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Hospice Care By Ownership Type

By February 15, 2011Commentary

For many years there has been suspicion about the motives of for-profit health care providers and whether they made money by skimping on care or by only treating relatively healthy patients.  Research in the Journal of the American Medical Association examines potential differences in care related to the ownership of hospices. The number of for-profit hospices in the US has doubled from 2000 to 2007, while the number of not-for-profits stayed roughly the same.  The researchers looked specifically at the Medicare population, where CMS reimburses on a per diem basis, which might create incentives to maximize profits by either patient selection or care decisions.  (JAMA Article)

The researchers found that for-profit hospices had more dementia and non-cancer patients that non-profit ones did, which they interpreted as being an indication that the hospices were seeking patients with longer stays, but needing less skilled services.  On an adjusted basis, however, they found no differences in overall care patterns.  For example, nurse visits were the same and there were actually more home health aide visits, although less use of social workers.  The for-profit concerns had more patients with stays over 365 days and fewer with stays under 7, which could have been manipulation by the hospices of how long the patient was treated, and definitely was related to the difference in diagnoses.  But the reason for the difference in diagnoses was not explored in any causal way.

While the authors do their best to suggest that the results of their research indicate profit-maximizing behavior, they have to acknowledge that the lack of differences in actual care would not support this conclusion.  It is also notable that for-profit hospices actually have higher populations of African-American and Hispanic patients, who often are considered higher cost.  The authors also don’t look at other characteristics of for-profit hospices versus not-for-profit that could account for the differences, for example, reputation or appearance.  People responsible for patients with dementia may be more swayed by those factors since the patient will presumably be at the hospice longer than a cancer patient.  They also do not explore any difference in the quality of care which might also account for physician referral or patient preferences.  All in all, fairly weak evidence of profit-maximizing behavior.

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