CMS tightens procedures, oversight for hospice medication claims

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In light of widespread inappropriate claims, providers will face heightened scrutiny for Medicare claims for hospice medications, the Centers for Medicare & Medicaid Services stated in a letter this week.

The vast majority of medications for hospice patients should be billed to Medicare Part A, with Medicare Part D only covering drugs needed for reasons unrelated to their terminal conditions, CMS stressed in its Dec. 6 letter to hospice providers and Part D plan sponsors.

While this policy is long established, CMS believes its previous policy statements continue to be “misinterpreted by some parties,” based on an Abt Associates analysis  cited in the letter. In 2010, Part D paid out $12.9 million in hospice claims for analgesics, the analysis found. These potentially inappropriate claims typically came from for-profit, new and/or rural hospice providers, and half of the claims were for hospice patients in nursing facilities.

These high reimbursement numbers fly in the face of CMS' expectation that hospice drugs covered by Part D will be “extremely rare,” the letter stated. To address this, plan sponsors are expected to place prior authorization requirements on all hospice medication claims.

To handle the appeals process if the provider and Part D sponsor disagree about whether a medication is needed to treat the terminal diagnoses, CMS is considering implementing a binding independent review process. In the meantime, providers and prescribers are expected to provide needed documentation for the Part D prior authorization process in a timely manner, according to the letter.

Stakeholders can submit comments on the letter through Sept. 6.