[Congressional Record Volume 142, Number 117 (Friday, August 2, 1996)]
[Senate]
[Pages S9582-S9584]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. BREAUX (for himself, Mr. Mack, Mr. Graham, and Mr. Cohen):
  S. 2034. A bill to amend title XVIII of the Social Security Act to 
make certain changes to hospice care under the Medicare program; to the 
Committee on Finance.


            the medicare hospice benefit amendments of 1996

  Mr. BREAUX. Mr. President, I rise today to introduce legislation to 
make technical changes to the Medicare hospice benefit which will 
ensure that high quality hospice services will be available to all 
terminally ill Medicare beneficiaries. Senators Mack, Graham, and Cohen 
join me in sponsoring this legislation, which is identical to H.R. 3714 
introduced last month. This legislation is endorsed by both the 
National Hospice Organization and the National Association for Home 
Care, and I urge my colleagues to support it.
  Hospices help care for and comfort terminally ill patients at home or 
in home-like settings. There are more than 2,450 operational or planned 
hospice programs in all 50 States. In 1994, approximately 1 out of 
every 10 people in America who died were tended to by a hospice 
program, and 1 out of every 3 people who died from cancer or AIDS were 
cared for by hospice. Services provided under the Medicare hospice 
benefit include physician services, nursing care, drugs for symptom 
management and pain relief, short term inpatient and respite care, and 
counseling both for the terminally ill and their families. Terminally 
ill patients who elect hospice opt-out of most other Medicare services 
related to their terminal illness.
  Hospice services permit terminally ill people to die with dignity, 
usually in the comforting surroundings of their own homes with their 
loved ones nearby. Hospice is also a cost-effective form of care. At a 
time when Medicare is pushing to enroll more beneficiaries in managed 
care plans, hospice is already managed care. Hospices provide patients 
with whatever palliative services are needed to manage their terminal 
illness, and they are reimbursed a standard per diem rate, based on the 
intensity of care needed and whether the patient is an inpatient or at 
home.
  With 28 percent of all Medicare costs now going toward the care of 
people in their last year of life, and almost 50 percent of those costs 
spent during the last 2 months of life, cost-effective alternatives are 
needed. Studies show hospices do reduce Medicare spending. A study 
released last year by Lewin-VHI showed that for every dollar Medicare 
spent on hospice, it saved $1.52 in Medicare part A and part B 
expenditures. Similarly, a 1989 study commissioned by the Health Care 
Financing Administration showed savings of $1.26 for every Medicare 
dollar spent on hospice. I would ask unanimous consent that a summary 
of these studies be inserted in the Record at the conclusion of my 
remarks.
  Since 1982, when the hospice benefit was added to the Medicare 
statute, more and more Americans have chosen to spend their final 
months of life in this humane and cost-effective setting. Yet in recent 
years it has become clear that certain technical changes are needed in 
the Medicare hospice benefit both to protect beneficiaries and to 
ensure that a full range of cost-effective hospice services continues 
to be available. The bill I am introducing today makes six necessary 
technical changes.
  First, the Medicare Hospice Benefits Amendments of 1996 restructures 
the hospice benefit periods. The basic eligibility criteria do not 
change. Under this bill, as in current law, a person is eligible for 
the Medicare hospice benefit only if two physicians have certified that 
he is terminally ill with a life expectancy of 6 months or less. 
Patients who elect to receive hospice benefits give up most other 
Medicare benefits unless and until they withdraw from the hospice 
program.
  While this bill does not change hospice eligibility criteria, it does 
change how the benefit periods are structured. Currently, the Medicare 
benefit consists of four benefit periods. At the end of each of the 
first three periods, the patient must be recertified as being 
terminally ill. The fourth benefit period is of unlimited duration. 
However, a patient who withdraws from hospice during the fourth hospice 
period forfeits his ability to elect hospice services in the future. 
Thus, a patient who goes into remission, and is thus no longer eligible 
for hospice because his life expectancy exceeds 6 months, is not be 
able to return to hospice when his condition worsens.
  This bill restructures the hospice benefit periods to eliminate the 
existing open-ended fourth benefit period and to provide that after the 
first two 90 day periods, patients are reevaluated every 60 days to 
ensure that they still qualify for hospice services. This restructuring 
ensures that those receiving Medicare benefits are able to receive 
hospice services at the time they need them and can be discharged from 
hospice care with no penalty if their prognosis changes.
  Second, the bill clarifies that ambulance services, diagnostic tests, 
radiation, and chemotherapy are covered under the hospice benefit when 
they are included in the patient s plan of care. No separate payment 
will be made for these services, but hospices will have to provide them 
when they are found to be necessary as a palliative measure. This 
change conforms the statute to current Medicare regulatory policy.
  Third, the bill also permits hospices to have independent contractor 
relationships with physicians. Under current law, hospices must 
directly employ their medical directors and other staff physicians. 
This creates a legal problem in some States which prohibit the 
corporate practice of medicine, and the requirement has made it 
increasingly difficult to recruit part-time hospice physicians.
  Fourth, the bill creates a mechanism to allow waiver of certain 
staffing requirements for rural hospices, which often have difficulty 
becoming Medicare-certified because of shortages of certain health 
professionals. Currently, about 80 percent of hospices are Medicare-
certified or pending certification.
  Fifth, the bill reinstates an expired provision regarding liability 
for certain denials. As made clear by an article published on July 18 
of last month in the prestigious New England Journal of Medicine, most 
patients are referred to hospice very late in the course of their 
terminal illnesses, but some live longer than 6 months. Predicting when 
an individual will die will never be an exact science, and we should 
not expect it to be. Therefore, the bill reinstates the expired 
statutory presumption that hospices with very low error rates on their 
Medicare claims did not know that denied benefits were not covered, and 
it expands the bases for waiver of liability to include cases where a 
prognosis of 6 months life expectancy is found to have been in error.
  Finally, this bill provides some administrative flexibility regarding 
certification of terminal illness. Currently, the statute requires that 
paperwork documenting physician certification of a patient s terminal 
illness be

