Hospice Medications – Who Pays for What?


Hospice Providers, it’s time to take your head out of the sand!  Medicare keeps writing long memos about who pays for what medications and I still keep hearing that the hospice only pays for pain medications.  The information below was taken from the Medicare Memo issued last week.

  1. You don’t get to exclude all meds and care not directly related to the terminal condition. Supposedly this has always been the case.
  2. You cannot exclude medications that are used for the comfort and palliation of symptoms no matter what.  If a patient is admitted for end stage heart failure and has arthritis, you must pay for arthritis medications as well.
  3. Prior authorizations for Medicare Part D will be required and they must include the reason why the medication is not covered under the hospice benefit.
  4. Medications that are paid for after the patient elects the hospice benefit but before the pharmacy has been notified will fall into some sort of limbo land and the pharmacy will have to collect from the hospice – or the patient.  Any UFC fans out there?
  5. If a patient wants a specific drug that is not one your formulary and the patient refuses to try medications that are on your formulary, you can refuse to provide them.  Alternatively, you can provide them and bill the patient if you have a signed advanced beneficiary notice.
  6. Patients have the right to appeal your decision.

If you want to survive this maze, the first thing you need to do is to approve a formulary.  This is a list of drugs you may potentially be required to provide over and above the standing orders for pain meds.  Personally, I would start with one of those $4.00 drug lists from a chain drug store.  They all have one.

Hospice nurses must have frank discussions with patients and caregivers at the time of admission.  In truth, there is no way to determine if a medication is for palliative relief of symptoms until the patient is assessed.  In talking with patients and caregivers, the emphasis should be on symptoms.  Some individuals with diabetes are very uncomfortable when their blood sugar goes up beyond a certain point.  Other people can sport a blood sugar of 550 without symptoms.  Blood pressure is usually asymptomatic but strokes are not.  If a patient has suffered a prior neurological insult, the safest thing to do would be to find a cheap drug and treat it for less than 10.00 per month.

Nice hospice providers will alert their contracted pharmacy to a hospice admission as soon as it is known for sure that a patient will be admitted.  This will prevent those limbo drugs where everyone is fighting over who pays.  This process is recommended but not mandated (I think…) in the new CMS guidelines published last week.

People are funny about their medications.  If a patient refuses to try Prilosec and opts for Dexilant at 20 times the cost, work with the patient.  Ask for samples and assist the patient in getting the best price for the medication of choice.

Maybe the most disturbing aspect of the new guidance from CMS is the involvement of the patient and families.  Part D pharmacies are advised to bill family members for medications that were inappropriately filled.  Hospices with limited (if any) formularies will attempt to pass the cost off to the patient.  Although the patient has the right to appeal the logistics of a hospice patient or family member appealing to Medicare strike me as utterly incongruent with the fundamental purpose of hospice which is to allow a patient to die at home in peace.

I have not seen as yet the proposed consequences to a provider who simply tells the patient Medicare won’t cover something without explaining all of the details, alternatives, etc. I think good hospices will put a blank appeal form in the home folder for the patient.  Bad hospices will go out of their way to avoid telling patients and family members that an appeal is possible.

Meanwhile adopt a comprehensive formulary and start today advising the patient what you will pay for, the reason it will given (comfort) and what you will not be giving.  It may cost you a few patients but I guarantee those that don’t put these processes into place will lose more than a patient or two.

Good luck with all this, you hear?

Hospice Coverage


What exactly does the hospice benefit cover?  When is it appropriate to treat an illness or condition for a hospice patient?  There are multiple shades of grey in these questions.  If a patient has a bladder infection, antibiotics will not only cure the infection but bring enormous relief to a patient.  A patient with Alzheimer’s Disease will not improve if their hypertension is treated but is it the responsibility of the hospice to pay for those medications?  On the other hand, withholding treatment for hypertension may put the patient on a fast track for a stroke hastening death (and lowering costs).  Medicare has addressed some of these questions directly and alluded to new adaptations of existing rules indirectly.  Brian Daucher, a lawyer who has championed the cause of hospice to the extent that he went up against Medicare won a huge battle concerning caps validity, has weighed in on Medicare’s new approach to hospice payments. 

When Mr. Daucher speaks, we should listen.  Graciously, he has agreed to allow us to reprint his article from December 19. 

Hospice to Provide “Virtually All” Care – First Up, Prescription Drugs

By Brian Daucher on December 19, 2013 Posted in Other

A hospice patient waives the right to receive other Medicare benefits “related” to the terminal illness.  In turn, the hospice must provide any care necessary for “pain or symptom relief.”  Focusing upon this waiver/assumption of liability, CMS is now redefining the scope of a hospice’s duty, requiring hospices to pay for “virtually all” prescription drugs and other care given to hospice patients.

