More than 25 million terminally ill people have used Medicare’s hospice benefit. But as the popular policy turns 40 this year, it’s struggling with a midlife crisis.
Hospice doctor Bethany Snider sees the writing on the wall: “The hospice care we’ve known and loved won’t be the same 10 years from now.”
Hosparus Health, the Louisville-based hospice agency where Snider serves as chief medical officer, is one of more than 100 provider organizations partnering with some of the country’s largest health insurers on a federal experiment that could transform hospice care for millions of people.
For the last four decades, Medicare has covered hospice services — including grief counseling, spiritual support and pain management — for terminally ill people. The benefit has helped more than 25 million Americans die more on their own terms, often at home, with the support of chaplains, social workers, nurses and others. Research shows hospice can reduce unwanted medical interventions, improve families’ satisfaction and, in some cases, save Medicare thousands of dollars.
Now Snider and others believe this popular benefit, whose structure has remained largely unchanged since its debut in 1983, is in the early days of an inexorable overhaul. Critical aspects of the 40-year-old policy no longer fit the needs of the people using the service — or the providers delivering it. Concerns with runaway costs — which topped $20 billion in 2019 — access and fraud dog the program.
In response, Medicare has begun a federal pilot project to test handing the reins of some hospice care over to private insurers, giving them more flexibility to control costs while also expanding access. The experiment, which began in 2021, involved several thousand patients in its first year, but multiple experts told Tradeoffs they believe it is likely to eventually become national policy and reshape the hospice care available to roughly 30 million Americans.
In an email to Tradeoffs, Liz Fowler, deputy administrator at the Centers for Medicare and Medicaid Services, said the agency hopes the effort will help ensure all beneficiaries have “access to high quality and coordinated care.”
The changes to hospice are “inevitable,” said Torrie Fields, a consultant who has advised Medicare and private insurers. “The hope is this pilot sheds some light on the guidelines and guardrails needed.”
One sign Medicare is seriously considering the policy: an announcement on March 23 that the pilot, initially slated to end in 2024, will continue through 2030.
A makeover for Medicare’s 40-year-old hospice benefit
This federal experiment, known by wonks as “the hospice carve-in,” is designed to revitalize a pair of particularly outdated hospice policies: how the program determines patient eligibility and the way it pays providers. Neither has changed significantly since 1983.
Here’s how the traditional program works now: To become eligible for hospice, patients must have two doctors certify they have less than six months to live and agree to stop all attempts at curing their terminal illness.
Many experts believe that harsh choice between giving up hope and getting help from hospice — along with the arbitrary 6-month cutoff — combine to repel many patients who could otherwise benefit. Only about one-third of Native, Asian, Black and Hispanic patients elect hospice compared to about half of white patients.
“One of the reasons that Black people shy away from hospice is because there isn’t room to reevaluate,” said Karen Bullock, a licensed clinical social worker and a professor at Boston College. “It’s too finite.”
Medicare covers much less at-home medical or social support for people who decline hospice. “They’re still ill. They’re still struggling,” Snider said. “But Medicare does not offer us a great way to serve that population.”
An outdated payment policy leaves hospice vulnerable to waste and abuse
For those who do enter hospice, Medicare has historically paid providers a flat rate for every day a person is enrolled in their care — even on days when they need little or no help.
That payment policy, experts say, made more fiscal sense in the early days of hospice when most patients had cancer and died within two months. Since then, hospice has become more popular with a wider range with diseases that are generally less predictable, such as dementia and heart failure. People, on average, now use hospice for almost 100 days.
Experts blame the program’s antiquated flat day rate as one reason for its ballooning costs, which are up more than 50 percent over the last decade. More than half of that budget is now consumed by stays longer than six months.
“The way Medicare pays for this benefit has not evolved to meet the changing needs of the people who use it,” said David Stevenson, a health policy professor at Vanderbilt University. Adding to those doubts is the flood of for-profit hospice businesses that have poured into the market.
About three-quarters of all providers are now for-profit and data suggest some are exploiting the program’s payment structure, averaging much longer stays and profits three times higher than nonprofit providers. Reports, including by ProPublica and the federal government, have also highlighted hundreds of millions of dollars in fraud and disturbing anecdotes of abuse.
