Saving money while improving quality of life

I have a post in the Health Affairs Blog titled “Saving Money While Providing Benefit in Medicare: A Standard Applied Only to Hospice.” Go and read it.

Here is a tag to many posts I have written on similar hospice policy themes if you want more.

The counterfactual in long term care

I was looking at assisted living facilities for my grandmother yesterday and then beginning to navigate the ongoing family discussion about what is best for her (age 89; she still lives alone but has been hospitalized 5 times in recent months) and my mother (age 70), who is increasingly feeling unable to navigate the current situation. There are of course many other people involved: my sister (who lives near both my grandmother and my mother), my step dad, and my uncle who lives about 50 miles from my grandmother. I have become “expert” at assessing such facilities, and have devoted a great deal of my finite creativity over the past 18 months to navigating complicated family long term care situations. I put expert in quotes, because for all that I know about long term care, mixed now with personal experience, it is a truly difficult decision to decide what is best. In large part, this is because there are so many people involved and affected, along with the existence of many sources of uncertainty.

One thing has become clear

• most people reflexively compare the (truly) high cost of something like assisted living to a cost of zero. “Oh my goodness, that is expensive!” is a correct statement, but it wrongly implies that the default, or current arrangement has a cost of zero.

The costs of the current living/long term care arrangement for my grandmother or anyone else can be difficult to estimate

• explicit costs such as paying for walkers, home modifications and paying helpers is straightforward
• implicit costs to caregivers are harder to estimate: the value of time, missed work, worry/anxiety/depression, feeling like you cannot travel, other health impacts, etc.

There are benefits of caregiving, such as connection with loved ones and of course the preferences of my grandmother are important. All of the costs and benefits must be netted out to make a decision. As with the societal level decision of what to do about long term care, having straight the counterfactual is the first step to making the best decision you can.

New paper confirms hospice reduces Medicare costs

A new paper in Health Affairs by Amy Kelley and colleagues shows that hospice reduces Medicare costs as compared to what they would have been had hospice not been chosen by the patient over a variety of common lengths of use in the Medicare program.

The paper is in many ways a replication of the 2007 study (funded by the HCFO initiative of RWJ) that I did with colleagues at Duke that found mean savings after the point of hospice election of just over $2,300, and that the savings (hospice costs after election as compared to normal care) were maximized with a length of hospice use of between several weeks and a few months.

Kelley et al.’s paper goes beyond ours in that it controlled for functional status of persons in hospice measured at a finer level than could the work that we had done. This lead to reasonable wonders about the impact of potentially important omitted variables in our work. The work of Kelley and colleagues has confirmed and extended our general finding that hospice saves Medicare money after accounting for the fact that patients choose hospice–and therefore are systematically different from those who do not. They identify larger savings very near death than did we. It should be noted that in addition to controlling for functional status variables that were omitted in our work, the current paper also is done on more recent data years (2002-08; our paper went back into the 1990s-2005). For example, they find hospice reduced Medicare costs by $2,650 for hospice stays of 1-7 days; $5,040 for those lasting 8-14; and $6,430 for stays of 15-30 days. Given that the median length of hospice use is around 18 days in the Medicare program, over the most typical range of use, hospice should be encouraged, and policies to increase use identified. The ‘short stay’ problems should not be forgotten while trying to address problems related to very long stays.

I know of nothing else that improves quality of life of patients and routinely reduces costs that is paid for by Medicare.

A word on data. The Health and Retirement Survey (HRS) is a massive, long term data effort funded by NIH for the past 20 years. HRS enrolled panels of patients and followed them over time. Amy’s paper took advantage of the joining of self-reported data on function collected in such surveys, to Medicare claims data that documents use and cost paid by the Medicare program. Such collection and linkage and time consuming, expensive and hard. Without the foresight of NIH to invest in data, this paper would not exist. A hole remains in the hospice literature because Medicare Advantage plans do not have to make claims data available as a matter of course. This makes no sense for a nation trying to address cost, coverage and quality issues in health care. update: when Med Advantage patient elects hospice they revert to Part A. The difficulty of claims from Medicare Advantage is a general problem.

If you enter the search term hospice into the blog sidebar, you get many posts on hospice policy if you want to read more.

Note: paper is gated; working on a clean link.

