This longing to provide a terminally ill loved one with the opportunity for a dignified death – free of suffering and surrounded by family and friends at home or in a home-like setting – is the very basis upon which the hospice movement got its start. Hospice originated with small nonprofit groups, many of them made up of devoted volunteers, providing the care.
But it appears this grass-roots movement to provide compassionate end-of-life care is becoming a foothold for big business.
Over the last decade, an industry once comprised of community and religious-based, non-profit organizations has evolved into a multi-billion dollar business. The non-profits now compete with large, for-profit providers, which often are publicly traded, financially benefit owners or shareholders, and are governed by corporate boards.
Today, of the nearly 4,300 hospices in the U.S., over 68 percent are for-profit, with dozens in the Dayton area alone. What has created the proliferation of for-profit hospices across the country?
"Investors see it as a low-risk business opportunity," explained Kent Anderson, CEO and president of Ohio's Hospice of Dayton, one of the oldest community-owned hospice and palliative care providers in Ohio and the US.
Some advocates say that the surge of for-profit companies into the hospice arena has been beneficial to patients because of big investments made in technology, a focus on efficiency, and making care more accessible. Others believe that for-profit hospices create a loss of local control, less financial accountability to the community, and a shifting of Medicare and Medicaid dollars to shareholders, resulting in patient care that ultimately suffers.
As part of their “Business of Dying” series, the Washington Post analyzed hundreds of thousands of U.S. hospice records and discovered that, on several key measures, for-profit hospices as a group fell short of those run by non-profit organizations.
For example, the typical for-profit hospice:
• Spends 25 percent less per patient than a not-for-profit hospice
• Provides less hospice care in the home setting
• Admits lower percentages of high-cost patient populations (i.e. cancer patients)
• Discharge patients at a higher percentage before dying, and
• Have almost twice as many patients re-admitted to a hospital
Hospices are paid a flat daily fee from Medicare for each patient -- meaning that, the fewer services provided, the larger the profit margin. MedPAC, an agency that reviews Medicare funding, states that hospice providers with substantially higher rates of discharge may signal a problem with quality of care or program integrity. The findings on for-profit hospices suggests pressure to cut costs, along with scant government oversight, has led some for-profit companies to focus on the bottom line, to the detriment of patients.
Most of the costs of hospice care is covered by Medicare, Medicaid or private insurance, however not all. Not-for-profit hospices spend more of the revenue they receive to support the broader array of end-of-life services and related activities that for-profits don’t provide. For example, services such as music and art therapy, grief and bereavement support, and palliative care are funded by Ohio’s Hospice of Dayton through donor and community support.
“Most [for-profit companies] want to provide good care,” said Anderson. “The difference is in how much you’re willing to invest in that care. On average, Ohio’s Hospice of Dayton spends 46 percent more per-patient than a for-profit hospice.”
As a patient faces the end of life, being able to choose where they take their last breath can give them a sense of empowerment at a time when they need it the most. Yet, in Ohio, only 32 percent of patients under for-profit hospice care receive their care in the home setting, as compared to 52 percent of patients receiving care from not-for-profits.
Anderson says, "At Ohio's Hospice of Dayton, we believe in caring for anyone, anywhere they want to call home."