Medicare banks on insurers’ incentives to reduce waste and improve care
Medicare’s experiment gives private insurers the flexibility to both expand eligibility and rein in costs. The same insurers already manage most other care for roughly 30 million Medicare beneficiaries through the program known as Medicare Advantage.
The hope is they can take that experience and those skills, like coordinating care and vetting the quality of providers, and apply them to improve hospice. Because private insurers get paid a lump sum to manage each Medicare patient, they are also motivated to keep costs down.
“There’s a natural alignment here,” said Susanne McComic, who’s overseeing the health insurer Humana’s involvement in the hospice demonstration. McComic said Humana had two main reasons for participating. First, they wanted to deliver better care to vulnerable members, and second, it made business sense: They own 40 percent of Gentiva, a large hospice chain.
A larger role for private insurers makes some experts uneasy, especially when it comes to end of life care. Joan Teno, a Brown University researcher and former hospice medical director, points to the United Kingdom’s experiment known as the Liverpool Care Pathway as a cautionary tale.
That program used financial incentives to encourage doctors to enroll more hospital patients in hospice-like services. Some families reported clinicians rushed their loved ones down a path toward death that they did not want or understand. Public outrage erupted and the government ultimately ended the initiative in 2013.
While Medicare’s hospice pilot has many differences, its reliance on financial incentives to change behavior still gives some experts pause.
In other areas of care, some Medicare Advantage insurers have aggressively declined requests for medical services — as much as 13 percent of the time, according to one federal report.
Insurers’ early efforts include cutting rates, cleaning carpets and expanding eligibility
Bethany Snider of Hosparus Health is also wary of what the pilot portends for nonprofit hospice agencies like hers — and their patients. But she encouraged Hosparus to take the leap and partner up with Humana. She valued the chance to shape — or at least glimpse — the likely future of hospice care for most Americans. “I wanted us to have as much time as possible to plan.”
The first big change providers like Hosparus are adapting to is the need to negotiate. The pilot lets insurers abandon Medicare’s day rate and pay providers however they want. An evaluation of the pilot’s first year by the RAND Corporation showed some insurers had already slashed payment rates by up to 12 percent.
The pilot also lets private insurers decline to contract with hospices that, for example, don’t meet certain quality standards. Soon, insurers can begin requiring patients to use only preferred providers.
The hope is this new power helps insurers weed out waste and bad actors. But Snider and others also worry that it could put some nonprofit hospices with thinner margins out of business and lead to further consolidation of the industry.
In an email to Tradeoffs, Medicare’s Liz Fowler emphasized the demonstration’s guardrails designed to protect patient choice. She also pointed to the agency’s “comprehensive monitoring strategy to address and track any unintended consequences.”
The other major shift being tested is an expansion of hospice’s eligibility criteria. Private insurers can choose to offer hospice care to people still pursuing chemotherapy or other curative treatments — and they can offer some services to seriously ill people with more than six months left to live. They can even give patients additional funds for nontraditional help, like carpet cleaning and rent — two uses Humana’s McComic said the insurer has tested.
Together, these experimental changes to who receives and who delivers hospice care, when, and at what cost represent relatively large shifts for a program that’s seen little change over the last 40 years. The overall effect on the cost and quality of care remains to be seen. Participation in the pilot was slow to start but has grown over time. The experiment, which this year includes 15 insurers serving patients across 23 states and Puerto Rico, was slated to end in 2024.
In a surprise announcement, Medicare made public on March 23 that they are extending the pilot through 2030. By then, private insurers are projected to manage the care of nearly 70 percent of Medicare beneficiaries — including, if this pilot becomes national policy, how they spend their final days.
Q&A with Medicare’s Liz Fowler
In reporting this story, we reached out to the Centers for Medicare and Medicaid Services (CMS). Deputy administrator Liz Fowler, who also runs the CMS Innovation Center, provided additional responses that did not fit in the story above. We’re sharing those in full below.
(Note these responses were provided before Medicare announced recent changes to its hospice experiment including extending the test through 2030.)
What is the fundamental question that CMS hopes to answer by the end of this pilot?
Fowler: This test allows CMS to assess the impact on care delivery and quality of care and Medicare expenditures, especially for palliative and hospice care, when participating Medicare Advantage (MA) plans are financially responsible for all Parts A and B benefits.
