Hospice is the strangest line item in American healthcare, because there almost isn’t one. Medicare pays the hospice a flat daily rate for everything in the plan of care, and the patient is billed for two things, neither of which will break a budget.
That does not make the benefit simple. Electing hospice means signing a statement that trades away part of your Medicare coverage, and the two most expensive things families end up paying for (room and board, and care the hospice team did not arrange) are the two things the benefit was never designed to cover. Every figure below was verified on September 6, 2026 against CMS and Medicare.gov, and both the current and the incoming payment year are given, because the rates change on October 1.
Does Medicare Cover Hospice? Yes, at $0
Medicare Part A covers hospice care if you meet four conditions, all of which Medicare.gov lists on its hospice coverage page:
- You have Part A.
- Your hospice doctor and your regular doctor (if you have one) certify that you are terminally ill, with a life expectancy of 6 months or less.
- You accept comfort care instead of care intended to cure the terminal illness and related conditions.
- You sign a hospice election statement before any hospice services begin.
Meet those and Medicare.gov’s cost line reads simply: you pay nothing for hospice care from a Medicare-approved hospice provider. There is no hospice deductible, and unlike the skilled nursing benefit there is no day limit. Coverage runs in two 90-day benefit periods followed by an unlimited number of 60-day periods, which is a duration question in its own right and is covered in how long you can be on hospice.
The Two Things You Actually Pay
Federal regulation allows a hospice to charge a patient exactly two coinsurance amounts, and CMS spells both out on its hospice payment page.
Up to $5 per prescription for symptom drugs. The rule sets the coinsurance at 5% of what the drug costs the hospice, under a copayment schedule the hospice sets, and caps it at $5.00 per prescription no matter what the drug costs. It applies only to outpatient palliative drugs you get during routine home care or continuous home care. You owe nothing for drugs during general inpatient care or respite care.
5% of the Medicare payment for each inpatient respite day. At the FY2026 respite rate of $532.48 a day, that is about $26.62 a day. From October 1, 2026 the respite rate rises to $545.98, making the daily coinsurance about $27.30. Medicare and Medicaid both pay respite for a maximum of five days per admission, so a full respite stay costs a patient roughly $133 this year and about $137 next year.
There is a hard ceiling on the respite side. Your respite coinsurance across a hospice coinsurance period can never exceed the inpatient hospital deductible for the year the period began, which the CMS fact sheet published November 14, 2025 set at $1,736 for 2026.
Separately, Original Medicare keeps paying for health problems unrelated to your terminal illness, and you owe the normal deductibles and coinsurance on those. That is where surprise bills come from, so ask for the election statement addendum described below.
The Four Levels of Care and What Medicare Pays
Medicare does not pay hospices per visit. It pays a per diem for every day you are enrolled, keyed to where care happens and how intense it is. These are the national base rates for hospices that submit the required quality data, taken from the CMS change requests that instruct Medicare contractors to pay them. Rates are adjusted up or down by the hospice wage index for your area.
| Level of care | FY2026 rate (through Sep 30, 2026) | FY2027 rate (from Oct 1, 2026) |
|---|---|---|
| Routine home care, days 1 to 60 | $230.83 per day | $236.35 per day |
| Routine home care, day 61 onward | $181.94 per day | $186.35 per day |
| Continuous home care (crisis care at home) | $1,674.29 per 24 hours, about $69.76 per hour | $1,726.50 per 24 hours, $71.94 per hour |
| Inpatient respite care | $532.48 per day | $545.98 per day |
| General inpatient care | $1,199.86 per day | $1,231.63 per day |
| What the patient is billed | $0 | $0 |
Routine home care is the default and covers the vast majority of hospice days. It is paid for every enrolled day unless a higher level applies, and it steps down on day 61 because CMS found hospice workload is heaviest at the beginning and the very end of a stay. A service intensity add-on pays extra for registered nurse and social worker hours in the last seven days of life.
Continuous home care is crisis care at home, paid hourly with a minimum of eight hours in a day, meant to prevent a hospital admission.
Inpatient respite care is a short facility stay so the usual caregiver can rest, capped at five consecutive days per admission. Day six reverts to the routine home care rate. See Medicare respite care for how families actually use it.
