Hospice billing under Medicare follows strict federal rules. Providers must understand eligibility criteria, four levels of care, billing modifiers (GV and GW), claims submission requirements, and coverage limits. Accurate hospice billing ensures timely reimbursement and full compliance with Centers for Medicare and Medicaid Services (CMS) regulations.
Hospice billing stands among the most regulated areas of healthcare reimbursement. Every claim requires precise coding, correct modifier usage, and timely filing. A single error can result in denied claims, lost revenue, or serious compliance violations.
Medicare covers hospice care as a Part A benefit. It serves terminally ill patients who choose comfort-focused care over curative treatment. Over 1.65 million Americans receive hospice care each year — yet billing for these services remains widely misunderstood, even among experienced medical billing professionals.
This guide breaks down Medicare hospice billing from eligibility through claims submission. You will learn about care levels, physician billing rules, key modifiers, and coverage beyond Medicare. Each section provides specific, actionable guidance to support accurate and compliant billing.
Medicare Hospice Benefit Eligibility and Election
Clinical Diagnosis of Terminal Illness
Medicare requires physician certification that the patient has a life expectancy of six months or less if the illness follows its normal course. Both the attending physician and the hospice medical director must sign this certification. Without it, Medicare will not approve the hospice benefit.
Eligibility rests on a terminal diagnosis — not a patient’s age or income alone. Medicare covers individuals aged 65 and older, along with certain younger individuals with qualifying disabilities.
Patient Election of Hospice Care
When a patient elects the hospice benefit, they waive the right to receive curative treatment for the terminal illness through Medicare. The patient signs a Notice of Election (NOE), which the hospice must submit to the Medicare Administrative Contractor (MAC) within five calendar days of admission.
Filing the NOE late creates “provider liable days.” During this period, the hospice delivers all care without Medicare reimbursement. CMS allows exceptions only for natural disasters, system outages affecting CMS or MAC platforms, or newly certified hospices awaiting their user ID from the MAC.
Medicare Hospice Benefit Periods and Re-enrollment
The Medicare hospice benefit includes two 90-day periods, followed by an unlimited number of 60-day periods. Benefit periods must be used in order: 90–90–60. A physician must recertify eligibility at the start of each new period. If a patient revokes the benefit or is discharged, any remaining days in that period are forfeited permanently.
Patients who still meet eligibility requirements can re-enroll at any time. Re-enrollment begins with the next available benefit period.
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Levels of Hospice Care and Corresponding Hospice Billing
CMS pays hospice providers at four predetermined per diem rates. Each rate corresponds to a specific level of care. The correct revenue code must appear on every claim.
Routine Home Care — Revenue Code 651
Routine Home Care is the most common level of hospice billing. Medicare pays this rate for each day the patient receives standard hospice services at home, in an assisted living facility, or in a skilled nursing facility. The rate does not change based on the volume or intensity of services provided on any given day.
Continuous Home Care — Revenue Code 652
Continuous Home Care applies during a period of medical crisis. A registered nurse (RN) or licensed practical nurse (LPN) must provide nursing care for more than half of a minimum 8-hour care period. CMS calculates payment in 15-minute increments, with a minimum of 32 units required for reimbursement.
Homemaker and hospice aide services may supplement nursing care but cannot replace it. The continuous home care rate is divided by 24 hours to arrive at an hourly rate.
Inpatient Respite Care — Revenue Code 655
Inpatient Respite Care allows caregivers to take a short break. Medicare pays this rate for up to five consecutive days per respite period, including the date of admission but excluding the discharge date. Payment reverts to the Routine Home Care rate from day six onward. Multiple respite periods are allowable within a single billing period.
General Inpatient Care — Revenue Code 656
General Inpatient Care covers patients admitted to a Medicare-certified hospice facility, hospital, or skilled nursing facility for pain or symptom management that cannot be controlled at home. If the patient dies during a General Inpatient Care stay, Medicare pays the inpatient rate for the day of discharge.