What has CMS learned from the pilot thus far?
Fowler: For a comprehensive review of the Center for Medicare & Medicaid Innovation’s (the Innovation Center’s) “lessons-learned” from the first year of the Hospice Benefit Component, we would direct anyone interested to the Evaluation of Phase II of the Medicare Advantage Value-Based Insurance Design Model Test. This evaluation report covers the first year (2021) of the Hospice Benefit Component. Additionally, there is a “Hospice At-A-Glance” summary of the report available here.
What’s the most positive trend you’ve seen in the pilot’s early results? Most concerning?
Fowler: We see a positive trend in how Medicare Advantage Organizations (MAOs) are identifying and partnering with hospice providers. For example, MAOs are partnering with hospice providers that have strong relationships with their local communities to actively collaborate with them and community-based organizations that help meet the social needs of patients. Additionally, MAOs are helping ensure cultural competency throughout their hospice networks.
In terms of challenges, we are hoping to see increased uptake in palliative care, transitional concurrent care (TCC), and hospice supplemental benefits. Standing up the infrastructure to deliver these two types of care is a significant undertaking for MAOs, hospice providers, palliative care providers, and all other provider types. This is in part because the Medicare hospice benefit has always been carved out of Medicare Advantage. Both MAOs and hospice providers have had to collaborate to create MAO-provider communication systems, patient/enrollee notification systems, billing and claims systems, clinical information exchanges, care management feedback loops, and others.
Moving forward, we look forward to seeing how these relationships become more established and the infrastructure for the collaboration becomes more routine. Ultimately, we hope the gradual maturing of the operational structures leads to improvements in uptake of services such as hospice care, palliative care, and transitional concurrent care.
Some experts told us they were concerned that some Medicare Advantage organizations were already paying hospice providers 10-12% less than traditional Medicare and that some MA insurers who own hospice businesses might unfairly favor those agencies over others.
How is CMS monitoring for those types of issues? What guardrails are in place to prevent them?
Fowler: CMS has a comprehensive monitoring strategy to address and track any unintended consequences associated with the Hospice Benefit Component. The most recent version can be found here.
With respect to negotiations between MAOs and hospice providers, CMS would like to highlight three key policy guardrails put into place across all four years of the Hospice Benefit Component: 1) a requirement for all enrollees in a plan participating in the Hospice Benefit Component to have complete access to in-network and out-of-network care* and 2) a requirement for all MAOs to reimburse out-of-network hospice care at 100% of Medicare fee-for-service rates, and 3) a requirement for MAOs to submit and implement strategies for network development that must include considerations beyond minimizing costs. Additionally, as of Calendar Year 2023, we have added on an additional layer of network adequacy requirements for MAOs with prior experience with the Component in a service area that take the form of a quantitative requirement to have a minimum number of hospice providers in-network along with additional qualitative requirements for creating and implementing a comprehensive network development strategy.
These policies are intended to help ensure continued enrollee access and serve as a guardrail for any hospice providers who may decide that a proposed rate during contract negotiations may not be sufficient. Finally, we would like to point out that Section 1854(a)(6)(B) of the Social Security Act specifically prohibits CMS from requiring an MAO to contract with a specific provider and from requiring a particular price structure for payment under such a contract, except for limited statutory exceptions (e.g., payments to federally qualified health centers).
*Last week, Medicare announced they will phase out this requirement, stating, “Beginning in 2026, participating MAOs will have more flexibility to require their enrollees to only receive hospice services from hospice providers in their network, as long as the MAOs meet CMS’s qualitative and quantitative network adequacy requirements.”
Tradeoffs’ coverage of Medicare sustainability is supported, in part, by Arnold Ventures.
Episode Transcript and Resources
Episode Transcript
Note: This transcript has been created with a combination of machine ears and human eyes. There may be small differences between this document and the audio version, which is one of many reasons we encourage you to listen to the episode!
Dan Gorenstein: Nobody wants to think about dying. But when they’re asked, the majority of Americans say they want to die at home, surrounded by loved ones, at peace spiritually. At its best, hospice care makes all of those things possible.
Karen Bullock: The hospice social worker said continue to say the things you want to say because she can hear you even if she can’t respond.
