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The Medicare Hospice Benefit: A Changing Philosophy of Care?
This article details the historical beginnings of hospice in the United States and its progression away from being a volunteer community organization to becoming a healthcare business, which increasingly occurred following Medicare’s funding of hospice care in 1982. The article also discusses the benefits of Medicare hospice and its deviation from hospice’s traditional philosophy of care, which can be partly attributed to certain laws. The increasingly business-driven model of care among hospice organizations and complexities in the law has led to confusion regarding the objective of hospice care and has opened the door to potential Medicare hospice fraud and abuse. We examine three case scenarios that outline different situations that may constitute or open the door to potential fraud and abuse.
Hospice History
Hospice originated in 1963 with the establishment of an inpatient hospice in London that sought to provide holistic care to terminally ill patients with cancer and their families. In 1969, Elisabeth Kübler-Ross, MD, published a book titled On Death and Dying, which was a compilation of interviews with 500 dying patients. In 1972, Kübler-Ross testified at the first national hearings on the subject of death with dignity, conducted by the U.S. Senate Special Committee on Aging, and the first hospice legislation was introduced in the U.S. Senate but was not enacted. The hospice movement was promulgated by a U.S. Department of Health, Education, and Welfare Task Force in 1978, and, subsequently, by the Centers for Medicare & Medicaid Services (CMS) through the funding of 26 demonstration grants to assess the cost-effectiveness of hospice and to determine what services hospices should provide. In 1980, the W.K. Kellogg Foundation awarded a grant to the Joint Commission on Accreditation of Hospitals to investigate the status of hospice and to develop standards for hospice accreditation.1 The Tax Equity and Fiscal Responsibility Act of 1982 provided coverage of hospice care for terminally ill Medicare beneficiaries who elected to receive care from a participating hospice. The Act established eligibility requirements and outlined covered services, reimbursement procedures, and the conditions that a hospice must meet to be approved for participation in the Medicare program.2
In the United States, hospices have been around for some time. Before the Tax Equity and Fiscal Responsibility Act was passed by Congress, hospices provided care to patients regardless of their ability to pay. In many instances, hospices were nonprofit organizations or were financially supported by such organizations, including county, church, or other civic entities. In the last 10 to 15 years, however, the hospice concept and benefit has flourished. This may be partially attributed to the burgeoning elderly and chronically ill population. To some extent, hospices have captured the favor of the public and even healthcare professionals. This is because hospice care has been viewed by some as a refreshing alternative to modern-day, impersonal, costly, high-tech hospital or subspecialty care, where the mantra is “life saving at all cost” and there is a fragmentation of services. In contrast, hospice facilitates “dying with dignity” through passionate and personal hands-on-care at the end of life. Hospice also has a financial incentive for patients and their families, requiring no co-payment from Medicare and no prior 3-day hospitalization or other requirements, such as admission to a skilled nursing facility. To be eligible to receive hospice services, the patient must have a life expectancy of 6 months or less, as certified by the patient’s primary care physician in writing, which is known as the “Medicare Attestation Statement.”
Title XVIII of the Social Security Act, Section 1861, defines hospice care as services provided to a terminally ill individual by others under a written plan that is periodically reviewed by the attending physician, the medical director, and the interdisciplinary team. Services may include nursing, rehabilitation, home health, homemaker services, medical supplies, short-term inpatient care, and counseling. Short-term inpatient care, including for respite or for acute or chronic pain management interventions, is allowable only on an intermittent, non-routine, and occasional basis, and may not be provided consecutively for more than 5 days.3
The expansion of the hospice concept in the United States has become a welcomed healthcare option for the dying patient and a relief to families, who want their loved one to have the best end-of-life care. This is because hospice services provide a more comprehensive array of services than can be provided in a home or hospital. Although some long term care providers think that nursing homes can provide the same care to their residents, hospices offer additional support services in this setting that may not otherwise be available, such as pastoral care and bereavement counseling services for family members after the patient’s death.
