THE MEDICARE HOSPICE BENEFIT

• When does Medicare cover hospice care?

• What kinds of care are covered?

• What is the difference between the regular Medicare home health benefit and hospice?

• How does the Medicare hospice benefit coordinate with Medicaid coverage?

• When will Hospice cover prescription drugs?

• What is the difference between "palliative" care and "curative" care?

For other information, follow one of the links below or scroll down the page.

A QUICK SCREEN TO AID IN IDENTIFYING COVERABLE CASES

Medicare claims for hospice care are suitable for coverage, and appeal if they are denied, if they meet the following criteria:

• The patient is terminally ill and has elected Medicare hospice coverage. Patients are entitled to two 90-day election periods, followed by an unlimited number of 60-day periods.
  

• The attending physician (if one exists) and the medical director or physician member of the hospice interdisciplinary team must have certified in writing at the beginning of the first 90-day period that the patient was terminally ill. For all subsequent election periods, only a hospice physician must certify that the patient is terminally ill.
  

• The patient or his or her representative has signed and filed a hospice election form with the hospice of choice.
  

• The hospice provider is Medicare-certified.
  

• The services for which Medicare coverage has been denied were provided for the palliation and management of the terminal illness.
  

ADVOCACY TIPS:

• The attending physician is always the key to obtaining Medicare coverage. Obtain a statement from the beneficiary’s physician stating that the patient is terminally ill, that the services are reasonable and necessary for the comfort and management of a terminal illness, and that the services were included in the written plan of care.

• The beneficiary does not have to have cancer to qualify for the Medicare hospice benefit.

• The beneficiary does not have to have a "do not resuscitate order" to qualify for the Medicare hospice benefit.

• The beneficiary does not have to be homebound, and may go out as long as he or she is able to do so.

• If coverage is sought for inpatient services, in a hospital or skilled nursing facility, the physician should explain why the inpatient care was reasonable and necessary and that the care could not be provided in other than an inpatient setting.

WHAT IS HOSPICE CARE?

• Hospice care is compassionate end-of-life care that includes medical and supportive services intended to provide comfort to individuals who are terminally ill.  Care is provided by a team.

• Often referred to as “palliative care,” hospice care aims to manage the patient’s illness and pain, but does not treat the underlying terminal illness.

• Hospice care may include spiritual and emotional services for the patient, and respite care for the family.

• Hospice care is provided by a team of appropriate professionals.

• Many hospitals and skilled nursing facilities have hospice units, but most hospice care is provided at home.

• Hospice Care Goals include ensuring that the patient will:

  • Be as comfortable and pain-free as possible.

  • Be independent for as long as possible.

  • Receive care from family and friends.

  • Receive support through the stages of dying.

  • Die with dignity.
    

WHAT KINDS OF CARE DOES MEDICARE HOSPICE CARE INCLUDE? 

Generally, hospice care includes services which are reasonable and necessary for the comfort and management of a terminal illness. These services may include:

• Physician services.

• Nursing care.

• Physical therapy, occupational therapy, and speech-language pathology services.

• Medical social services.

• Hospice aide services.

• Homemaker services.

• Medical supplies, including drugs and biologicals and medical appliances.

• Counseling, including dietary counseling, counseling about care of the terminally ill patient, and bereavement counseling.

• Short term inpatient care for respite care, pain control, and symptom management.

WHEN WILL MEDICARE COVER HOSPICE CARE?

• A physician must certify that the beneficiary is terminally ill. This means that in the physician’s judgment the individual has 6 months or less to live if the illness runs its normal course.

• The beneficiary or his/her representative must elect the Medicare hospice benefit by signing and filing a hospice benefit election form with the hospice of choice.

• The beneficiary’s attending physician and the hospice physician must certify the beneficiary for the initial period. For subsequent periods the hospice physician recertifies the beneficiary.

• After having been certified by a physician, the beneficiary may elect the hospice benefit for two 90 day periods and an unlimited number of subsequent 60 day periods.

• All hospice care and services furnished to patients and their families must follow an individualized written plan of care established by the hospice interdisciplinary group in collaboration with the attending physician (if any), the patient or representative, and the primary caregiver, in accordance with the patient's needs if any of them so desire.

