CMS Urged to Reimburse Providers for End-of-Life Planning

Should Medicare and Medicaid reimburse providers for counseling patients regarding end-of-life issues? Support for Medicare and Medicaid reimbursement for end-of life planning has been growing from a variety of sources, including Congress, state Medicaid programs, the American Medical Association (AMA), the American Academy of Family Physicians, and the Institute for Medicine (IOM). An August 30, 2014, New York Times article, noted that even private payers have begun reimbursing doctors for advance care planning service.

Congressional Support

“Currently, the time doctors spend having discussions with their patients about end-of-life care and planning is not reimbursed under Medicaid and Medicare. Without this incentive, these conversations are not happening,” according to a news release issued by Congressman Earl Blumenauer (D-Oregon). On March 14, 2013, Blumenauer and Phil Roe (R- Tennessee) introduced a bill titled “Personalize Your Care Act” (H.R. 1173) that would provide for coverage of voluntary advance care planning consultation under Medicare and Medicaid every 5 years or in the event of a change in health status. In summary, the bill, which had 58 additional co-sponsors, allows for periodic revisiting of advance care documents and goals of care recognizing that an individual’s preference may change over time. It also provides grants to states to establish or expand physician orders for life sustaining treatment programs and improves the accessibility of advance care planning documents by ensuring that an individual’s electronic health record is able to display his or her current advance directive and/or physician orders for life sustaining treatment so that his or her wishes would be more readily known. The bill was endorsed by AARP, American Academy of Hospice and Palliative Medicine, American College of Physicians, American Geriatrics Society, American Hospital Association, and the American Academy of Family Physicians.

Blumenauer along with 33 other members of the House of Representatives sent a letter to Marilyn Tavenner, CMS Administrator, on September 24, 2014, urging CMS to adopt recommendations to reimburse Medicare providers for voluntary discussions with patients on end-of-life care and planning. Blumenauer cited to a recent study in the New England Journal of Medicine that found that more than one in four elderly Americans lacked the capacity to make their own medical care decisions at the end of life.” He noted that this leads to decisions that are made by family members and doctors “who may not know the treatment preferences of their loved one.” To conduct complex and time consuming end-of life discussions regarding patients’ goals and wishes, Blumenauer stressed that providers need adequate time, space, and reimbursement.

AMA Establishes End-of-Life CPT Codes

Blumenauer noted in the letter that the AMA has created two specific current procedural terminology (CPT) codes for providers to report advance care planning services with patients to CMS. He urged Tavenner to adopt the CPT codes recommended by the AMA in the Medicare Physician Payment Schedule so that providers could be reimbursed for end-of life discussions with patients. According to a September 19, 2014, article in Medscape Multispecialty Medical News, the AMA CPT codes, which will be incorporated into the CPT in January 2015, are “a necessary step for Medicare to begin considering reimbursement for end-of-life discussions between physicians and patients” and also “will help streamline reimbursement from private payers.” One of the two codes would be used for the first 30 minutes of face-to-face time with the patient or family member to discuss advance directives and the second code would be used to bill for each additional 30 minutes of planning.

The Medscape article noted that “The Illinois State Medical Society submitted an editorial proposal to the AMA’s CPT Editorial Panel requesting that a code be added for advance care planning services.” In response to the Illinois State Medical Society’s request, the CPT Editorial Panel created the new codes, which then “triggered an evaluation of the time and resources required to perform the services detailed in the code,” according to Medscape. The AMA’s Relative Value Scale Update Committee (RUC), which evaluates time resources and raw materials, “has met to discuss advance care planning services and has submitted its reimbursement recommendation to Medicare,” Medscape said.

IOM’s Report on “End-of-Life”

In its report “Dying in America: Improving Quality and Honoring Individual Preferences Near the End of Life,” published in September 2014, the IOM noted that the medical community has more knowledge about how to better engage patients and families in advance care planning and shared end-of-life decision making. The IOM committee recommended “integrated, person-centered, family-oriented, and consistently accessible care near the end-of-life be provided by health care delivery organizations and covered by government and private insurers.” IOM stated that advanced planning is of critical importance to ensure individuals goals and needs are met. Recognizing the usefulness of advance directives, the IOM stressed, nonetheless, that they “should not take the place of open, continuous communication.” IOM recommended payers and health care delivery organizations adopt standards “as a necessary component of high-quality care for individuals with advanced serious illness and their families and enable them to seek these services from their physicians and providers. “

Seeing Medicare’s Future Through Public Deliberation


A recent study took a novel approach to federal health care reform and asked the public for answers about how to reform Medicare. Mary Ginsburg of the non-partisan Center for Healthcare Decisions decided to explore Medicare reform by putting hard questions about reimbursement, quality, and coverage in the hands of ordinary Americans. The findings of the California Medicare CHAT Collaborative (MedCHAT) demonstrated that some Americans, or at least the 810 Americans that took place in the study, find a lot of common ground when it comes to redesigning Medicare.


