Medicare Advantage Hospice Carve-In Starting Small in 2021 

The demonstration project to test inclusion of hospice in the value-based insurance design model — often called the Medicare Advantage hospice carve-in — will be a small program in its first year. The 53 participating Medicare Advantage plans cover 8% the market and a limited geographic footprint, according to data from the U.S. Centers for Medicare & Medicaid Services (CMS).

Starting in 2021, payers and hospice providers will have the option to participate in the demonstration, which according to CMS is intended to increase access to hospice services and facilitate better coordination between patients’ hospice providers and their other clinicians.

Though the program is getting off to a relatively small start, CMS may still learn big lessons from the project.


“In the markets where these plans are operating, enrollment for the VBID hospice benefit is less than 10%, and the number of plans participating is really small nationally, though this can increase with open enrollment in October,” Anne Tumlinson, CEO of consulting firm ATI Advisory, told Hospice News. “Even though this is relatively small, there’s a lot that CMS can learn when they get underway in January [2021] in the markets where this will be ongoing. The plans have a couple of years before they can actually start to develop any kind of a narrow network. So even if you’re a hospice provider in one of the markets that’s affected, just know that there’s not a lot of Medicare beneficiaries that are impacted by this.”

Through Medicare Advantage, CMS contracts with private insurance companies to provide coverage for Medicare beneficiaries. CMS in early 2019 year announced that it would test coverage of hospice care through Medicare Advantage plans beginning in 2021. The agency began accepting applications for participation in the program last December.

Through the demonstration CMS will evaluate the inclusion of hospice in VBID using several metrics, including rates of patient length of stay that are less than seven days as well as those that exceed 180 days. The agency will also measure documentation of patients’ goals of care, performance on pain control, family satisfaction and the number of days that patients were in their homes during their final six months of life.


With current plan participation, hospice coverage through VBID will be available in 13 states and Puerto Rico. According to Tumlinson, 26 of those plans are located in Puerto Rico.

The 53 participating plans are operated by nine insurance companies. Only two of those are large companies: Humana (NYSE: HUM) and the Kaiser Foundation Health Plan.

These numbers apply only to the program’s first year, and the program may grow throughout the four-year demonstration. Further growth would likely occur if CMS eventually decided to make the program permanent.

“I don’t want to minimize it, but it’s a demonstration program. This is a voluntary demonstration program that is not touching that many lives. It’s very geographically concentrated. There’s just pockets here and there,” Tumlinson said. “It’s typical for [CMS] demonstration projects. It’s hard to get health plans to do things that they don’t normally do.”

Among the carriers, Humana has the most Medicare Advantage plans that will be offering hospice in 2021.

“A lot of these plans are Humana plans. Humana is really interested in this space. For hospice providers, if Humana has a big presence in their market, it’s probably worthwhile to start to develop a relationship with them in the event that this becomes a more national program after the four year demonstration period,” Tumlinson told Hospice News.

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