M. Kay M. Judge, EdD, RNMarjorie J. Wells, PhD, ARNP

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Introduction• The number of persons approaching

the end of life is rising. Health care services for the dying are expensive.

• Resources for paying for end-of-life care are limited.

• Proponents of funding end-of-life (EOL) care cite the human value of respect for life at all points on the life span continuum, including the end of life.

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The Dollar Outlay• In 1995, $1 trillion was

spent on health care services, supplies and service delivery mechanisms. This is the largest outlay in the US national budget.

• An estimated 7.5% of total health care expenditures is spent on .9% of the population in the last 6 months of their lives.

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Public Funding• 73% of deaths occur in the “over

65” population.– Most are covered by Medicare and 13% are

also covered by Medicaid.

• Uninsured die in tax dollar-supported public hospitals.

• Medicare pays 53% of the costs.• Other sources cover some costs:

– Private insurance– Out-of-pocket spending by patients and

families– Contributions of unpaid care givers

+65

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Insurance Coverage: Who Pays for EOL Hospice Care?• Medicare

– 1983 – Hospice care became a covered benefit under Medicare.

• Medicaid– 43 states and D.C. have Medicaid coverage of hospice benefits.

• Businesses – 82% offer hospice benefits.

• Private Insurance• Federal Civilian Health and Medical Program of the

Uniformed Services program.

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Costs, Savings & Revenue

Hospice Third-Party Payers in 1995

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Who Pays for Hospice Care?

• In 1995 actual hospice revenues were: – Medicare, 74%– Private insurance, 12%– Medicaid, 7%– “Other” (e.g., donations, grants, private pay), 7%

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Where Hospice Patients Died in 1995

77%

4% 19%

At homeIn Institutions (e.g., hospitals, nursing homes)Other settings

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Hospice & Palliative Care in the 1990s

Diagnosis Death

Proposed Practice

Curative Treatment

Palliative Care & Symptom Relief

Diagnosis Death

Present Practice

Curative Treatment

Palliative Care

Current & Proposed Allocation of End-of-Life Resources

(Higginson I, Palliative care: a review of past changes and future trends. Journal of Public Health Medicine. 1993)

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Hospice & Palliative Care II• 80% of cancer care resources in developed countries are

allocated for anticancer treatments and curative therapies.– However, cancer pain relief and palliative care constitute only about

20% of expenditures.• Palliative care specialists contend that curative and palliative

care, are not mutually exclusive. – Palliative care resources have typically been limited to the last weeks

or months of life. – This is despite the fact that persons with both life threatening and non-

life-threatening chronic illnesses are not eligible for coverage. • The WHO has proposed reallocation of cancer resources and

that palliative care should be a gradually increasing component of care from diagnosis until death.

(Schonwetter, 1996)

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Personal Costs• One study cited in the EPEC (Education for

Physicians on End-of-Life) Project reported that:– 20% of family members quit work to provide care to someone dying

in their family.– 31% indicated that end-of-life care for a loved one had resulted in a

total loss of family savings.– 40% said process made them impoverished.

• Federal law prohibits denial of care to the critically ill for lack of insurance or other financial resources.

• No law mandates accessibility to good EOL care even for those who have insurance coverage.

• Health plans may place barriers to EOL services.

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Family Caregiving Statistics• Family caregivers provide about 80% of home care services

in the United States.– “Family caregivers are the immediate family, relatives by blood,

marriage, or adoption, partners, or close friends who provide directly or manage the care of people who need medical and non-medical assistance, emotional support, and advocacy because they are ill or disabled. Caregivers are sometimes referred to as personal care assistants or attendants.”

• Almost half of the US population has a chronic condition. • In 1995, 41 million persons were limited in their daily

activities and required care. – This number is expected to reach 72 million by 2050

(GAO/HEHS, 1994; Institute for Health and Aging,1996; Fact Sheet on Family Caregiving, 1998 )

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Medical Care Expenses & Service Types • Hospice benefits under Medicare were designed to increase

access to hospice. • 60% of hospice patients are covered by Medicare. This

program of benefits is bounded by the following features: – Medicare limits the number of qualifying beneficiaries– Encourages efficient and economical home care– Discourages in-patient palliative treatment

• Dichotomy: Acute care coverage encourages short stays and high technology procedures during the stay. Physicians are rewarded for seeing many patients in a short time, for doing procedures and usually receive fee-for-service reimbursement.

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Long Term Care Facilities: Nursing Home Services• The number of patients dying in nursing homes is rising.• Traditional attributes of nursing homes include:

– Low level of physician involvement– Low RN to patient ratio– Low level of community involvement– Large numbers of unlicensed caregivers and concerns about the quality

the care that is delivered. • The implications of these attributes and assumptions include:

– A need for EOL education for nursing home staff, for health care community involvement with nursing homes

– A need for close monitoring of quality indicators for EOL care in this setting.

• Changes are happening: Long term care facilities have begun to provide hospice services to residents needing them.

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Definitions: Hospice Services

• 1) Hospice – a discrete site of care, a free standing facility or a designated area in another institution where services are delivered.

