This form is originally found at: http://www.oig.hhs.gov/fraud/docs/alertsandbulletins/hospice2.pdf
[Federal Register: November 2, 1995 (Volume 60, Number 212)]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Office of Inspector General
Publication of the Medicare Advisory Bulletin on Hospice Benefits
AGENCY: Office of Inspector General, HHS.
SUMMARY: This Federal Register notice sets forth a recently issued
Advisory Bulletin, in conjunction with Operation Restore Trust, that
identifies important eligibility and other information involving the
current Medicare hospice benefit. This Advisory Bulletin has been made
available to consumers, health care professionals and health care
associations, and is now being reprinted in this issue of the Federal
Register as a means of ensuring public awareness of the purposes of
hospice care and the consequences of electing the Medicare hospice
FOR FURTHER INFORMATION CONTACT: Joel J. Schaer, Office of Management
and Policy, (202) 619-0089.
SUPPLEMENTARY INFORMATION: This Medicare Advisory Bulletin is part of
Operation Restore Trust--a joint effort among the Office of Inspector
General (OIG), the Health Care Financing Administration (HCFA) and the
Administration on Aging within the Department of Health and Human
Services to combat fraud, waste and abuse in the Medicare and Medicaid
programs. The purpose of this Advisory Bulletin is to inform consumers
and health care professionals about certain questionable practices
affecting Medicare's hospice program. The issuance calls specific
attention to the possible misuse of the hospice benefit, as uncovered
through collaborative work undertaken by the OIG and HCFA.
Specifically, the Advisory Bulletin highlights several practices
which indicate that some hospice providers may have inappropriately
maximized their Medicare reimbursements at beneficiary expense. These
- Making incorrect determinations of a person's life
expectancy for purposes of meeting hospice eligibility criteria;
- Engaging in marketing and sales strategies that offer
incomplete or inadequate information about Medicare entitlement under
the hospice program to induce beneficiaries to elect hospice and
thereby waive aggressive treatment options that Medicare would
otherwise cover; and
- Encouraging hospice beneficiaries to temporarily revoke
their election of hospice during a period when costly services covered
by a plan of care are needed in order for the hospice to avoid the
obligation to pay for such services.
A reprint of this Medicare Advisory Bulletin follows.
Medicare Advisory Bulletin--Questionable Practices Affecting the
Hospice Benefit October 1995
The Department of Health and Human Services administers the
Medicare program for the benefit of 38 million elderly and disabled
Americans. In May 1995, the Secretary of Health and Human Services
announced Operation Restore Trust, a joint project of the Office of
Inspector General, the Health Care Financing Administration and the
Administration on Aging. Among its objectives, Operation Restore Trust
seeks to identify vulnerabilities in the Medicare program, and pursue
ways to reduce Medicare's exposure to fraud, waste and abuse.
This Advisory Bulletin is a product of Operation Restore Trust. The
bulletin describes some potentially abusive practices which have been
identified through examination of the Medicare hospice benefit.
What Is Medicare's Hospice Program?
The goal of hospice care is to help terminally ill patients
continue with their normal activities of daily living as comfortably as
possible, while remaining primarily in a home environment. To achieve
this goal, the Medicare program shifts the focus of medical attention
from curative treatment seeking to reverse an underlying disease or
condition to palliative or supportive care, including a wide range of
medical, social, and emotional supportive services.
To be eligible for hospice services under Medicare, an individual
must be certified as terminally ill by hospice medical staff and the
individual's attending physician if he or she has one. Terminal illness
is defined as a medical prognosis that the patient's life expectancy is
6 months or less if the terminal illness runs its normal course. The
Medicare beneficiary's inclusion in a hospice program is voluntary and
can be revoked by the beneficiary at any time.
The decision to elect the hospice benefit has significant
consequences because the beneficiary waives the right to receive
standard Medicare benefits, related to the terminal illness, including
all treatment for the purposes of curing a terminal illness. Hospice
coverage is divided into four discrete election periods, during each of
which the beneficiary must be certified as terminally ill. The fourth
and last election period has an indefinite duration, unless or until
the beneficiary no longer meets the eligibility requirement of a
prognosis of 6 months or less to live.
What Problems Have Been Identified?
In the course of reviewing trends in Medicare's hospice program,
the Office of Inspector General has learned of activities that should
be of concern to beneficiaries who are in hospice or who are
considering the option of hospice. These questionable practices
primarily involve issues of hospice enrollment and are the subject of
ongoing analysis by the Medicare program and, in appropriate cases,
investigations and audits by the Office of Inspector General. Some
hospice providers, in efforts to maximize their Medicare reimbursement,
may knowingly engage in one or more of the following activities:
- Making incorrect determinations of a person's life
expectancy, for the purposes of meeting hospice eligibility criteria.
- Engaging in marketing/sales strategies that offer
incomplete or inadequate information about Medicare entitlement and
restrictions under the hospice program, in order to induce
beneficiaries to elect hospice and thereby waive other treatment
- Encouraging hospice beneficiaries or their representatives
to temporarily revoke their election of hospice during a period when
costly services covered by the hospice plan of care are needed, so that
the hospice may avoid the obligation to pay for these services.
