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Some People Have A Right To Choose Any Hospice Agency. Some Don’t.

Some People Have a Right to Choose Any Hospice Agency. Some Don’t.

Hospice patients or their representatives have legally guaranteed rights to use the hospice agency of their choice. However, these rights are not universal. Younger people may have fewer rights than Medicare beneficiaries. Violations of these rights seem to be on the decline, but reports of patient steering still surface. Learn your hospice freedom-of-choice rights and how to protect them.

Hospice Freedom of Choice in Medicare & Medicaid 

People with Medicare and Medicaid have the most rigorously protected freedom of choice. The Social Security Act mandates this patient right in sections 1802 and 1902 (a)(23). In short, patients with Medicare or Medicaid may receive health services from any certified hospice agency. Adding to your patient protections, guidance from the Office of the Inspector General stipulates that people receiving a hospice referral must also receive a list of agencies from which to choose.1 The list should show every hospice agency in the area who asked to be on the list. The list must also disclose any financial relationship with the hospital (or whatever company is making the referral). Today, most hospitals use an online service to handle organization and presentation of these lists.

The authority to enforce these rules stem from Medicare’s and Medicaid’s conditions of participation for the hospital, nursing home, clinic, etc. If you are working with a doctor who does not take Medicare or Medicaid, some or all of these rules may not apply. 

Hospice Freedom of Choice in Private Insurance

Most hospice services are paid for by Medicare, with Medicare paying up to 100%. However, some younger patients may use their commercial health insurance to pay for hospice.2  These situations can limit hospice freedom of choice. Private health insurance companies commonly operate as health maintenance organizations (HMOs) or preferred provider organizations (PPOs). Exceptions notwithstanding, in these arrangements, customers agree that insurance will only pay when services are delivered by a short list of providers. When people sign-up for health insurance, they usually check the list of general practitioners. How many people would even think to check the list of hospice agencies?

Hospice Freedom of Choice in Medicare Advantage

Medicare Advantage plans are health insurance plans from private insurance companies, but that use and replace a senior’s Medicare benefits. Like other commercial insurance, they tend to operate as HMOs and PPOs. Fortunately, Medicare Advantage plans do not limit a patient’s hospice freedom of choice. This arises from the fact that Medicare Advantage plans do not technically cover hospice services at all. Under Medicare Part C rules, Medicare Advantage plans cover at least all the same benefits as original Medicare except hospice. When seniors with Advantage plans need hospice, it is still covered through original Medicare / Medicare Part A, regardless of whether they are using original Medicare or Medicare Advantage plans. Unlike in home health where Medicare Advantage limits freedom of choice, all Medicare beneficiaries have full hospice freedom of choice.

Hospice Freedom of Choice and ACOs

ACO stands for accountable care organization. ACOs are providers that have entered into a contract with Medicare where they try to deliver more cost-effective healthcare and get some of the savings back as a bonus. For instance, one possible ACO organization could be a large family practice group, a community hospital, a cardiologist, a dialysis center, and a hospice agency, all working together to improve organization during patient transitions. It is a common misunderstanding that ACOs can limit a patient’s freedom of choice. They should not attempt this. Medicare and Medicaid beneficiaries seeing health care providers in ACOs always have the freedom to choose providers inside or outside of the ACO. Members of ACOs have the right to tell patients their recommendations for other providers and why, but they are violating the law if they give the impression that patients have limited choice due to the ACO.

Specific Rights Under Hospice Freedom of Choice

  • Time: Situation allowing, patients are entitled to the time needed to make an informed decision. For instance, doctors and care planners in facilities might know for weeks that a patient will need hospice. They should tell the patient as soon as possible (in accordance with the patient’s communications wishes), so the patient can research his or her hospice choice. An unethical practice would be to wait to the last minute to ask the patient’s preference for a hospice agency, give the patient an uninformative list, and mention that this or that hospice is the one they recommend.
  • Organization: Medicare and Medicaid offer full freedom of choice. ACOs do not limit a patient’s rights. Commercial HMOs, PPOs, and other private contracts may and usually do limit choice.
  • Financial Interest: Patients have the right to be informed automatically if a provider has a financial interest in any referred-to provider.
  • Recommendations: Patients have a right to hear their doctors’ recommendations for hospice. No external organization may tell doctors what they can and can’t say about personal medical experience with local providers. Furthermore, no law prohibits doctors from recommending one hospice over another.2 Employers, may, however, create rules and guidelines about what their employee doctors may and may not say.
  • All Services: Healthcare providers may not threaten to limit the services they offer based on choice of other provider types.

How To Protect Your Hospice Freedom of Choice

In conclusion, all Americans start with a right to receive healthcare from the provider they choose. One way to lose that freedom is through private insurance contracts. The other way to lose that freedom is by not exercising it knowledgably. People can protect their freedom of choice by considering what different types of healthcare providers they will need in the future, researching their choices, and knowing their rights.


  1. Office of Inspector General. OIG Draft Supplemental Compliance Program Guidance for Hospitals. Federal Register Volume 69, Number 110. FR Doc No: 04-12829. Pages 32012-32031.
  2. Hogue E. How to Honor Patients’ Right to Freedom of Choice: What case managers / discharge planners need to know about patients’ right to freedom of choice of providers. 2012. PDF.