CMS Finalizes Medicare Hospice Payment Increase and New Patient Disclosure Rules for FY 2027

A hospice nurse speaks with a patient and family member during an in-home visit. CMS has finalized fiscal year 2027 Medicare hospice payment updates, expanded patient disclosure requirements, and revised quality reporting policies that take effect October 1, 2026. Rido/Shutterstock

The Centers for Medicare & Medicaid Services (CMS) has issued a final rule updating Medicare hospice payment rates, the hospice wage index, and quality reporting program requirements for fiscal year 2027. According to an official announcement published in the Federal Register on August 3, 2026, the changes take effect October 1, 2026.

Medicare Hospice Payments Will Increase in FY 2027

The rule, identified as CMS-1851-F and published at 91 FR 49118, covers several areas relevant to Medicare beneficiaries who are enrolled in or considering hospice care, as well as the providers who serve them.

On the payment side, CMS finalized updates to the hospice wage index and the hospice payment update percentage for FY 2027. The wage index is used to adjust Medicare hospice payment rates based on local labor costs, which can affect what hospice providers are paid depending on where they are located. The rule also finalizes the hospice cap amount for FY 2027, which sets a limit on the total Medicare payments a hospice provider can receive per patient.

Quality Reporting Requirements Continue to Expand

A notable policy change in the final rule makes the Hospice Election Statement Addendum mandatory for all hospice elections. The addendum is a form that informs patients and their families about services and conditions that will not be covered under the hospice benefit, helping them understand what non-hospice care they may still access or need to arrange separately. Previously, this addendum was not uniformly required for every election. CMS also analyzed Medicare spending on non-hospice services that occur while a patient is enrolled in hospice, examining trends across categories including neurological and degenerative diseases, circulatory and cerebrovascular diseases, respiratory diseases, and cancers.

The rule also includes clarifying changes to regulation text regarding discharge from hospice care and face-to-face encounter requirements. Additionally, CMS used the rule to request information on ways to enhance the provision of palliative care outside of the hospice benefit, signaling potential future policy interest in that area.

What Medicare Beneficiaries and Families Should Know

For Medicare beneficiaries over 50 and their families, hospice is a benefit available to those with a terminal illness who choose to focus on comfort rather than curative treatment. The payment and policy updates in this rule primarily affect how hospice providers are reimbursed, but the mandatory addendum change directly involves patients at the time they elect hospice coverage.

Readers should verify how these changes may apply to their specific situation by contacting CMS directly or visiting Medicare.gov, as individual circumstances vary. The official rule spans 59 pages in the Federal Register and the full text is available through the Government Publishing Office.