Last Tuesday, I offered some basics on hospice care in America—mostly for older people, mostly at home, and becoming standard care with 40% of Medicare beneficiaries now in hospice when they die.  I warned that the attention on supposed “overuse” and increased costs from long-stay cases may lead to an overreaction that we will all regret.

As I argued last week, the real problem with hospice is not overuse but that most people assigned to it do not get enough—recall that only 33% of hospice enrollees get the 30 days of care that experts think is the minimum effective "dose."  The only reason I can see that we are satisfied with a less than effective "dose" is that it is cheap (16 x $143 = $2,288 for the median patient.)

I’ve felt for a long time that a reasonable policy experiment would be to relax the life expectancy requirement of people entering hospice, say from six months to nine, to try to increase median length of stay.  MedPAC, the advisory body for Congress on Medicare, argues that the drivers of excessively short stays are outside the financial and regulatory structure of the hospice benefit itself, but I think the experiment would be worthwhile and is certainly better than doing nothing.

Another better-than-nothing approach laid out in Section 3140 of the Affordable Care Act finally provides for a "concurrent hospice" demonstration that will test on a small scale the consequences of offering hospice while a patient is still in curative treatment.  Research supported by The Robert Wood Johnson Foundation (reported in 2002!) suggests that models permitting a more gradual transition from full-on curative care to hospice care result in substantial cost and quality benefits.  But with all the work dumped on the Centers for Medicare and Medicaid Services in health reform, I wouldn’t hold my breath for this demonstration to get going.

I would also very much like to see efforts to give hospitals and physicians some incentives to get patients into hospice with more time to benefit as opposed to our current fee-for-service, more for more system (see "A Disappointing About-Face" ). I recall the case of my late Aunt Janet, who, as soon as she had had expensive brain surgery, radiation, and rehab for her brain cancer, was immediately certified for hospice.  And I can’t help but recall what Upton Sinclair said: "It is difficult to get a man to understand something, when his salary depends upon his not understanding it!"  Perhaps Accountable Care Organizations can align incentives so that patients get all the care they need when they need it without artificial distinctions between curative, palliative, and hospice care.

But what Medicare has done, instead of addressing the short stay issue, is implement a new process for hospice: very formal recertification for those surviving past six months, including a physician sign-off and an in-person visit from either an MD or a Nurse Practitioner before that sign-off.   The thinly disguised intent is to make legal accountability clearer and scarier and to put an obstacle in the way of long-stay patients.  From the hospice agency perspective, recertification visits are considered part of administrative responsibilities and aren’t billable, adding to overhead costs without a change in payment rates.

I do recognize that fraud and abuse exist in health care and agree that Medicare has to address the issue.  A few recent headlines provide some dramatic examples of intentionally criminal behavior, such as this $200 million fraud case in South Florida unrelated to hospice care.  However, Medicare’s new hospice recertification procedure seems a weak response to criminal fraud and an intentionally burdensome and unclear regulatory approach that certainly drives up costs and has a real risk of discouraging legitimate service use.

A more sensible program modification being considered is the so-called “U” shaped plan for hospice daily payment.  The observation is that real costs of hospice care are high at the beginning (with care planning, mobilizing durable medical equipment, and implementing plans), lower in the middle (steady state – especially in long-stay cases), and high again at the end (when active dying may require new services or a revision to the care plan).  Therefore, a reduction to the daily payment rate for the middle period would reduce the “excess” profitability of long-stay, low-intensity clients.

I still think this notion still misses the point.  More and more micro-management of how care is delivered and how it is paid for is the reverse of what Medicare administrators have stated they want: to identify measures of quality of care and seek value for the health care dollar by permitting providers more flexibility.  The reality is that more and more people will be dying of things other than cancer that have unpredictable courses and variable needs.  We need to go back and design a benefit and a model of care that will serve people with these needs.  Larding on more and more layers of regulation to a benefit that is just not well-suited to their care is not the answer.