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Statement of Need: This final rule revises and reorganizes the existing conditions of participation (CoPs) for Medicare participating hospice providers first published in 1983. The final rule focuses on the care delivered to patients and patients’ families by hospices and the outcomes of that care. The requirements continue to reflect an interdisciplinary view of patient care and allow hospices flexibility in meeting quality standards. These changes are an integral part of the Administration's efforts to achieve broad-based improvements in the quality of health care furnished through the Medicare and Medicaid programs. This rule codifies hospice language in the Balanced Budget Act of 1997 and the Medicare Modernization Act of 2003.

Summary of the Legal Basis: The Social Security Act (the Act) provides the statutory qualifications and requirements that a hospice must meet to receive payment for hospice care given to Medicare beneficiaries who elect the hospice benefit under the Medicare and Medicaid programs. This section gives the Secretary broad authority to establish standards for hospices. Under this authority, the Secretary established conditions of participation (CoPs) for hospices. In addition, the Act gives the Secretary the authority to make and publish such rules and regulations as may be necessary to the efficient administration of the functions with which he is charged under the Act. This section of the Act gives the Secretary broad authority to establish requirements for hospices that are necessary for the efficient administration of the Medicare program.

Alternatives: Rely on the current CoPs: We concluded that this was not a reasonable option because the current CoPs are not patient-focused but rather problem-focused, an approach that has inherent limits. Trying to ensure quality through the enforcement of prescriptive health and safety standards, rather than trying to improve quality of care for all patients, adversely affects agency improvement efforts and does not stimulate broad-based quality of care initiatives. On the other hand, revising the current CoPs would take advantage of continuing advances in health care delivery. Increase prescriptive requirements relative to patient rights, drugs and durable medical equipment, and personnel qualifications: We decided not to pursue this approach because the additional burden that would be placed on hospices would outweigh any potential benefits. Exclude the revisions to the comprehensive assessment and interdisciplinary group requirements: Since these areas represent two of the most frequently cited deficiencies noted during hospice surveys and have a great impact on patient care, we decided that these sections did, in fact, need to be strengthened.

Anticipated Costs and Benefits: Provisions within the final rule may require that some hospices provide patient care and patient care related services that they are not currently providing. These services will most likely require a cost outlay. Since these rules have not been revised for over 20 years, we believe that many of the improvements that are being made are already being implemented in whole or in part by a portion of hospices.

Risks: This final rule must be published by May 26, 2008 in order to comply with section 902 of the Medicare Modernization Act. In addition, failure to update these outdated regulations will not address the needs of patients or providers.