[[Page S9583]]

completed within a certain number of days of the patient s admission to 
hospice. This bill will eliminate the strict statutory requirements and 
give the Health Care Financing Administration the discretion, as it 
currently has with home health certifications, to require hospice 
certifications to be on file before a Medicare claim is submitted.
  The Medicare Hospice Benefit Amendments of 1996 are noncontroversial 
and should not affect Medicare spending, but they will make important 
and necessary changes to the Medicare hospice benefit, to enable 
hospices to provide high quality, cost effective care to the terminally 
ill, and to protect beneficiaries who depend on these services. I urge 
my colleagues to support this bill.
  Mr. President, I ask unanimous consent that additional material be 
printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                S. 2034

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Medicare Hospice Benefit 
     Amendments of 1996''.

     SEC. 2. HOSPICE CARE BENEFIT PERIODS.

       (a) Restructuring of Benefit Period.--Section 1812 of the 
     Social Security Act (42 U.S.C. 1395d) is amended in 
     subsections (a)(4) and (d)(1), by striking ``, a subsequent 
     period of 30 days, and a subsequent extension period'' and 
     inserting ``and an unlimited number of subsequent periods of 
     60 days each''.
       (b) Conforming Amendments.--(1) Section 1812(d)(2)(B) of 
     such Act (42 U.S.C. 1395d(d)(2)(B)) is amended by striking 
     ``90- or 30-day period or a subsequent extension period'' and 
     inserting ``90-day period or a subsequent 60-day period''.
       (2) Section 1814(a)(7)(A) of such Act (42 U.S.C. 
     1395f(a)(7)(A)) is amended--
       (A) in clause (i), by inserting ``and'' at the end;
       (B) in clause (ii)--
       (i) by striking ``30-day'' and inserting ``60-day''; and
       (ii) by striking ``and'' at the end and inserting a period; 
     and
       (C) by striking clause (iii).

     SEC. 3. AMBULANCE SERVICES, DIAGNOSTIC TESTS, CHEMOTHERAPY 
                   SERVICES, AND RADIATION THERAPY SERVICES 
                   INCLUDED IN HOSPICE CARE.

       Section 1861(dd)(1) of the Social Security Act (42 U.S.C. 
     1395x(dd)(1)) is amended--
       (1) in subparagraph (E), by inserting ``anticancer 
     chemotherapeutic agents and other'' before ``drugs'';
       (2) in subparagraph (G), by striking ``and'' at the end;
       (3) in subparagraph (H), by striking the period at the end 
     and inserting a comma; and
       (4) by inserting after subparagraph (H) the following:
       ``(I) ambulance services,
       ``(J) diagnostic tests, and
       ``(K) radiation therapy services.''.

     SEC. 4. CONTRACTING WITH INDEPENDENT PHYSICIANS OR PHYSICIAN 
                   GROUPS FOR HOSPICE CARE SERVICES PERMITTED.

       Section 1861(dd)(2) of the Social Security Act (42 U.S.C. 
     1395x(dd)(2)) is amended--
       (1) in subparagraph (A)(ii)(I), by striking ``(F),''; and
       (2) in subparagraph (B)(i), by inserting ``or under 
     contract with'' after ``employed by''.

     SEC. 5. WAIVER OF CERTAIN STAFFING REQUIREMENTS FOR HOSPICE 
                   CARE PROGRAMS IN NON-URBANIZED AREAS.

