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Medicare Reimbursement for Hospice Care: Ethical and Policy Implications of Cost-Containment Strategies

In several areas of health policy, current concern over rising costs has generated considerable political support for reforms that many in the business have advocated unsuccessfully on philosophical, ethical, or humanitarian grounds for years. Thus, for example, the spiraling cost of caring for the mentally ill and the develop-mentally disabled in an institutional setting has breathed new life into proposals to bring these groups out into the community where they can live more independently– and more cheaply. But this overlap of quality and frugality goals is only partial. Although alliances with cost-cutters can bring reform, health policy reformers are discovering that they may have to accept a lot of bathwater along with the baby. Medicare reimbursement for hospice care, authorized by Section 122 of PL 97-248, the Tax Equity and Fiscal Responsibility Act of 1982, provides one recent example of this dilemma. This article discusses the results of a survey–conducted by the Office of the Inspector General of the Department of Health and Human Services–to discover how many hospices would seek certification for reimbursement by Medicare, how many patients would be served, and the consequences of this legislation for cost, access, and quality of service.