General inpatient care is for symptoms that cannot be managed anywhere else, and at $1,199.86 a day it is the most expensive level and the shortest.
CMS finalized a 2.3% hospice payment update for FY2027, an estimated $755 million increase, and raised the annual per-patient aggregate cap from $35,361.44 to $36,174.75 effective October 1, 2026. The dollar-by-dollar breakdown of what all this means for a family budget lives in our hospice care cost guide.
Electing Hospice: What You Sign and What You Give Up
The election statement is not a formality. Under 42 CFR 418.24 it must identify the hospice and your attending physician, acknowledge in writing that you understand hospice is palliative rather than curative, state the effective date, disclose your cost sharing, and carry your signature. Nothing is covered before it is signed.
What you give up is specific and narrow. For the duration of the election you waive Medicare payment for hospice care from any hospice other than the one you designated, and for any Medicare services aimed at treating the terminal condition or a related condition. You do not waive coverage for anything unrelated, and you do not waive your attending physician.
You can also demand the list of what the hospice will not cover. The election statement addendum, formally titled “Patient Notification of Hospice Non-Covered Items, Services, and Drugs,” names every condition, item, service and drug the hospice has decided is unrelated to your terminal illness, with a written clinical explanation. Request it in the first five days of election and the hospice has five days to produce it; request it later and it has three. In the FY2027 final rule CMS made that addendum mandatory for everyone electing hospice, not just those who ask, specifically because non-hospice spending kept growing and beneficiaries were absorbing the bills.
What the Benefit Will Not Cover
Medicare.gov lists four exclusions, and they are the source of nearly every hospice billing surprise:
- Curative treatment for your terminal illness and related conditions, and drugs meant to cure rather than to control pain and symptoms.
- Care from any provider the hospice team did not set up. All care for the terminal illness must be given or arranged by your hospice. Going to the emergency room or being admitted to a hospital without the hospice arranging it can leave you liable for the entire cost.
- Room and board. Not at home, not in a nursing home, not in a hospice inpatient facility. The only exception is a short-term inpatient or respite stay the hospice arranges. If your relative lives in assisted living or a nursing home, that invoice keeps arriving in full, which is why does Medicare cover long-term care and our nursing home cost guide matter here.
- Outpatient, inpatient or ambulance care unrelated to the terminal illness that the hospice did not arrange, unless it truly is unrelated, in which case Original Medicare pays with normal cost sharing.
If You Are in a Medicare Advantage Plan
Hospice is carved out of Medicare Advantage. Original Medicare pays for your hospice care even if you stay in your plan, and the Medicare Hospice Benefits booklet says so directly.
You can keep the Advantage plan as long as you keep paying its premium. It continues to cover the extras (dental, vision and similar) and it can cover care for health problems unrelated to your terminal illness, with your plan’s copay rather than the Original Medicare copay. If you belong to a plan and want hospice, the plan must help you find a Medicare-approved hospice in your area.
CMS ran a demonstration from 2021 through 2024 that let some Advantage plans cover hospice themselves. CMS concluded that Hospice Benefit Component on December 31, 2024 because participation was limited and falling, so the carve-out now applies to everyone. If you are weighing plan types for other reasons, see Medicare Advantage vs Original Medicare.
Is Part A Alone Enough?
Yes. Eligibility under 42 CFR 418.20 requires entitlement to Part A and a terminal-illness certification, and nothing else. You do not need Part B, a Medigap policy or Part D for the hospice benefit itself.
Part B still earns its keep, because it pays for doctor visits and services unrelated to the terminal illness while you are enrolled. Part D matters in the rare case the hospice benefit does not cover a drug, when the hospice is supposed to contact your drug plan. If premiums are the obstacle, Medicare Savings Programs and Extra Help exist for exactly that.
The Bottom Line
Medicare covers hospice, it covers it completely, and it bills you almost nothing: up to $5 a prescription and roughly $27 a day for respite, with a hard cap of $1,736 in 2026. Medicare pays the hospice $230.83 a day for routine home care through September 30, 2026 and $236.35 a day after that.
The money you need to plan for is everything the benefit was never meant to cover. Room and board keeps coming, care the hospice did not arrange can land on you in full, and unrelated conditions are billed normally. Get the election statement addendum in writing on day one, and if coverage is the problem rather than the cost, start with who pays for hospice care.