Hospice care focuses on comfort and quality of life for individuals facing a life-limiting illness. The goal shifts from seeking a cure to managing symptoms and providing emotional and spiritual support for the patient and their family. While services are not technically “free,” a complex system of third-party payers ensures that most eligible patients receive comprehensive hospice care with minimal or no financial obligation.
Understanding the Medicare Hospice Benefit
The primary mechanism for funding hospice care in the United States is the Medicare Hospice Benefit (MHB). To qualify, a patient must be entitled to Medicare Part A and have a physician and the hospice medical director certify that they have a terminal illness with a prognosis of six months or less if the disease runs its expected course. The patient must also formally elect the hospice benefit, agreeing to seek comfort care instead of curative treatment for the terminal diagnosis and related conditions.
The benefit is structured into specific timeframes, beginning with two initial 90-day periods, followed by an unlimited number of subsequent 60-day periods. At the start of each period, a physician must recertify that the patient remains terminally ill for coverage to continue. Once a patient elects the MHB, Medicare pays the hospice provider a daily rate to cover almost all services related to the terminal illness, resulting in virtually no cost to the patient for covered services.
The scope of services covered by the MHB is comprehensive, encompassing nursing care, physician services, medical social services, home health aide, and homemaker services. The benefit also covers all medications for pain and symptom management, medical equipment like hospital beds and wheelchairs, and necessary medical supplies. Furthermore, the MHB covers four levels of care:
- Routine home care.
- Continuous home care during a crisis.
- General inpatient care for symptom management.
- Short-term inpatient respite care to provide a break for caregivers.
Coverage Options Beyond Medicare
For patients who do not qualify for or are not enrolled in Medicare, several other programs offer extensive hospice coverage. State Medicaid programs are required to offer a hospice benefit that largely mirrors Medicare coverage. Eligibility for Medicaid is based on income and asset limits, which can vary significantly from state to state.
Most commercial health insurance plans, including those provided by employers or purchased through the Affordable Care Act marketplaces, also include a hospice benefit. These private plans frequently model their coverage on the federal Medicare benefit, often covering 100% of the cost for hospice services. The terms of coverage, such as network restrictions or any associated co-pays and deductibles, depend entirely on the specific plan’s design.
Veterans who are enrolled in the Veterans Health Administration (VA) healthcare system are also eligible for comprehensive hospice care through the VA benefit package. The VA covers all hospice-related expenses for eligible veterans, including the medical care, medications, and supplies needed for the terminal diagnosis. This coverage is often provided through community hospice partners, ensuring access to care wherever the veteran resides.
Potential Out-of-Pocket Costs for Patients
While the majority of hospice costs are covered by third-party payers, patients may encounter a few specific charges that are not absorbed by these benefits. The most common exception is the cost of room and board when the patient is receiving routine hospice care in a nursing home, assisted living facility, or long-term care setting. Medicare and Medicaid generally pay for the clinical services provided by the hospice team, but the patient or family remains responsible for the daily living expenses of the facility.
Another potential cost arises for treatments or medications that are unrelated to the terminal diagnosis and conditions managed by the hospice team. Services for a chronic condition that is separate from the illness for which the patient elected hospice may still be billed to the patient’s original insurance, potentially incurring standard co-pays or deductibles. This distinction is made because the hospice benefit waives Medicare coverage for services intended to cure the terminal illness.
In rare instances, a patient may be responsible for a nominal co-payment for certain services, depending on the payer. For patients covered by the Medicare Hospice Benefit, there can be a small co-payment for prescription drugs used for pain and symptom management, typically no more than $5 per prescription. Additionally, a patient may be responsible for 5% of the Medicare-approved amount for inpatient respite care, although this cost is capped.