Earlier use of hospice can lower costs, improve care of Medicare patients

While nearly half of terminally ill Medicare patients use the program’s end of life hospice benefit, a new study found that many of these patients may receive better and more cost effective care if they opt for hospice sooner once it has been deemed appropriate.

The study, titled “Hospice Use, Hospitalization, and Medicare Spending at the End of Life,” was published by The Journals of Gerontology and co-authored by Sally Clark Stearns, PhD, professor of health policy and management at the University of North Carolina’s Gillings School of Global Public Health.

The study compared inpatient hospital days and Medicare spending during the last six months of life for beneficiaries using hospice care versus matched non-hospice beneficiaries. Patients included in the study were limited to those affected with at least one of five conditions: Alzheimer’s disease or dementia, heart failure, stroke, lung cancer or colorectal cancer.

Sally Clark Stearns, PhD, professor of health policy and management.

Sally Clark Stearns, PhD, professor of health policy and management.

Among the researchers’ findings: hospice use of at least two weeks prior to death was associated with anywhere from one to five fewer days spent in hospital care for all Medicare patients. Spending could drop as much as $5,000 for patients in hospice care for one to three months and not residing in a nursing home prior to six months before death, except for patients with Alzheimer’s or dementia.

“About half of terminally ill Medicare patients do opt for hospice care,” Dr. Stearns said. “However, the enrollment often occurs very shortly before death. We found that opting for hospice care in a more timely fashion not only significantly reduced costs but also likely improved quality of life during this period.”

Reduced hospital use during these periods would also translate into reduced Medicare payments for most but not all of the conditions studied. “The exception was those afflicted with Alzheimer’s disease or dementia,” says Stearns. “With those chronic conditions, longer hospice stays may actually result in increased Medicare payments, especially for beneficiaries who were residing in nursing homes.”

Medicare provides hospice care benefits when a patient’s physician certifies a remaining life expectancy of six months or less and the patient agrees to forgo curative treatments in lieu of hospice. The study directly examined the records of 433,063 Medicare beneficiaries who died in 2010; 205,904 of these were hospice patients. Within that patient group, the researchers analyzed the spending over the six months prior to death for the five selected diagnoses. While Medicare spending declined on average in all five categories for patients who received more than a month of hospice care (except, as noted above, for Alzheimer’s or dementia patients) and did not appear to be residing in a nursing home prior to the last six months of life, the patients afflicted with lung and colorectal cancer showed the largest reductions in hospital use and Medicare expenditures. Among persons who appeared to be long term nursing home residents, expenditures only declined for lung cancer patients.

Dr. Stearns said going forward, future research should look more closely at Alzheimer’s/dementia patients to understand whether the hospice benefit is the most efficient and effective way for these patients to get the necessary and appropriate services to serve their end of life needs.

“If the current Medicaid program doesn’t provide access to an effective alternative to the hospice care that meets their needs, we as researchers should investigate alternative programs or structures that would do so,” she said. “This is a challenging but extremely important issue, especially as the population ages and more people will be using these benefits in coming decades.”

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