The success of hospice is outlined in a study published in 2004 by Barnato and colleagues that evaluated trends in inpatient treatment intensity among Medicare beneficiaries who were at the end of life by examining Medicare medical provider data from 1985 to 1999.4 The authors concluded that inpatient treatment intensity for all fee-for-service beneficiaries increased during this period and that per-capita hospital expenditures, intensive care unit admissions, and use of intensive inpatient procedures was much higher among decedents. Their hypothesis was that hospital expenditures would have been much higher for the dying patient over this time period if the shift toward hospice had not occurred.4 As early as 1986, experts in the hospice field thought that the success or failure of Medicare hospice would depend on the plan of care, appropriate implementation of the plan, and the hospice team sharing the same philosophy, including the primary care physicians and all interdisciplinary team members.4 It was also thought that the criteria for enrolling a patient into hospice includes an understanding by the patient and his or her family that the intent of the program is for palliation and not cure, and not just certification by the attending physician or medical director that the patient has a life expectancy of 6 months or less.5
The Beginnings of Fraud and Abuse!
After being immune to the federal government’s fraud and abuse investigations for two decades, the hospice community, including community non–Medicare-funded hospices, began an important transition in 1995 when the Office of Inspector General (OIG), U.S. Department of Health and Human Services, announced that Operation Restore Trust, an antifraud investigation originally targeted at nursing homes, home care agencies, and durable medical equipment supply companies, had been extended to hospices in 5 states. Hospices attempted to retain their image as being ethically driven, with volunteerism as their defining principle, amid allegations that included certification of patients as being hospice-eligible despite these patients not meeting the criteria of having a life expectancy of 6 months or less and then discharging them during the unlimited benefit for reasons other than death. In particular, the services provided by hospices on a contractual basis to patients in nursing homes were especially disconcerting. Some hospices were found to be paying nursing homes a higher room and board rate for hospice patients than the Medicaid rate and were paying a fixed amount per day for each Medicare patient whom the facility referred to the hospice. The Health Care Financing Administration determined that it was improper for any money to be exchanged between the hospice and the nursing facility, as this represented a “kick back.”6
Over a decade later in 2007, the OIG issued a report that was critical of CMS’s oversight of the Medicare hospice benefit.7 The OIG determined that hospices were rarely included in federal comparative surveys or annual state performance reviews and that CMS and state agencies rarely analyzed performance data of existing hospices. In addition, data available for evaluation were sparse and lacking patient assessment information, including objective healthcare ratings for the scope and severity of illness. At that time, termination of the hospice by CMS from the Medicare program was the only enforcement option, as monetary penalties or denial of Medicare payments was not an option. As a result of the OIG report, CMS agreed to include hospices in annual state performance reviews and to expand oversight of hospices through the Quality Assessment and Performance Improvement Program.7
Hospice Goals: Who Is Being Served?
By offering a vast array of comprehensive services and promoting the notion that hospices “can do no wrong,” the hospice movement has continued to gain momentum. According to the recent Medicare Payment Advisory Commission (MedPAC) report to Congress, “one driver of increased hospice use over the last decade has been growth in hospice election by patients with noncancer diagnoses, as there has been increased recognition that hospice can appropriately care for patients with noncancer diagnoses.”8 In 2008, patients with such diagnoses accounted for 69% of all hospice users, up from 47% in 1998.8 According to the MedPAC report, “This greater share of hospice patients with noncancer diagnoses reflects substantial growth in the enrollment of such patients” (Table 1).
With the number of patients who are requesting hospice growing, hospice chains and corporations that serve patients in multiple states and regions are competing with smaller hospices and other patient care business for patients, resulting in hospice gravitating to a business model of care. This transition has caused confusion for patients, caregivers, healthcare professionals, and institutions alike, as it calls into question what hospice represents, what the goals of care are, and the benefit-to-cost ratio. For example, is the goal of hospice to provide palliative care to terminally ill patients, offering them the ability to die peacefully and providing closure for the family and caregivers, or is the goal a financial one, with only secondary benefits for the patient and family? While this may seem to be an inappropriate claim, and such accusations would be defended against by hospice physicians, staff, and hospice organizations, the basis for such allegations may originate from specific regulations that govern hospice and what can and cannot be done in this setting relative to life-sustaining versus palliative care or the issue of interpreting a patient’s advance directives.