• 2) Hospice – a program that provides, arranges, and consults on services to the dying and their families

• 3) Hospice – an approach to or philosophy of care for dying patients

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Care Services

• The case mix includes: – Short term care patients (those recovering from

surgery or needing intensive rehab services).– Long term care patients (usually people with

chronic illnesses, many of whom could benefit from intensive palliative care).

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Counseling Tips for Insurance Coverage at End of Life• When counseling patients it is important to point out that a

clear understanding of the benefits package is essential when dealing with insurance companies.

• Much of what is required for patients at the end of life can be interpreted as “skilled nursing care” and “medication management.”

• “Home care” can be interpreted as a replacement for hospital care, not an “add on.”

• It is important that patients and families develop a personal relationship with a claim adjuster at their insurance agency; an advocate on the “inside” can be most helpful.

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Barriers to Accessing EOL Care

1) Providing financial incentives for clinicians to provide less care (bonuses based on “productivity,” i.e., the number of patients “seen” each day).

2) Setting time limits on clinicians for patient visits. 3) Requiring prior-authorization for services.4) Creating protocols to govern care; the “one size fits all”

method. 5) Requiring that members be treated only by designated

providers in the “network.”6) Limiting the number, type, and geographic distribution of

medical specialists in the “network.”

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Medicare Barriers to EOL & Palliative Care• Common barriers:

– Medicare hospice benefit is limited to those patients with a prognosis of death occurring within 6 months or less.

– Patients must also be homebound, require intermittent skilled nursing care, physical therapy, or speech therapy.

– Hospice nurses need to establish a trusting, confidant role with the patient and family in order to effectively care for the bereaved after their loved one’s death.

– With good supportive care, many dying people are able to remain mobile (i.e., not homebound).

– There is little outpatient prescription medication benefit unless enrolled in a hospice program for symptom management.

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Reducing EOL Care Costs

• Medicare’s long term financial position is uncertain.– There is a disparity between stated social values and

budgetary constraints for the program.

• Impact of EOL care on overall health care costs is likewise uncertain.

• EOL care does not mean doing less, rather doing differently. – Though there are less invasive procedures in EOL care, it

requires close monitoring and aggressive treatment of symptoms and can be labor intensive for professionals.

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Advance Directives

• A significant increase in advance directives executed by patients, communicated to all family members, and respected by providers would:– Decrease the money spent on

expensive, futile procedures in the last days/weeks of life.

• There are questions about the actual dollar amount of savings in health care expenditures would result.

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New Consumer Choice Strategies • Some think that consumers should be offered an

option to pay for aggressive, but marginally beneficial, treatments themselves. – The usual plan would be to provide comfort services only

at a pre-determined point. • Another option is give consumers a choice related to

“intensity,” “quality,” or “extensiveness” of the insurance programs they can choose from.

• Serious questions exist about consumers understanding of complicated issues presented to them at a time when death is an abstract concept.

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Managed Care • As with other managed care programs,

the cost of managed palliative care can be controlled with limiting access to services.

• “Discharge patients sicker and quicker” mandate

• Managed care could provide excellent EOL care.– the issue is whether or not financial

considerations will override humanitarian concerns.

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Changing Incentives for Intensive ‘High Tech’ Therapy• Futility is defined as: • “a medical conclusion that a therapy is of no value to a patient

and should not be prescribed.” • Probabilistic is defined as:

– A point on a continuum where the probability of cost (physical, emotional, cognitive, financial, resources) vs. benefit is very low, i.e.,1 in 100.

– This can be and is used by patients, families and health care providers to determine the cost of further aggressive therapy.

– The cost savings are questionable. • Studies are limited, but experts are restrained in their

predictions of cost savings. This alone is not a reason to abandon this area of study.

(Miles, 1992)

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Rationing

• Age-based rationing suggests that above a predetermined age, heart surgery, chemotherapy, similar life prolonging treatments would be unavailable. – In theory, rationing tends to focus on preventive services

and those common place procedures thereby giving the community the most bang for the buck.

– In practice, advocates for disadvantaged segments of the population register strong opposition to rationing. The mentally and physically challenged are seen as being particularly vulnerable in this type of plan.

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Value of Palliative Care

• The argument for funding of EOL cannot be made solely on financial considerations. It can be made on arguments including:– Advocating for vulnerable populations, – Appropriate care for designated conditions, – A holistic approach to health care including

emphasis on care at all transitions on the life span continuum.

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Cost of Therapies/Interventions

• Traditional Therapies• 7.5% of the $1 trillion outlay for all healthcare

was spent on care at end of life (.9% of the population)

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Complimentary & Alternative Medical (CAM) Therapies • Include the following:

– Massage, acupuncture, chiropractic care, biofeedback, naturopathy, homeopathy, therapeutic touch, meditation

– More than 70% of Americans have tried these therapies

• Consider the Costs– Massage therapy costs

upwards of $60/hour

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Death Expenses Autopsy

• Autopsy– Cost begins at $300.– Price goes up depending

upon the number of tissues studied and the specificity of the studies.

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Funerals

• In early 1990’s, the “average” funeral cost $4610– Add $1000 for flowers, obituary notices, acknowledgment

cards, burial liners or vaults and special transportation– Add $2400 for in-ground burial