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Hospices Inappropriately Billed Medicare Over $250 Million for General Inpatient Care

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Nancy Harrison

Hospices Inappropriately Billed Medicare Over $250 Million for General Inpatient Care

Nancy Harrison, Deputy Regional Inspector General for the Office of Evaluation and Inspections, is interviewed by Jodi Nudelman, Regional Inspector General for the Office of Evaluation and Inspections in New York City.


Recent investigations by the Office of Inspector General have shown a number of instances in which hospices inappropriately billed Medicare for hospice general inpatient care (GIP). Misuse of GIP includes care being billed but not provided and beneficiaries receiving care they do not need. Such misuse has human costs for this vulnerable population as well as financial costs for Medicare. The goals of hospice care are to help terminally ill beneficiaries with a life expectancy of 6 months or less to continue life with minimal disruptions and to support beneficiaries' families and other caregivers. The care is palliative, rather than curative. Hospices must establish an individualized plan of care for each beneficiary. GIP is the second most expensive level of hospice care and is intended to be short-term inpatient care for symptom management and pain control that cannot be handled in other settings.


We based this study on data from a medical record review of a stratified random sample of all GIP stays in 2012. We analyzed the results of the medical record review to estimate the percentage of GIP stays that were billed inappropriately. We also used Medicare Part D data to identify the drugs paid for by Part D and provided to beneficiaries during GIP stays.


We found that hospices billed one-third of GIP stays inappropriately, costing Medicare $268 million in 2012. Hospices commonly billed for GIP when the beneficiary did not have uncontrolled pain or unmanaged symptoms.

Percentage of Inappropriate GIP Stays, 2012

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For example, a hospice billed for GIP for a beneficiary with a circulatory disease who had no unmanaged symptoms. This beneficiary could have been cared for at home, but the hospice billed Medicare for 46 consecutive days of GIP. The hospice was paid just over $31,000 for the stay.

Some States, such as Florida, had many inappropriate GIP stays. Hospices were more likely to inappropriately bill for GIP provided in skilled nursing facilities than GIP provided in other settings. For-profit hospices were more likely than other hospices to inappropriately bill for GIP. We also found that Medicare sometimes paid twice for drugs because they were paid for under Part D when they should have been provided by the hospice and covered under the hospice daily payment rate. Further, hospices did not meet all care planning requirements for 85 percent of GIP stays and sometimes provided poor-quality care. For example, one hospice provided GIP to a beneficiary with dementia for 16 days, but his pain was never brought under control.


The findings in this report make clear the need to address the misuse of GIP and hold hospices accountable when they bill inappropriately or provide poor-quality care. We recommend that the Centers for Medicare & Medicaid Services (CMS) (1) increase its oversight of hospice GIP claims and review Part D payments for drugs for hospice beneficiaries; (2) ensure that a physician is involved in the decision to use GIP; (3) conduct prepayment reviews for lengthy GIP stays; (4) increase surveyor efforts to ensure that hospices meet care planning requirements; (5) establish additional enforcement remedies for poor hospice performance; and (6) follow up on inappropriate GIP stays, inappropriate Part D payments, and hospices that provided poor-quality care. CMS concurred with all six recommendations.