Amy S. Kelley, Partha Dah, Qingling Du, Melissa D. Aldridge Carlson, R. Sean Morrisson. Hospice Enrollment Saves Money for Medicare and Improves Quality Across A Number of Different Lengths-of-Stay. Health Afffairs 2013;552-61.

Hospice and functional decline

An interesting new paper in the Journal of the American Geriatrics Society (JAGS) on different patterns of functional decline (ability to walk, eat, cognition) among persons who were in hospice care and ultimately died. The most important point of the paper is that there is great heterogeneity in ability to function, even on the last day of life.

In an inverse probability–weighted sample of individuals who had a PPS score recorded in the last day of life (n = 1,959, 22.6%), 35.9% had a PPS score of at least 40, indicating some oral intake, variable mental status, limited self-care, and an ability to get out of bed for at least part of the day. [my note: PPS in this context is a standard functional status measure often used in hospice and palliative care settings; 10 is quite poor, 90 is very good]

Two points on hospice policy here, both related to MEDPACs great interest in (shortening) long stay hospice users. First, over one-third of patients in this sample had reasonable functioning on the day they died. This shows the difficulty of predicting death with any precision, even among the subset of patients enrolled in hospice (all patients in this study died, so this is not an issue of discharging alive from hospice). Second, table 2 from this study demonstrates the current reality of hospice as not simply being used to treat Cancer; a broader set of conditions including dementia and debility(or frailty) are also included.  Such conditions tend to have a less clear disease course than does Cancer. Both the difficulty of predicting death, and the spread of hospice into non Cancer diagnoses (which has been a stated goal of Medicare hospice policy), have likely contributed to the  increase in relatively long hospice stays that have drawn so much policy attention. More work to demonstrate the link between functional status and length of hospice use/patterns is likely to be an important part of any Medicare hospice payment reform.

Pamela Harris, Esther Wong, Sue Farrington et al. Patterns of Functional Decline in Hospice: What Can Individuals and Their Families Expect. Journal of the American Geriatrics Society 2013 online first.

Bill Keller’s piece of end of life care

Bill Keller has an insightful piece on end of life care in England v. the USA, using the example of the recent death of his father in law. First, let me say that it is brave for a family to share such a personal story, and I want express condolences to the family.

A few policy thoughts on Keller’s piece:

• I agree with his notion that focusing on end of life care with the expressed purpose of saving money is likely to prove not only politically difficult, but it is hard for such efforts to work. That is because the “last year of life” is an inherently retrospective concept, and you don’t know when the last year started, until it ends. This makes it very hard to know when to shift into “cost saving” mode.
• One interesting note is that the proportion of total spending using the “last year of life” metric in the NHS is quite similar to that in the U.S. The tremendous difference is in the level of spending (on the order of $2 for $1 per capita) between the two nations.
• The citation Keller uses from Zeke Emanuel on limited cost savings of hospice is from 1994 and there is more recent work that does demonstrate that hospice reduces Medicare expenditures as compared to similar non-hospice users that has been published in the past several years (sorting out selection bias is a tremendous methodological challenge in this literature, meaning those choosing hospice differ from those who don’t in ways the impact health spending). One of the papers that sorted this out is my paper with colleagues from Duke. There are others.* I reviewed a new paper two weeks ago for a top journal that actually confirms and extends the findings from my paper (while including a richer set of matching variables). So, hospice remains just about the only thing of which I know that holds out the hope of reducing costs while improving quality of life (typically we are left to assess whether something with a marginal benefit at greatly increased cost “is worth it.”
• A reality is that the hospice benefit was “sold” in 1982 as a means of cost savings when it was added to the Medicare program. A recent paper of mine on some of this history.
• Medicare hospice policy greatly needs to be updated. The insanity of “death panels” and our inability to talk reasonably about something that will happen to each of us (death) greatly hinders good policy. My book frames this inability to face limits as a key source of inability to reasonably address health care costs.
• The antidote to what I have termed insanity, is to seek to ask three basic questions about all care, regardless of our belief about someone’s prognosis: does it improve quality of life? does it extend life? how much does it cost? These questions need to become part of our broad cultural dialogue about health care, as well as explicit parts of evidence based policy making.

For example, see:*Pyenson B, Connor S, Fitch K, Kinzbrunner B. Medicare cost in a matched hospice and non-hospice cohorts. Journal of Pain and Symptom Management 2004;28(3):200-12.

