MedPAC recommends less hospice choice for Medicare Advantage beneficiaries, at a higher cost

Categories: Policy.

National Hospice and Palliative Care Organization is opposed to the
recent recommendation by the Medicare Payment Advisory Commission (MedPAC) to
“carve-in” the Medicare Hospice Benefit (MHB) for Medicare Advantage (MA) participants. 

In its March 2014 report to Congress, MedPAC recommended that
Medicare Advantage plans assume both the clinical management and financial
responsibility of the hospice benefit (hospice would be ‘carved-in’ to Medicare
Advantage plans).

“Should the MHB be changed to a ‘carved-in’ benefit, patients,
families caregivers, the hospice community and Medicare will be significantly
and negatively impacted,” said J. Donald Schumacher, NHPCO president and CEO.

Would Be Limited

Currently, a MA patient is free to enroll in any Medicare
certified hospice program. Under the “carve-in”, the patient would be directed
to a MA contracted hospice giving the patient and family less choice.

“End-of-life care is a deeply personal experience.  It is
both unreasonable and insensitive to require families to conform their needs
and preferences to those of a MA plan,” noted Schumacher.

Financial Burden to Patients

The MedPAC recommendation opens the possibility for MA plans to
require additional co-payments or other cost-sharing for hospice.  Such
financial burdens are minimal under the current system.  

“By their very design MA plans are concerned about risks and the
bottom line.  By advancing this recommendation, MedPAC seems to find it an
acceptable risk for financial incentives to shape or even limit hospice choice
and quality,” said Schumacher.

“carve in” would cost Medicare $1.3 billion

Under the current system, hospice saves Medicare an average of
$2,309.00 per beneficiary enrolled (Duke, 2007).  The “carve-in” would
create additional costs for Medicare.  

According to a new study by Avalere Health, commissioned by
NHPCO, the MedPAC proposed “carve-in” of hospice would cost Medicare an
alarming $1.3 billion over a ten-year budget window.

Impacts on Hospices

Hospices contracting with MA plans would not be assured of the
baseline reimbursement rates established under Medicare.  At a time when
MA plans are under immense financial pressure, the carve-in would surely leave
hospices vulnerable to further reimbursement cuts.

Reduction in reimbursement would force hospices to re-evaluate staffing
and devote valuable resources to maintaining the administrative infrastructure
required to support ongoing communication, billing and data reporting with the
MA plan.  

These additional burdens would put many hospices, especially smaller
and rural programs, at a competitive disadvantage, and could further limit
access to compassionate end-of-life care in underserved communities.


information from NHPCO’s affiliate organization, the Hospice Action Network:

•  Issue Briefing: Hospice and the Medicare Advantage “Carve-In” (03/2014)

•  Advocate
Backgrounder on hospice and Medicare Advantage

•  How
much will MedPAC’s proposal cost Medicare? NHPCO asked Avalere Health to find
out. (03/2014)

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