Hospice care, usually elected toward the end of life to alleviate pain and symptoms rather than cure an underlying disease, involves fewer medical interventions and technology than conventional medical care. For this reason, and the fact that the care is often provided in a home, in part by trained volunteers, it is also less expensive.
Still, concerns about paying for medical expenses can often add stress to those dealing with illness and caregiving. Fortunately, there are several sources that may cover part of all of the costs involved in hospice care.
A recent survey by the National Hospice and Palliative Care Organization targeted the main payers for hospice care, assigning approximate percentages to each.
- Medicare (86%)
- Managed Care or Private Insurance (7%)
- Medicaid or Medi-Cal (5%)
- Charity Care (1%), and
- Self pay (1%).
Details on each of these—along with resources to find out more specifics for your situation—are covered in this post.
Paying Through Medicare
Far and away, most hospice care is paid by Medicare, a federal health insurance program for people who are:
- Age 65 and older who have contributed to Social Security at least 10 years
- Age 65 and older whose spouses have contributed to Social Security
- Under 65 and disabled and collecting Social Security disability benefits for 24 months
- Diagnosed with permanent kidney failure, or
- Diagnosed with Lou Gehrig’s disease.
For a quick online determination of eligibility for Medicare, as well as an estimate of premiums needed to pay for the coverage, use the Medicare Eligibility & Premium Calculator.
The various supplies and services provided by hospice care are covered under Medicare Part A, known as its “hospital insurance,” which is free for most people — although copayments, co-insurance, or deductibles may be required.
Those with Medicare Part A are entitled to hospice care coverage as long as:
- A hospice doctor and primary care doctor—if one is involved—certify that a patient has a condition that may result in death within six months, and
- The patient signs a statement choosing hospice care instead of other treatments, and
- The hospice provider has been certified by the Centers for Medicare and Medicaid Services to provide hospice care (93% of the hospice agencies currently operating have been certified).
The range of Medicare hospice coverage includes:
- Services from doctors, nurses, social workers, dieticians, counselors, and physical and speech therapists
- Medical equipment, such as wheelchairs and adjustable beds
- Prescription drugs required for symptom control or pain relief
- Hospice aide and homemaker services
- Short-term inpatient care, and
- Respite care for regular caregivers.
Medicare covers hospice care in benefit periods: two 90-day periods followed by an unlimited number of 60-day periods. At the start of each new period, the hospice doctor or medical director must certify that the care is still required—usually a simple procedure.
Patients may also choose to switch their medical care from hospice to treatment intended to cure an illness at any time. Those receiving Medicare must verify this in writing on a form the hospice provider supplies; their insurance coverage will then revert to the type in place before Medicare hospice insurance went into effect. Those who choose to go back to hospice care may do so, but must again become certified for eligibility by doctors.
For more detailed information, see the online publication: Medicare Hospice Benefits.
For counseling and assistance with Medicare concerns, contact the State Health Insurance Assistance Program.
Paying Through Managed Care or Private Insurance
It’s no secret that the ins and outs of health insurance have changed and are continuing to change in ways that make the often-confusing topic even more flummoxing. The best advice is the most annoying: read the fine print. Check existing policies, including riders and endorsements, or consult an insurance agent or company to find out whether and how much of hospice costs are covered by a specific policy.
If private insurance is being used to cover hospice costs, the insurer will assign an insurance case manager to ensure that the hospice service is providing all services. Should questions or problems arise with the care, it is also case manager’s responsibility to help work them out.
One caveat: many people assume that long-term care insurance, which became popular a couple decades ago, naturally covers hospice care. However, many such policies pay only for care lasting a few months or less. And due to stringent requirements, those who do not have such insurance will probably not qualify for coverage once they are considering hospice care.
For more information and help with understanding and comparing insurance policies, contact your state’s Insurance Department. Most operate free consumer hotlines offering help with questions and concerns.
Another caveat: when searching for insurance information, be careful to consult a reputable, objective source. There are many companies—most with “official sounding” names—brazenly soliciting insurance business from vulnerable consumers seeking to pay for end-of-life care.
Paying Through Medicaid or Medi-Cal
Medicaid, called Medi-Cal in California, is a state and federal program that offers free and low-cost coverage for some people with low incomes and limited resources. The program has undergone huge changes and expansion since the Affordable Care Act was passed, as one of that law’s lauded goals was to increase access to health insurance.
To learn more about eligibility in each state, based on income and household size, see the online Health Coverage Tool.
Because states establish and administer their own Medicaid programs, they also determine the type, amount, duration, and scope of services covered. Federal law requires coverage for certain “mandatory benefits” such as inpatient and outpatient hospital services. But states are otherwise free to choose to provide other “optional benefits” through the Medicaid program—and hospice care is defined as optional.
For those who qualify, the rules for hospice coverage by Medicaid and Medi-Cal programs operate much the same as Medicare, described above: doctors must certify the need for the care, the patient must elect it, and the provider must be certified by the Centers for Medicare and Medicaid Services.
However, there are differences in how the states define some terms—including having a “terminal condition,” which is required before hospice coverage will begin, with definitions fluctuating from a prognosis with a life expectancy of 6 months to as long as 12 months.
To find out whether a particular hospice provider is certified by Medicaid or Medi-Cal, ask the provider directly—or consult the Hospice Directory, which provides a profile of most hospices currently operating.
For questions about a particular state’s eligibility rules, contact the State Medicaid Agency.
And for an overview of Medicaid and Medi-Cal coverage of hospice benefits, see the Hospice Toolkit.
Receiving Free Hospice Care
For people who are financially strapped but do not have coverage or assistance with paying from other sources, some hospice organizations provide free “charity care” or charge for care on a sliding scale basis. Money to pay for or subsidize the care generally comes from donations, bequests, gifts, grants, or community sources. Again, the hospice provider should explain whether this option is available.
Paying Out of Pocket
A typical range for cost paid out of pocket is about $150 per day for a few hours of care at home to $650 daily for constant care in a facility. A small number of people who need hospice care and services pay for it with their own money—perhaps selling some assets or tapping into savings accounts, stock portfolios, or pensions.