Hospice care provides services that increase the comfort of people who are dying from an untreatable health condition. Hospice care is intended to manage the patient’s pain while promoting a peaceful death.

Adult children of a dying parent often turn to hospice care when the parent wants to die at home. Hospice care also be provided by inpatient hospice facilities, nursing homes, and other residential facilities. Fortunately, the cost of hospice care is typically covered by the parent’s Medicare benefits, although other sources of funding might be available in the absence of Medicare.

Medicare

Medicare is the most common source of funding for hospice care. Most Americans who are 65 or older have free Medicare Part A coverage. Medicare Part A pays for hospice care under these circumstances:

• The patient’s physician and a hospice doctor certify that the patient is likely to die within 6 months.
• The patient is not receiving medical treatment to cure the condition that is likely to result in death. Treatment to manage pain does not disqualify a patient from Medicare coverage for hospice care.
• The patient elects in writing to receive hospice care rather than Medicare-covered treatment of the life-threatening condition.

Medicare Part A will pay for hospice care by a Medicare-certified provider in:

• the patient’s home,
• an inpatient hospice facility,
• a hospital’s hospice care unit, or
• a nursing home.

While some assisted-living facilities offer hospice care, Medicare Part A will not generally pay that cost. Residents of assisted-living facilities who elect to receive hospice care will need to find another source of funding.

Coverage for home hospice care includes the cost of hospice services provided by physicians, nurses, aides, social workers, physical therapists, homemakers, and grief counselors. Medicare pays for most pain management services that a hospice recommends.

Medicare covers the full cost of outpatient hospice services. It covers 95% of the cost of in-patient services but might not cover the cost of room and board if the patient is residing at an in-patient facility. Most medication to relieve pain is covered for outpatients, although the patient must make a copayment of up to $5 for each filled prescription.

Medicare will also cover most of the cost of short-term inpatient respite care. Respite care allows family caregivers to take a break while a patient spends time in an inpatient hospice facility. The periods of respite care cannot generally be longer than five days at a time.

Medicare Part A will not cover the cost of outpatient services that are meant to cure an illness. If a hospice patient develops an illness that needs to be treated, the patient will need to turn to Medicare Part B, Medicare Advantage, or some other source of funding to cover that cost.

Medicaid

Medicaid might also pay for hospice care. Medicaid is available for very low-income individuals. Patients might turn to Medicaid if they do not qualify for Medicare Part A, although some people will qualify for both Medicare and Medicaid. Depending on the state in which the patient resides, Medicaid might cover room-and-board costs of inpatients who receive hospice care in a nursing home.

VA Benefits

VA Benefits cover hospice services for eligible veterans as part of the VA’s Health Benefits package. Hospice care can generally be provided in any setting with no required copayment.

Health Insurance

Most older adults who have reached retirement age opt for Medicare rather than private insurance. Seniors who have elected to continue their private insurance might be able to use their insurance benefits to pay for hospice care. Most private health insurance plans cover hospice care, although the amount of coverage provided varies from plan to plan.

Long-term Care Insurance

Long-term care insurance has declined in popularity in recent years. Seniors who are funding their residence in an assisted-living facility with long-term care insurance might nevertheless use that insurance to cover hospice care that the facility provides. Since Medicare does not usually cover hospice care provided by an assisted-living facility, long-term care insurance can bridge that coverage gap.

Life Insurance

Seniors who have maintained a life insurance policy may be able to sell the policy to a third party for a lump sum of cash. They can then use the money to fund hospice care. That option will deprive beneficiaries of the money they might have used to pay funeral expenses, but beneficiaries who are adult children might prefer to sacrifice the insurance proceeds to assure that hospice care is funded.