Policy & oversight
Medicare Hospice Rule Reveals 2 Billion Dollars in Parallel Medicare Billing During Patients' Hospice Elections
A CMS final rule published July 30 shows that nearly half of Medicare hospice patients also have conventional Medicare claims filed on their behalf during enrollment, totaling 2 billion dollars in FY 2025, and details how a nine-factor scoring index will flag outlier providers.
By the Goodsurance editorial teamJuly 29, 2026
The FY 2027 Hospice Wage Index and Payment Rate Update Final Rule, published July 30, 2026 by the Centers for Medicare and Medicaid Services, carries a data disclosure that goes well beyond rate-setting. According to the rule, almost half of all Medicare beneficiaries who elect hospice care also have non-hospice services billed to Medicare on their behalf during the same enrollment period. In fiscal year 2025, those non-hospice bills totaled 2.0 billion dollars, a 160 percent increase from fiscal year 2020.
Hospice is designed as a comprehensive end-of-life benefit: when a beneficiary enrolls, the hospice is generally responsible for all care related to the terminal diagnosis, and Medicare's regular fee-for-service program covers only unrelated conditions. The 2.0 billion dollar figure suggests that the boundary between what belongs to the hospice and what can be separately billed remains contested in practice.
Half of Medicare hospice patients also have other Medicare claims filed during their enrollment. CMS's scoring index aims to identify the patterns behind 2 billion dollars a year in parallel billing.
To help identify providers with patterns worth scrutiny, CMS maintains the Service and Spending Variation Index (SSVI), a composite score drawn from nine claims-based measures. The SSVI tracks metrics including total non-hospice spending, the share of beneficiaries with stays exceeding 180 days, average minutes of care per routine home care day, and the rate of live discharges returning to the same hospice within seven days. Hospices with elevated SSVI scores are flagged for possible targeted education or program integrity review.
The FY 2027 rule updated provider-level SSVI data using FY 2024 and FY 2025 claims, making the scores available for public reference. CMS also finalized a requirement that hospices provide an addendum to each beneficiary's election statement, describing items, services, and drugs related to the terminal illness that the hospice will not cover. The annual payment cap per hospice for FY 2027 is set at 36,174.75 dollars, a 2.3 percent increase from the FY 2026 figure.
For beneficiaries or family members choosing a hospice agency, the SSVI data is publicly available through CMS and may support a more informed comparison of providers.
In plain words
Medicare pays for hospice care when a patient is near the end of life. The hospice is supposed to handle most of the patient's care. But about half of all patients in hospice also have other Medicare bills filed in their name at the same time. In 2025 alone, those extra bills came to 2 billion dollars. CMS keeps a score for every hospice agency that shows how much extra billing and unusual care patterns appear at that location. In 2027, hospices must also give patients a written list explaining what services the hospice will not cover. CMS can use this scoring tool to find agencies that may need a closer look.
Understand the basics first
Source: CMS
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