Shugarman L, Campbell D, Bird C, Gabel J, Louis T, Lynn J. Differences in Medicare expenditures during the last 3 years of life. Journal of General Internal Medicine 2004;19:127-35.

Medicare as insurance innovator: the case of hospice

I have a new paper* that is available online now at the American Journal of Hospice and Palliative Medicine.

The stylized fact is that Medicare has produced many insurance payment innovations (DRGs, prospective payment of hospitals, RBRVS), while private insurance has tended to innovate on the benefit side of the equation. The creation by Medicare of the hospice benefit in 1983 stands as a notable exception. The paper lays out the linkage between Medicare and private insurance coverage of hospice.

Interestingly, hospice is the only part of the Medicare benefit package that is carved out of the Medicare Advantage program. I am unsure of why this is the case. I believe it is likely related to the fact that hospice was created as a demonstration in Medicare as part of TEFRA 1982, as was what I think was the first private insurance option in Medicare. After both parts were later mainstreamed into Medicare, I think they were just never joined. However, it is also possible that it is related to the politics of hospice and end of life care generally. Those politics have only gotten worse (more hysteria, less reasoned discussion) in the last few years. I will be writing more about this and you have thoughts about why someone who elects hospice while in a Medicare Advantage plan reverts to FFS Medicare for hospice, let me know.

This is particularly important because of the strong sense from most hospice and palliative medicine experts that the Medicare hospice benefit needs to be updated, but that it is viewed as politically very hard to address policy focused on end of life. It is an important issue since ~8 in 10 deaths that occur in the U.S. each year occur in persons who are insured by Medicare.

Discharge from hospice alive

Paula Span recently wrote about hospice as a shield against unwanted medical treatments that provided the space for an elderly Medicare beneficiary to get better. The irony is that the family she writes about had to choose the option associated with imminent death to be able to take their mother home and allow her to receive competent care that her adult children could trust; eventually, she was discharged alive from hospice. Work that I did with colleagues at Duke shows that around 15% of Medicare beneficiaries who begin hospice are discharged alive (85% of Medicare beneficiaries choosing hospice used such care continuously until their death, an average of 50 days later; median 15 days, Group 1 below).

The Big Impact Tournament: Hospice Wins!

Modern Healthcare held a ‘tournament’ to determine what “one person, event, organization or innovation had the biggest impact on the health care deliver system in the past 35 years.”  And the winner is, a No. 12 seed, hospice! In the final, hospice defeated the Institute for Healthcare Improvement. On the way to the Championship round, hospice ‘upset’ such heavyweights at Electronic Health Records, and the release of the IOM report, To Err is Human. On the way to the final, IHI had to beat its founder, Don Berwick. That match up must have all of Cambridge, MA on edge, much as the first Wednesday of February has Durham and Chapel Hill hyperventilating over each season’s first UNC v. Duke battle. The tourney was decided by votes online.

While on its face it seems surprising that hospice would win (a No. 12 seed!) in fairness, I cannot think of anything else that Medicare pays for that is said to improve quality of life and actually reduce Medicare spending. Typically, we are left asking whether something that improves quality of life is worth the extra cost. Even the fact that hospice would be expected to deliver value while reducing cost is quite remarkable. I can’t think of any other intervention that faces that type of expectation. Can anyone else?

Hospice Policy-What is the Problem?

Chris Langston in the Hartford Foundation’s health AGEnda blog has a nice post summarizing some basic information on hospice and asking what are the key policy questions that need to be addressed. This new flurry of hospice discussion has been sparked by the recent NY Times story on for profit hospices, along with research peer review research that also raises questions about profit status and the delivery of hospice care. There are several big picture policy issues as I see them:

