Response to MedPAC Medicare Advantage Proposal
For Immediate Release:
March 14, 2014; 1:02pm
MedPAC Recommends Less Hospice Choice for Medicare Advantage Beneficiaries, At a Higher Cost
NHPCO Voices Concern for Flawed Recommendation
(Alexandria, Va) – The National Hospice and Palliative Care Organization (NHPCO) is opposed to the recent recommendation by the Medicare Payment Advisory Commission (MedPAC) to “carve-in” the Medicare Hospice Benefit (MHB) for Medicare Advantage (MA) participants.
In its March 2014 report to Congress, MedPAC recommended that Medicare Advantage plans assume both the clinical management and financial responsibility of the hospice benefit (hospice would be ‘carved-in’ to Medicare Advantage plans).
“Should the MHB be changed to a ‘carved-in’ benefit, patients, families caregivers, the hospice community and Medicare will be significantly and negatively impacted,” said J. Donald Schumacher, NHPCO president and CEO.
Choice Would Be Limited
Currently, a MA patient is free to enroll in any Medicare certified hospice program. Under the “carve-in”, the patient would be directed to a MA contracted hospice giving the patient and family less choice.
“End-of-life care is a deeply personal experience. It is both unreasonable and insensitive to require families to conform their needs and preferences to those of a MA plan,” noted Schumacher.
Potential Financial Burden to Patients
The MedPAC recommendation opens the possibility for MA plans to require additional co-payments or other cost-sharing for hospice. Such financial burdens are minimal under the current system.
“By their very design MA plans are concerned about risks and the bottom line. By advancing this recommendation, MedPAC seems to find it an acceptable risk for financial incentives to shape or even limit hospice choice and quality,” said Schumacher.
Hospice "carve in" would cost Medicare $1.3 billion
Under the current system, hospice saves Medicare an average of $2,309.00 per beneficiary enrolled (Duke, 2007). The “carve-in” would create additional costs for Medicare.
According to a new study by Avalere Health (PDF), commissioned by NHPCO, the MedPAC proposed “carve-in” of hospice would cost Medicare an alarming $1.3 billion over a ten-year budget window.
Negative Impacts on Hospices
Hospices contracting with MA plans would not be assured of the baseline reimbursement rates established under Medicare. At a time when MA plans are under immense financial pressure, the carve-in would surely leave hospices vulnerable to further reimbursement cuts.
Reduction in reimbursement would force hospices to re-evaluate staffing and devote valuable resources to maintaining the administrative infrastructure required to support ongoing communication, billing and data reporting with the MA plan.
These additional burdens would put many hospices, especially smaller and rural programs, at a competitive disadvantage, and could further limit access to compassionate end-of-life care in underserved communities.
Helpful information for providers from the Hospice Action Network:
- Issue Briefing: Hospice and the Medicare Advantage “Carve-In” (03/2014)
- Advocate Backgrounder on hospice and Medicare Advantage
- NHPCO letter to MedPAC on Medicare Advantage “carve-in” proposal (12/2013)
- How much will MedPAC’s proposal cost Medicare? NHPCO asked Avalere Health to find out (03/2014)
Senior Vice President, Communications
NHPCO is the oldest and largest nonprofit leadership organization representing hospice and palliative care programs and professionals in the United States. NHPCO’s mission is to lead and mobilize social change for improved care at the end of life, www.nhpco.org.