CMS Releases Proposed Pay Rules for Hospice, Skilled Nursing

The Centers for Medicare and Medicaid Services released the proposed rule for 2025 hospice reimbursement including a 2.6% raise in per diems and two new quality measures.

The 2.6% net increase would amount to a $705 million increase from FY 2024, including a 3% market basket update and a 0.4% cut for productivity. According to the American Hospital Association, CMS will also include an annual payment cap per patient of $34.364.85.

However, hospices were concerned that the rate hike would be insufficient for the slew of reasons that are now raised throughout the healthcare industry: rising costs, inflation, interest rates and staffing shortages. But hospices also contend that their services save the Medicare program money — up to $3.5 billion, Hospice News reports. From National Association for Home Care and Hospice (NAHC) Vice President for Hospice Policy Davis Baird:

More and more people are being served by hospice every year, and CMS needs to recognize the dynamic value the benefit provides — not only from the improved quality of life hospices provide but also from the huge financial savings to Medicare that utilization of the hospice benefit drives.

Skilled nursing homes are also slated to get a 4,1% increase in Medicare reimbursements, under a related proposed rule. The regulation includes proposals to strengthen oversight and impose penalties, Modern Healthcare reports.

Of course, the rule further adds to the regulatory burden coming down the pike for nursing homes, which are already bracing for federal nursing home staffing minimums. In a statement on the proposed rule, American Health Care Association (AHCA) President and CEO Mike Parkinson asked the Biden administration for mercy — and a higher payment increase:

While we appreciate this proposed increase, this funding will not stem the tide for the billions of dollars that will be required by providers each year to meet the agency’s proposed minimum staffing requirement. We implore the Administration and CMS to reverse course on this staffing mandate; otherwise, more nursing homes will close, more vulnerable residents will be displaced by these closures, and more seniors won’t be able to access the long term care they need.