DG: A team of nurses and social workers, chaplains, counselors working to honor people’s wishes and help them pass with dignity — sometimes even joy.
KB: We could pray out loud, we could shout, we could sing and that was one of the things that made the most significant difference in my mother’s capacity to die well.
DG: Since 1983, Medicare has covered hospice, paid for 25 million people to die more on their own terms without the aggressive, medical interventions that taint so many families’ final memories. But the program also has some serious shortcomings.
Today, as hospice celebrates its 40th anniversary on Medicare, the middle-aged policy faces a midlife crisis. From the studio at the Leonard Davis Institute at the University of Pennsylvania, I’m Dan Gorenstein. This is Tradeoffs.
***
DG: About half of people on Medicare will use hospice care before they die. But at 40 years old, the popular program is facing some tough challenges. Tradeoffs senior producer Leslie Walker is here today to help talk us through hospice at this important crossroads.
Hey, Leslie.
Leslie Walker: Hey, Dan.
DG: So Leslie, Medicare has paid for hospice services since the early 1980’s. Let’s start with the good. What do we know about its upside?
LW: It’s pretty good, Dan. When you look at the data, compared to people who don’t get hospice, people who do tend to be more satisfied, get less unwanted, aggressive care, more emotional and spiritual support. And, for some patients, hospice saves Medicare thousands of dollars — mostly because it keeps people out of the hospital.
DG: So I mean, that’s pretty remarkable that hospice has actually managed to be that health care win-win, deliver better quality at lower cost. At the same time though, Leslie the basics of Medicare’s hospice policy — who’s eligible and how it pays providers — has been largely the same for the last 40 years.
As you know, I’m also in my forties.
LW: Yes, I am aware of that.
DG: When you get there, you need some upkeep from time to time or things can really start to fall apart on you, like my right knee. It hurts! So if hospice went to the doctor for a kind of 40-year check-up, what would show up?
LW: Definitely some aches and pains, Dan – three big ones. Here’s the first.
About half of people who die on Medicare never get help from hospice. Many others get this kind of care only days, even hours before they die. That’s especially true for Black, Hispanic, Asian and Native people — groups where only about a third of people use hospice compared to about half of white people.
DG: Given hospice’s benefits, do we know why so many people are putting it off or just skipping it?
LW: One big reason, Dan, in order to get hospice the rules require you to give up a lot — any attempt at curing your disease. Chemotherapy, surgery, treatment, you have to stop it all. This decision between getting extra help and giving up hope, it’s so tough providers actually call it the ‘the terrible choice.’
DG: Yeah, so you’re saying people who don’t want to make that terrible choice — who want to keep fighting, keep going —Medicare’s rules prevent them from getting hospice.
LW: Exactly and that leaves this very important question.
Bethany Snider: What do you do with those patients and families?
LW: How does Medicare help them die with dignity too?
BS: They’re still ill, they’re still struggling with many things. They still need these support services.
LW: I talked to Bethany Snider about this. She’s the chief medical officer at Louisville-based Hosparus Health. She told me right now, Dan, the only way for most people to get the end of life support they say they want is by choosing hospice. If they don’t, Medicare just doesn’t pay for much of that kind of help — the kind of help that keeps people from dying in ways they don’t want: in an ICU bed, surrounded by machines or in pain at home, alone.
BS: We do not have a great way to serve that population. There has to be more than what’s available today.
DG: Okay so not helping as many people as it could is this middle aged program’s first ache. What’s the next one, Leslie?
LW: Well, it’s kind of the opposite problem, Dan. There’s this whole group of hospice patients that Medicare might be spending too much money on. And there’s a pretty simple reason why.
David Stevenson: The Medicare hospice benefit has not evolved to meet the changing needs of the people who use it.
LW: David Stevenson, who’s a health policy professor at Vanderbilt, told me ever since Medicare started covering hospice in 1983…you remember that day, right Dan?
DG: Sure do. Third grade, my friend.
LW: It’s paid providers a flat daily fee, whether someone needs 10 visits a week or two. Now back in the 80s, most patients who went on hospice had cancer and sadly died pretty quickly. Plus if things went really sideways, Medicare just stopped paying after 210 days.
