Proposed Hospice Payment Rule

3 min read

Apr 02, 2025

5:24

On April 11, 2025, the Centers for Medicare & Medicaid Services (CMS) released the Fiscal Year (FY) 2026 Hospice Wage Index and Payment Rate Update Proposed Rule, outlining key payment changes, regulatory clarifications, and future directions for quality reporting in hospice care.

With hospice providers continuing to navigate staffing challenges, rising costs, and increasing quality reporting demands, understanding the potential impact of this proposed rule is essential.

Here’s an overview of the proposed updates—and where the industry may need further clarity and support.

Payment Rate Update for FY 2026

CMS proposes a 2.4% increase to hospice payment rates for FY 2026—an estimated $695 million in additional payments to hospice providers. This update reflects a 3.2% inpatient hospital market basket increase, reduced by a 0.8 percentage point productivity adjustment, in accordance with statutory requirements.

The aggregate cap on payments would also increase from $34,465.34 to $35,292.51.

Hospices that do not submit required quality data would see their update percentage reduced by four points—resulting in a 1.6% payment cut compared to FY 2025.

Overall, while the payment increase provides some relief, many providers continue to face economic pressures that outpace reimbursement growth, particularly related to workforce shortages and inflation-related costs. In a statement from the National Alliance for Care at Home, CEO Dr. Steve Landers notes:

“The proposed payment update for FY 2026 falls short of what is needed to sustain high-quality hospice care. Without meaningful adjustments, hospices across the country will face serious challenges—jeopardizing access to care for terminally ill patients and placing added strain on families already facing the unimaginable. CMS must act to protect this vital benefit and ensure that every American can receive compassionate, dignified care at the end of life.”

Clarifications to Hospice Admission and Certification

The proposed rule includes two regulatory clarifications aimed at aligning documentation with current hospice care practices:

The physician member of the Interdisciplinary Group (IDG) may recommend a patient’s admission to hospice, reinforcing alignment between payment and certification regulations.
Face-to-face encounter attestations must include a dated signature from the physician or practitioner and appear as a clearly labeled section or addendum to the recertification documentation.

These clarifications aim to reduce ambiguity and ensure consistency in compliance reviews.

Hospice Quality Reporting Program (HQRP) Updates

CMS continues to lay the groundwork for future quality measurement under the HQRP. Key updates include:

Restating the planned implementation of the Hospice Outcomes and Patient Evaluation (HOPE) tool beginning October 1, 2025
Technical corrections to regulatory text at § 418.312(j)
Updates related to the iQIES platform transition

In addition, CMS issued two Requests for Information (RFIs) on:

Future quality measures focused on interoperability, nutrition, and well-being
Strategies for advancing digital quality measurement (dQMs) in hospice

Hospice organizations preparing for HOPE and iQIES may benefit from more detailed implementation guidance to ensure readiness without disrupting patient care. Industry leaders and The Alliance have additionally voiced concern around the lack of time and clarity surrounding the upcoming HOPE tool implementation.

What’s Next: CMS Invites Public Feedback

The FY 2026 proposed rule for hospice offers important updates to payments and regulatory language, while signaling CMS’s continued focus on interoperability, digital measurement, and regulatory reform.

CMS is currently seeking public input through a Request for Information focused on:

Streamlining Medicare regulations
Identifying ways to reduce provider burden and enhance operational efficiency

Providers, industry groups, and stakeholders are encouraged to review and respond to ensure the final rule reflects the needs and realities of today’s hospice environment:

Full proposed rule: Federal Register Public Inspection

Hospice Center: CMS Hospice Provider Page

As the industry reflects on these proposals, one thing is clear: ongoing feedback from the field will be key to shaping a future where high-quality, compassionate hospice care is both sustainable and accessible.

Stay Ahead of CMS Changes with Expert Support from MTEC

CMS’s proposed updates—like the upcoming HOPE assessment tool—are impacting the hospice landscape. Maxwell TEC is dedicated to continuously supporting hospice organizations navigate these changes with confidence. Our expert consulting team helps train staff, evaluate operational readiness, and ensures your agency is prepared for HOPE.