• The care must be provided by, or under arrangements with, a Medicare certified hospice.
  

HOSPICE MEDICARE APPEALS

Under Medicare, there are currently two methods of appeal available for denials of hospice care.  The appeals are fraught with confusion and bureaucratic complications.  To make matters worse, the two systems are not clearly named or demarcated.  For purposes of this discussion, they will be referred to as "expedited appeals" and "standard appeals". 

1.                  Expedited Appeals

The right to an expedited appeal became effective on July 1, 2005.[1]  Hospice patients have the right to an expedited appeal when their provider decides to discontinue hospice care entirely.[2]  The hospice provider must give the beneficiary a standardized "valid written notice" at least two days prior to the cessation of care.[3]  Among other pieces of information, the standardized notice must tell the beneficiary the date that coverage of services ends; the date that the beneficiary's financial liability for continued services begins; and a description of the beneficiary's right to an expedited determination.[4]  This notice is valid when the beneficiary (or the beneficiary's authorized representative) has signed and dated the notice to indicate that she has received the notice and can comprehend its contents.[5]

Providers are financially liable for continued services until two days after the beneficiary receives valid notice or until the service termination date specified on the notice, whichever is later.[6]  A difficulty that often arises is that many agencies render both Medicare covered hospice and home health care.  When beneficiaries are discharged from hospice care, they are often transferred to the agency's home health program.  Providers sometimes inappropriately believe that since the beneficiary is still getting care from the same organization, they do not have to issue the standard notice regarding expedited appeal.  If no notice is issued, the beneficiary will never know that she had a right to have the hospice program's discharge decision reviewed. 

The standardized notice contains the telephone number for the Quality Improvement Organization (QIO) serving the beneficiary's state.    To exercise their right to an expedited review, beneficiaries must contact the QIO by no later than noon of the calendar day following receipt of the provider's notice of termination.[7]  This time frame is terribly short, and given that the hospice patient is obviously very sick, and caregivers and families may be disorganized or take some time to process the significance of the standardized notice, the deadline is frequently missed.  If beneficiaries make untimely requests, they lose financial liability protections and the guarantee of a quick decision.[8] 

Initial Determination

The QIO 's decision regarding whether the hospice program's discharge decision was appropriate is supposed to made within 72 hours after receipt of the beneficiary's request for an expedited determination.[9] Prior to rendering a decision, the QIO must review the hospice medical records, provide the hospice provider an opportunity to explain why the discharge was appropriate, and solicit the views of the beneficiary.[10]   The burden of proof rests with the provider regarding whether its decision to discharge the beneficiary was correct.[11]  It is, of course, good that this is an expedited process.  However, 72 hours is rarely enough time for a sick beneficiary to understand what exactly is being appealed (the provider's allegation that the beneficiary is no longer terminally ill), secure copies of all pertinent medical records, and solicit the opinion and support of the attending physician. 

It should be noted that at the beneficiary's request, the hospice must furnish the beneficiary with a copy of, or access to, any documentation that it sends to the QIO, including records of any information provided by telephone.  The provider can charge for the cost of duplicating documents.  Unfortunately, beneficiaries are never told they have the right to review the documents.  In the event that a beneficiary does request access to the medical records, the provider must accommodate the request by no later than close of business of the first day after the material is requested.[12]   Even if beneficiaries are aware that they have a right to review their medical records, the cost of paying for duplicate copies might be prohibitive, or they may lack the ability (due to illness, caregiving responsibilities, or lack of transportation) to go to the provider's office to review the medical records. 

Coverage of hospice care continues until the date designated on the termination notice, unless the QIO reverses the provider's discharge decision.[13]  If the QIO finds that the beneficiary did not receive valid notice, coverage of provider services continues until 2 days after valid notice was received.[14]

Even if the beneficiary prevails and the QIO decides that the beneficiary is still terminally ill and that hospice services should continue, there are still potential problems.  One problem is that hospice coverage requires a certification from the hospice doctor that the beneficiary's life expectancy is six months or less if the terminal illness runs its normal course.[15]  The hospice physician can circumvent the QIO's decision by refusing to sign the required certification.  Another potential problem is that the scope of the QIO's decision is limited to the finding that the hospice care should not have been discontinued on the date identified on the standardized notice.  There is nothing preventing the hospice from issuing another such notice after the beneficiary receives her favorable QIO decision.  In other words, one day after the QIO finds that care should continue, the provider can issue another notice warning the beneficiary that she will be discharged in two days.