Service Intensity Add-on Payment
The Service Intensity Add-on (SIA) payment applies during the final seven days of a patient’s life. Medicare adds this payment on top of the Routine Home Care rate for qualifying RN and social worker visits rendered in the home or nursing facility. Each visit must last at least 15 minutes. The combined daily maximum is 16 units — equivalent to four hours. Chaplain visits and aide visits do not qualify for SIA.
Physician Services in Hospice Care: Billing Guidelines
Physician billing in hospice depends on two key factors: whether the physician serves as the attending physician, and whether the services relate to the terminal diagnosis.
Attending Physician vs. Hospice-Employed Physician
The attending physician is chosen by the patient at the time of hospice election. This physician holds the most significant role in determining and delivering the patient’s medical care. An attending physician who is not employed by — or paid under arrangement with — the hospice may bill Medicare Part B directly for services related to the terminal illness.
A hospice-employed physician cannot bill Medicare Part B separately. All services provided by a hospice-employed physician are included in the hospice per diem rate and billed by the hospice to Medicare Part A.
Billing for Services Related to the Terminal Diagnosis — GV Modifier
A non-employed attending physician bills Medicare Part B using the applicable CPT E/M code, the GV modifier, and the ICD-10 code for the hospice diagnosis. This applies to all services directly related to the terminal illness.
Attending physicians may also bill for care plan oversight using the GV modifier. Providers who volunteer at the hospice are treated as employees under Medicare rules and therefore cannot bill Medicare Part B separately for attending physician services.
Billing for Services Unrelated to the Terminal Diagnosis — GW Modifier
Any physician — attending or not — may bill for services unrelated to the terminal illness using the GW modifier. The applicable CPT E/M code and appropriate ICD-10 codes for the non-terminal condition must accompany the claim. Claims submitted without the GW modifier under these conditions will be denied.
Consulting Physician Agreements and Reimbursement
A specialist providing care related to the terminal illness — who is not the designated attending physician — must have a signed contractual agreement with the hospice before rendering any services. The hospice submits these claims to Medicare Part A and reimburses the physician per the agreement’s terms.
The physician bills the hospice using a CMS 1500 form with the applicable CPT E/M codes for professional and technical components.
Administrative and Supervisory Activities
Hospice medical directors and employed physicians perform administrative tasks such as updating care plans, supervising care implementation, and reviewing patient progress. These activities are included in the Medicare hospice payment rate. No separate billing occurs for administrative services.
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Key Billing Modifiers and Their Applications in Hospice Billing
GV Modifier — Attending Physician Services Related to Terminal Illness
The GV modifier identifies services provided by a non-employed attending physician for the patient’s terminal condition. Three conditions must all be met: the patient must be enrolled in hospice, the physician must be the patient’s designated attending physician, and the services must relate to the terminal illness.
Failing to include the GV modifier on a qualifying claim results in automatic denial.
Example: A hospice patient visits their attending physician for management of terminal lung cancer. The physician submits the claim with the applicable CPT E/M code + GV modifier + the corresponding lung cancer ICD-10 code.
GW Modifier — Services Unrelated to the Terminal Condition
The GW modifier identifies services unrelated to the hospice diagnosis. All providers must use this modifier when submitting such claims. For hospital-based claims involving non-terminal conditions, providers also report condition code 07 alongside the GW modifier.
Example: A hospice patient receives closed treatment for a metatarsal fracture unrelated to the terminal diagnosis. The treating physician bills CPT 28470 + GW modifier.
Consequences of Incorrect Modifier Usage
Missing or incorrect modifiers lead to claim denials. Medicare will not process claims submitted without the required modifier for a patient enrolled in hospice. Providers must verify modifier requirements carefully before submitting any claim for a hospice patient.
Billing for Medications, Supplies, and Equipment
Medicare Coverage for Hospice-Related Items
Medicare covers all medications, supplies, and equipment related to the terminal illness under the hospice benefit. This includes pain management drugs, wound care supplies, and durable medical equipment such as hospital beds and oxygen. These items are bundled into the per diem rate.
Medications, diagnostic tests, and procedures require prior authorization from the hospice before the provider renders the service. The hospice team supervisor manages this process.