The statutory requirements for advance directives for hospice patients, which include do-not-resuscitate (DNR) orders, are not located in the hospice section, but in Section 1867 of the Federal law; this is the section that deals with provider agreements. It essentially states that hospitals, skilled nursing facilities (SNFs), home health agencies, and hospice organizations must comply with the requirement to maintain written policies and procedures respecting advance directives as they relate to all adult individuals who are receiving medical care by or through the provider or organization, and includes the following requirements: (1) to provide written information to each patient or caregiver regarding the patient’s rights under state law, whether statutory or as recognized by the courts of the state, to make decisions concerning the patient’s medical care, such as the right to accept or refuse medical or surgical treatment and the right to formulate advance directives; (2) to provide a copy of the provider’s or organization’s written policies respecting the implementation of such rights; (3) to document in a prominent part of the individual’s current medical record whether or not the individual has executed an advance directive; (4) to not condition the provision of care or otherwise discriminate against an individual based on whether or not the individual has executed an advance directive; (5) to ensure compliance with requirements of state law, whether statutory or as recognized by the courts of the state, respecting advance directives at facilities of the provider or organization; and (6) to educate the staff and the community, whether individually or collectively, on issues concerning advance directives.9
The basic premise of this legislation relative to hospices and the DNR status of patients is to allow hospices considerable latitude on their actual service offerings, as long as the services are explained fully to the patient or the caregiver. Some healthcare providers and scholars interpret this law as indicating that hospices cannot require DNR as a condition of admission, stating that a person dying of X may become afflicted by unexpected condition Y and may reasonably want resuscitation attempted so that he or she does not die of condition Y while he or she is waiting to die of X. While this may be true, others have argued that hospices cannot require DNR because they do not want to be responsible for CPR or for patients who still wanted CPR. The same interpretation may be true for a host of other treatments available to hospice patients, such as total parental nutrition, radiation, and blood transfusions.
Nevertheless, the big business atmosphere that some hospices have chosen, where the goal is clearly financial gain, has caused confusion for the healthcare team, patients, caregivers, and public. Particularly worrisome and confusing are the issues of rights and advance directives, which were discussed previously, or the provision of offering DNR versus “full code” for hospice patients. Even more confusion results when a hospice patient is hospitalized repeatedly for diagnoses other than those that led to his or her hospice admission.
The perception by CMS, state agencies, healthcare professionals, and the public that hospice is becoming part of the same old healthcare industry that may not always do what is best for the patient, and that hospice goals of care are becoming increasingly questionable, have left some to conclude that hospices may be “gaming the system” through various “loopholes.” For example, some hospice organizations are allowing and even encouraging patients, their families, and healthcare providers to admit hospice patients to the acute hospital setting for different diagnoses and procedures than are allowable within Section 1867, thereby potentially prolonging patients’ lives through potential or actual lifesaving interventions. As a result, MedPAC issued a series ofrecommendations, which are outlined in Table 2, to Congress in March 2010.8
It also appears that plaintiff attorneys have caught on to the perceived confusion regarding hospice care, which has resulted in litigation against hospices and their employees. When the goals of care are unclear and there is failure to communicate mutual goals between nursing home or hospital employees, the hospice staff, and, most importantly, the patient and his or her family, the risk of litigation is high. What follows are three case scenarios that provide examples of Medicare fraud and abuse as well as situations that open the door to unethical practices in the hospice setting.
Case Scenario 1
Mrs. X is a 92-year-old black hospice patient with advanced dementia, end-stage congestive heart failure, and end-stage chronic lung disease. She is admitted to a nursing home in a rural area in the southeastern United States. Mrs. X has shortness of breath at rest and requires oxygen continuously at 2 liters per minute for her chronic hypoxia. She is totally dependent on staff for activities of daily living and was previously cared for by her daughter at home. At a weekly care plan meeting, it is noted that Mrs. X has full code status, including intubation and ventilator support as per her daughter’s advance directive. The patient’s primary care physician asks the hospice nurse whether the attending physician signed a Medicare Attestation Statement, giving the patient hospice eligibility. The hospice nurse answers “yes.” The attending and physician care plan team members look confused.
Because Mrs. X’s Medicare hospice designation suggests that she has less than 6 months to live, she should have DNR status. The physician signing the Medicare Attestation Statement can be wrong regarding his or her expectation that the patient will die within 6 months, but allowing her to have full code status sends mixed messages to the interdisciplinary team, especially during a medical emergency. Giving Mrs. X full code status also allows the possibility for unnecessary hospitalization and opens the door to potential fraud and abuse of the Medicare system.