In addition, the expedited appeal system is not synchronized with the standardized appeal system.  The provider may honor the QIO's decision, but still submit a bill to the Medicare Contractor who may later choose to deny the claim.  

Reconsideration

If the QIO decides that the provider's decision to terminate care because the beneficiary is no longer terminally ill was correct, the beneficiary then has a right to an expedited reconsideration.[16]  The reconsideration request must be submitted to the Qualified Independent Contractor (QIC) in writing or by telephone no later than noon of the calendar day following notification by the QIO of its decision.[17]  If this deadline is missed, the beneficiary can request a standard reconsideration.[18]  This right, however, is essentially moot, as the beneficiary would be asking the QIC, after up to 60 days of no care, to rule that hospice care should not have been discontinued.[19]  There is currently no evidence that the QIC would have the authority to order the hospice to resume care after such a long period of discontinued care. 

Unless the beneficiary requests an extended period, the QIC must render a decision within 72 hours of receipt of the request for an expedited reconsideration, and any medical or other records needed for such reconsideration.[20]  The beneficiary has the right to extend this period to up to 14 days for purposes of preparing an argument.[21]  Upon the beneficiary's request, the QIO must furnish the beneficiary with a copy of, or access to, any documentation that it sends to the QIC.  The QIO may charge the beneficiary for the cost of duplicating documents and/or delivering the documents to the beneficiary.  The QIO must accommodate the request no later than close of business of the first day after the material is requested.[22]  Again as at the initial (QIO) level of review, beneficiaries have no way of knowing that they have this right and even it is known, the cost or effort involved in duplication may be prohibitive. 

ALJ Hearings

In the event that the QIC upholds the QIO's decision that the provider was correct in discontinuing hospice care because the beneficiary was not terminally ill, the beneficiary has a right to request an Administrative Law Judge (ALJ) hearing.  ALJ hearings are not expedited.  They must be requested within 60 days of the date the beneficiary receives the QIC's decision.[23]  The ALJ must issue a decision within 90 days of receipt of the request for hearing.[24]  The benefit of this right, however, is terribly unclear.  By the time the beneficiary speaks to the ALJ, several months will have passed since the beneficiary was discharged from hospice care.  The ALJ will be evaluating medical evidence that is no longer current to decide whether the beneficiary was terminally ill months ago.  In the event that the ALJ decides that the beneficiary was still terminally ill at that time, it is unclear that the beneficiary would currently be considered terminally ill.  Furthermore, even if the ALJ did decide the beneficiary was still terminally ill, she is not given the authority to order the resumption of care. 

Alternatively, it is possible that the hospice never discharged the beneficiary, but has not billed Medicare.  Despite the fact that care was ongoing, all the ALJ is technically reviewing is the QIC's decision regarding discharge.  The regulations do not explicitly give the ALJ authority to convert the appeal from one regarding the appropriateness of discharge to the issue of coverage.   It is, in other words, conceivable that the beneficiary could get a decision from an ALJ indicating that care should not have been discontinued, but no direction as to how to put the remaining care into controversy.  These same problems arise if the beneficiary successfully brings the case to the next levels of review, Medicare Appeal Council Review or Federal district court.[25]   

2.                  Standard Appeals

Making the system particularly confusing is the fact that hospice beneficiaries not only have a right to an expedited appeal, but also a right to standard appeals.  Standard appeals review not whether care should have been terminated, but whether rendered and billed care should be paid for by Medicare.  Standard appeals begin with an Advance Beneficiary Notice (ABN) from the provider to the beneficiary  giving the provider's opinion that continuing hospice care will not be covered by Medicare.  This ABN serves the purpose of shifting financial liability from the provider to the beneficiary for ongoing care.[26]   It also acts as a vehicle for the beneficiary to put ongoing care into controversy, or "demand bill."  It does this through its standardized construction which includes options to either request ongoing continuing care and have the care billed to Medicare, receiving ongoing care and not have the care billed to Medicare, or to discontinue care.[27]  Unfortunately, providers frequently do not understand the distinction between the standardized notice for expedited appeals and the ABN.  Consequently, they may only issue the standardized notice and not the ABN or, if they issue both, fail to explain to the beneficiary that there are two notices being rendered explaining different appeal rights.[28]  Often, given the two notices, beneficiaries will exercise the right to an expedited determination but not the right to a standard appeal.  This means, as was discussed earlier, that the question of the appropriateness of discharge will be the only issue reviewed.  The issue of coverage of ongoing care will not be addressed.

