Annals of Long Term Care

This article details the historical beginnings of hospice in the United States and its progression away from being a volunteer community organization to becoming a healthcare business, which increasingly occurred following Medicare’s funding of hospice care in 1982. The article also discusses the benefits of Medicare hospice and its deviation from hospice’s traditional philosophy of care, which can be partly attributed to certain laws. The increasingly business-driven model of care among hospice organizations and complexities in the law has led to confusion regarding the objective of hospice care and has opened the door to potential Medicare hospice fraud and abuse. We examine three case scenarios that outline different situations that may constitute or open the door to potential fraud and abuse.

Hospice History
Hospice originated in 1963 with the establishment of an inpatient hospice in London that sought to provide holistic care to terminally ill patients with cancer and their families. In 1969, Elisabeth Kübler-Ross, MD, published a book titled On Death and Dying, which was a compilation of interviews with 500 dying patients. In 1972, Kübler-Ross testified at the first national hearings on the subject of death with dignity, conducted by the U.S. Senate Special Committee on Aging, and the first hospice legislation was introduced in the U.S. Senate but was not enacted. The hospice movement was promulgated by a U.S. Department of Health, Education, and Welfare Task Force in 1978, and, subsequently, by the Centers for Medicare & Medicaid Services (CMS) through the funding of 26 demonstration grants to assess the cost-effectiveness of hospice and to determine what services hospices should provide. In 1980, the W.K. Kellogg Foundation awarded a grant to the Joint Commission on Accreditation of Hospitals to investigate the status of hospice and to develop standards for hospice accreditation.¹ The Tax Equity and Fiscal Responsibility Act of 1982 provided coverage of hospice care for terminally ill Medicare beneficiaries who elected to receive care from a participating hospice. The Act established eligibility requirements and outlined covered services, reimbursement procedures, and the conditions that a hospice must meet to be approved for participation in the Medicare program.²

In the United States, hospices have been around for some time. Before the Tax Equity and Fiscal Responsibility Act was passed by Congress, hospices provided care to patients regardless of their ability to pay. In many instances, hospices were nonprofit organizations or were financially supported by such organizations, including county, church, or other civic entities. In the last 10 to 15 years, however, the hospice concept and benefit has flourished. This may be partially attributed to the burgeoning elderly and chronically ill population. To some extent, hospices have captured the favor of the public and even healthcare professionals. This is because hospice care has been viewed by some as a refreshing alternative to modern-day, impersonal, costly, high-tech hospital or subspecialty care, where the mantra is “life saving at all cost” and there is a fragmentation of services. In contrast, hospice facilitates “dying with dignity” through passionate and personal hands-on-care at the end of life. Hospice also has a financial incentive for patients and their families, requiring no co-payment from Medicare and no prior 3-day hospitalization or other requirements, such as admission to a skilled nursing facility.