Case Scenario 2 Mr. Y is an 88-year-old white patient admitted to the SNF unit of a nursing home in the upper northeastern part of the United States following a fall and recent physical deconditioning. The patient has metastatic stage IV prostate carcinoma, for which he is receiving leuprolide acetate for depot suspension, a palliative therapy. The patient also has a history of long-standing type 2 diabetes mellitus, which is controlled on metformin; malnutrition; glaucoma; and congestive heart failure, classified as New York Heart Association class II. Prior to admission to the SNF, Mr. Y was cared for by his wife at home with the help of a hospice aide. He requires extensive assistance with mobility, bathing, dressing, toileting, and grooming. Over the next 6 weeks, his ability to ambulate improves and he requires only supervision with bathing, dressing, and toileting. His weight also increases from 120 lbs to 135 lbs. Laboratory studies reveal that his serum albumin level has increased from an admission level of 2.8 g/dL to 3.5 g/dL (normal, 3.5-5 g/dL), which is attributed to protein supplementation and dietary supplements provided on admission. He is subsequently discharged to home, but is readmitted to the SNF 2 months later after a hospitalization for an acute urinary tract infection and physical deconditioning requiring physical and occupational therapy. On this admission, his laboratory serum albumin level is 3.8 g/dL and his weight is 150 lbs. When reviewing Mr. Y’s case at a care plan conference, the minimum data set (MDS)/care plan nurse and medical director are puzzled and ask the hospice nurse why he is still receiving hospice care. The nurse does not have an answer.
Although Mr. Y initially met the criteria for Medicare hospice designation, as his general condition had deteriorated because of his multiple comorbid conditions, his physical status and nutritional status have improved, as demonstrated by his weight gain and increased serum albumin level. According to the Medicare hospice definition, Mr. Y does not further qualify for Medicare funding or hospice designation, and he should be removed from hospice, as continuing would constitute Medicare fraud and abuse. Healthcare professionals aware of situations like this should report them to Medicare through the whistleblowers statute and Website at www.medicare.gov.10
Case Scenario 3
Hospice Z. asks a physician who has a primarily nursing home practice to serve as the organization’s associate medical director. The physician agrees to serve with the written contract that he will receive a sign-on bonus of $1500 and an additional $500 for every patient he refers to the hospice.
The physician in this vignette should not agree to serve as associate medical director of hospice Z., as receiving “self-referral payment” is a violation of the Federal Stark Law of 1993.11 Physicians aware of such Medicare fraud and abuse should report it through the whistleblowers statute and Website.10
Conclusion
We believe that the majority of hospices are ethical and provide passionate personal care to patients and their families, allowing patients to die with dignity while helping their families to grieve the loss of their loved one. As has been the case in the past, it is also probable that only a minority of hospices in the United States may be guilty of Medicare fraud and abuse. There is no question that it is the duty of the federal government and CMS to stem the tide of potentially unnecessary services and Medicare spending when potential fraud and abuse are involved; however, healthcare professionals also have a duty to report suspected Medicare fraud and abuse, as those who do are acting in the best interest of patients, caregivers, their profession, and the country.
The authors report no relevant financial relationships.
Dr. Cefalu is professor and chief, and Dr. Ruiz is assistant professor of medicine and geriatrics, Section of Geriatric Medicine, Department of Medicine, Louisiana State University Health Sciences Center, New Orleans, LA.
References
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2. Medicare program; Hospice care-HCFA. Proposed rule. Fed Regis. 1983;48(163):38146-38175.
3. Centers for Medicare and Medicaid Services. U.S. Department of Health and Human Services. www.CMS.gov. Accessed October 25, 2010.
4. Barnato A, McClellan MB, Kagay CR, Garber AM. Trends in inpatient treatment intensity among Medicare beneficiaries at the end of life. Health Serv Res. 2004;39(2):363-375.
5. Brenner PR, Tehan C, Mahoney JJ, et al. The Medicare hospice benefit: success or failure depends on perspective. Caring. 1986;5(10):8-27, 95.
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7. Neigh JE. OIG critical of CMS oversight of the Medicare hospice benefit. Caring. 2007;26(8):66-68.
8. MedPAC. Section 2E. Hospice. Report to the Congress: Medicare Payment Policy. March 2010. https://medpac.gov. Accessed October 27, 2010.
9. Medicare and Medicaid programs; Advance directives—HCFA. Final rule. Fed Regist. 1995;60(123):33262-33294.
10. Federal False Claims Act of 1986. Accessed October 27, 2010.
11. Office of Inspector General. Fact Sheet: Federal anti-kickback law and regulatory safe harbors. https://oig.hhs.gov/fraud/docs/safeharborregulations/safefs.htm. Accessed October 27, 2010.