If a beneficiary does exercise her right to a demand bill, the provider will bill the care as non-covered and the beneficiary will get a denial via a Medicare Summary Notice.[29]  Unfortunately, there are no established rules regarding how many days of care the beneficiary is entitled to have billed to Medicare.   And of course, prior to exercising this right, beneficiaries must understand that in the event that Medicare coverage is ultimately not granted, they will be financially responsible for the ongoing care.  Successful appeals generally require the support of the beneficiary's attending physician.  Prior to starting a standard appeal, it is a very good idea to ask the beneficiary's attending physician if she will write letters and potentially testify in support of Medicare coverage.

The right to an initial determination is followed by a right to a redetermination, a reconsideration, an ALJ hearing, a MAC review, and so long as there is enough in controversy, a right to judicial review.[30]  

Medicare Advantage

Medicare Advantage (MA) plans may provide, but are not required to provide, hospice services to Medicare beneficiaries.[31]  Beneficiaries enrolled in MA plans, like all Medicare beneficiaries, must elect the hospice benefit.[32]  If the plan offers hospice coverage, the beneficiary must receive coverage within the plan's network.  If the plan does not offer hospice coverage, the beneficiary can select any Medicare-certified hospice provider.  The hospice care will be covered through traditional Medicare and care not related to the terminal illness will be covered by the MA plan.[33]  Beneficiaries in MA plans have a unique set of appeal rights that will not be discussed but can be found in the regulations.[34]  The MA appeals are simpler than traditional appeals as there is only one appeal system.  However, like expedited appeals, the initial question considered is whether discharge is appropriate, and thus beneficiaries have a difficult time negotiating the system so that the question of ongoing care can be considered. 

HOSPICE LEVELS OF CARE

Generally, Medicare pays hospice agencies a daily rate for each day a beneficiary is enrolled in the hospice benefit.  This daily payment is made regardless of the amount of services provided on a given day, and even on days where no services are provided.  The daily payment rates are intended to cover costs that hospices incur in furnishing services identified in patients’ care plans.  Payments are made according to a fee schedule that has four base payment amounts for the four different categories of care.

• Routine home care: Ninety-three percent of hospice care is provided at the routine home care level.  Routine home care is provided where a person resides.  This might be a home, a skilled nursing facility, or an assisted living facility.  It is the level of care provided when the person is not in crisis.  Care provided is dictated by the hospice plan of care, which is developed by the hospice team in partnership with the beneficiary’s attending physician.  It will include, but is not limited to, scheduled visits from nurses, aides, and social workers, payment for palliative medications related to the terminal illness, and coverage of durable medical equipment, such as hospital beds and wheelchairs.  It also includes 24 hour access to “on-call” hospice registered nurses.  It does not include room and board while a beneficiary resides in a skilled nursing facility.  While on routine home care, beneficiaries may be charged a five percent coinsurance for each drug furnished, but the coinsurance may not exceed five dollars per medication.

• Continuous home care:  Occurs where a person resides when there is a medical crisis. During such periods, the hospice team can provide up to around-the-clock care.  During continuous home care, hospices bill Medicare per hour rather than per day. Coinsurance responsibility for the beneficiary is the same as routine home care.

• General inpatient care: Occurs in an inpatient facility.  If care cannot be managed where the patient resides, the patient will be moved to an inpatient facility until the patient’s condition is stabilized.  This level of care does include coverage of room and board.  Beneficiary is not responsible for any coinsurance while he or she is at a general inpatient level of care.

