For-profit hospices select patients who require less care, study shows

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OIG collected more than $5.8 billion in recoveries for FY 2013, makes hospice recommendations
OIG collected more than $5.8 billion in recoveries for FY 2013, makes hospice recommendations

For-profit hospices might be admitting more low-cost, lucrative patients, who require less skilled-care than non-profit hospices, a study released Wednesday suggests. Additionally, for-profit agencies average 20 days of care, compared to the 16 days covered by non-profit facilities, according to the study.

Medicare pays hospices a flat daily rate—approximately $143—regardless of a patient's needs. Harvard-affiliated researchers say this policy may create a financial incentive for hospices to admit patients with fewer medical needs. But hospice providers argue that this is an over-generalization.

For-profit hospices were also shown to be more likely to have patients without cancer diagnoses and more dementia patients, which require fewer visits from hospice nurses and social workers.

"Patient selection of this nature leaves nonprofit hospice agencies disproportionately caring for the most costly patients," researchers wrote. "As a result, those hospices serving the neediest patients may face difficult financial obstacles to providing appropriate care." The study was published in the Journal of the American Medical Association.