How Hospice and Medicare supplements work together

As parents age, sometimes Hospice care is necessary.  Hospice is defined as care designed to give supportive care to people in the final phase of a terminal illness and focus on comfort and quality of life, rather than cure. The goal is to enable patients to be comfortable and free of pain, so that they live each day as fully as possible.

Children who are intervening with parents’ affairs are often confronted with keeping Medicare Supplement insurance while Hospice pays the majority of expenses, sometimes making the supplement unnecessary.  You should be aware that there are some expenses, like medical equipment and prescription drugs, that are not covered by Hospice.  These services are then covered 80/20 by Medicare and the supplement.  The risk you run is if you drop the supplement, you are then paying the 20% yourself.

It is also not uncommon that a person is taken off Hospice.  For example, a person with terminal cancer can go into remission, a person can rebound from illnesses, or just decide to come off of Hospice care and continue medical treatment for their condition.  In this situation, you are now responsible for everything Medicare leaves behind and it would be difficult or impossible to purchase a supplement at this point (because you have to answer health questions to buy a new supplement.)

There are also expenses, not related to the Hospice illness, which can be charged to Medicare rather than Hospice.  These expenses can result from a fall, hospital stay, or routine services for chronic conditions.

If the Hospice recipient is also eligible for Medicaid, there is an exception.  Medicaid is assistance for people with very limited income.  When someone is on Medicaid, they are allowed to “suspend” their Medicare Supplement for up to 24 months.  This could allow you to stop premium payments, while on Hospice, with the ability to pick up the Medicare Supplement in the event that Hospice is ended.  Click here for a Medicaid application.

Because of the risks involved, I suggest keeping the Medicare Supplement in force while on hospice unless that person is lower-income and on Medicaid. In that situation, you are able to suspend the premiums for up to 24 months with the ability to pick up the plan at a later date.