Who pays for hospice care?

Home hospice care usually costs less than care in hospitals, nursing homes, or other institutional settings. This is because less high-cost technology is used and family and friends provide most of the care at home.

Medicare, Medicaid in most states, the Department of Veterans Affairs, most private insurance plans, HMOs, and other managed care organizations pay for hospice care. Also, community contributions, memorial donations, and foundation gifts allow many hospices to give free services to patients who can't afford payment. Some programs charge patients according to their ability to pay.

Medicare hospice

To get payment from Medicare, the agency must be approved by Medicare to provide hospice services.

To qualify for the Medicare hospice benefit, a doctor and the hospice medical director (also a doctor) must certify that the patient has less than 6 months to live if the disease runs its normal course. The doctor must re-certify the patient at the beginning of each benefit period (2 periods of 90 days each, then an unlimited number of 60-day periods). The patient signs a statement that says he or she understands the nature of the illness and of hospice care, and that he or she wants to be admitted to hospice. By signing the statement, the patient declines Medicare Part A and instead chooses the Medicare hospice benefit for all care related to his or her cancer. The patient can still receive Medicare benefits for other illnesses. A family member may sign the statement if the patient is unable to do so.

Medicaid coverage

In 1986, laws were passed to allow the states to develop coverage for hospice programs. Most states have a Medicaid hospice benefit, which is patterned after the Medicare hospice benefit.

Private insurance

Most private insurance companies include hospice care as a benefit. Be sure to ask about your insurance coverage, not only for hospice, but also for home care.

Private pay

If insurance coverage is not available or is not enough to cover all costs, the patient and the family can hire hospice providers and pay for services out of pocket. Some hospices provide services without charge if a patient has limited or no financial resources.