Hospice Leaders Applaud MA Carve-In Approach — But Also Voice Concerns

Hospice leaders are, for the most part, encouraged by the move to explore a Medicare Advantage (MA) carve-in for hospice through an expanded demonstration. But several questions remain, they caution, with the bulk of them focusing on whether the hospice benefit could somehow be diluted or lessened.

The Centers for Medicare & Medicaid Services (CMS) and other federal policymakers outlined the move on Friday.

“Our main focus is: How do we make sure that consumers, patient and families are assured of their access to hospice care in a transition to hospice that is at least as good as what they have now — and ideally better?” Edo Banach, CEO and president of the National Hospice and Palliative Care Organization (NHPCO), told Home Health Care News. “Going forward, we’re going to be watching to make sure this is a plus and not something that detracts from care.”


In the U.S., the hospice benefit can trace its roots back to when Congress included a provision to create a Medicare hospice benefit in the Tax Equity and Fiscal Responsibility Act of 1982. The Health Care Financing Administration (HCFA) — a precursor to CMS — assessed the cost-effectiveness of hospice care in a demonstration of three years prior.

In its present form, the hospice benefit is for terminally ill individuals projected to have six or fewer months to live. In general, hospice care focuses on caring and comfort, as opposed to curative care, while also providing family support.

Unlike home health services, hospice care is not currently covered by MA plans, despite enrollment skyrocketing. An estimated 22.6 million Medicare beneficiaries are expected to sign up for MA plans in 2019, according to CMS.


MA enrollees who elect hospice remain in their MA plans, but fee-for-service (FFS) Medicare pays for their hospice services.

The fact that hospice is covered by traditional Medicare but not Medicare Advantage has, in some instances, created beneficiary confusion and contributed to late admissions into the hospice setting. Roughly 35% of hospice patients die or are discharged within seven days of admission, NHPCO statistics show.

The plan CMS announced last week calls for the agency to test out a hospice MA carve-in using the Value-Based Insurance Design (VBID) model, which launched in seven states in 2017 and will be expanded to all 50 by 2020. Plans participating in the VBID model will be able to offer a hospice benefit starting in 2021.

“I think plans are looking forward to this,” Tom Koutsoumpas, CEO and president of the National Partnership for Hospice Innovation (NPHI), told HHCN. “I don’t know what all the plans’ views are, but I think there’s a general sense that it would be an opportunity that they would embrace. It ultimately depends on how it would work, how it’s constructed and what the results of the demonstration are, frankly.”

Avoiding fragmentation

The Medicare Payment Advisory Commission (MedPAC) has been among the groups that have criticized the fragmented and confusing nature of the hospice benefit under traditional fee-for-service Medicare and Medicare Advantage. In particular, MedPAC officials have found that the carving-out of hospice from MA fragments care accountability and financial responsibility for MA enrollees who elect hospice.

Overall, MA decedents have consistently utilized hospice services at a higher rate than their FFS counterparts, according to MedPAC. In 2014, for example, 50.8% of MA decedents used hospice compared with 46.8% of FFS decedents.

For the past several months, NHPCO and NPHI have each been working to bring insurers and hospice stakeholders together to figure out what a hospice benefit would look like under MA. While it wasn’t directly tipped off about CMS’ Friday announcement, NHPCO had been expecting something to come down the pike soon, Banach said.

“Did I think this was going to come out on Friday? No,” he said. “But I thought this was a possibility. Frankly, doing something via demonstration rather than outright for the entire country all at the same time is preferable, too.”

Broadly, the VBID model allows participating MA plans to offer more flexible supplemental benefits or reduced cost-sharing to enrollees with certain chronic conditions approved by CMS, including diabetes, congestive heart failure and hypertension, among others. MA plans were granted additional leeway for identifying VBID beneficiaries at the start of 2019, however.

Thirteen health plans from 10 parent organizations are participating in the VBID model, the latest information from CMS shows.

Ultimately, it’s far too early to gauge which plans will opt to offer a hospice benefit come 2021, Banach said.

“It’s been believed that if health plans are offered more flexibilities, they’d do so, but based on what I’ve seen and what I know for this plan year, that’s not true,” he said, using plans’ newfound ability to offer some in-home services and supports as an example. “Just because you can do something doesn’t mean you will. That’s something worth watching because it will obviously impact the scope of the demonstration.”

The odds of a broader MA rollout occurring within the next five years are low, according to Banach.

Identifying the unknowns

Similar to NHPCO’s Banach, Koutsoumpas said he applauds CMS for testing an MA hospice carve-in before making any broader policy moves.

Policymakers’ decision to do so is in stark contrast to what’s going on in the home health space, where CMS has caught flak for finalizing major payment reform — the Patient-Driven Groupings Model (PDGM) — without testing its impact first.

“We’re thrilled that this is in demonstration form,” Koutsoumpas said. “Having a demonstration is just an extraordinary opportunity to get it right.”

Additionally, exploring a hospice carve-in gives hospice providers and MA plans time to develop working relationships and feel each other out. As home care agencies are finding out, using data to demonstrate the value of hospice care and its capacity to lower health care spending will be essential to establishing successful MA connections.

“That’s part of why there needs to be a demonstration,” Mollie Gurian, chief strategy officer for NPHI, told HHCN. “Just as hospices are learning how to work with Medicare Advantage plans, MA plans are learning how to work with home care and hospice agencies, figuring out what’s needed for their members in the home.”

Hospice providers are mixed in support for a hospice carve-in, with sentiments largely varying based on their size and potential leverage in negotiating with MA plans. Smaller hospice providers may be more likely to oppose a broader hospice carve-in, though, due to their ability to compete.

Dr. Timothy Ihrig, chief medical officer for Crossroads Hospice & Palliative Care, told HHCN that his organization is excited for the opportunity, but that there is still a long way to go to realize the full value of hospice care and how it is delivered in the United States.

Crossroads Hospice & Palliative Care is one of the largest palliative care providers in the United States, providing services across Georgia, Kansas, Missouri, Ohio, Oklahoma, Pennsylvania and Tennessee.

“While it is encouraging that VBID, on its surface, represents an expansion of care opportunities for individuals living with end of life issues, I mimic the concerns of many others with respect to properly aligning incentives,” Ihrig said. “Maintaining services reflective of that which is sacred to the individual and true informed consent, coupled to coordinated, high-quality care and accountability are keys to success.”

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