Do I Need Supplemental Insurance If I Am on Hospice?
Decipher if supplemental insurance is necessary during hospice. Understand its continued role for medical care unrelated to your terminal illness.
Individuals facing a terminal illness often navigate complex decisions regarding medical care and financial planning. A common confusion point is how existing health insurance, especially supplemental coverage, interacts with hospice services. Understanding these interactions is important for continuous medical support. This article clarifies how primary and supplemental insurance plans coordinate benefits once hospice care begins, addressing whether supplemental insurance remains necessary.
Understanding Hospice Care Coverage
Hospice care focuses on comfort and quality of life for individuals with a terminal illness, shifting emphasis from curative treatments to palliative care. Medicare Part A is the primary payer for hospice services for most eligible individuals. To qualify, a physician must certify a life expectancy of six months or less, and the individual must choose comfort care over curative treatments.
The Medicare Hospice Benefit is comprehensive, covering nearly 100% of costs related to the terminal illness. This includes physician services, nursing care, medical equipment and supplies, medications for pain and symptom management, hospice aide and homemaker services, various therapies, and grief counseling for the patient and family. While Medicare Part A covers most services, a small copayment, up to $5, may apply for outpatient prescription drugs used for pain and symptom management. Additionally, a 5% coinsurance may be required for short-term inpatient respite care, which provides temporary relief for caregivers. Room and board expenses are generally not covered if hospice care is provided in a home or facility setting.
Supplemental Insurance and Hospice Care
Supplemental insurance plans, or Medigap policies, cover out-of-pocket costs not covered by Original Medicare (Parts A and B), such as deductibles, copayments, and coinsurance. When an individual elects the Medicare Hospice Benefit, Medicare Part A assumes primary responsibility for all services related to the terminal illness. Since Medicare Part A covers most hospice-related costs at or near 100%, the role of supplemental insurance becomes minimal.
For care directly related to the terminal illness and covered by the Medicare Hospice Benefit, supplemental insurance does not pay, as there are few “gaps” to fill. However, some Medigap plans may cover copayments or coinsurance amounts, such as for outpatient prescription drugs or respite care. These plans complement Original Medicare’s benefits, not duplicating the comprehensive coverage under the Medicare Hospice Benefit. While supplemental insurance remains active, its financial contributions for hospice-specific services are limited.
Non-Hospice Related Medical Needs
While the hospice benefit covers care related to the terminal illness, an individual’s Original Medicare (Parts A and B) coverage for conditions unrelated to the terminal illness continues. For instance, if a person on hospice care for a cardiac condition experiences a broken bone, treatment for the fracture would still be covered by Medicare Part A and Part B. In such scenarios, standard Medicare deductibles, copayments, and coinsurance would apply.
This is where supplemental insurance maintains a role. It continues to provide coverage for these unrelated medical needs, helping to cover deductibles, copayments, and coinsurance. Prescription drug coverage, through a Medicare Part D plan, remains effective for medications unrelated to the terminal illness and its symptoms. The hospice provider is responsible for drugs related to the terminal condition, but for unrelated prescriptions, the Part D plan should cover them.
Deciding on Your Supplemental Coverage
The decision of whether to keep supplemental insurance while on hospice care involves weighing several factors. One consideration is the likelihood of needing medical care for conditions entirely unrelated to the terminal illness. If such needs arise, maintaining supplemental coverage can prevent out-of-pocket expenses. The cost of supplemental insurance premiums should be compared against the financial risk of paying full deductibles, copayments, and coinsurance for unrelated medical events without it.
Another factor is the possibility of revoking the hospice benefit. Individuals can discontinue hospice care at any time and return to traditional Medicare coverage, re-electing hospice later if needed. If hospice is revoked, supplemental insurance resumes its role in covering gaps in Original Medicare. Re-purchasing a supplemental policy later might involve underwriting and health questions, potentially leading to higher premiums or denial of coverage. Consulting with an insurance advisor or the hospice care team can provide guidance regarding these coverage interactions.