How is Hospice Paid For?


Hospice coverage is widely available. It can be provided

through Medicare and Medicaid in Georgia as well as by most private

insurance plans. If coverage is not available, hospice will assist in

investigating other resources the family may not be aware of. Barring

this, most hospices provide care by using money raised in the community

from memorials, special events, foundation gifts, or other



Medicare Hospice Benefit


More than 90% of hospices in the United States are certified

by Medicare. Medicare defines a set of hospice core services, which

many hospices surpass through voluntary, community-based efforts.


The Medicare Hospice Benefit, initiated in 1983, is covered

under Medicare Part A (hospital insurance). Medicare beneficiaries who

choose hospice care receive a full scope of non-curative medical and

support services for their terminal illness. Hospice care also supports

the family and loved ones of the patient through a variety of services,

enhancing the value of the Medicare Hospice Benefit.


The Medicare Hospice Benefit provides for:


Physician services

Nursing care

Medical appliances and supplies

Drugs for symptom management and pain relief

Short-term inpatient and respite care

Homemaker and home health aide services


Social work service

Spiritual care

Volunteer participation

Bereavement services

Who is Eligible?


Medicare has three key eligibility criteria:


The patient’s doctor and the hospice medical director use

their best clinical judgment to certify that the patient is terminally

ill with a life expectancy of six months or less, if the disease runs

its normal course;

The patient chooses to receive hospice care rather than

curative treatments for their illness; and

The patient enrolls in a Medicare-approved hospice program.


Payment for Hospice:


Medicare pays the hospice program a per diem rate that is

intended to cover virtually all expenses related to addressing the

patient’s terminal illness.


Because patients require differing intensities of care during

the course of their disease, the Medicare Hospice Benefit affords

patients four levels of care to meet their needs: Routine Home Care,

Continuous Home Care, Inpatient Respite Care, and General Inpatient

Care.  Ninety-six percent (96%) of hospice care is provided at

the routine home care level .


The Hospice Benefit rates have increased annually based on the

Hospital Market Basket Index. With the advent of costly new drugs and

treatments like palliative radiation, the average cost to hospices has

risen much faster than the hospice benefit reimbursement rates.


Hospices that are Medicare-certified must offer all services

required to palliate the terminal illness, even if the patient is not

covered by Medicare and does not have the ability to pay.