Hospice Drug Coinsurance
Medicare requires patients to pay coinsurance for certain outpatient prescription drugs and biologicals. The coinsurance equals 5% of each drug’s cost, with a maximum cap of $5 per prescription. No coinsurance applies for General Inpatient Care.
Reporting Medications on Hospice Claims
Per CMS Transmittal 2864, hospices must report both injectable and non-injectable drugs on claims, on a line-item basis per fill. Hospices are not separately reimbursed for these drugs — they are included in the daily rate. For compound drugs, providers must report each ingredient separately with its corresponding National Drug Code (NDC). Infusion pump charges must reflect total charges for the covered claim period.
Understanding Hospice Claims Submission
Accurate claims submission requires the correct form, codes, and timing. Missing any element can delay or deny payment entirely.
Type of Bill 811 and Frequency Codes
Type of Bill (TOB) 811 identifies the claim as originating from a non-hospital-based hospice. The first digit (8) identifies a special facility. The second digit (1) indicates non-hospital-based hospice. The third digit reflects the billing frequency — 1 for admit-through-discharge, 2 for the first interim claim, 3 for a continuing interim claim, and 4 for the last interim claim.
Beginning and Ending Service Dates
Form Locator 6 captures the beginning and ending service dates for the billing period. These dates must align with the service dates on each claim line. Medicare requires sequential billing — each monthly claim must process before the next is submitted.
Revenue Codes and HCPCS Location Codes
Each level of care requires its specific revenue code: 651, 652, 655, or 656. Providers must also report a HCPCS Level II code (Q5001 through Q5010) to identify where the care was provided — such as Q5001 for the patient’s home or Q5004 for a skilled nursing facility. If care occurred at multiple locations in one billing period, each location needs a separate line with its own revenue and HCPCS codes.
Principal Diagnosis Code and Notice of Election
Form Locator 67 must list the principal diagnosis code. Every service on the claim must support this diagnosis. The NOE must be submitted to the MAC within five calendar days of the patient’s hospice election. Late filing triggers provider liable days — during which the hospice bears all care costs without Medicare reimbursement until the NOE processes.
Hospice Coverage Beyond Medicare
Medicaid Coverage for Hospice Care
Medicaid covers hospice care in most U.S. states. Low-income individuals, seniors, and people with disabilities generally qualify. Medicaid also covers younger patients over age 18 who lack employer-based insurance. Each state sets its own eligibility requirements and coverage rules. Billing teams should verify state-specific regulations before submitting Medicaid hospice claims.
Private Insurance Plans and Hospice Billing
Most private insurance plans model their hospice benefit on the Medicare Hospice Benefit structure. However, coverage details differ significantly by policy. Billing specialists must review each patient’s benefits package carefully before submitting claims. Unlike Medicare, private insurers may not follow standardized billing codes or reimbursement structures.
Self-Pay and Financial Assistance Options
Patients without insurance coverage may access care through self-pay arrangements. Many hospice providers offer sliding-scale fees based on the patient’s financial situation. Community grants and charitable donations also help fund care for uninsured or underinsured patients. State-funded programs and financial hardship assistance are additional options worth exploring.
Discontinuation and Re-enrollment in Hospice Care
Patient’s Right to Discontinue Hospice Care
A patient may revoke the hospice benefit at any time, for any reason. Revoking hospice means the patient immediately regains the right to receive curative treatment for the terminal illness through Medicare. The hospice submits a Notice of Termination/Revocation (NOTR) to the MAC within five calendar days of the effective revocation date.
Any remaining days in the current benefit period are permanently forfeited upon revocation.
Resuming Treatment After Hospice Revocation
After revoking hospice, a patient receives standard Medicare treatment for the terminal condition. Regular Medicare Part A and Part B billing rules apply throughout this period. Revoking hospice does not eliminate future access to hospice benefits.
Re-enrolling in the Medicare Hospice Benefit
A patient who revoked hospice may re-enroll at any time, provided they still meet the eligibility criteria. A physician must re-certify the terminal diagnosis and confirm a life expectancy of six months or less. Re-enrollment places the patient into the next available benefit period in the 90–90–60 sequence.
