WASHINGTON—The Centers for Medicare & Medicaid Services (CMS) issued a final rule that sets Medicare hospice payment rates 2.6% higher in 2026. Hospices that don’t meet quality standards would be penalized four percentage points, leading to a 1.4% reduction over 2025’s payment rate.
The new Fiscal Year 2026 Hospice Wage Index and Payment Rate Update and Hospice Quality Reporting Program Requirements Final Rule also increases the aggregate cap for annual payments by the same 2.6%, to $35,361.44.
The overall increase was tallied from a .7 percentage point productivity adjustment, offset by a 3.3% inpatient hospital market basket percentage increase. The National Alliance for Care at Home said that while the increase is higher than initially proposed, it still falls short of providers’ needs given the costs of doing business.
“While the finalized 2.6% payment update is still insufficient for providers that face persistent inflationary forces amid an ongoing nationwide healthcare workforce crisis, we recognize CMS’s incorporation of Alliance feedback to help streamline regulatory requirements,” said Alliance CEO Steve Landers. “We will continue to partner with CMS to advocate for home-based care rulemaking that focuses on comprehensive long-term strategy to best serve both the American people and the Medicare trust fund. Evidence consistently demonstrates that hospice care aligns with patient and family preferences and saves the American healthcare system money.”
The Alliance had also asked CMS to delay the October 1, 2025 implementation of the new Hospice Outcomes and Patient Evaluation (HOPE) tool or to wave the timeliness completion requirement for HOPE record submission. It did not do so in the final rule—a disappointing move, the Alliance said.
“We expect providers to face a burdensome transition and urge CMS to remain responsive to real-world challenges, offering flexibility as providers navigate the change,” Landers said.
The organization said it is also concerned about increasing nonhospice spending and will also continue to sipport CMS’s focus on a targeted approach to stopping fraud, waste and abuse in the hospice benefit.
The rule also:
- Allows the physician member of the interdisciplinary group to recommend admission to hospice care
- Clarifies that hospice face-to-face encounter attestations must include the signature and date of the signature of the physician or nurse practitioner and allows a signed and dated clinical note to satisfy the attestation requirement