Important Features of the Medicare Hospice Benefit
- The hospice benefit is restricted to patients with a
diagnosis of terminal illness and prognosis of 6 months or less to
In several recent medical reviews of beneficiary eligibility for
hospice, the Office of Inspector General has found significant
inaccuracies in the determinations of terminal illness. These findings
have prompted a concern that some hospices may intentionally
misrepresent a condition as terminal in order to secure Medicare
reimbursement. For instance, investigators have encountered hospices
that asked nurse employees to alter notes in patients' records or to
otherwise misrepresent patients' medical conditions, in order to
falsify the existence of a terminal condition.
There have also been cases where physician certifications of
terminal illness have been medically questionable. If a hospice submits
claims to Medicare under circumstances
where it knows of the absence of a terminal condition, the hospice may
be liable for the submission of false claims. Criminal penalties can
also be imposed against persons who knowingly and willfully make false
representations about a patient's medical condition which are used to
determine eligibility for payment of Medicare or Medicaid benefits.
- A hospice should not refuse to address health care needs
relating to a beneficiary's terminal diagnosis.
Once a Medicare beneficiary elects hospice care, the hospice is
responsible for furnishing directly, or arranging for, all supplies and
services that relate to the beneficiary's terminal condition, except
the services of an attending physician. Hospice beneficiaries have the
right to receive covered medical, social and emotional support services
from the hospice directly, or through arrangements made by the hospice,
and should not be forced to seek or pay for such care from non-hospice
When a beneficiary is receiving hospice care, the hospice is paid a
predetermined fee for each day during the length of care, no matter how
much care the hospice actually provides. This means that a hospice may
have a financial incentive to reduce the number of services provided to
each patient, since the hospice will get paid the same amount
regardless of the number of services provided.
Medicare has received complaints about hospices neglecting patient
needs and ignoring reasonable requests for treatment. One individual
reported that his wife's hospice failed on three separate occasions to
respond to telephonic requests for emergency services. He was forced to
call a non-hospice physician who arranged for hospitalization. His
wife's care required a 26-day length of stay. Although the hospital
contacted the hospice the day following admission, the hospice did not
visit the patient or in any way coordinate her care during the hospital
The Office of Inspector General also has uncovered situations where
duplicate claims were submitted by a hospice and other providers (such
as skilled nursing homes and hospitals) for services related to the
beneficiary's terminal illness. In a nationwide audit of services
provided to Medicare beneficiaries enrolled in hospice programs,
approximately $21.6 million was improperly paid to hospitals and
nursing homes for the treatment of hospice beneficiaries. Hospices are
required to make financial arrangements for hospitalization, nursing
services and all other health care needs related to the beneficiary's
terminal illness and included in the hospice plan of care. The cost of
these services should be paid by the hospices.
- A beneficiary has a right to expect a hospice to provide
complete and accurate information about the consequences of hospice
election and revocation.
A hospice is obligated to inform beneficiaries or their
representatives that by electing the hospice benefit, they waive all
rights to curative treatment or other standard Medicare benefits
related to the terminal illness, except for the services of an
attending physician. Some hospices inappropriately induce beneficiaries
or their representatives to enroll in the hospice program without
explaining that hospice election results in forfeiture of curative
treatment benefits under Medicare. For instance, some hospices have
solicited the beneficiary's neighbors and friends, who in some
jurisdictions may act as beneficiary representatives, and who may not
be familiar with the beneficiary's medical condition. In these
situations, the beneficiary and/or representative may not appreciate
that traditional Medicare benefits will be denied once the hospice
benefit is elected.
The Office of Inspector General also has learned of hospices which
induce beneficiaries to revoke the hospice election if expensive
palliative treatment, even for a temporary period, becomes necessary.
As a consequence, beneficiaries may then be burdened with substantial
co-payments that would not be charged under hospice. It is especially
important to note that when a beneficiary revokes the hospice election
during the last election period, re-enrollment in the Medicare hospice
benefit will be precluded permanently.
You Should Be Alert to the Following Questionable Activities
- Hospice recruiters failing to notify prospective patients
or their representatives that they will no longer be entitled to
Medicare coverage of curative treatment if they elect the hospice
- Hospice personnel inducing beneficiaries to revoke their
hospice election when more costly treatment is needed.
- A hospice refusing or failing to provide or arrange for
- Nursing home residents being induced to elect hospice but
not receiving the additional benefits of hospice care;
- Non-hospice providers charging Medicare for services to
hospice patients that hospices can and should provide, such as
counseling or medical equipment.
What To Do With Information About Questionable Practices Involving
If you have questions about the scope of the hospice benefit or the
care you are receiving in hospice, you should first consider discussing
these matters with your attending physician or the hospice provider. If
you wish to report questionable practices, call or write: 1-800-HHS-
TIPS, Department of Health and Human Services, Office of Inspector
General, P.O. Box 23489, L'Enfant Plaza Station, Washington, D.C.
Dated: October 23, 1995.
June Gibbs Brown,
[FR Doc. 95-27217 Filed 11-1-95; 8:45 am]
BILLING CODE 4150-04-P
All material copyright of Hospice Patients Alliance ("HPA") unless otherwise credited.