After all these years of writing about health policy, I finally attended my first MedPAC meeting the other day. (Not sure what it says about me that I found it interesting.) They recommended a significant change in how hospices are paid under Medicare starting in 2013. Instead of one daily per diem, the rates would be higher at the beginning of a hospice stay and after a death, the two points when care is most intensive. (Transcript here, policy brief here, background from June MedPAC report here) First a bit of back story...

About two years ago, I tried to write an article about the growth of for-profit hospices. I spent weeks on it, and it was a frustrating exercise. I couldn't make it, as some editors wished, completely black and white. Not-profit good. For-profit bad. It isn't that simple; tax status doesn't in and of itself determine whether a hospice provides high quality, compassionate care to the dying. Remember too, there are for-profit, publicly traded, investor-owned chains as well as small for-profits owned by a family or individuals who may just prefer the control they have in the for-profit model, without having to deal with a nonprofit board. In the reporting I've done over the last few years on end-of-life care, I've met families who got excellent care from for-profits, and I have met families who didn't get ideal care from nonprofits. In some parts of the country, most hospice care is for-profit.

I did form some educated guesses about trends, and some opinions about what I'd want for someone I cared about. But there wasn't enough data accessible to me at the time (or to academic researchers I tracked down who were delving into the same topic) to draw watertight conclusions. But now MedPAC has gathered and analyzed data, concluding there are some—not many but some—bad actors in hospice and they tend to be found in the for-profit sector.

The context MedPAC was addressing at this particular meeting wasn't so much the quality of care. Medicare itself in 2008 introduced new rules aimed at making ongoing quality improvement an integral part of how both nonprofit and for-profit hospices operate. (Here's a separate article I wrote on hospice quality). This was more about the intensity and duration of care, and on making sure that hospice does what hospice was designed to do.

Hospice is for the dying. It's for people who are likely to die within six months if their terminal disease follows its likely course. Of course it's notoriously hard to prognosticate how long someone has left. That isn't really the issue here. If a patient doesn't die "on schedule", hospice doesn't expel them (assuming they are still terminally ill and meet legal hospice criteria, that they haven't rebounded or gone into remission.) Some people can and do stay on hospice for more than six months. MedPAC is fine with that. Up to a point.

As a rule—there are and will continue to be exceptions—large numbers of slowly, declining frail elderly people with conditions like Alzheimers should not be in hospice care month after month after month after month. This doesn't mean we don't have to come up with a better way of taking care of this population, of meeting their complex medical, practical, social and spiritual needs. We do. But that's a long-term care problem—a very serious problem that deserves more attention than it's getting right now. It is a palliative care problem, another area that needs our attention. But it isn't the Medicare hospice benefit. Having hospice collect from Medicare a daily fee (about $140/day now with some regional variation) month after month after month when it isn't delivering very much care to the patient (at home or in an nursing facility) isn't a practice MedPAC wants to encourage. Hospice now costs Medicare about $10 billion a year. MedPAC isn't necessarily bound and determined to cut that number; the payment changes it is recommending now are budget-neutral. But it wants that $10 billion spent appropriately. MedPAC wants to pay for hospice care, not for hospices that game the system. The main provider groups understand that, although they want changes made with care, caution and attention to unintended consequences.

The payment changes are not a perfect solution; even the MedPAC commissioners noted the new system could hurt smaller nonprofits, forcing them to get bigger or merge. I know hospice docs who are worried about the impact of payment changes on rural hospices. But here, boiled down, are the panel's recommendations to Congress:

1. Instead of having the same daily rate, pay the hospice more per day at the beginning and the end of the hospice stay when care is more intense. Payments in the middle of the stay would decline. So instead of being linear, it would be a sort of lopsided U.
2. Have more oversight, documentation and accountability, particularly for stays exceeding 180 days. Add an additional outside review for hospices where 40 percent of their patients exceed six months.
3. Look into possible conflicts of interest between hospices and long-term care facilities, nursing homes etc., and examine marketing and admission practices particularly regarding the nursing home population.
4. Collect more data—partly so they can get these new payment rates right when they go into effect in 2013.

Getting those payments right, without creating barriers to hospice care, is crucial. We want to take advantage of hospice's potential to save the system money while also providing great care. Inappropriate long stays cost Medicare money. Very short stays can also cost Medicare more (if patient have already done a lot of expensive aggressive care that, in retrospect at least, seems futile) and can be brutal on the hospice finances as well.

Finding the right balance isn't just hard on a national payment basis, it's also hard for conscientious hospice workers. I saw this when I tagged along with a hospice nurse in LA to visit a stroke patient; would he survive for weeks, months or years in his hospital bed in his living room, with a cross over his bed and his wife hovering at his side? I saw it when I accompanied a hospice doctor from a high-quality nonprofit in Maryland when she did a recertification visit to a frail patient with dementia. The doctor had to determine whether after a few months under hospice care the old woman was still eligible or whether she had stabilized to the point where she really didn't meet the legal eligibility rules anymore, She was doing well at a relative's home, with the hospice team supporting the family. Much better than she had done in the nursing home, when she had bounced in and out of emergency rooms. But was she now doing too well? Did she still belong in hospice? Was she likely to die within six months? Or could she hang on six years? Would she deteriorate if the family lost the assistance of hospice? How would the family caregivers cope without the extra support from hospice? It would be easier for the doctor if we had a home and community based long-term care system to fill in these gaps, or more palliative care services aimed at home-based dementia patients. But we don't. So the hospice doctor did her best. She happened to be seated at the kitchen table when a caregiver, feeding the older wman with sippy cups and child-safe blunt utensils, casually mentioned how much trouble the woman was having eating even soft and mushy foods now, how she had nearly choked the previous week. And she had fallen too, twice. The doctor was perversely relieved by these signs of decline. She could recertify the woman, in good conscience, for another 60 days. The woman died a few weeks later, at home, at peace.