High costs give palliative care increased industry interest
While a nascent industry of for-profit companies is eyeing palliative care, some believe a more viable response would be for health systems to build out internal capacities.
Efforts to improve palliative care are growing as both providers and payers struggle to control costs and provide quality end-of-life care. A recent Kaiser Family Foundation report found roughly 25% of Medicare dollars are spent on beneficiaries in the last year of life for services including hospitalization, post-acute care and hospice.
Palliative care is medical care that’s been customized to meet the needs of people with complex and serious illnesses. The goal is to reduce stress and improve the quality of life for both the patient and their family through pain relief, symptom control and help managing care and basic living tasks. “Palliative care teams are able to pull everyone together into the same room — not only the family but also the many different sub-specialists — and actually have a conversation about what is medically appropriate for this patient, so that the care plan becomes rational and appropriate,” says Center to Advance Palliative Care Director Diane Meier.
Today, nearly all hospitals with more than 300 beds and roughly two-thirds of hospitals with more than 50 beds have palliative care teams. While the size of the U.S. palliative care market is hard to pin down, the combined hospice and palliative care market totals $31 billion and is growing at an annual rate of 1.4%, according to research firm IBISWorld.
Providing better care
“There’s no question that palliative care teams reduce avoidable crises and rationalize the care so that patients get only the care they want and need,” Meier says. But don’t equate palliative care with rationing, she insists. The way palliative care teams reduce costs is by doing a comprehensive assessment of what the patient and their family actually need and what is most important to them and then aligning the care plan and the way it’s delivered with those things.
Meier recounts the case of an elderly man who showed up repeatedly in the emergency room with intractable lower back pain over a three-month period. On his fourth visit, the attending physician contacted her and a palliative care plan was devised. After determining the appropriate dose of painkiller and showing his wife how to administer his medication, the man was sent home from the hospital. What followed was a home safety assessment. Loose rugs were gotten rid of and grab rails were added to the bathroom, and congregants from the couple’s church began visiting to provide assistance and support. Several years later, the man has not returned to the ER.
As the U.S. healthcare system moves from volume to value, many organizations are embracing palliative care as integral to that shift. Trinity Health, based in Livonia, MI, is a next-generation accountable care organization and participates in many new Centers for Medicare & Medicaid Services payment models, Meier notes. They’re also investing heavily in ensuring that various entities within the health system are developing palliative care capacity.
“The more committed to value a healthcare system is, the more committed to integrating palliative care across the continuum of care they are,” Meier tells Healthcare Dive.
"Hospitals are able to invest in hospital palliative care teams because they can’t afford not to."
Center to Advance Palliative Care
Peoria, IL-based OSF HealthCare launched a palliative care program in 2005. “We developed a framework of standards of care delivery and asked each inpatient operating unit to develop a specific business plan,” says Robert Sawicki, senior vice president of supportive care at nonprofit Catholic health system. “The standards focused on clinical issues and best practices.”
Establishing inpatient care teams required hiring some additional full-time employees at most OSF facilities. The health system also created a system-wide division to oversee these efforts. The program, which is now fully integrated into its ACO, has been a win for patients and OSF. “By focusing on what patients and families truly desire from their care, we find that expensive, unnecessary and potentially dangerous care can be avoided,” Sawicki tells Healthcare Dive.
From a financial standpoint, palliative care will always be a “cost center” in the traditional sense, but it brings a plethora of other benefits, he says. “Specifically, cost avoidance is clear, hospice referrals are up but length of stay is not, indicating that culture impacts this area at least as much as programming,” Sawicki adds.
OSF’s focus on palliative care has spawned an outpatient program as well, which has further reduced costs to the health system.
The crux of the issue is willingness to accept risk, says Meier. “Hospitals are able to invest in hospital palliative care teams because they can’t afford not to,” she explains. “The problem is that once you get out of the hospital, fee-for-service alone will not cover these services. So the more risk-bearing and movement towards value instead of volume a community or a region or a health system is doing, the higher the likelihood that they are investing resources and scaling access to palliative care.”
Rise of for-profit vendors
Meanwhile, a nascent industry of for-profit companies is taking advantage of the workforce deficit and lack of clear financing infrastructure in palliative care to offer services through vehicles like Medicare Advantage plans, Medicaid managed care and ACOs.
“If you’re a fee-for-service Medicare beneficiary, you are out of luck with those programs because they are negotiating for their fees on a per member per month basis with health insurance plans that are accepting financial risk,” says Meier.
“There’s no app for palliative care.”
General Parter, Oak HC/FT Partners
The market leader in the for-profit vendors is Nashville-based Aspire Health, a community-based palliative care call service founded by physician and former U.S. senator Bill Frist. The company, which currently operates in 19 states and the District of Columbia, recently completed a $32 million funding round led by GV, formerly Google Ventures.
Given that hospitals currently drive about 60% of end-of-life care, there is a clear need for innovative solutions to improve care while reducing costs, says Andrew Adams, general partner at Oak HC/FT Partners, who also invested in Aspire Health. However, there hasn’t been an outpouring of venture capital dollars in this segment, he adds.
“There’s no app for palliative care,” Adams tells Healthcare Dive. “It really is a combination of specialized services and then you have to build an operating infrastructure to support those services through centralized functions or technology.” And this all needs to be done in a way that accommodates local needs and preferences, he adds.
Filling a need
While companies like Aspire Health, Landmark Health and Turn-Key Health are filling a need in the palliative care space right now, Meier doesn’t see for-profits as a long-term solution. “It’s a buy, not build strategy. It’s trying to outsource to a for-profit vendor the care of the most complex high-need members,” she says.
A more viable response, Meier believes, is for health systems to build internal capacity — be that a homecare agency, nursing home, office practice of hospital — to meet the needs of seriously ill patients and their families.
Still, she says, mainstream medicine could learn a lot from these for-profits about how to develop a standardized, reliable and responsive product that not only quality care but does so efficiently.
Hospitals also need to address the lack of preparation today’s medical workforce has to care for these patients, Meier says. Health systems need to ensure that “some decent minimum training for all their frontline clinical staff occurs in the core knowledge and skills of palliative care, because every clinician that takes care of sick people needs them,” she says.
To help meet that need, Fairfield University in Connecticut is planning to launch a palliative nursing care curriculum next fall. The Kanarek Center for Palliative & Supporting Nursing Education will teach students to be more “palliative care-ready” to deliver multidisciplinary care, including pain and symptom management, to seriously ill patients.
Telemedicine can be an important tool in palliative care as well, Meier says. For example, efficient, accessible technology-based platforms can help people in rural areas get help for intractable pain or consult with a clinician. They also allow patients to access clinicians after regular working hours.
“We have to be responsive to crises or needs or questions whenever they come up, because if we don’t the patient will end up in the ER and the hospital,” she says.