In early 2013, CMS revisited hospice reporting requirements on billing.  CMS issued a reminder of the requirement that a hospice must code for all co-morbidities and also announced the phase-out of failure to thrive and debility as primary diagnoses.  Both instructions ensure that a hospice’s responsibility for any admitted patient will be broad, the first by broad listing of any co-morbidities, the second by requiring more concrete primary terminal diagnoses.  These reporting requirements help set up review of the hospice’s duty to cover any “related” care.

In guidance issued in October and December,[1] CMS explores a hospice’s dual obligation to cover any medical care (including drugs) for any related condition but to limit such care to pain or symptom relief.

CMS concedes that historically it has viewed the hospice “related care” question as one to be addressed on a “case-by-case basis” considering the “wide variation of patient circumstances.”  To date, CMS has shown deference to providers on this question.

But CMS now states that separate Medicare coverage will only be available to hospice patients for conditions “completely unrelated,” noting for the first time that hospices are required to provide “virtually all care” needed by terminally ill patients and that unrelated care would be “extremely rare.”  CMS notes that many illnesses are “brought on by the underlying condition of the patient.”  These appear to be new standards that will require broad assumption of liability by hospices.

Less conspicuously, CMS tackles the question whether there are certain drugs that are inappropriate for hospice patients.  CMS notes that the hospice benefit only provides coverage for drugs “used primarily for the relief of pain and symptom control.”  CMS notes correctly that by electing hospice, patients are moving from a “curative model of care” to a “palliative model.”  But, because drugs provided by hospice are covered by the per diem and not separately paid by Medicare, CMS’ interest here appears to be to restrict access to certain drugs and treatments that might extend a patient’s life.  CMS has not yet defined any category of drugs as improper (i.e., antibiotics, chemotherapy).

Initially (October 30), with respect to what a hospice must cover, CMS took the initial step of indicating that it would view any analgesics (pain medication) as necessarily related to the terminal illness.  (October 30.)

In December, CMS expanded its analysis to apply to almost any conceivable medication, stating that “only very rarely” will a beneficiary take drugs not covered by the hospice.  (December 6.)

In these publications, CMS advises drug plan sponsors to track hospice patients and limit approvals of medications for them; and, if medications are given, sponsors may in some cases look to hospices for reimbursement.  In turn, CMS notes that hospices may refuse certain medications to patients; in turn, patients have appeal rights.  To mediate all of this, CMS will establish an independent reviewer.  According to a new Part D webinar, hospices will soon be “presumed responsible” for any medications given to a hospice patient.

Hospices should anticipate claims for payment where its patients receive drugs through Part D from any other providers.

To show the extent of this new thinking, consider CMS Change Request 8098 (September 30, 2013).  Although CMS has now indicated its intent to rescind this CR, the CR is still instructive on the thinking within CMS.  In this CR, CMS imposed a pre-payment edit to preclude payment to non-hospice providers for vaccinations of hospice patients (i.e., flu, PPV, Hepatitis B).

Although vaccines typically protect against diseases not then present in a person, CMS provided that the hospice alone should decide if a terminally ill patient would get such vaccines; and, if a hospice determined to vaccinate a patient, the hospice would then bill for such vaccines (presumably as unrelated care).  Of all treatment, it seems that vaccines might arguably be the least directly related to a terminal illness, as they are not present at the time of vaccination.  And yet, before rescinding this CR in response to questions, CMS tried to cabin vaccination decisions at the hospice level, showing the extent of CMS’ view that “virtually all care” should be through the hospice.

More than anything else, these recent changes seem to reflect CMS’ core desire to contain cost, both by ensuring that hospices pay “virtually all” costs associated with medical care (including drugs) of terminally ill patients and also, where possible, to limit the lives of such hospice patients (and thereby limit the cost of such lives).

CMS has not yet imposed a broader rule precluding any type of care to hospice patients by other providers, but these pronouncements could be early steps toward such a rule.

After years of slogging with modest success through hospice medical necessity audits, perhaps CMS has altered is strategic approach to cost containment.  The relatedness doctrine, now finding application in the prescription drug context, will likely find broader application.

[1] Clarification of Recovery of Part D Payment for Pain Medications for Beneficiaries Enrolled in Hospice, October 30, 2013 (published to Part D Plan Sponsors by Medicare Program Integrity Group and Medicare Drug Benefit and C&D Data Group); and Part D Payment for Drugs for Beneficiaries Enrolled in Hospice – Request for Comments, December 6, 2013 (published by Medicare Program Integrity Group, Medicare Drug Benefit and C&D Data Group, and Chronic Care Policy Group).