Accurate Hospice Billing Protects Both Providers and Patients
Hospice billing demands precision at every step — from the initial Notice of Election through the final claim submission. Each level of care carries its own billing code. Each physician role follows its own set of rules. Each modifier carries a specific legal requirement that Medicare enforces strictly.
Errors in hospice billing affect more than reimbursement. They can trigger compliance audits, repayment demands, and regulatory penalties. Accurate documentation and timely filing protect both the provider’s revenue cycle and the patient’s uninterrupted access to care.
Staying current with CMS updates and Medicare Claims Processing Manual guidelines — particularly Chapter 11 — is essential for every billing team handling hospice claims. Strong internal audit processes, clear modifier usage policies, and thorough staff training form the foundation of compliant and effective hospice billing.
Frequently Asked Questions
What is hospice billing and how does it differ from standard Medicare billing?
Hospice billing is a specialized category of Medicare Part A billing. Unlike standard Medicare billing, hospice providers receive a per diem rate covering all services related to the terminal illness. Other providers cannot bill Medicare separately for terminal-illness-related services once the patient elects hospice. Billing occurs through the UB-04 claim form using hospice-specific Type of Bill codes.
What are the four levels of care in hospice billing?
The four levels are Routine Home Care (revenue code 651), Continuous Home Care (revenue code 652), Inpatient Respite Care (revenue code 655), and General Inpatient Care (revenue code 656). Each carries a different Medicare per diem rate. The level of care must match the patient’s documented clinical needs and care setting.
What is the GV modifier and when is it required in hospice billing?
The GV modifier identifies services provided by a non-employed attending physician that relate to the patient’s terminal illness. The attending physician submits the claim to Medicare Part B with the applicable CPT E/M code, the GV modifier, and the terminal diagnosis ICD-10 code. Claims missing the GV modifier under these conditions are automatically denied.
What does the GW modifier mean in hospice medical billing?
The GW modifier applies when any physician provides care to a hospice patient for a condition unrelated to the terminal illness. All providers — not just attending physicians — must use this modifier in that scenario. Missing the GW modifier results in automatic claim denial.
How does the Notice of Election impact hospice billing and reimbursement?
The Notice of Election must reach the Medicare Administrative Contractor within five calendar days of hospice admission. Late submission creates provider liable days, during which the hospice cannot receive Medicare reimbursement. CMS grants exceptions only for extraordinary, fully documented circumstances such as natural disasters or MAC system failures.
Can a consulting physician bill Medicare directly for hospice patients?
No. A consulting physician providing care related to the terminal illness cannot bill Medicare Part B directly. The hospice must execute a signed consulting agreement with the physician before any care is rendered. The physician bills the hospice on a CMS 1500 form, and the hospice reimburses according to the agreement terms.
What are the Medicare hospice benefit periods and how do they work?
Medicare provides two 90-day benefit periods followed by an unlimited number of 60-day periods, used in 90–90–60 order. A physician must certify the patient’s eligibility at the start of each new period. If a patient revokes hospice or is discharged alive, any unused days in the current period are lost permanently.
How does hospice billing handle medications and pharmaceutical supplies?
All medications and supplies related to the terminal illness are covered under the per diem rate. Providers must obtain prior authorization from the hospice team before dispensing. Patients may owe coinsurance of up to 5% of each drug’s cost, capped at $5 per prescription. No coinsurance applies for General Inpatient Care patients.
What happens to hospice billing when a patient revokes the benefit?
The hospice submits a Notice of Termination/Revocation to the MAC within five days of the revocation. The patient forfeits remaining days in the current benefit period. Standard Medicare billing resumes for all services. The patient retains the right to re-enroll in hospice at any time, provided they still meet clinical eligibility requirements.
How does Medicaid or private insurance affect hospice billing processes?
Medicaid covers hospice in most states, with eligibility criteria and reimbursement rules that vary by state. Private insurance plans often mirror the Medicare hospice benefit but differ in coverage specifics, billing codes, and reimbursement structures. Billing teams should verify each patient’s active insurance plan and coverage details before submitting any hospice claim.
