Impact of New Hospice Drug Policies on Expenditures, Utilization, Prescribing Quality, and Access

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Principal Investigator: Matthew  Alcusky
Organization: UNIV OF MASSACHUSETTS MED SCH WORCESTER
Fiscal Year: 2024
Award: $400,000
Funding agency: Agency for Healthcare Research and Quality

PROJECT SUMMARY
Nearly 1.25 million Americans aged 65 years and older receive hospice services annually, with hospice
medications paid for by two Medicare programs: the Medicare Part A Hospice Benefit and the Medicare Part D
prescription drug benefit. A 2012 Office of the Inspector General (OIG) audit reported that Medicare paid twice
for medications used by some hospice enrollees. In response, the Centers for Medicare and Medicaid Services
(CMS) began a series of policy shifts in 2014 to increasingly place the burden of medication payment on hospice
agencies’ operating budgets and away from Part D. Under threat of audit and penalties, this put enormous
financial pressure on hospices to ensure that all medications that their enrollees are taking are necessary and
billed appropriately. The impact of this policy shift on patient and hospice outcomes is largely unclear. To address
this clinical and policy gap, we propose a nationwide retrospective interrupted time series analysis using
secondary data from CMS. Aim 1 will examine changes in Part D expenditures and drug utilization pre- and post-
2014 hospice policy change, focusing on individual and hospice factors associated with persistent high part D
expenditures after the 2014 policy change. Aim 2 will examine patient-level changes in prescribing patterns and
quality indicators after 2014 using a combined Part D-Medicare hospice drug database to achieve complete
capture of drug utilization from the perspective of Medicare. Because CMS policy results in incomplete reporting
of hospice drugs in Medicare hospice claims pre-2014 and post-2018, sensitivity analyses will use proprietary
hospice pharmacy dispensing data (2011-2020) from a national hospice provider to examine patient-level
medication analyses before and after the policy change from the perspective of hospice providers. Aim 3 will
examine geographic trends in hospice enrollment by admitting diagnosis before and after the policy change.
Taken together, this will be the first nationwide examination of the impact of Medicare hospice drug policy of
which we are aware. This project is in keeping with AHRQ research priorities to improve access and affordability
of healthcare by examining approaches to care delivery and financing. Our findings will generate sorely needed
outcomes data related to policy impacts for a vulnerable population, and will serve as the basis of feedback to
CMS that will help inform policy refinement and design.