment 2 of 3 - FY2010 CMS Claims Processing Manual - Chapter 11 - Processing Hospice Claims

Attachment 3 of 3 - Pub 100-04 Medicare Claims Processing - Hospice

Casey Blumenthal, MHSA, RN, Vice President
Casey@mtha.org    406- 442-1911

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