According to the MedCHAT report, MedCHAT is a computer-based interactive simulation where participants are confronted with comprehensive information regarding things like costs, coverage options, and current Medicare spending over a three our public deliberation.  The simulation is premised on the CHAT® (Choosing All Together) exercise. Participants are asked, in a group setting of eight to 15 people, to negotiate the best group of coverage options as well as indicate the reasons for arriving at given conclusions. Additionally, participants are asked to evaluate their decisions as citizens and not as individuals seeking coverage. The MedCHAT simulation is intended to replicate the kinds of decisions that lawmakers undertake when reforming health care programs by requiring participants to impose restrictions in one area any time they want to expand coverage in another area.


One of the key findings of the MedCHAT project was that 82 percent of participants agreed to a network model in place of the traditional Medicare model that provides relatively unrestricted physician choice. A key factor in that choice was the significant cost savings realized through the implementation of a network. In another cost saving measure, 85 percent of participants were willing to reduce spending on current and future Medicare beneficiaries in order to ensure the continued existence of the Medicare program.  Participants also heavily favored value based care, with 88 percent signing on to the idea. Adding additional benefits was another area where the majority of participants agreed. In the case of long-term care, 77 percent of participants agreed to at least one additional year of coverage.  Additionally, 69 percent of participants believed that long-term coverage for treatment of less severe mental health problems was a worthwhile additional benefit to expand what participants considered to be an underfunded and underutilized health care need.  A large majority of participants, about 81 percent, also believed that transportation costs should be an added Medicare benefits for seniors without support networks.

Rewards and Penalties

Latching on to the growing trend among private insurers, 85 percent of participants agreed that it was a good idea to include rewards and penalties as incentives for beneficiaries to improve health status while lowering the cost of health care.  Participants also felt strongly about having higher-income seniors pay higher premiums than they do now.

Weight of Public Opinion

The MedCHAT findings were revealed at a forum held by the American Enterprise Institute and the Engelberg Center for Health Care Reform at the Brookings Institution. The responses from a panel at that forum suggest that the findings might not carry much weight among politicians. According to a Kaiser Health News (KHN) report, John Rother, CEO of the National Coalition on Health Care, cautioned that what took place in California will not be an accurate predictor of how Congress will go about solving the problem. According to KHN, Ginsburg recognizes that Medicare reform will be a slow process; yet, Ginsburg indicated that the MedCHAT program was part of a “gradual process of enlightenment.” Whether the opinions of 810 Californians will have any sway on Capitol Hill remains to be seen. Although the likely influence of the MedCHAT findings is small, the study represents a novel perspective to a difficult question that few want to be responsible for answering.

Supreme Court Denied Review to Medicare Contractor Claims Challenge

The Supreme Court denied a petition for certiorari which challenged a Medicare contractor’s handling of over 15,000 individual medical claims submitted for inpatient rehabilitation services by one provider. This denial was announced without comment after the rehabilitation provider challenged 6,200 adverse decisions and another 8,900 claims that had not proceeded beyond the first level of administrative review for the past 11 years. The provider challenged the lower courts’ decision to foreclose the provider’s opportunity to pursue judicial review of those claims in conjunction with constitutional, federal, and state law claims against the Medicare contractor. The provider also presented the issue of an alleged procedural gap in the Medicare appeals process that resulted in the 11-year delay of the review of his claims.

Factual Background

Dr. James P. Little provides care at the HEALTHSOUTH Rehabilitation Hospital, which is classified as an inpatient rehabilitation facility (IRF) (collectively Southern Rehab.) pursuant to the Medicare program. According to the petition, CIGNA Government Services, LLC began to improperly deny Southern Rehab’s claims for Medicare reimbursement in 2001. Between 2001 and 2006, CIGNA continued to wrongly deny claims. While 6,200 of these claims were carried through to the Medicare Appeals Council and were ultimately denied, Southern Rehab asserted that 8,900 claims “remain stuck at the first level of administrative review,” due to a procedural gap.

Questions and Issues Presented

While Southern Rehab admitted in its petition that this action arises out of “a single provider’s claims for reimbursement,” it also asserted that “the case involves questions of exceptional public importance,” as it has the potential to impact “virtually every Medicare provider and beneficiary, now and hereafter, who traverses the administrative review process.” Specifically, in addition to highlighting the issue of the alleged 11-year procedural gap in the review process, Southern Rehab also presented questions to the Court in the following areas: (1) whether the Medicare statute allows providers to raise “inextricably intertwined” constitutional, federal, and state law violations against Medicare contractors; (2) whether non-Medicare reimbursement claims need to be presented to a government agency; and (3) whether the Medicare statute waives immunity for Medicare contractors in suits by providers claiming constitutional, federal, and state violations.

