Hospice Patients Alliance: Consumer Advocates

Medicaid Reimbursed Hospice Services

Note: The following page is taken directly from the Health Care Financing Administration website's public information on state Medicaid hospice services. The page was originally posted at: hcfa.gov/medicaid/ltc2.htm but HCFA is now Centers for Medicare Services. See Hospice Medicaid regulation information at: http://www.cms.hhs.gov/CFCsAndCoPs/05_Hospice.asp or http://www.access.gpo.gov/nara/cfr/waisidx_04/42cfr418_04.html ***********************************************************


The hospice service benefit is an optional benefit which States may choose to make available under the Medicaid program. The purpose of the hospice benefit is to provide for the palliation or management of the terminal illness and related conditions. Under Federal guidelines, the hospice benefit is available to individuals who have been certified by a physician to be terminally ill. An individual is considered to be terminally ill if he/she has a medical prognosis that his or her life expectancy is 6 months or less. Individuals who meet these requirements can elect the Medicaid hospice benefit.

In order to receive payment under Medicaid, a hospice must meet the Medicare conditions of participation applicable to hospices and have a valid provider agreement. The provision of care is generally in the home to avoid an institutional setting and to improve the individual's quality of life until he or she dies. However, individuals eligible for Medicaid may reside in a nursing facility (NF) and receive hospice care in that setting.

In order to be covered, a plan of care must be established before services are provided. The following are covered hospice services: nursing care; medical social services; physicians' services; counseling services; home health aide; medical appliances and supplies, including drugs and biologicals; and physical and occupational therapy. In general, the services must be related to the palliation or management of the patient's terminal illness, symptom control, or to enable the individual to maintain activities of daily living and basic functional skills.

Additionally, there are other services that may be provided under the hospice benefit, subject to special coverage requirements. Continuous home care may be provided in a period of crisis. This consists of primarily nursing care to achieve palliation or management of acute medical symptoms. A minimum of 8 hours of care must be provided during a 24-hour day.

Also, short-term, inpatient care is covered, as long as it is provided in a participating hospice unit or a participating hospital, or NF that additionally meets hospice standards. Services provided in an inpatient setting must conform to the written plan of care. General inpatient care may be required for procedures necessary for pain control or acute or chronic symptom management, which cannot be provided in other settings. Respite care is short-term, inpatient care provided to the individual only when necessary to relieve the family members or other persons caring for the individual at home. It may only be provided on an occasional basis and may not be reimbursed for more than 5 days at a time. Respite care may not be provided when the hospice patient is a nursing home resident.

The Omnibus Budget Reconciliation Act of 1990 (OBRA 90) modified the Medicaid statute relating to hospice services. Prior to OBRA 90, when a Medicaid eligible individual elected the Medicaid hospice benefit, he or she waived the right to Medicaid payment for services other than those described earlier. As modified, the law would allow an individual to receive payment for Medicaid services related to the treatment of the terminal condition and other medical services that would be equivalent to or duplicative of hospice care, so long as the services would not be covered under the Medicare hospice program. This means that Medicaid can cover certain services which Medicare does not cover.


Medicaid reimbursement for hospice care will be made at one of four predetermined rates for each day in which an individual is under the care of the hospice. The four rates are prospective rates; there are no retroactive adjustments, other than an optional application of a "cap" on overall payments and the limitation on payments for inpatient care, if applicable. The rate paid for any particular day would vary, depending on the level of care furnished to the individual. The four levels of care are classified as routine home care, continuous home care, inpatient respite care, or general inpatient care. Payment rates are adjusted for regional differences in wages.

Payments to a hospice for inpatient care must be limited according to the number of days of inpatient care furnished under Medicaid. During the 12-month period beginning November 1 of each year and ending October 31, the aggregate number of inpatient days (both for general inpatient care and inpatient respite care) may not exceed 20 percent of the aggregate total number of days of hospice care provided to all Medicaid recipients during that period. The State may exclude recipients with AIDS in making this calculation. Any excess reimbursement must be refunded by the hospice. Additionally, if a Medicaid hospice patient resides in a NF, the State must pay an amount equal to at least 95 percent of the NF rate to the hospice to pay for the room and board services provided by the NF.

Note: The above page is taken directly from the Health Care Financing Administration website's public information on state Medicaid hospice services. The page was posted at: hcfa.gov/medicaid/ltc2.htm however HCFA is no longer and Centers for Medicare and Medicaid Services is the new government agency. See cms.gov ***********************************************************

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