and planning for the CY2027 HH PPS Proposed Rule

Following are some updates, articles, and information applicable to Hospice (above), and Home Health (below), that all should be aware of, and preparing for where appropriate:

Hospice Issues/Considerations:

The 2027 Hospice Proposed Rule

The Comment Period is open until Monday, June 1, 2026

• Significant Changes/Updates per this Proposed Rule:
  • Payment Changes:
    • A proposed 2.4% increase for FY 2027, estimated to add about $785 million in Medicare Hospice spending
    • Patient cap proposed to be $36,210.11 (an increase of $848.67)
    • Budget Neutrality Factor 0.9999 (virtually unchanged)
    • SIA (Service Intensity Add-on for skilled care) proposed to continue to compensate RN/SW visits at an increased level in the last 7 days of life

• New Oversight & Transparency Measures
  • NEW: Service and Spending Variation Index (SSVI): Nine claims-based measures tracking hospice utilization and non-hospice spending during hospice enrollment. High scores signal potential program integrity issues, possibly leading to audits or other enforcement reviews/activities
    • Score can range from 0 (good) to 16 (not good)
    • See IFS4hh blog
  • Mandatory hospice election addendum: Required for all Medicare beneficiaries at the time of hospice election, not just when requested
  • Discharge authority: Expanded to allow physician designees and physician members of the interdisciplinary group, in addition to the medical director, to discharge patients
  • Telehealth face-to-face policy: Updated in line with the Consolidated Appropriations Act, 2026

• Quality Reporting & Compliance
  • Hospice Quality Reporting Program (HQRP): Failure to meet HOPE reporting requirements will result in a -1.6% negative update instead of the Hospice receiving the full base payment rate
  • Public visibility: CMS proposes adding an icon on Medicare.gov’s Compare Tool (Care Compare) for hospices that fail HQRP requirements

• Healthcare leaders break down hospice reform, Medicare & quality care | part one

• Ohio’s Hospice CEO: prepare for value-based care

• CMS trains its program integrity sights on Texas Hospices

• New tech lets home carers and hospice providers communicate better, more safely  –  (time will tell)

Home Health Issues/Considerations:

• The Preliminary April 2026 IPRs for the expanded HHVBP Model have been published in the Internet Quality Improvement and Evaluation System (iQIES).

• The 2027 HH PPS Proposed Rule will likely be out in the Public Inspection Desk (of the Federal Register) in less than two months – see the following identifying the publication dates of the last six Proposed and FINAL Rules (late June is the norm since we moved to PDGM):

Preparing for the CY2027 HH PPS Proposed Rule

Within a days or so of its publication, not only will I be able to identify the average payment rate change (and the MAX Increase and Decrease) for every CBSA/Service Area in the Medicare program (for 2026 there are 489 CBSA/Service Areas), I will be able to calculate what the agency-specific impact would be projected to be, if/when engaged to perform this service (and for most, this rate WILL NOT equate to the change in home health spending).

An additional review I recommend coincident with the Payment Rate Change Analysis is also a Resource Utilization Review to identify for the agency the extent of overutilization over the last 12-18 months. I have been doing this for over 20 years, and it has never failed to surprise.

This overutilization exists at levels few realize (it is a ‘hidden-cost’ to the agency) and can be costing agencies anywhere from 2.5-15+ % points on their margins (meaning, if the overutilization did not exist, their profit margin % would likely increase between 2.5 to 15+ % points: that is, it could move a 6% profit margin up to somewhere between 8.5-21+% | most agencies will fall somewhere in between, ~6-10%).

And the thing about this kind of fix, is that this is a fix that tends to stay in place for several years; it is not a one-time fix that you must constantly re-do (but, you do need to keep the staff aware that this is something you are now regularly inspecting, which helps extend this fix’s useful life).

Would this be of value to your agencies? 

Remember What Happened for CY2026

• And remember, last year (for CY2026), CMS tried to eviscerate home health spending. However, because of the outcry from the industry (such as it was; it should have been a lot more: only 455 comments submitted) and help from Congress, the pain was reduced and punted down the road. We are now down the road. So what will CMS propose for 2027? 
• See the projected home health spending comparison per the Proposed and FINAL Rule for CY2026 (last year’s rule making period):

• The Proposed Rule was going to reduce CY2026 Home Health Spending by ~ $1.135 Billion!
• The FINAL Rule only reduced CY2026 Home Health Spending by ~$220 Million.
• Note: The BA Adj above refers to the Behavioral Adjustments per CMS.

• The question is:  What will CMS propose for CY2027?

Conclusion

If you would like some assistance with any of these issues and/or services, are struggling with your financial or operational processes or outcomes, please reach out to IFS for Home Health to see how we can help.