As more use hospice, Medicare sees sharp rise in costs, problems

By Kate Santich, The Orlando Sentinel
Posted Nov. 10, 2011, at 10:26 p.m.

ORLANDO, Fla. — On the final day Elly Barton worked as a hospice nurse last spring, she quit in disgust.

The 74-year-old Winter Park, Fla., woman had been hired as a “crisis care” nurse, assigned to patients considered so frail that they required around-the-clock medical supervision. Instead, Barton said, she wound up “baby sitting” a nursing home patient who needed nothing more than someone to make sure she didn’t “jump out of bed and fall over.”

“I know what the criteria are for crisis care — and this woman didn’t meet them,” Barton said. “And she wasn’t the only one. I was assigned to patients who were supposed to be bedridden and they’d be up cooking for themselves.”

Because of Barton’s presence, though, the hospice organization for which she worked could bill Medicare at the highest reimbursement level, a practice Barton thinks was a big waste for taxpayers.

“This is my money, too,” she said. “I’m on Medicare, and I don’t want the system to be abused.”

Her employer, Hospice of the Comforter in Altamonte Springs, is currently the focus of a whistle-blower retaliation lawsuit by a former top financial executive. The executive, Douglas Stone, said he was fired after urging the CEO and board of directors to investigate Medicare billings that may have led to the organization returning millions of dollars in payments to the federal government.

Hospice of the Comforter officials have strongly denied any wrongdoing and characterize Stone as a disgruntled employee fired for insubordination. They would not address specifics of the case or comment further for this story.

Regardless of whether there was overbilling, as Barton suspects, or simply a difference of opinion about the level of care needed, hospice costs in general have risen sharply in recent years, prompting the federal government to crack down on waste and prosecute fraud.

Officials for Medicare report that spending for hospice care has increased about $1 billion per year since 1998 — to a record $12.1 billion in 2009, the most recent statistics available.

And since 2007, the main propellant of that increase has been the cost of hospice care for nursing home patients, which climbed nearly 70 percent from 2005 to 2009, when it reached $4.31 billion.

The growth parallels a rise in both for-profit hospice organizations — which now outnumber nonprofit hospices — and the rate of troubling compliance issues.

In July, the federal Office of Inspector General issued a report voicing “concern” over the growing number of hospice patients who reside in nursing homes, noting “hospices and nursing facilities may be involved in inappropriate enrollment and compensation.” Nursing home hospice patients tended to require less medical care than average hospice patients and yet have longer stays, givi ng providers a heftier profit margin, the auditors noted.

They also found that for-profit hospices had a greater percentage of their patients in nursing homes and that they were reimbursed, on average, 29 percent more per beneficiary than nonprofit hospices.

When hospice care was first covered by Medicare in 1982, it was seen as a way to lower end-of-life costs and provide a more humane, compassionate setting for terminally ill patients. And in the early years, hospices almost exclusively were not-for-profit organizations that served people dying of cancer.

But in 2003, the tide turned. Jon Keyserling, senior vice president of health policy for the National Hospice & Palliative Care Organization, said at that point the industry began to see more patients diagnosed with conditions that have “far less predictable disease paths,” and longer, more expensive hospice stays. Many of those patients suffer from neurological disorders such as Alzhe imer’s disease.

“There’s more to the story than the limited sample of cases the OIG (Office of Inspector General) looked at,” Keyserling said. “And the tax status of the hospice provider” — whether it’s nonprofit or for-profit — “is irrelevant.”

As he sees it, the still-young hospice industry is merely starting to catch up to other health care providers — hospitals, nursing homes, home health agencies — that have moved from predominantly nonprofit to for-profit in recent years.

But critics say the hospice industry in general has become less about compassion than about mining a golden business opportunity.

Paulette Davis, a 63-year-old Clermont schoolteacher, calls her encounter with a Lake County hospice “a nightmare.” After her 88-year-old father passed away in her home a year ago, she said, shock over the billing statements to Medicare prompted her to call a federal fraud hot line.

“The bills were outrageous,” Davis said. “I couldn’t believe what they charged for about two hours of care a week. … I said, ‘At least make a note that you are being ripped off.’ “

One reason Medicare costs for hospice have risen is simply because more Americans are using it. By 2006, about 40 percent of Medicare beneficiaries who died had opted for hospice care. And by 2007, about 1 million Medicare beneficiaries were enrolled in hospices — more than double the enrollment of a decade earlier.

Keyserling attributes the rise largely to word-of-mouth praise for hospice care. Not only do hospice patients wind up costing the government less money than patients who die in hospitals, he said, but “studies also show that 98 to 99 percent of family members would recommend hospice to another family member. That’s a very high level of satisfaction.”

But there also has been a high level of hospice overbilling. In 2009, for instance, auditors found that 82 percent of hospice claims for Medicare patients in nursing homes did not meet the government’s requirements — resulting in $1.8 billion in excess charges.

http://bangordailynews.com/2011/11/10/health/as-more-use-hospice-medicare-sees-sharp-rise-in-costs-problems/ printed on November 26, 2014