Summary of issues
The article “In Hospice Care, Longer Lives mean Money Lost” (New York Times, November 27, 2007) highlights the critical issue of a graying population and hospices without resources to care for those living longer (e.g., those with terminal cancer). As those using hospice services live longer, hospices find themselves unable to meet reimbursement criteria to Medicare, leaving them in debt to the tune of millions of dollars, and even bankruptcy. As the fees are assessed retrospectively the money tends to have been spent on salaries, medicine, and supplies.
Interestingly though, it appears that the Southern and Western states are more likely to experience the extended living of patients deemed terminal by medical staff. It has been contended by the Medicare Payment Advisory Commission that there may be an issue with the management of these hospices, given that less than one-tenth of organizations nationally have been asked to reimburse Medicare. The National Alliance for Hospice Access however counters this claim by pointing to the dramatic rise in numbers of patients accessing hospice care in the last five years, mostly with patients who have unpredictable health trajectories, such as Alzheimer’s disease. Longer stays are the norm for this population of hospice users whose average time spent receiving care is 96 days as compared to the average of 44 days for terminal lung cancer patients.
It has been suggested by research from Duke University that Medicare can save thousands of dollars a year per beneficiary by raising the cap on reimbursements. However, congress appears hesitant to consider such a move, given that Medicare spending in this area of health and social care has tripled from 2005 to 2008 to the tune of over 8 billion dollars, with over 40 percent of Medicare recipients also accessing hospice care.
Description of parties involved
The stakeholders at the focus of this article are of the hospice. As a profile example, Hometown Hospice in Wilcox County, Alabama is a locally owned and for-profit organization that has been operating for 5 years and is a critical service as Wilcox is an extremely poor county. Hometown provides hospice services to around 60 older persons, visiting most in their homes.
Recently, from its first two years of operation Hometown had to repay Medicare 27% of its operating revenue. This was achieved with a bank loan in the first year, followed by a 5-year payment plan with Medicare at 12.5% interest when the bank refused them credit for the second year. It is unlikely that Hometown will be able to withstand another reimbursement payout to Medicare which totals into the hundreds of thousands of dollars.
Potential resolutions
The president of the hospice access alliance, Louise Armstrong, has stated that the cap on Medicare reimbursements needs to be lifted to ensure that access and quality to care is not diminished for those elderly most in need. She emphasizes that this is an evidence-based solution as literature points to economic savings for Medicare, up to an average of $2, 300 for each beneficiary (Taylor, Ostermanna, Van Houtvenb, Tulskyc, & Steinhauser, 2007). Richard R. Slager, the chairman, and chief executive of VistaCare, advocates a “niche” approach, with his company only recruiting terminal cancer patients.
Open questions
- Why has an inquiry not been carried out in the last 25 years to evaluate the needs of users and hospices to aid in forecasting potential future issues?
- Do doctors have national standard criteria for determining a person to have a terminal illness? If yes, are they tested in using the criteria to ensure standardized administration?
- Why is the director of Hometown relying on the nurses’ judgment of the terminality of a person? Is this a best practice to put the responsibility on the nurse? If yes, is the procedure standardized across the nation?
- What do other empirical-based studies, domestically and internationally, offer as solutions?
References
“In Hospice Care, Longer Lives mean Money Lost”, New York Times, 2007. Web.
Taylor, D. H., Ostermanna, J., Van Houtvenb, C., Tulskyc, J. A., & Steinhauser, K. (2007). Social Science & Medicine, 65, 1466–1478. Web.