CMS published a notice with comment period on July 22, 2010 announcing the annual update to the hospice wage index for FY 2011. Under the notice, Medicare hospice rates increase by 1.8% overall, reflecting a 2.6% market basket increase partially offset by an 0.8% decrease due to updated wage index data and the second year of CMS’s seven-year phase-out of its wage index budget neutrality adjustment factor (BNAF). The notice is effective October 1, 2010; CMS will accept comments on the notice until September 20, 2010. In a related development, CMS has released a transmittal to contractors announcing FY 2011 hospice payment rates, the hospice aggregate cap amount, and the hospice wage index.