SOURCES: Pedro Gozalo, Ph.D., research associate professor, health services, policy and practice, Brown University School of Public Health, Providence, R.I.; Amy Kelley, M.D., assistant professor, geriatrics and palliative medicine, Mount Sinai Hospital, New York City; May 7, 2015, New England Journal of Medicine
WEDNESDAY, May 6, 2015 (HealthDay News) -- More nursing home residents are opting for hospice care as they near death, choosing comfort and reassurance over medical interventions aimed at squeezing out every possible extra day of life.
But while hospice care has proven effective in providing peace to the dying, it's also more expensive than previously thought, according to a new study published in the May 7 New England Journal of Medicine.
Medicare costs for nursing home residents receiving hospice care increased an average of almost $6,800 per patient between 2004 and 2009, said study lead author Pedro Gozalo, a research associate professor of health services, policy and practice at Brown University School of Public Health in Providence, R.I.
This runs counter to the idea that hospice should cost less than traditional care because doctors aren't using expensive procedures to prolong life, Gozalo said.
"We expected that hospice was going to be a little more costly, but to me it was surprising the amount of money that the hospice was adding to the care of these patients," he said.
The increased cost likely is due to hospice care being provided to nursing home residents who are not as near death as initially suspected, Gozalo said. These patients can spend months or even years in hospice, he said.
Medicare initially created its hospice benefit in 1983, and expanded it in 2004 to reflect the growing acceptance of hospice care, Gozalo said. The benefit is paid as a flat per-day fee.
Following the expansion, many more nursing home residents opted for hospice. Researchers found that by 2009, nearly 40 percent of nursing home residents who died had been receiving hospice care, as opposed to about 28 percent five years earlier.
A review of Medicare data for almost 800,000 nursing home residents who died in either 2004 or 2009 found that hospice care did significantly reduce a number of signs of aggressive-but-futile attempts to prolong life. Use of intensive care dropped by 7 percent, hospital transfers fell 2 percent, and feeding tube use declined by 1 percent, the study revealed.
But the average length of stay in hospice increased by 28 percent during the same period of time, rising from 72 days in 2004 to nearly 93 days in 2009.
Medicare ended up spending an additional $10,000 for each patient's hospice care. But Medicare only saved about $3,500 per patient, the study found. Those savings came from fewer hospitalizations, less need for skilled nursing facility care, and other areas of cost savings associated with hospice.
Hospice care initially was created to help ease the pain and suffering of terminal cancer patients, and was provided mainly by volunteers from nonprofit groups, Gozalo said.
But these days many different types of patients are receiving hospice, including people who have advanced dementia, other chronic illnesses, or merely the frailty and poor health that comes near the end of life, he said.
Nursing home patients may suffer an initial crisis that causes them to enter hospice, and then may spend a long time languishing in hospice before end-of-life care is actually needed. During the intervening weeks or months, the person is not receiving much hospice care but the nursing home still is charging Medicare a daily fee for hospice.
"It's harder to pinpoint when they may die, so they end up having on average a longer length of stay," Gozalo said. "Now that we have this growth and we have expanded hospice to different diagnoses and different settings, hospice is not saving money as they said it would in the beginning."
For example, cancer patients without dementia were associated with the smallest rise in net cost associated with hospice expansion, about $2,200, while patients with dementia but not cancer produced the largest net cost increase, nearly $8,600, the study reported.
Part of the problem is that palliative care is being provided under the guise of hospice care, and they really are two separate things, said Dr. Amy Kelley, an assistant professor of geriatrics and palliative medicine at Mount Sinai Hospital in New York City.
Palliative care focuses on easing pain and can be given to anyone, not just people who are near the end of their lives, she said.
"We need an active palliative care program available to all patients, and then appropriate transition at the right time for a patient who needs hospice," Kelley said. "Hospice provides high-quality care but it's inadequate on its own, particularly in nursing homes."
Kelley noted that the study focused solely on nursing home residents, and didn't examine hospice care that is provided to people in their own homes or at hospice facilities.
"We know for those people, hospice helps in those crisis situations and avoids unwarranted transfers to the hospital and emergency room," she said.
The Centers for Medicare and Medicaid Services (CMS) has proposed changes for 2016 to address its increased hospice expenditures, Gozalo said. The agency would decrease hospice payments after a patient's first 60 days in hospice, but then provide a bonus for hospice care given during a patient's last two days of life.
"The idea is once a patient appears to be stable and doesn't need as many visits, the payment is more concordant with the requirements of care," he said. "And if you're there in the last days, CMS will pay a bonus, when it's really clear that hospice should be there."
To learn more about hospice care, visit the U.S. National Institutes of Health.