DG: So what you’re saying Leslie is those two factors – very sick patients and a hard cap on hospice days – kinda kept costs in check.
LW: Exactly, but over time hospice became more popular with more people — people with diseases a lot less predictable than cancer…dementia, heart failure, COPD.
DG: So this is a good thing, right? Medicare wants more people using this kind of help.
LW: It is, but it also raises this big question right? Is one flat rate for all these different people dying from all these different diseases really the best way to pay for all this care anymore? Especially since that 210 day cap, Dan — Congress nixed it years ago, and hospice stays now last much longer on average.
DG: So Medicare’s paying for a lot more days including ones where it’s hard to say someone is actually at the end of their life. Basically taxpayers are losing money to this sort of relic that is the day rate.
LW: To be fair here, Medicare did create a second, slightly lower rate for some patients a few years back but people see it as a pretty minor fix to a major problem.
DG: What’s that?
LW: Medicare’s hospice budget has spiked 50% in the last decade. It’s now over $20 billion a year, which brings us to the third and final problem: a bunch of fraud and abuse.
A whole bunch of for-profit hospice companies have come pouring into this market and reports suggest they’re taking advantage of this day rate. In fact, some of these businesses are so profitable, Dan, private equity and big insurers are buying them up for billions of dollars.
DG: I’m curious when you say fraud and abuse, Leslie, what does that look like on the ground?
LW: So one report from the Department of Health and Human Services estimated companies are cheating Medicare out of hundreds of millions of dollars a year. But what really stuck with me was this damning investigation by Ava Kofman at ProPublica. She tells stories of hospice marketers combing through church prayer lists, stalking Meals on Wheels vans. People, Dan, who didn’t realize they’d been enrolled in hospice until after their chemotherapy had been cut off.
DG: That is so disturbing, Leslie. Okay, so just to review the 40-year check-up here: Medicare is spending too much on some people, some companies are fleecing both the program and patients, and at the same time, Medicare wants a bunch more people who could legitimately benefit from these services to get them.
Did I miss anything?
LW: Nope, I think that’s the rundown, Dan. Thanks for the recap.
I’m no doctor here, but based on my reporting, when I hear all those issues, right, they’re all symptoms of this single underlying problem. And it’s a problem that a lot of you Gen-Xers have.
[80s music]
LW: Medicare’s hospice policy is stuck in the 80s.
DG: The 80s? Leslie, you’re going to blame this on the 80s? The 80s were the best. 1985, my friend.
LW: Don’t even start with the Chicago Bears. Don’t do it.
DG: 15 and 1! The Super Bowl Shuffle. We are the Bears…
LW: I’m going to shuffle on out of this booth if you don’t stop.
DG: Alright.
LW: But seriously Dan, Medicare is finally trying to get with the times, update its hospice program with an ambitious pilot including 15 insurers in 23 states.
DG: A classic mid-life crisis shakeup, Leslie. I love it!
LW: I mean it’s not quite a Mustang or a motorcycle — it is still a health policy pilot after all — but I’ll tell you more after the break.
MIDROLL
DG: Welcome back. Medicare’s hospice program is facing a midlife crisis. A policy designed 40 years ago no longer fits the people and providers using the service today, leading to problems with access, waste and inequity. Medicare recognized its shortcomings and decided to test a pilot that our sources tell us has a real shot at becoming national policy down the road. And that national policy would put private insurers in charge of hospice for tens of millions of people.
Senior producer Leslie Walker is back to tell us more about this ambitious project that launched in 2021. Leslie, let’s start with who is involved.
LW: Some major names, Dan, insurers like Aetna, Humana, United, more than 100 hospice agencies — all across 23 states plus Puerto Rico.
DG: Sounds pretty big, Leslie. How would you describe what’s at stake?
LW: Well, we’re talking about how people die, Dan. These important and difficult last days…a family’s final memories of their loved one. That’s what we’re talking about. And any kind of policy change to end of life care can be dangerous.
There’s this cautionary tale that’s worth keeping in mind. It comes from the UK.
News: First tonight the case of a young mother whose family say she died because she was given an unexplained dose of morphine.
LW: This program known as the Liverpool Care Pathway, encouraged doctors to start more hospital patients on hospice-like services.
