Does Medicare Cover Hospice? Which Expenses to Anticipate

Parts of Medicare and Hospice Coverage

Medicare is broken down into different parts: A, B, C, D, and Medigap. To qualify for the hospice-care benefit from Medicare, you need Medicare Part A, which covers hospital insurance and all other conditions. Medicare typically pays your hospice provider for your hospice care and there’s no deductible, but you’ll pay the remaining cost of monthly Medicare Part A or Medicare Part B premiums.

Medicare Part A covers most medically necessary hospital, skilled nursing facility, home health, hospice, and respite care. Under Medicare Part A, you’ll need to meet specific conditions certified by a hospice doctor and regular doctor.

• Your hospice doctor and regular doctor must certify that you are terminally ill and expected to live six months or fewer.
• You agree to accept palliative or comfort care instead of curing your illness.
• You sign a statement accepting hospice care instead of other Medicare treatments for terminal illness.

Medicare Part B provides outpatient and medical coverage, which includes certain doctors’ services, outpatient care, medical supplies, x-rays, mental health care and some home health, and other preventative services.

Medicare Part C, also called Medicare Advantage, offers the same coverage of Original Medicare with, in many cases, additional benefits related to hearing, vision, and dental health. These plans are offered by private insurers.

To learn more, read our guide to our favorite Medicare Advantage providers.

Medicare Part D covers outpatient prescription-drug insurance and is provided only through private insurance companies with government contracts. This coverage will also help you pay for prescriptions not related to your terminal illness.

Medigap, also known as Medicare Supplement Insurance, fills certain gaps in Original Medicare. Hospice care is, for the most part, covered by Part A and Original Medicare, but Medigap fills in for additional health costs such as copayments, deductibles, and coinsurance. To learn more, read my article: What Is Medigap?

Paying for Hospice Care With Medicare

When your hospice-care benefits start, Medicare will cover the costs related to your terminal illness even if you are in a Medicare Advantage Plan or another Medicare health plan. For peace of mind, there is no deductible for hospice care. You may, however, need to pay monthly premiums, copayments for prescription meds, or a certain percentage for coinsurance.

Consider this scenario: Debra is turning 65 and retiring soon. She’s active, and she enjoys kayaking and other outdoor sports to stay in good health. She has never been admitted to the emergency room or had surgery, but she is concerned about potential health risks in the future.

Debra may want to consider signing up for Medicare Part A and B as a backup plan, which will help pay for inpatient hospital care, hospice care, nursing facility care, and other medical services and supplies. Since Medicare doesn’t pick up 100 percent of the tab, Debra decides to take a proactive approach by signing up for a Medicare Supplement Insurance Plan for further coverage. This would cover everything from deductibles to coinsurance to copayments.

Hospice Care Costs Not Covered by Medicare

Medicare provides comprehensive coverage, but there are certain limitations to what will be covered for hospice care. Below are hospice-care costs that will not be covered by Medicare.

• Treatment that aims to cure your terminal illness or other health conditions.
• Prescription drugs that aren’t related to your terminal illness or other health conditions.
• External care that wasn’t previously set up by your hospice medical team, which means you can’t get hospice care from a different hospice until you change your hospice provider.
• Room and board are not covered by Medicare, but this depends largely on whether your hospice team deems you fit for short-term inpatient or respite-care services.
• Medicare won’t cover ambulance transportation or the care you receive as a hospital outpatient or inpatient.

Medicare generally pays for approximately 85 percent of overall hospice costs, according to studies. If you have Medicare Part A and you meet all the requirements, hospice care is $0. You may need to pay a copayment of no more than $5 for each prescription and other products, though, and you also may need to pay 5 percent for inpatient respite care.

For Part D or Medicare prescription-drug coverage, the monthly premiums differ from plan to plan. People with higher incomes may pay higher premiums. A jointly filed tax return of between $222,000 and $276,000 would cost $31.80 plus your plan premium on a monthly basis.

Medicare Part B, for example, covers certain approved procedures such as casts, X-rays, and outpatient services. If you’re getting a cast for your foot, then you’d likely have to pay 20 percent of the Medicare amount, plus a copayment for being a hospital outpatient and a Part B deductible. This changes if you are getting hospice care, though, since it’s not covered by Medicare. It’s best to inform your hospice team before you get any services separate from hospice care or you may have to pay the entire cost of the services.