• Inpatient respite care: Is provided in an inpatient facility.  Because it is acknowledged that caring for a dying person can be difficult, this level of care is available to give the caregiver a rest.  It is available for periods of up to five consecutive days.  This level of care does include room and board costs.  Hospices, however, may charge beneficiaries five percent of Medicare’s respite care per diem (about $144.79 per day in 2009).

WHAT ARE SOME OF THE DIFFERENCES BETWEEN THE MEDICARE HOSPICE BENEFIT AND THE REGULAR MEDICARE BENEFIT?

HOW LONG DOES HOSPICE COVERAGE LAST?

• Hospice coverage is not time limited. Initially the beneficiary must be certified as hospice eligible for a ninety day period. When this period is exhausted, the beneficiary must be certified for a second ninety day period, there are then an unlimited number of sixty day certification periods.

• Beneficiaries who elect hospice coverage give up their right to regular Medicare benefits for services related to their terminal illness during the hospice election period.

• Hospice beneficiaries may revoke the benefit.  Upon doing this, they are immediately eligible for their traditional Medicare benefits.

• After revocation, the beneficiary may re-elect the hospice benefit at any time.  Upon re-election, the beneficiary begins the next certification period.

• Within a certification period, the beneficiary may change his or her designated hospice program one time without the need for revocation.

MEDICAID-COVERED HOSPICE SERVICES

• Medicaid-covered hospice services. Hospice is an optional benefit for state Medicaid programs. Individuals who live in states that choose to provide a Medicaid hospice benefit may be able to obtain payment for hospice services even if coverage is not available under Medicare. (For example, if the individual does not have Medicare Part A.)

• Services for hospice care under Medicaid must be provided by a public agency or private organization that is primarily engaged in providing care to terminally ill individuals, that meets the Medicare conditions of participation for hospices, and that has a valid provider agreement. The Centers for Medicare & Medicaid Services (CMS) has taken the position that states may provide a more limited benefit under Medicaid than is available under Medicare. At a minimum, however, Medicaid hospice coverage must be available for at least 210 days. The services to be covered under Medicaid are essentially those described above for Medicare-covered hospice. Certification periods may be subdivided into two or more periods.

• Election of benefit. An individual electing the Medicaid hospice benefit must be eligible for Medicaid in the state in which she resides. Limitations on co-payments and deductibles would be reflected in the state’s Medicaid plan in accordance with Medicaid law.
  

COORDINATION OF SERVICES AND DUALLY ELIGIBLE BENEFICIARIES

• Medicare Hospice and "Regular" Medicaid Benefits. Hospice care is available for individuals who live in Medicaid-reimbursed nursing facilities. Under these circumstances, Medicare Part A will pay the hospice program for the palliative care. The state Medicaid agency will pay the hospice program a daily rate for the hospice patient’s room and board, the hospice program must then reimburse the nursing facility for the room and board. Room and board services include the performance of personal care services, assistance in the activities of daily living, socializing activities, administration of medications, maintaining the cleanliness of the resident’s room, and supervising and assisting in the use of durable medical equipment and prescribed therapies.

• Medicare covered hospice patients can simultaneously receive Medicaid covered personal care aide-only services.  The hospice must coordinate its hospice aide and homemaker services with the Medicaid personal care benefit to ensure that the patient receives all the hospice aide and homemaker services he or she needs.
  

PHYSICIAN EDUCATION ABOUT THE HOSPICE BENEFIT

• Physicians are often confused about how Medicare interprets its terminal illness requirement. They often delay certifying patients for hospice care or refuse to re-certify patients who do not die within the first six months of the initial certification, even when the patient’s conditions and clinical prognosis remain unchanged. It is often difficult for beneficiaries and their advocates to convince physicians that hospice certification may well remain appropriate, that the beneficiary need not have died within six months for the hospice certification to have been legitimate, and that recertification should not result in a fraud claim.

• Medicare published an article in several professional magazines to provide physicians with information about the hospice benefit and to encourage them to consider ordering hospice services for their patients earlier in the course of a terminal illness. Medicare also sent a letter to physician associations to let physicians know that the Agency understands that making a prognosis about life expectancy and end of life is not an exact science and that the end-point of a terminal illness cannot be precisely predicted.

Copyright © 2010 Center for Medicare Advocacy, Inc.