Hundreds of hospice providers across the country are facing the catastrophic financial consequence of what would otherwise seem a positive development: their patients are living longer than expected.
Over the last eight years, the refusal of patients to die according to actuarial schedules has led the federal government to demand that hospices exceeding reimbursement limits repay hundreds of millions of dollars to Medicare.
The charges are assessed retrospectively, so in most cases the money has long since been spent on salaries, medicine and supplies. After absorbing huge assessments for several years, often by borrowing at high rates, a number of hospice providers are bracing for a new round that they fear may shut their doors.
One is Hometown Hospice, which has been providing care here since 2003 to some of the most destitute residents of Wilcox County, the poorest place in Alabama.
I worked for non-profit hospices for several years so I found this interesting: “For reasons that are not fully understood, problems with the cap have been most prevalent at small, for-profit hospices in Southern and Western states like Mississippi, Alabama and Oklahoma.”
The operative word here is “for profit.” That’s a relatively new phenomenon in hospice and, as anyone working for a non-profit will tell you, hospice is not profitable. When Medicare started clamping down on home health agencies (it seemed like new ones were popping up and then closing down in town every day), some enterprising individuals opened small, for-profit hospices and made the rounds to doctors’ offices begging for referrals. As the article stated, these for-profits were taking Alzheimer’s, diabetes, and COPD patients, whose prognosis was less than certain.
The non-profits know two things: First, it’s very difficult to make a profit in hospice care. It’s a very people-intensive, all-inclusive service. Hospice provides a team of professionals, medical equipment and medications for each patient. Secondly, the cases have to be managed carefully. Yes, the non-profits would take Alzheimer’s and COPD patients when the doctors referred them, saying they had six months or less to live, but when the six months approached the patients had to be discharged from hospice and transitioned to another service if there wasn’t a decline in the patients’ health. You cannot milk the hospice benefit.
I don’t mean to make for-profits out as bad guys — hospice workers care deeply about their patients and I’m sure they provided good care. But it’s not a profit-making enterprise unless they’re not following the rules.