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Costs & IRMAA

OIG: Medicare Could Have Saved 255 Million Dollars by Screening New Hospice Enrollees Without Recent Hospital Visits

Federal auditors found documentation problems in 45 of 100 reviewed new hospice enrollment records and say targeted eligibility screening by Medicare contractors could prevent hundreds of millions in improper payments.

By the Goodsurance editorial teamOctober 26, 2026

A federal audit found that Medicare paid for hospice care for a share of new enrollees whose records did not satisfy eligibility requirements, leaving an estimated 255.1 million dollars in potential savings unrealized.

The Department of Health and Human Services Office of Inspector General reviewed 100 initial hospice certification periods from fiscal year 2021, focusing on a group it identified as high-risk: new enrollees who had no inpatient or emergency room visits in the 18 months before beginning hospice care. That absence of prior acute care contact is a signal that eligibility may warrant closer review.

A federal audit says better screening of new hospice enrollees without prior hospital visits could save Medicare 255 million dollars.

Forty-five of the 100 sampled records had documentation problems. In 21 cases, clinical records did not support a finding of terminal illness, generating about 251,000 dollars in unallowable payments in that sample. In 24 other cases, the records did not meet Medicare's documentation standards for hospice enrollment, generating about 294,000 dollars more.

Scaling the sample findings across all similar new hospice enrollees for that fiscal year, the OIG estimated Medicare could have saved 255.1 million dollars had the Medicare Administrative Contractors responsible for hospice claims conducted eligibility reviews targeting that population.

The OIG recommended that CMS direct the hospice contractors to incorporate this high-risk group into ongoing review work and consider establishing pre-payment or post-payment review procedures.

To receive Medicare hospice benefits, a beneficiary must be certified as having a terminal illness with a life expectancy of six months or less and must elect hospice care in place of curative treatment for that illness.

In plain words

Medicare pays for end-of-life care called hospice. To qualify, a doctor must say the person has less than six months to live. A federal watchdog reviewed people who signed up for hospice without any hospital or emergency room visits in the 18 months before. About half of those records had problems. Either the records did not show a terminal illness, or the paperwork was incomplete. The watchdog estimates Medicare may have spent 255 million dollars on cases like these. The watchdog is asking Medicare to check this group of patients more carefully before approving payments.

Understand the basics first

Source: OIG
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