By: Craig Dresang, Executive Director for Yolo Hospice
Imagine devoting your life and career to the noble calling of hospice, being a Sherpa for end-of-life journeys — and then having to check the stock price of your publically traded hospice company every morning to make sure it is generating enough shareholder value.
What began as a grass-roots movement to improve end-of-life care has become big business. In 1990, only five percent of hospices were for-profit operations. Last year, for-profits dominated the industry, representing 63 percent of hospices.
Fortunately, I can assure our donors and members of the community that Yolo Hospice’s shareholders are our patients and families. Sometimes, we have the privilege of making decisions that on the surface may look like bad business decisions, but are really the best care decisions for our patients.
I’m often asked if status matters. Nonprofit versus for-profit. Having worked in the field of palliative care and hospice for nearly 15 years, I have personally witnessed the difference. Hospice corporations, as opposed to organizations, have an economic incentive to provide less care because they get paid a flat daily fee from Medicare for each of their patients. That means that the fewer services they provide, the wider their profit margin. A recent study in the Journal of Palliative Medicine found that large hospices owned by publicly traded companies generate profit margins nine times higher than those of large nonprofits.
I frequently ask those who inquire about the difference between nonprofit and for-profit programs to check out the facts for themselves. In December of 2014, The Washington Post published an analysis of hundreds of thousands of U.S. hospice records. The study concluded that for-profit companies have transformed a movement once dominated by community organizations into a $17 billion industry, and that patient care has suffered along the way.
On several key measures, for-profit hospices as a group fell short when compared to nonprofits.
According to the analysis, typical for-profits:
- Spend less on nursing per patient.
- Are less likely to send a nurse to a patient’s home in the last days of life.
- Are less likely to provide more intense levels of care for patients undergoing a crisis in their symptoms.
- Have a higher percentage of patients who drop out of hospice care before dying.
Last February, researchers from the Icahn School of Medicine at Mount Sinai in New York released one of the first studies to look at the impact of for-profit versus nonprofit hospice status. What they determined is that there are major disparities between the two groups, and that nonprofit programs are much more involved in staff training, education, research, and charity care, and that patients are twice as likely to receive a full range of services and support. Additional studies conclude that for-profits “cherry pick” patients to minimize expense and maximize profit.
Fortunately, because of generous community support, Yolo Hospice has always been able to provide superb care, free-of-charge, for patients who have no health coverage or financial resources. In addition, the organization offers a robust and no-cost adult and pediatric bereavement program to the community, a Veterans program, and family navigation services. Clearly, at the end of the day, status matters as much as our community’s generous and continued support.
P.S. Many thanks to everyone who made a gift to Yolo Hospice during the region’s Big Day of Giving. This year, we raised over $40,000, exceeding last year’s total by more than eight times. Indeed, this level of support is what helps sustain Yolo County’s community treasures. And in the end, it is our patients and families who are the real beneficiaries of your generosity. Thank you!