Hospice is covered by Medicare, Medicaid and most private insurance.

Congress established the Medicare Hospice Benefit in 1982 to provide patients with life-limiting illnesses compassionate, coordinated care to manage the symptoms and consequences of their disease. The Hospice Benefit was designed to help terminally ill patients with the often-significant expenses incurred at the end of life, including prescription and over-the-counter drugs, medical equipment and supplies, hospital copayments and counseling support for the family.

While the benefit offered a lifeline to terminally ill patients covered by Medicare (later extended to Medicaid and to most private insurance plans), it enacted a number of requirements that providers must meet in order to be certified as hospices by Medicare and qualify for payment from Medicare. These include the mandate to provide or manage all services needed to manage terminal illness.

Other features of the Medicare Hospice Benefit include a limit on the proportion of days of care a hospice can provide in an inpatient setting, rather than the patient’s home; a global cap on total average payment per patient; and a requirement that dedicated and trained volunteers must contribute at least 5 percent of the agency’s services.

For Medicare hospice coverage, patients must:

• Be eligible for Medicare Part A
• Consent to hospice care and agree that he or she wishes to receive “palliative, not curative care”
• Be certified by his or her physician and the hospice medical director as having a “medical prognosis that his or her life expectancy is six months or less, if the illness runs its normal course”
• Continue to have a six-months-or-less prognosis, although some individual patients may receive hospice services for longer than six months as long as they continue to have a limited life expectancy throughout that time

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