• Medicare hospice policy needs to be updated because the basic regulations are unchanged since 1983. In particular, the language of having to ‘unelect curative care’ in order to access hospice makes no sense. If we could ‘cure’ the disease in question we would. What they meant was you have to unelect ‘the default in the health care system which is aggressive care.’ We need to modernize the language.
• We need to get straight the distinction between hospice and non-hospice palliative care. Non-hospice palliative care could be viewed as care that addresses symptoms regardless of prognosis. Hospice is a subset of palliative care that is for persons who are believed to be in the last 6 months of their life.
• We need to move toward concurrent palliative care, which means addressing symptoms before a person is viewed as ‘dying’, but do this in a way so that CMS doesn’t think that what we are actually doing is developing a back door long term care benefit. This is a key issue since ~90% of hospice paid for by Medicare is provided to people in their homes.
• We need to determine the linkage between use, cost and quality of all of these services. Most research has looked at use and cost, or use and quality of hospice or palliative care. You need to know all three to be able to evaluate the appropriateness of care or to determine if it is ‘working’ or ‘worth it.’ I have two research studies underway on this, and hope to have preliminary results in the Fall.
• Note that for a variety of reasons, including the fact that the introduction of the hospice benefit in the early-1980s was sold at least partly on the basis that it would not increase overall Medicare costs and so would ‘save money’, hospice care in particular has been evaluated differently from just about everything else that Medicare pays for. For example, no one asks if a new chemotherapy, or a left-ventrical assistive device improves quality AND SAVES MONEY. The question is does it improve QOL and/or extend life and how much does it cost to do so. There is nothing else that Medicare purchases that I can think of that is expected to provide benefits AND SAVE MONEY. I realize I have helped to drive this expectation by publishing papers such as this.
• All of this has to be done in the current political environment in which when in doubt, politicians accuse their opponents of wanting to ration care, kill my grandmother, etc. Shocking as it may seem, this does not help us develop better policy.

Do for profit hospices milk the system?

An article in the June 27, 2011 raised questions about inappropriate use of hospice in the Medicare program, especially by for profit providers. I am at Myrtle Beach this week and trying to stay off grid, but I have gotten several calls and emails from people asking me about this (so have failed to stay fully off). Below is a post that is reproduced from my old blog back in February, 2011.

The news story in the NY Times is factually correct, but misses the main point. What we really need to know is the relationship between use of hospice, cost and quality of care. In many ways this is true for the entire health care system. We often focus on cost, or on quality, but you need to look at cost and quality at the same time to figure out if care is ‘worth it’ or not. The post below from February 2, 2011 provides a fuller context in which to discuss hospice and the overall health care system. This follow up post from the following day (that is not reproduced below) provides even more context.

Back to the beach….

*************

Do For Profit Hospices Milk the System? That is essentially the background question asked by a paper out today in JAMA that looks at the association between the hospice agency type (for profit [FP], not for profit [NP]) and how they differ in terms of patients cared for and for how long. A related question that is framed by the paper is whether the payment policy used by Medicare to reimburse hospice care should be changed. Before discussing the paper, let me say that the paper by Wachterman et al., like most work in this area (including work I have done showing the hospice reduces Medicare expenditures) leaves out something very important: the quality of care that is provided for the money spent. The authors readily note this as a limitation.

The paper has two basic findings. FP hospices are more likely than are NP hospices to:

• treat patients who do not have Cancer. [17.2% in FP, v. 8.4% in NP had a diagnosis of Dementia]. Patients with Cancer represented 34.2% of FP patients v. 48.4% in NP.
• provide hospice for a longer period of time prior to death. The median length of use (half the patients stayed shorter, half longer) was 20 days for patients treated in FP v. 16 in NP. The 75% percentile showed even larger differences with 1 in 4 users staying longer than 88 days for FP v. 52 days for NP. And 6.9% of patients cared for by FP hospice providers used hospice for longer than 365 days v. 2.8% who were cared for by NP providers.

The paper further shows that patients with primary diagnoses other than Cancer received less intensive services while receiving hospice than did hospice patients with Cancer. This would make the FP hospice patient mix more profitable than the NP patient mix since the payment would be the same, while the amount spent providing care lower for FP providers (this is not inevitable, but was observed).

Hospice provides interdisciplinary care for persons who are dying and have decided to forego curative treatments in order to receive hospice based palliative care, which is care that focuses on treatment of physical symptoms, psycho-social concerns, planning and family concerns. A phyisican must certify that death in likely within 6 months for the initiation of the hospice benefit in Medicare (though patients can receive services for longer).

