Are Rising Hospice Costs A Concern?

KHN’s story on concerns about the rising costs of hospice to Medicare, which ran Tuesday in The New York Times, has stirred up passionate debate among palliative care blogs and advocates. The story reported that the fourfold increase in hospice costs over the last decade has heightened worries that Medicare’s flat fee method of payment has encouraged hospices to seek out patients sooner and to keep them even if they no longer meet Medicare’s eligibility rules. The story also reported that there have been several whistleblower lawsuits that alleged for-profit hospice chains fraudulently admitted and kept patients.

Palliamed, a blog run by hospice and palliative care doctors and nurses, acknowledges fraud is a legitimate problem but says more attention should be given to some of the “potential changes to the payment structure to focus greater reimbursement during the first 7 and last 7 days of service when need is thought to be the greatest.” That so called “U-shaped” payment method has been suggested repeatedly by the Medicare Payment Advisory Commission, or MedPAC, an independent congressional agency, but has yet to be adopted by the Centers for Medicare & Medicaid Services (CMS).

The National Hospice and Palliative Care Organization, a hospice association, says “growth in hospice over the past decade reflects our caring more compassionately for the dying in this country.” The association tells its members that its lobbying team “has put together some specific talking points they are sharing with legislators and their staffs on Capitol Hill who may have concern or confusion resulting from this article.”

The Incidental Economist takes a break from a beach vacation to weigh in, saying that examining the increase in Medicare’s costs isn’t enough. “What we really need to know is the relationship between use of hospice, cost and quality of care. In many ways this is true for the entire health care system. We often focus on cost, or on quality, but you need to look at cost and quality at the same time to figure out if care is ‘worth it’ or not.” CMS is starting to develop measures for hospice quality, but for now, as MedPAC has repeatedly noted, Medicare receives no information about the quality of care being provided.

But Larry Beresford, a blogger and author of the Hospice Handbook, says hospices themselves are to blame for the lack of knowledge about their quality. He writes: “Although the hospice industry has often complained about the kind of coverage seen in this week’s Times article, it has been too slow to embrace accountability, self-policing and quantifiable demonstrations of quality for the care it provides to vulnerable, terminally ill patients and their families.”  He says “it’s time for America’s hospices to step up to the plate and get serious about demonstrating their quality and accountability.”

Atul Gawande, the surgeon and author who championed hospice in The New Yorker last year, tweets that the article raises “a troubling pattern of healthcare fraud,” especially given the fraud problems in Medicare’s home health program. “Hospice = better care — until it’s just another business exploiting the frail,” Gawande tweets.

jrau@kff.org