News: We went along because if a doctor tells you that someone’s near to death you have to believe that.
LW: But under this Liverpool Care program, Dan, hospitals were offered financial incentives to do this. And some doctors were caught pressuring vulnerable patients and their families to give up treatments before they were ready.
News: Kayleigh Hollobone thought cancer doctors were doing her best for mum. In fact she’d been put on the controversial Liverpool Care Pathway and was being deprived of food and fluids without consent.
LW: The policy erupted into this massive scandal, lost public trust and was ended in 2013.
Now, the nuts and bolts of the Liverpool model are really different than the experiment Medicare is running. But what they both share is banking on money — financial incentives — to motivate hospitals in the case of the UK and insurers here at home to help more people get on hospice.
DG: And the moral of that story, Leslie, is monkeying around with money when it’s tied to the care of dying people is risky business. So let’s talk about the nuts and bolts of what Medicare is testing here to try and understand its potential risks and its benefits.
LW: The big picture, Dan: Medicare’s putting private insurers on the financial hook for some people’s hospice care and in exchange, giving those companies more say over how they pay for and deliver that care.
Right now about half of the 64 million people on Medicare have what’s called Medicare Advantage or MA, which is run by insurance companies.
DG: And those insurance companies get paid a lump sum to manage all of a person’s care, right?
LW: Almost all of their care, Dan – except for hospice. Before this pilot began, if an MA patient wanted hospice, the federal government stepped in to pick up that tab, deliver that care.
DG: Wait, so as someone is dying their insurance plan essentially stops paying the bills? Seriously?
LW: I am serious, and, here’s how Brown University researcher Vince Mor described this cluster.
Vince Mor: Right now what happens is your, your MA plan gets to wipe their hands clean, say, “Okay, you’re on hospice. Bye bye!” And that’s it. And there’s no continuity. There’s no doctor. There’s no nothing there. They don’t even transfer the records.
DG: That sounds like a fragmented, frankensteined nightmare. Seems like an obvious improvement that this experiment keeps people’s MA plans on the hook for their care until the very end. And what’s it do, Leslie to address those other middle-aged aches that you ran down before the break?
LW: The government’s basically letting insurance companies make two major changes here to hospice care for people who have Medicare Advantage. First, companies can pay the hospice providers in the pilot whatever they want, however they want instead of Medicare’s flat day rate. Second, the insurers can do a lot more to bring that half of people who never choose hospice into the fold.
DG: Those people who want to keep treating their condition, keep fighting.
LW: Exactly. Those folks can now get that last round of chemo, that last surgery, and this care at the same time. And insurers can even offer a kind of ‘hospice light’ to sick people who aren’t quite yet at the end — get them on a kind of onramp. The whole idea, Dan, is to test turning hospice from being this cliff into more of a bridge — a continuum of services that gets the right level of care to the right person at the right time.
DG: And it seems like if that happens, Leslie, then Medicare will have tackled two of those midlife problems: Spending its money more efficiently and bringing these helpful services — counseling, nurse visits, a hospital bed for your home — to more people who say they want them. And what about the third scary third ache and pain, the fraud and abuse, Leslie?
LW: Right. So as many of us know firsthand, insurance companies in an effort to control costs and enhance quality they develop these networks of doctors and hospitals we can use. Now, in this experiment, they’re curating networks of hospices, too. And soon Medicare is going to let them steer patients only toward preferred providers and in theory, away from bad actors.
DG: Got it. So that’s the ‘glass half full’ take on this. But this whole experiment assumes that insurers who have their own bottom lines to worry about will be more fiscally responsible and make sure people get great care in their final days. That’s a big assumption.
LW: It is. There’s no denying it. And giving insurance companies more control means giving them more control. Insurers right now are playing hard ball with hospices. Some companies have already sliced hospice payments by 10 to 12 percent. If this test eventually becomes national policy, Dan — depending on how much latitude Medicare gives insurers — companies could cut rates so low that some hospices go out of business.
DG: So that’s the downside for providers, which sounds real. But what about patients? What happens to them if insurance companies have more control?
LW: Yeah so the original hospice policy is this kind of one size fits all benefit, right? Its simplicity is its beauty. People on Medicare know what they’re getting. Hospice providers know what they’re giving. But with insurers behind the wheel, they could design tons of different flavors of hospice, which could leave patients and providers confused about what’s really covered.
