Opposition to a Medicare Advantage hospice “carve-in” remains strong in the field, though some say the lack of one creates a serious gap in the MA program.

Medicare Advantage enrollment continues to grow. As of 2025, 54% of Medicare beneficiaries were enrolled in Medicare Advantage, about 31.4 million people, according to the Kaiser Family Foundation. However, MA health plans, by design, do not cover hospice care. When an MA beneficiary elects hospice, they transition to the traditional Medicare benefit, though they may keep their Medicare Advantage coverage for care or services deemed unrelated to their terminal condition.

Conversations about a potential carve-in persist in the halls of federal government, according to Logan Hoover, vice president of policy and government relations for the National Alliance for Care at Home.

“In [Washington, D.C.,] there’s always this sort of whispers and talk about this. I think there’s a lot of misconceptions about why hospice was intentionally carved out from Medicare Advantage when they were creating MA originally, and why they viewed hospice as different,” Hoover told Hospice News. “This should be outside of managed care, because hospice is already managed care.”

Some misconceptions as to why hospice was “carved out” of MA include that this was a drafting error rather than a considered decision, Hoover said. Some also believe that hospice was omitted because the care model was too new at the time. Hoover called these contentions “weak arguments.”

Legislative actions

The most recent attempt at a carve-in arose in May 2025. Rep. David Schweikert (R-Ariz.) introduced the Medicare Advantage Reform Act. If enacted, the bill, numbered H.R. 3467, would make wholesale changes to the Medicare Advantage program. A key provision of the bill was a proposed requirement that MA plans pay for hospice care.

The bill’s hospice provision was written as a broad stroke. While it contained the potential requirement, it did not include a methodology or framework for how a carve-in could be implemented.

In November, two U.S. Senators have penned a letter to congressional leadership urging them to oppose any measures to bring hospice reimbursement into Medicare Advantage.

Sens. Dr. Roger Marshall (R-Kan.) and Sheldon Whitehouse (D-R.I.) circulated the letter, addressed to Senate leaders from both major political parties, as well as the chair and ranking member of the Senate Finance Committee.

“We write to express our strong, bipartisan support for policies that preserve Medicare’s Hospice Benefit under Original Medicare, including for Medicare Advantage (MA) beneficiaries, which has protected their access to high-quality, timely end-of-life care for nearly three decades,” the senators wrote. “As Congress considers potential reforms to the MA program, we urge you to maintain this critical safeguard and oppose any proposals that would include hospice in the Medicare Advantage program, including repeal or alteration of the Special Rule for Hospice.”

The “Special Rule” was established under the Balanced Budget Act of 1997. It stipulates that Medicare Advantage beneficiaries revert to Medicare Part A when they elect the hospice benefit.

Among the senators’ concerns were potential delays of care due to MA prior authorization processes, as well as reduced patient choice due to network limitation.

“Adding MA plan management on top of this system would be duplicative and inefficient, creating new administrative barriers without improving care,” the senators wrote in the letter.

Hoover echoed this position.

“Providers have the ability to deliver the right care and not have the middleman interfering with that care delivery …” Hoover said. “When we look at whether there is something we can improve within hospice, adding it into MA, adding additional bureaucracy, adding prior approvals, adding networks like these are things that are really the antithesis of what hospice is all about, and really a devastating direction that some policymakers are toying around with.”

The shadow of VBID

The highest profile attempt to work hospice into MA was the hospice component of the value-based insurance design model, which tested coverage of hospice care through Medicare Advantage.

Hospice VBID, which was often called the Medicare Advantage hospice carve-in, is just one component of a larger program. The program has a number of goals, including cost savings, simplification of care transitions and preservation of patient choice in regards to their health plans.

Former U.S. Centers for Medicare & Medicaid Services (CMS) Administrator Seema Verma also said at the time that the payment model demonstration was designed to fix inconsistencies in length of stay.

The hospice component of VBID ended at the close of 2024 due to what CMS said were “operational challenges,” and this was largely about numbers and logistics. Too few plans participated and too few beneficiaries were served within hospice VBID to conduct an effective test, according to CMS. The larger VBID program will continue until 2030, excluding the hospice component.

A total of 9,630 beneficiaries received hospice care through the VBID demo in 2021, and 525 utilized the program’s supplemental benefits, according to a report the RAND Corporation prepared for CMS. Of those, only about 37% received care from in-network providers.

Also, the first year of hospice VBID was also the first year of the COVID-19 pandemic, a time when health care providers’ priorities got turned upside down. Many found it hard to adapt to a new payment system on top of it.

Logistical challenges also existed within health plans on how to process VBID claims and align their internal processes with the demo. Hospices, likewise, encountered confusion when billing and collaborating with MA plans.

“We tried this through VBID, and it didn’t work. And that’s the purpose of the [Center for Medicare & Medicaid Innovation]. That’s the purpose of trying out models. It’s to see, can this level of innovation, is this going to help, or is this going to hurt?” Hoover said. “Both from patient satisfaction, access expense, I think we saw across the board that it’s going to achieve no positive metrics. I don’t think hospice has any sort of home within managed care.”

The MA plan perspective

These positions are not universal. Some stakeholders within the Medicare Advantage system contend that the lack of a hospice carve-in represents a significant gap in the MA program that should be filled.

An effective hospice carve-in with an appropriate payment model would be an “incredible opportunity” to improve quality of care, according to Dr. Sachin Jain, CEO of SCAN Group, the parent company of SCAN Health Plan, a nonprofit Medicare Advantage organization.

Jain also said that incorporating hospice into MA could escalate the importance of palliative care within the MA program, enabling more seamless transitions of care. It could also ameliorate patients’ concerns that they would lose access to their other benefits when they enroll in hospice, which represents a barrier in enrollment, Jain indicated.

“The discontinuity that exists between MA and kind of hospice is one of the fissures in the [MA] program,” Jain told Hospice News. “It’s one of the health care system’s broken things … So, I think pulling it together creates a lot of opportunity.”