FY 2027 Hospice Rule: The Election Addendum Goes Mandatory

CMS wants your coverage decisions in writing

Deciding what hospice covers has always been a judgment call. CMS wants it in writing, on every election, in the patient's hands.

The FY 2027 proposal reads like a rate update. Underneath, it changes who sees your medication decisions and how you answer for them. Here is what is actually in it.

What the FY 2027 proposal actually changes

On April 2, CMS proposed the FY 2027 hospice payment update. The headline is a 2.4% increase, an estimated $785 million, tied to the rising cost of hospice goods and services. The number is welcome. The conditions attached to it are the story.

CMS is proposing to make the hospice election statement addendum mandatory for every election. Today, the addendum is provided only when a patient or representative requests it. Under the proposal, a hospice could not bill Medicare for that election period without one.

The addendum is not the election statement, and the distinction is the whole point. The election statement confirms the patient's choice of comfort over cure. The addendum does something narrower and heavier. It lists, in writing, the conditions, items, services, and drugs the hospice has determined are unrelated to the terminal illness and its related conditions, and therefore fall outside the benefit. It is the document in which the relatedness determination becomes visible to the patient, and the patient learns what they are financially responsible for.

That determination now pulls weight in three directions at once. It sets the patient's financial responsibility. It gates the hospice's ability to bill. And it feeds into a new Service and Spending Variation Index, a claims-based score that CMS will use to flag hospices whose non-hospice spending is high. Separately, hospices that fall short on HOPE quality reporting would be marked on Care Compare for the public to see.

The through-line is hard to miss. CMS is asking every hospice to state, defend, and stand behind which drugs and services belong to the terminal illness. That call used to live in a clinician's head. It is becoming a written, patient-facing, reimbursement-bearing, publicly visible record.

The governance read

Read the proposal closely, and one word runs beneath all of it. Governance. CMS is no longer satisfied to see what a hospice spends. It wants to see how a hospice makes its decision. The relatedness determination is moving out of the chart and onto a document the patient holds, a claim Medicare reads, and a score the public can find.

This is the moment an independent administrator earns its keep. Wise does not dispense your drugs, and Wise does not sit inside a private equity roll-up with a reason to blur these lines. As the administrator, Wise sees every medication decision, which is the right vantage point to support the relatedness call your clinicians have to make. Building that support is where we are putting our work right now: a governance layer that helps your team determine what is related and defend it with citable evidence. When the addendum has to be right on every election, the work you have always done becomes the work CMS now scores.

The hospice that treats relatedness as paperwork will feel this rule as a burden. The hospice that treats it as governance will feel it as an advantage. We built Wise for the second kind.

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