How Much Does Medicare Cover for Hospice Care?

Is Hospice Care Covered by Medicare?

When a loved one receives a terminal diagnosis, they’re typically given an average of six months to live. The next step is to find a place that can meet those special needs.  While this is devastating news, the next logical step is to seek out options regarding hospice care to ensure a comfortable transition as their health continues to decline. Of course, figuring out how to pay for hospice care is part of that step.  For those on Medicare, how much does Medicare cover for hospice care?

Understanding Medicare’s Hospice Care Coverage

Medicare, the federal health insurance program for individuals age 65 and over, offers coverage for hospice care under Part A. This coverage is available to eligible beneficiaries who have a terminal illness and have a life expectancy of six months or less. Medicare’s hospice care coverage includes a range of services, such as medical and nursing care, pain management, counseling, and medication.

To be eligible for Medicare hospice care, individuals must also be enrolled in Medicare Part A and have their doctor certify that they have a terminal illness with a life expectancy of six months or less. Additionally, individuals must sign a statement choosing hospice care instead of other Medicare-covered benefits for their terminal illness.

How Does Medicare Pay?

Medicare provides financial assistance for hospice care through its hospice benefit under Part A. Medicare Part A covers medications, medical equipment, nursing care, and counseling. The hospice provider is reimbursed directly by Medicare, and the provider must be Medicare-approved to receive reimbursements from Medicare.  Beneficiaries are not responsible for any copays.

Medicare’s payment structure for hospice care is based on a per diem (daily) rate. This means that Medicare pays a fixed amount to the hospice provider for each day that an individual is enrolled in hospice care. The per diem rate varies depending on the level of care provided.  There may be higher rates for individuals receiving continuous home care or inpatient respite care.

However, it’s important to note that Medicare’s hospice benefit does not cover room and board in a hospice facility.  If a beneficiary chooses to receive hospice care in a hospice facility, they may be responsible for paying the room and board costs out of pocket. Alternatively, if a beneficiary receives hospice care at home, Medicare will cover the cost of necessary medical equipment and supplies.

Medigap & Medicare Advantage with Hospice Care

Medicare Part A covers everything hospice-related.  Patient costs are copays for hospice-covered medications and respite care.  The copay for hospice medications is no higher than $5.  Medicare Part A covers 95% of respite care for persons who have taken responsibility for the dying patient.  The patient would be responsible for 5% of the costs.

If an individual has a Medigap policy, the Medigap policy would cover the hospice medications and the coinsurance for respite care.  Medicare Advantage would continue to cover everything as before, but it would not normally cover the hospice medication copay or respite coinsurance payment.

It is important to note that there are many other medical costs for hospice patients during their time–non-hospice doctors, hospital beds, emergency room visits, ambulances, oxygen, walkers & wheelchairs, and other non-hospice medications, etc.  These expenses fall under Original Medicare and the Medigap policy or Medicare Advantage.  Hospice care does not cover these other medical needs.  It is important to understand this fact.

Once time the daughter of a client called me to let me know her mother was going into hospice.  One of the hospice workers told her to save money by canceling her Medigap policy.  I tried to explain there were other medical costs her mother would incur from doctors and other providers, but she was convinced it was an unnecessary expense.  Unfortunately, they don’t find out about their mistaken decisions until after the fact and the bills roll in.

Eligibility Requirements for Medicare Covered Hospice Care

To be eligible for Medicare hospice care, individuals must meet certain requirements. First, they must be enrolled in Medicare Part A, which provides hospital insurance coverage. Second, they must have a terminal illness.  Terminal is defined as a life expectancy of six months or less, as certified by their doctor. Finally, they must sign a statement choosing hospice care instead of other Medicare-covered benefits for their terminal illness.

A beneficiary can stop hospice care at any point.  They are not obliged to remain in hospice once they sign the statement.

It’s important to note that individuals can still receive Medicare hospice care even if they are enrolled in a Medicare Advantage plan. Medicare Advantage plans are private health insurance plans that provide Medicare benefits.  You don’t lose Part A when you enroll in a Medicare Advantage plan.  It is Part A that pays for hospice, even when you are enrolled in a Medicare Advantage plan.

How Long Does Medicare Pay for Hospice Care?

Once you are certified at the terminal with approximately six months or less of life expectancy, your doctor may recertify you.  There are usually two 90-day periods and then every 60 days.  You do not need to recommit to hospice.  The doctor determines that you are still terminal with a six-month or less time period to live.  You can remain in hospice almost indefinitely if you meet the criteria.

The Bottom Line: How Long Does Medicare Cover Palliative Care?

A quarter of the Medicare budget each year goes to cover the last year of Medicare beneficiaries’ lives. That is an incredible number.  Hospice care is an essential part of Medicare.

The practice of hospice exists to provide comfort and optimal quality of life to individuals approaching the end.  Medicare provides peace of mind that medical bills will be paid and that care will be provided uninterrupted.  As long as a person continues to be certified for hospice, Medicare will continue to cover hospice care.  You can be assured Medicare will be there for them the entire time.

Hospice is a difficult time.  I have gone through this with both of my parents and with hundreds of clients.  Contact us at Omaha Insurance Solutions to speak with a caring insurance professional about your Medicare needs.  We are a call away at 402-614-3389.