Hospice/Medicaid Issues Update

Posted on Tuesday, October 13, 2015 10:36 AM

Hospice Payment Reform/Medicaid: In response to CMS’s proposed hospice payment reforms that, by law, are applicable to fee-for-service Medicaid hospice benefits, there has been widespread concern that hospices, vendors, Medicare Administrative Contractors (MACs), and state Medicaid programs would not be ready for the anticipated October 1, 2015. As part of the final hospice payment rule and out of concern for state Medicaid programs, CMS delayed implementation of the two-tiered payment system for Routine Home Care (RHC/Service-intensity Add-on) until January 1, 2016. Medicaid Hospice/Managed Care: States are at different stages in their development of Medicaid managed care contracts that include the hospice benefit. On the fee-for-service side, Medicaid programs are required to pay for hospice care based on existing Medicare rates. “NAHC has had inquiries relative as to whether this same requirement applies when hospice care is provided by a managed care organization. NAHC has posed specific questions to CMS, to which we received the following response: Under Medicaid fee-for-service (FFS), the State plan payment must meet the requirements specified in Section §1902(a)(13)(B). However, under Medicaid managed care, as specified in 42 CFR §438.6(c)(2), CMS only requires that payment rates between the State and health plans be actuarially sound. Managed Care Organizations (MCOs), Prepaid Inpatient Health Plans (PIHPs), and Prepaid Ambulatory Health Plans (PAHPs) may negotiate different payment amounts with providers, unless the State requires the MCO, PIHP, or PAHP (specified in the contract) to pay at the same rate as the Medicaid State plan. Legal research conducted by NAHC staff concluded that, because of the way Medicaid MCO authorizing language is crafted, payments for hospice services provided through a MCO likely are not required to follow Medicare reimbursement requirements. NAHC has submitted follow up questions to CMS and will report on additional findings as they become available.” Click here to read more.

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