A hospice exceeding its aggregate cap owes CMS retroactively — everything billed over the limit, per beneficiary. On a 50-patient hospice, a $25,000 overage per patient is $1.25 million. The Medicare Cost Report doesn't reveal it until months after the cap year ends.
The hospice aggregate cap is calculated at the Medicare Administrative Contractor level against a rolling 12-month cap year, not a calendar year. Most hospice administrators don't know which cap year they're in, what their current reimbursement-to-cap ratio looks like, or where the inpatient 20% exposure sits. They find out when the Cost Report settles.
The eligibility side of the equation compounds the problem. Weak CTI narratives, untimely face-to-face attestations, and Addendum delivery failures don't just create ADR exposure — they can turn a technically within-cap situation into a retroactive denial situation where previously paid claims are recouped regardless of cap status.
The hospice cap year runs November 1 through October 31 — not January through December. Most hospice administrators track revenue against a calendar year and never see the cap exposure accumulating in the actual measurement period.
The Medicare Cost Report that reveals cap exposure is typically settled 12–18 months after the cap year ends. A hospice that exceeded the cap in October 2025 may not receive a demand letter until mid-2027 — after the money has been spent.
The aggregate cap and the 20% inpatient cap (limiting GIP and respite days) are calculated independently. A hospice with an inpatient unit can be within the aggregate cap but over the inpatient cap — and owe money on both simultaneously.
A hospice that is borderline on the aggregate cap cannot afford eligibility deficiencies. Retroactive denial of previously paid claims due to weak CTI narratives or untimely F2F attestations shrinks the denominator and worsens the cap ratio simultaneously.
This engagement covers the aggregate cap, the 20% inpatient cap, eligibility documentation, F2F attestation, GIP level-of-care patterns, and Addendum delivery compliance — in a single fixed-fee engagement.
Projection of your aggregate cap exposure against the FY 2026 cap of $35,361.44 per beneficiary. Built from your actual reimbursement data against your current beneficiary census. Shows where you sit relative to the cap limit and how much runway remains in the cap year.
Fifteen-chart review of Certifications of Terminal Illness — narrative specificity, functional decline documentation, attending physician language, and recertification timing. Each chart scored against Palmetto LCD L38655 denial criteria.
Review of face-to-face attestation compliance under § 418.22(b)(4), including the FY 2026 flexibility provisions allowing attestation by the hospice physician or nurse practitioner. Timing compliance and documentation format reviewed for all 15 audited charts.
GIP utilization pattern review against the 20% inpatient cap. Length-of-stay distribution, attending documentation of GIP appropriateness, and transition-to-routine-home-care documentation. Identifies IPU operators at risk of inpatient cap exposure before the Cost Report settles.
Review of Addendum delivery workflow compliance — the § 418.28 requirement to provide the Addendum within 5 business days of request or upon discharge, whichever is earlier. Template review and delivery timing documentation assessed against the FY 2027 proposed-rule expansion.
Full written report — cap projection model output, eligibility audit findings by chart, F2F compliance summary, GIP analysis, Addendum workflow assessment, and prioritized corrective actions. Structured for placement in your compliance program file or presentation to ownership.
12-month aggregate cap model output documenting current exposure position, remaining cap year runway, and projected year-end exposure under current utilization patterns. Includes the inpatient cap calculation separately.
Chart-by-chart findings notation for CTI narrative adequacy, F2F attestation compliance, and election statement completeness. Deficient charts flagged with the specific regulatory citation and recommended corrective language.
Written assessment of GIP length-of-stay distribution against the 20% inpatient cap. Includes documentation quality review for the GIP-to-RHC transition process — the most frequently cited inpatient cap compliance gap.
Assessment of current Addendum template against the post-FY 2020 requirements and FY 2027 proposed-rule expansion. Delivery timing documentation reviewed and workflow recommendations provided.
Every finding tied to a specific regulatory citation, a recommended corrective action, and a suggested timeline. Formatted for integration into a compliance plan, board presentation, or response to a MAC inquiry.
30-minute call to confirm census, cap year position, and IPU status. SOW and BAA issued within 24 hours. Engagement clock starts on signed SOW and BAA execution.
Secure transfer of reimbursement data and the 15 selected charts. Data is processed locally — no PHI enters cloud storage. Chart selection criteria provided by us; final selection made jointly.
Cap projection model built, charts reviewed, GIP pattern analyzed, Addendum workflow assessed. Findings drafted and internally reviewed before delivery.
Full written report delivered via encrypted transfer. 60-minute debrief call included — we walk through the cap projection, eligibility findings, and corrective action priorities with your administrator and/or compliance officer.
The Cap Audit is the most analytically intensive hospice engagement we offer. It is also the most natural entry point into ongoing compliance work — because cap exposure doesn't resolve on its own, and eligibility weaknesses identified in the audit require a workflow change, not a one-time fix.
Most clients who complete a Cap Audit add either a PPEO Readiness Assessment (if they are in active PPEO) or a Compliance Subscription for ongoing monitoring. The debrief call is the natural moment to scope either engagement.
The discovery call is 30 minutes. We'll confirm your cap year position, census range, and IPU status — then issue the SOW and BAA within 24 hours. The engagement fee is confirmed in the SOW before work begins.
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