DG: So you’re saying, I think, you could end up spending really important final moments with your loved one waiting on hold with an insurance company to tell you what’s going to get paid for and what won’t.
LW: Exactly. Not a great way to spend those final hours.
DG: So, Leslie, you’ve sort of painted these two possible outcomes of putting insurers in charge, which, again, based on our reporting, could very likely become reality for people on Medicare Advantage. One where insurers use their resources and incentives to save taxpayers some money, improve the quality of these vital services and get them to more people. The other painting, far less rosy, is one where people in some of the worst moments of their lives can’t get the hospice care that they want.
LW: Yes, that is basically the history of managed care in a nutshell, Dan.
DG: Either way, assuming Medicare Advantage keeps growing at this speed, it sounds like insurance companies are going to be more involved in some people’s hospice care. The big question remains: is this going to be good or bad?
So let’s zoom out to close here, Leslie. Obviously this whole experiment handing the reins to insurers is just one way Congress could revitalize this 40 year old program. Instead they could do away with Medicare’s flat payment rate, nix restrictions like that terrible choice. But those policies could backfire in their own ways and open the door to new kinds of abuse. So passing the buck and those tough questions to insurers seems like an easier path, right?
LW: It is from a political perspective. Takes the heat off lawmakers. Puts someone else in charge of cutting providers payments, telling patients no. But from a policy perspective, it’s a real gamble. I go back to the Liverpool Care Pathway, and the scandal there. When you change financial incentives around end of life care, whether for insurers or providers, you have to tread very carefully. The stakes are sky high and unintended consequences can get ugly fast.
DG: Leslie, thanks for your work on this story.
LW: You’re welcome, Dan.
DG: Medicare’s hospice pilot was slated to end next year but got extended until 2030 just last month. In an email to Tradeoffs, Liz Fowler, deputy administrator at the Centers for Medicare and Medicaid Services said “ensuring that people with Medicare have access to high quality and coordinated care is a top priority.” She emphasized the project has guardrails designed to protect patient choice. And she pointed to the agency’s “comprehensive monitoring strategy to address and track any unintended consequences.” More on the agency’s response and the policy details of the pilot can be found at tradeoffs.org.
I’m Dan Gorenstein. This is Tradeoffs.
Episode Resources
Additional Research and Reporting on Hospice and the Carve-In Pilot:
- Hospice Services (MedPAC, 3/15/2023)
- How Hospice Become a For-Profit Hustle (Ava Kofman, ProPublica/New Yorker, 11/28/2022)
- The Hurdles Facing Black Families Navigating Serious Illness (Tradeoffs, 11/10/2022)
- Evaluation of Phase II of the Medicare Advantage Value-Based Insurance Design Model Test (RAND Corporation, 10/2022)
- Carving in Hospice to Medicare Advantage—Potential Unintended Consequences (Joan Teno, JAMA Health Forum, 7/1/2021)
- When a Health Insurer Also Wants to Be a Hospice Company (Reed Abelson, New York Times, 6/22/2018)
- Medicare’s Hospice Benefit: Revising the Payment System to Better Reflect Visit Intensity (Steve Sheingold, Susan Bogasky and Sally Stearns; ASPE; 5/27/2015)
- Integrating Care at the End of Life: Should Medicare Advantage Include Hospice? (David Stevenson and Haiden Huskamp, JAMA, 4/16/2014)
Episode Credits
Guests:
- Vince Mor, PhD, Professor of Health Services, Policy & Practice, Brown University
- Bethany Snider, MD, Chief Medical Officer, Hosparus Health
- David Stevenson, PhD, Professor of Health Policy, Vanderbilt University School of Medicine
- Leslie Walker, Senior Producer, Tradeoffs
The Tradeoffs theme song was composed by Ty Citerman, with additional music this episode by Blue Dot Sessions and Epidemic Sound.
This episode was reported and produced by Leslie Walker and mixed by Andrew Parrella and Cedric Wilson. Editing assistance from Cate Cahan.
Additional thanks to Karen Bullock, Torrie Fields, Mireille Jacobson, Rebecca Anhang Price, Sally Stearns and Joan Teno.