       Section 1861(dd)(5) of the Social Security Act (42 U.S.C. 
     1395x(dd)(5)) is amended--
       (1) in subparagraph (B), by inserting ``or (C)'' after 
     ``subparagraph (A)'' each place it appears; and
       (2) by adding at the end the following:
       ``(C) The Secretary may waive the requirements of 
     paragraphs (2)(A)(i) and (2)(A)(ii) for an agency or 
     organization with respect to the services described in 
     paragraph (1)(B) and, with respect to dietary counseling, 
     paragraph (1)(H), if such agency or organization--
       ``(i) is located in an area which is not an urbanized area 
     (as defined by the Bureau of Census), and
       ``(ii) demonstrates to the satisfaction of the Secretary 
     that the agency or organization has been unable, despite 
     diligent efforts, to recruit appropriate personnel.''.

     SEC. 6. LIMITATION ON LIABILITY OF BENEFICIARIES AND 
                   PROVIDERS FOR CERTAIN HOSPICE COVERAGE DENIALS.

       (a) In General.--Section 1879(g) of the Social Security Act 
     (42 U.S.C. 1395pp(g)) is amended--
       (1) by redesignating paragraphs (1) and (2) as 
     subparagraphs (A) and (B), respectively, and moving such 
     subparagraphs 2 ems to the right;
       (2) by striking ``is,'' and inserting ``is--'';
       (3) by making the remaining text of subsection (g), as 
     amended, that follows ``is--'' a new paragraph (1) and 
     indenting such paragraph 2 ems to the right;
       (4) by striking the period at the end and inserting ``; 
     and''; and
       (5) by adding at the end the following new paragraph:
       ``(2) with respect to the provision of hospice care to an 
     individual, a determination that the individual is not 
     terminally ill.''.
       (b) Waiver Period Extended.--Section 9305(f)(2) of the 
     Omnibus Budget Reconciliation Act of 1986 is amended by 
     striking ``and before December 31, 1995.''.
       (c) Effective Date.--The amendments made by this section 
     shall take effect on December 31, 1995.

     SEC. 7. EXTENDING THE PERIOD FOR PHYSICIAN CERTIFICATION OF 
                   AN INDIVIDUAL'S TERMINAL ILLNESS.

       Section 1814(a)(7)(A)(i)(II) of the Social Security Act (42 
     U.S.C. 1395f(a)(7)(A)(i)(II)) is amended by striking ``, not 
     later than 2 days after hospice care is initiated (or, if 
     each certify verbally not later than 2 days after hospice 
     care is initiated, not later than 8 days after such care is 
     initiated),'' and inserting ``at the beginning of the 
     period''.

     SEC. 8. EFFECTIVE DATE.

       Except as provided in section 6(c), the amendments made by 
     this Act shall apply to benefits provided on or after the 
     date of the enactment of this Act, regardless of whether or 
     not an individual has made an election under section 1812(d) 
     of the Social Security Act before such date.
                                                                    ____



       Summary of Studies Regarding Cost-Effectiveness of Hospice

       Lewin-VHI's 1995 report, An Analysis of the Cost Savings of 
     the Medicare Hospice Benefit, prepared for The National 
     Hospice Organization, updates a previous study prepared in 
     1989 by Abt Associates for the Health Care Financing 
     Administration entitled Medicare Hospice Benefit Program 
     Evaluation.
       The 1989 Abt study found that:
       (1) Medicare saved $1.26 for every $1.00 spent on hospice 
     care.
       (2) Much of these savings were realized during the last 
     month of life of the patient and were largely a result of the 
     substitution of home hospice care for in-hospital care.
       The 1995 Lewin-VHI study was based on data generated from a 
     group of Medicare recipients who died of cancer during the 
     period between July 1 and December 31, 1992. This group was 
     further divided into those who had one or more hospices claim 
     during the aforementioned period and those who had none. 
     (Additional analysis was done to ensure no selection bias.)
       The Lewin-VHI report concluded:
       (1) Medicare saved $1.52 for every $1.00 spent on hospice.
       (2) While savings were highest for the last month of life, 
     there were also net savings over the last year of life for 
     those who enrolled in hospice.
       (3) While the greatest savings were found in Part A 
     Medicare expenditures, savings were also found in Part B 
     expenditures.
  Mr. GRAHAM. Mr. President, I rise today to join in support of the 
``Medicare Hospice Benefit Amendments of 1996'' to be introduced by 
Senator Breaux.
  The number of terminally ill patients choosing hospice care over 
conventional Medicare has increased from 11,000 Medicare admission in 
1985 to more than 220,000 Medicare beneficiaries last year.
  During the current session of Congress, much has been made about the 
problems with the Medicare Trust Fund. Congress should act as soon as 
possible to reduce Medicare costs and protect the Medicare Trust Fund. 
However, radical cuts to the program are not the solution.
  Instead, we should emphasize prevention, fraud reduction, and 
successful programs such as hospice care--all proven efforts at 
reducing spending while maintaining current Medicare quality and 
beneficiary protections.
  The goal of hospice is to provide comprehensive health care at home 
to terminally ill patients in a manner that improves the quality of 
life for the patients and their families. This approach places a high 
value of personal choice, family support, and community involvement.
  Patients covered by Medicare and Medicaid waiver their eligibility 
for all other public program benefits when choosing hospice care. By 
doing so, hospice patients are cared for at home with their families 
and avoid costly hospitalizations. Hospice makes sense from a health 
care, quality of life, and economic perspective.
  The number of terminally ill patients choosing hospice care over 
conventional Medicare has increased from 11,000 Medicare admission in 
1985 to more than 220,000 Medicare beneficiaries last year.
  Clearly, hospice is an idea that is rapidly gaining acceptance and 
acclaim in modern times. Florida has been a pioneer in the modern 
hospice movement. In 1979, while I was the Governor in Florida, my 
State became the first to set standards for hospices and recognize 
hospice as an option for the terminally ill. The Florida law served as 
a model for national legislation. As a result, inpatient and at-home 
hospice care has been covered by Medicare since 1982.

