Medicare is the Number One Payee for Hospice Care.
Insurers that pay for Hospice care include: Medicare, Long Term Care Insurance, Private Pay, and in certain circumstances, Medicaid will pay for hospice. Here is the breakdown of insurers: (Jump to Lessons Learned)
Over 90% of all hospice cases are covered by the Medicare Hospice Benefit under Medicare Part A. When a person elects hospice, they are forgoing other parts of the Medicare Part A benefit, for example, hospitalization. Unlike hospital stays, there are no co-pays under the Medicare Hospice Benefit.
Long Term Care (LTC) Insurance
LTC is the second largest insurer of hospice, covering about 7% of the care.
Private Pay is rare, but is sometimes used to pay for hospice care when the patient is not eligible for either Medicare or Medicaid benefits.
Medicaid will pay for hospice in certain cases. For example, if someone is diagnosed with end stage liver cancer at age 35, because of their age, they were not eligible for Medicare, which begins for most at age 65. In this example, Medicaid will pay for hospice.
Center for Medicare and Medicaid Services (CMS)
Hospice guidelines determine the factors under which Medicare and other insurers will pay for Hospice care. Since Medicare is a federally funded program, they allow the Center for Medicare and Medicaid (CMS) to develop hospice criteria. Criteria includes:
- Entitled to Medicare Part A
- Certified terminally ill (e.g. stage 4 cancer)
- Physician must give a prognosis of 6 months or less
- Once this determination is made a doctor writes a script for hospice which is brought to your hospice agency of choice (More about this in the next post)
- Age and race are not factors
The most recent and impactful change to hospice is a change in the use of “failure to thrive” as criteria for a dementia diagnosis. In the past, a patient refusing to eat or get out of the bed for weeks at a time would get a “failure to thrive” diagnosis and be placed on hospice. With dementia in the United States being the more prevalent disease amongst seniors over 85, physicians are required to be specific about the type of dementia a patient exhibits. This guideline change helps keep Medicare solvent and moreover, it differentiates a patient who does not want to do anything, from a patient unable to do anything.
- Hospice care is available in a nursing facility, even for Medicaid patients. Under Medicaid, a patient has to spend down to assets of only $2,000 dollars. When assets are $2000 or less, if patient resides in a nursing home and elects hospice, Medicare will pay for the hospice while Medicaid will continue paying for room and board.
- Basic disease states for hospice include: Cancer, COPD, Congestive Heart Failure (CHF), HIV/AIDs, ALS, Parkinson’s, Dementia (e.g. cerebral arterial insufficiency or Senile Dementia of the Alzheimer Type.) A dementia diagnosis requires a subset diagnosis which can include: 7-10 lb. weight loss, inability to swallow, incontinence, bed sores, speaks 7 words or less.
This hospice series is dedicated to Mary Ellen Afflitto. Wife, mother, sister, aunt and friend with the most incredible upbeat attitude and wicked sense of humor. She is missed greatly and I am so grateful she was my aunt.
With thanks to my collaborator on the Hospice series, Victor Hudson
Victor Hudson, Jr., is an ordained minister and church planter. He served in the United States Marine Corps and worked for Pfizer Inc. He currently works at Embracing Hospicecare out of Wall, NJ. He holds three masters degree, one in gerontology from the University of Southern California, an MBA from Regent University’s School of Business and Leadership, and a masters degree in religion from Liberty Baptist Theological Seminary. He is the father of two wonderful adult children, Kieya and Corey, and a proud grandfather of three boys, Javon, Jordan and Jacob. He lives in New Jersey with his wife, Yvonne.
Disclaimer: The material in this blog is for educational purposes only. It is not intended to replace, nor does it replace, consulting with a physician, lawyer, accountant, financial planner or other qualified professional.