The Changing Face of Hospice Providers

Hospice services began as a cause, a movement in which volunteers helped patients facing terminal illness. The organizations that provided hospice services were charities, but today the hospice services are big business. According to the March 2014 report of the Medicare Payment and Access Commission (MedPAC), the number of not-for-profit hospices has remained constant from 2000 (1,324) to 2012 (1,313), while the number of for-profit hospices has increased more than 300 percent, from 672 in 2000 to 2,196 in 2012. The number of patients using hospice services also has grown substantially; about 47 percent of deaths now occur while a patient is in hospice care, compared to about 23 percent in 2000.

Hospice services include skilled nursing, nurse aide or home health aide visits, pain management, counseling, spiritual support, and other palliative care.  The Medicare and Medicaid hospice benefits are available to individuals who have been diagnosed as terminally ill with an anticipated life expectancy of six months or less. The services are  provided in a patient’s home, which may be an assisted living facility or nursing home. The benefit includes four levels of care, from routine to 24-hour services in times of crisis.

Longer Stays

As we have discussed previously, the average length of stay in hospice care has increased as use of hospice services has spread from cancer patients to patients with other diagnoses, including Alzheimer’s disease or other dementia, neurological disorders, chronic obstructive pulmonary disease (COPD), or debility. The average length of stay varies by diagnosis; cancer patients spent an average of 51 days in hospice care, while patients with neurological conditions had an average length of stay of 139 days. But much of the variation is related to the form of provider ownership. At not-for-profit  entities, patients spent an average of 69 days in hospice care in 2012, while patients of for-profit entities averaged 105 days. The difference in length of stay between for-profit and not-for-profit hospices varied more dramatically as stays grew longer. At the 50th percentile, for-profit hospice  patients had a length of stay of 21 days compared to 14 days at not-for-profits. At the 75th percentile, the average was 58 at not-for-profits and 97 days at for-profits; at the 90th percentile, patients spent 185 days in not-for-profit hospice care, but 306 days in the care of for-profit hospices.

In an interview on National Public Radio’s Marketplace on April 22, 2014, Fran Smith, co-author of Changing the Way We Die, said that hospice services now are a $17 billion industry. “People are making a lot of money on hospice services,” she said.She added that research shows that for-profit hospices tend to “cherry-pick,” enrolling the healthier patients who will have longer stays. The largest hospice chain in the country, Vitas, is owned by ChemEd, which also owns Roto-Rooter.

Marketing Efforts, Whistleblower Actions

Marketing of hospice services also appears to be a growth industry. Consultants now sell data analysis services to help hospices increase their referrals by “connecting patients to the physicians who treated them before they entered hospice care” so that the hospice can “target primary care physicians” who have many patients in hospice services. Some for-profit hospice providers have settled whistleblower actions by former employees who were directed to keep the patient population up by selling the services, even to people who were not terminally ill.

In 2012, Odyssey Healthcare, Inc.  settled a whistleblower action for $25 million, according to the Milwaukee Journal Sentinel. The specific allegations remained under seal, but Odyssey settled similar suit brought by another Wisconsin employee for $12.5 million in 2006, the newspaper reported. In May 2013, the U.S. Justice Department joined in a whistleblower action and brought another action independently against Vitas, alleging that Vitas enrolled patients in hospice who were not terminally ill, billed for more intensive services than actually were provided, and compensated employees based on the number of patients admitted and the length of their stays. The government also alleged that Vitas took adverse employment action against employees who failed to meet admission goals.

Hospice of the Comforter, Inc., an Orlando, Florida hospice company, agreed to pay $3 million to the Department of Justice and entered into a corporate integrity agreement. The government’s complaint alleged that it knowingly admitted patients who were not terminally ill and directed employees to falsify medical records to make the patients appear eligible for hospice care.  In March 2014, the parent company of Hospice Compassus, which formerly operated in Alabama, agreed to pay $3.92 million to the government as part of a settlement agreement to resolve allegations that it presented claims for services furnished to patients who were not eligible for hospice services. And on April 23, 2014, Amedisys, Inc. and its affiliates, who provide home health and hospice services, agreed to pay $150 million to the federal government to resolve seven actions under the False Claims Act. Amerisys was alleged to have provided and billed for medically unnecessary services for which patients did not qualify and to have entered into improper financial relationships with physicians and an oncology practice.

Patient Satisfaction

Still, Fran Smith says that hospice services are usually very successful; patients and their surviving families are usually very satisfied with the services they receive.  Often, the social worker will ask patients to consider what they want to do with their remaining time. Some patients use the time in hospice care to fulfill unmet goals or do things, such as travel, that they had always planned to do “some day.” She also  noted that many people choose hospice services too late to derive the full benefit of the service and regret that they did not choose to start earlier.