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 Volume 24.03

In a stunning development, yesterday the U.S. Centers for Medicare & Medicaid Services (“CMS”) announced that the hospice component of the value-based insurance design model (“VBID”) will end on December 31, 2024.

The hospice component was recently extended until 2030; however, CMS has issued the following, “After carefully considering the feedback about the increasing operational challenges of the Hospice Benefit Component and limited and decreasing participation among MAOs that may impact a thorough evaluation, CMS has decided to conclude the Hospice Benefit Component as of December 31, 2024, 11:59 PM.”  “CMS will not accept applications to the previously released CY 2025 Request for Applications for the Hospice Benefit Component of the VBID Model.”

The Health Group, LLC, as well as national associations have continuously voiced opposition to the inclusion of hospice in VBID; however, it appears that the major obstacle to the hospice component of VBID was the lack of participation; in fact, participation was declining from previously experienced low-level participation.  We believe this is a victory for patients and providers.  Fortunately, CMS identified the hospice component as a program with little support as designed.  Additional information is available here.


Many hospices subjected to Hospice CAP repayments liquidate these obligations through an Extended Repayment Schedule approved by the Medicare Administrative Contractor (“MAC”) and CMS.  Obligations determined at the time of self-filing the CAP liability report have caused significant confusion to hospices regarding when requests for an ERS are to be submitted.

CGS, NGS, and Palmetto have all accepted the policy of accepting an ERS Request once a demand notice is issued regarding the CAP liability obligations.  We applaud the MACs for this position as a consistent approach to addressing the self-determined CAP liability of the respective hospice.


Hospices which have been subjected to claim denials and which have incurred CAP liabilities need to be keenly aware of refund opportunities to which they may be entitled.

Claims denials related to services rendered in a CAP Year for which a CAP liability occurred may entitle the provider to a partial refund of a CAP liability previously paid.  The denied claims triggering a repayment by the hospice may represent a second recovery of funds from the hospice and, accordingly, a partial refund of CAP repayments may be appropriate.

As claim reviews and denials become more prevalent, we see more potential CAP liability recoveries by hospices.  Depending on the CAP Year impact, the hospice may not be notified by the MAC of the recovery potential.  Hospices may need to request a refund to secure the excessive repayment to the Medicare program.


The Health Group, LLC will be attending and exhibiting at the upcoming Financial Management Conference in Las Vegas, sponsored by NAHC, on July 21-23, 2024.  Make certain to plan and visit with us at Booth 217.  Information regarding the program can be obtained at www.nahc.org.  Do not hesitate to contact us at contact@healthgroup.com or ted.cuppett@healthgroup.com to schedule a time during the program to get together.