Wall Street sinks its blood-sucking fangs into the non-profit hospice industry

Your loved one is dying and the last thing you want to worry about is whether that person’s end-of-life care is going to be short-changed by the greed of private equity and the nameless, faceless billionaires who are now out to make bank gobbling up non-profit hospices and turning them into money machines:

With the U.S. population rapidly aging, hospice has become a boom industry. Medicare — the federal insurance program for people 65 and older, which pays for the vast majority of end-of-life care — spent $22.4 billion on hospice in 2020, according to a Medicare Payment Advisory Commission report to Congress. That’s up from $12.9 billion just a decade earlier. The number of hospices billing Medicare over that time grew from less than 3,500 to more than 5,000, according to the report.

But with limited oversight and generous payment, the industry is at high risk for exploitation. Agencies are paid a daily rate for each patient — this year, about $200 — which encourages for-profit hospices to limit spending to boost their bottom lines. For-profit hospices tend to hire fewer employees than nonprofits and expect them to see more patients.

Many hospice nurses and social workers are booked for 30-minute appointment slots throughout the day, unable to spend more time with patients if needed. For-profit hospices hire more licensed practical nurses than registered nurses, who are more skilled, and rely more on nurse’s aides to further cut costs. One study found patients in for-profit hospices see doctors or nurse practitioners one-third as often as those in nonprofit hospices. The U.S. Government Accountability Office found in an analysis of federal data from 2014 to 2017 that patients in for-profit hospices were less likely than patients in nonprofit hospices to have received any hospice visits in the last three days of life.

“The main way of making the bottom line look good is decreasing visits,” Teno said.

According to the Medicare Payment Advisory Commission, for-profit hospices had Medicare profit margins of 19% in 2019, compared with 6% for nonprofit hospices.

For-profit hospices also enroll a different set of patients, preferring those likely to remain in hospice longer. Most costs are incurred in the first and last week of hospice care. Patients who enroll in hospice must undergo several assessments to develop a care plan and set their medications. In their final days, as the body begins to shut down, patients often need additional services or medications to stay comfortable.

“So the sweet spot is kind of in the middle,” said Robert Tyler Braun, an assistant professor of population health sciences at Weill Cornell Medical College.

That makes dementia patients particularly profitable. Doctors have a harder time predicting whether a patient with Alzheimer’s disease or another form of dementia has less than six months to live, the eligibility criterion for enrollment. For-profit hospices enroll those patients anyway, Teno said, and stand to profit the longer those patients live. They tend to enroll fewer cancer patients, whose prognosis is generally more predictable but who usually die sooner.

Thus far, private equity has been able to run rampant over industry after industry, including nursing homes, mobile home parks and, of all things, the New England fishing industry.

Now they want to take over an industry which deals with people when they are most vulnerable to exploitation: when they are dealing with a dying loved one.

You can read the rest of Markian Hawryluk’s KHN article here.

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