Hospice Length of Stay: Balancing Patient Needs Against Regulatory Compliance

Though evidence shows that longer hospice stays reduce costs, providers are still walking a regulatory tightrope.

On one hand, longer hospice stays can lead to improved patient and family satisfaction and greater cost saving opportunities. On the other hand, regulators often treat stays longer than six months or frequent recertifications to be red flags that signal malfeasance.

Hospices must learn to strike a healthy balance to avoid regulatory scrutiny, especially as regulators zero in on longer lengths of stay, according to Howard Young, partner at the law firm Morgan Lewis. Hospice auditing activity in recent years has been particularly “robust” when it comes to length of stay issues, Young said.

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“For a hospice administrator or executive, you really have to be very focused on your length of stay data,” Young told Hospice News in a recent Elevate podcast episode. “Are you in an outlier scenario with your data that Medicare contractors are looking at? Although they don’t publish who and why they select hospices for an audit, it seems pretty clear they’re focused a bit more on those with longer stays.”

Length of stay grows contentious

Questions around appropriate lengths of hospice stay have proliferated in the industry, hinging on the six-month terminal prognosis.

The U.S. Centers for Medicare & Medicaid Services (CMS) and the U.S. Department of Health & Human Services Office of the Inspector General (HHS-OIG) have taken an increasingly harder look at hospice eligibility. This includes close examination of long stays, which some argue is an indicator that patients were sent to hospice too soon.

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“The bottom line is in many ways the same issues that hospices have wrestled with for some time: what’s your average length of stay?” Young told Hospice News.

The debate comes at a time when lengths of stay are on a seesaw.

In 2020, the average length of stay for Medicare patients enrolled in hospice was 97.0 days, according to a report from the National Hospice and Palliative Care Organization (NHPCO). That number reached 92.5 days the prior year in 2019, representing the “largest increase” during the previous five years of incremental growth, NHPCO reported.

However, those numbers fell by nearly five days in 2021 to 92.1, according to the Medicare Payment Advisory Commission. The median length declined slightly to 17 days, down from 18 in 2020.

Nevertheless, longer stays continue to trigger regulatory audits and additional documentation requests. Hospices have been challenged in striking a balance between regulatory requirements and patient needs, particularly when it comes to diagnoses that have unpredictable trajectories, such as dementia and other neurodegenerative diseases, or chronic obstructive pulmonary disease,

Building the case for change

Hospices and stakeholders alike have been building the case for reforming the hospice benefit, particularly in regards to the six-month terminal prognosis requirement, which, stakeholders point out, is designed as a cost saving measure rather than an indicator of patient needs.

But perhaps ironically, patients with longer hospice stays may ultimately save payers more money due to reductions in high acuity and other aggressive forms of care in a patients’ final year of life.

Recent data show that hospice stays of six months or longer can reduce health care costs in a patient’s last 12 months by as much as 11%.

Regardless of length of stay, hospice care saves Medicare roughly $3.5 billion annually — a 3.1% cost reduction, according to the joint report from NHPCO, the National Association for Home Care & Hospice (NAHC), and NORC at the University of Chicago.

“What’s important to state at the outset is that there’s still significant savings from 15 days beyond, even for those with neurodegenerative diseases,” NHPCO COO and interim CEO Ben Marcantonio told Hospice News. “Findings show that patient stays at 15 days or longer on hospice care cost less than [those for] similar patients that didn’t receive hospice care through the course of their illness. Access to quality care that supports that overall experience at the end of life. Results in cost savings should be supported, even when the savings might be a little less in one group than another.”

Even so, the prevalence of aggressive end-of-life treatments persists.

More expensive forms of health care utilization remains a common occurrence in the United States, recent data show.

Researchers from the Case Western Reserve University School of Medicine in Ohio analyzed data for cancer patients between 2013 to 2017, finding that aggressive care in the last 30 days of life was more common among nursing home residents than community-dwelling older adults, at 64% versus 58%, respectively.

Aggressive care has been associated with increased symptom burden, frequent emergency department use and hospitalization, as well as intensive care unit stays, the researchers indicated. It can also cause “delay in accessing hospice programs” and pose “enormous” financial cost burdens on both the health care system and family caregivers, researchers added.

If these trends of high cost health care utilization continue, the potential impacts could reach beyond financial, according to NAHC President Bill Dombi.

“There’s an atmosphere around dementia patients with long lengths of stay risks in hospice, which could create a chilling effect in offering individuals hospice at the right time,” Dombi told Hospice News. “Patients in the Medicare program could benefit significantly if hospice as an option for care was presented fully to patients earlier on for those who are in that large group of people whose length of stay is 10 days or less.”

Navigating LOS challenges with community initiatives

Declines in length of stay during the pandemic have become a pain point for many hospice providers.

Length of stay was among the bumps in hospice segment performance for Addus HomeCare’s (NASDAQ: ADUS) during the fourth quarter. Hospice length of stay reached an average of 90.2 days in Q4, compared to 99.3 days during the same period in 2021.

Length of stay challenges have been rooted in late hospice referrals, according to Addus CEO Dirk Allison.

One area with room for improvement involves patients who are referred to hospice from nursing home settings where median lengths of stay have yet to recover from pre-pandemic levels, according to Allison.

“Hospice patients that were coming on board over the last couple years seem to have been later in their hospice stage, so their length of stay once they came on service tended to be shorter than what we had seen historically,” Allison said in an earnings call. “The question will be whether we start to see that longer length of stay as nursing homes and [skilled nursing facilities (SNFs)] get back after the public health emergency is over. Will it get back to more of the normal approach? Our belief is we will start to see that change over the next year or two. But as to what point it really reverts back to a more normalized level – that’s still a question for us.”

Some hospice providers have seen signs of rebound in length of stay, in part due to ramped up initiatives aimed at improving referral streams and community outreach.

Community outreach efforts aimed in part at helping bridge gaps in patient stay and access have borne fruit for providers such as Kentucky-based Hosparus Health and Maryland-based Gilchrist Hospice Care.

Staff in Hosparus Health’s Ambassador Program engage with existing local leaders to foster trust and stem community relationships. The program has helped the hospice provider to deepen roots into underserved groups throughout their service regions in Kentucky and southern Indiana.

“We’ve seen tremendous impact by engaging existing leaders within those communities that people trust more than us,” Hosparus CMO Dr. Bethany Snider, previously told Hospice News.

Community initiatives can help move the needle around improved lengths of stay, according to Dr. Joseph Shega, CMO at VITAS Healthcare, a subsidiary of Chemed Corp (NYSE: CHEM).

The company last year launched a Community Access Initiative to improve timely access to hospice care. The initiative focuses on educating health care providers across the continuum to help identify eligible patients sooner in their disease process.

VITAS CEO Nick Westfall attributed sequential gains in its hospice length of stay partly to the community initiative in a recent earnings call. Average length of stay reached 103.9 days during the fourth quarter, representing a rise from 97.9 year-over-year.

The community education efforts have led to greater referrals and better hospice conversions, said Shega, with VITAS seeing a higher average daily census tied back to community referrals.

“What we were seeing through the pandemic is such a focus on the hospital in education and resources that really further led to poor access, poor utilization for those that were in the community and needed hospice services,” Shega told Hospice News. “We’ve worked really hard to retool all of our education … to really make sure each session represents the stories of community-dwelling older adults who become hospice eligible. At the same time, ensuring that our care model also has resources in the hospital and the community for those timely referrals, so that we can try to see them the same day and continue to build trust so that they will feel more comfortable transitioning to hospice.”

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