The Medicare program began covering hospice in 1983, which helped to legitimize the concept in the U.S. health care system. Currently, nearly half of the decedents in the Medicare program (which insured around 8 in 10 persons who died last year) choose to use hospice prior to death. Hospice was initially conceived of primarily to care for persons with Cancer, but has spread to other diseases, which have a less predictable time course to death. The spread of hospice beyond Cancer provides the opportunity to provide needed care to more patients, while also making more likely longer periods of hospice use prior to death. Most hospice care is provided in patient’s homes, but can also be provided in institutional settings.

Hospice is one of the few remaining types of care that is reimbursed on a per diem basis, which means that a fixed amount of money is provided to a hospice provider for each day a patient is enrolled. The incentive with such a payment approach (for the provider) is to provide more care, since the costs of hospice are higher in the first few days (intake period) and last few days prior to death, when physical symptoms tend to be acute. So, a longer length of hospice use means providers have more days with lower costs, while receiving the same per diem payment, thus maximizing their payment. Long periods of hospice use raise concerns about inappropriate, wasteful or perhaps even fraudulent use (the current Medicare hospice benefits stipulates 6 months as the presumptive period of eligibility, though you can receive such care for longer).

It is worth noting that very short periods of hospice use raise quality concerns. In the study noted above, 28.1% of persons using a FP hospice died less than a week after initiating such care, as compared to 34.3% of those care for by a NP hospice. In fairness, that could be taken as evidence of FP hospices outperforming NPs. Very short periods of hospice use lead to worries that patients are not able to realize the full benefits of what hospice could provide in the way of symptom relief and other benefits, and may be a signal of poor quality care. Colleagues of mine who are hospice and palliative care providers tell me that 4-6 weeks of hospice is likely needed for a patient to achieve the maximum benefits.

There has been an ongoing discussion and recommendation from MEDPAC to change the Medicare hospice payment to a so-called U-shaped approach in which higher per diem rates are paid for the first several and last several days of hospice care, acknowledging that the care needs and therefore costs of patients during those days are higher. And dropping the per diem costs for the in between periods when patients are stable, and costs of care are lower.

This general change in payment policy seems reasonable to me, and could lessen the incentive to over-provide, but there is something missing from this calculus.

What about quality?

In one sense, hospice has passed the market test, and there is research that shows that patients and families are satisfied with the care they receive in hospice. However, a good deal of this work is based on retrospective reports of families who basically say that hospice was there when my family needed them, when we were in a difficult situation. But, the question remains, what is the length of hospice use that maximizes benefits? Can an empirical basis for the gut of my colleagues that 4-6 weeks of hospice use maximizes benefits be obtained? How steep is the slope of the curve? How much extra benefit would be gained from moving a person from a 5 day to a 15 day length of use prior to death? Likewise, if a payment policy reduces the extreme long outlier cases, how bad will it be in quality terms if the median drops from 20 days to 15 days?

These questions cannot be answered with any certainty given the current evidence.

The figure above shows that the Medicare margin for hospice providers (avg. margin in 2001-06, figure is an approximation of a MEDPAC figure) increases with length of use, meaning simply that it is more profitable for hospice providers the longer a patient uses in hospice. This shows hospices losing money on the lowest 3 deciles of length of hospice use (say, less than 10 day stays). Margin rises steadily beyond that, showing that longer lengths of hospice use are more profitable for hospice providers. What remains unknown is the quality curve, which is hypothetical in the graph above. Knowing the shape of the quality by length of use decile relationship is really needed in order to make Medicare hospice payment policy with full information.

I recently received a grant along with an oncologist colleague from Duke Amy Abernethy, to essentially estimate the quality by length of use relationship shown in the figure above for both hospice care but also for non-hospice palliative care in patients covered by Medicare and other insurers. This is possible because of painstaking work (not done by me) to develop a cohort of patients receiving such care in a variety of settings, with quality being prospectively measured in patients covered by different types of insurance.

Amy and I have written that end of life is the fools gold of health reform, meaning that focusing on time to death will likely disappoint as a cost savings strategy because of how difficult it can be to make an accurate prognosis. However, a focus on value of care (does this extend life? does this improve quality of life? how much does this cost?) can likely improve quality while reducing costs. And the Medicare program and end of life situations is an important place to focus such questions since diminishing returns to expenditures designed to forestall death eventually set in given that everyone eventually dies, and 8 in 10 decedents were insured by Medicare last year.

To engage this discussion in an evidence based manner means we have got to not only look at cost or quality, but consider both together. This is true for hospice policy, and for health policy generally.