[[Page S9584]]

  The goal of hospice is to make the last months of a person's life as 
comfortable and meaningful as possible. Hospice does not use artificial 
life-support systems or surgery when there is no reasonable hope of 
remission. Hospice offers dignity for the dying and avoids costly--
often traumatic--acute-care hospitalization.
  For example, according to Lewin-VHI in their 1994 study entitled 
Hospice Care: An Introduction and Review of the Evidence, Medicare 
beneficiaries in their last year of life constituted 5 percent of 
beneficiaries in 1988 but more than 27 percent of Medicare payments. 
Lewin-VHI adds that ``during the last month of life, hospice users 
cost, on average, $3,069, while those using conventional care cost 
$4,071.'' Overall, that study indicates the use of the hospice benefit 
saved Medicare $1.26 for every $1.00 spent.
  However, an updated 1995 Lewin-VHI study shows even better results 
through the use of hospice. The study, entitled An Analysis of the Cost 
Savings of the Medicare Hospice Benefit, found that Medicare saves 
$1.52 for every $1.00 spent on hospice.
  According to Lewin-VHI, ``First, hospices effectively substitute 
relatively inexpensive care at home for costly inpatient hospital days 
during the period in which expenditures are typically the greatest and 
in which most hospice users enroll in the benefit, in the last month of 
life. Second, the financial incentives of the current Medicare Hospice 
Benefit reinforce the organizational incentives of most hospice 
programs to provide quality care at a lower cost.''
  In another study entitled ``Survival of Medicare Patients After 
Enrollment in Hospice Programs'' in the New England Journal of Medicine 
on July 18, 1996, authors Nicholas Christakis and Jose Escarce 
establish that the benefits of hospice should be expanded. They write, 
``Enrolling patients [in hospice] earlier . . . might enhance the 
quality of end-of-life care and also prove cost effective.''
  Again, hospice has been a Medicare benefit since passage of the 1982 
law and its implementation in 1983. Hospice care has grown dramatically 
since the benefit's inception, but few changes have been made to the 
1982 law. As the bill's House sponsors--Congressmen Ben Cardin and Rob 
Portman--have said, ``As more and more patients choose the hospice 
benefit, it has become clear that certain provisions of the law need to 
be clarified in order to protect Medicare beneficiaries and to ensure 
that Medicare hospice patients can continue to receive excellent, cost-
effective hospice care.''

  We should do what we can to encourage hospice care in the Medicare 
program and through the health care system generally. This bill makes 
technical amendments to Medicare's hospice program. Specifically, the 
bill would:
  Restructure the benefit periods to require more frequent 
certifications after 180 days to facilitate appropriate discharge with 
no penalty to the patient; clarify that ambulances, diagnostic tests, 
radiation and chemotherapy are covered hospice services when included 
in the plan of care; amend the ``core services'' requirement to allow 
hospices to contract for physician services with independent contractor 
physicians or physician groups; allow waiver of certain staffing 
requirements of rural hospices; extend the expired favorable 
presumption of waiver of liability provisions and include waiver 
protection where prognosis of terminal illness is found to have been in 
error; and, allow the Health Care Financing Administration to set 
documentation requirements of physician certifications.
  Finally, I would like to commend Congressman Cardin from Maryland for 
his hard work on this legislation on the House side. The Congressman is 
a great thinker on the topic of how to improve Medicare and his 
legislation--H.R. 3714--once again serves that purpose.
                                 ______