The authors also found that Medicare beneficiaries living in their homes or elsewhere in the community were more likely to die in a nursing home and less likely to die at home—where most patients would rather be—if a patient received care in a skilled-nursing facility at some point in the last six months of life.
Among seniors who were living in the community and had received the skilled-nursing benefit, 42.5% died in a nursing home, 10.7% died at home, 38.8% died in a hospital and 8% died elsewhere. That contrasts sharply with results for seniors living in the community who had not received the skilled-nursing facility benefit. In that group, 5.3% died in a nursing home, 40.6% died at home, 44.3% died in a hospital and 9.8% died elsewhere.
“This has been a problem forever,” says Carla Braveman, vice president of home and community services at not-for-profit Elliot Health System, Manchester, N.H. “When the patient most needs (hospice), we can't be there because of a payment issue.”
The Medicare long-term-care payment structure gives everyone involved—except the hospice-care provider—reasons to push for a severely ill patient possibly near the end of life to go into a skilled-nursing facility even though hospice care might be the preferred setting.
Though limited to 100 days—with copayments kicking in after 20 days—the Medicare skilled-nursing benefit includes 24-hour oversight, and room and board and must follow a minimum three-day hospitalization. Elderly patients leaving the hospital with the prognosis they don't have long to live may need the kind of high-attention care that a spouse or other family member is unable or unwilling to perform.
In those cases, admission to a skilled-nursing facility as a Medicare patient might seem like an attractive alternative when a patient doesn't have a family member able or willing to provide near-constant assistance. Hospice offers limited respite services to caregivers.
The patient and family also might not have the financial resources to pay for privately funded nonskilled nursing-facility care—also known as custodial care—that would allow the patient to receive Medicare hospice care in a nursing home stay. Armour says it would cost about $6,000 a month to pay privately for a nursing-home stay. Even if it's only for a month or two, many patients and families can't afford it or don't want to pay that much, making Medicare-covered skilled-nursing facility care more attractive because it costs them nothing.
Under rare circumstances, a patient can be treated in a skilled-nursing facility for one condition while still on the hospice benefit for another, but those patients made up less than 1% of hospice patients in the study.
One option for hospice-eligible people leaving the hospital and needing shelter is Medicaid, which will pay for nursing home care—but only if they have depleted all their assets. Applying can be a lengthy and tedious process, and approval for those who qualify often wouldn't come quickly enough for them to enter the nursing home before they die, Braveman says.
Industry executives contacted for this story, including Braveman, don't point the finger at skilled-nursing facilities, even though they may benefit from the situation by getting patients they might not normally treat.
“I wouldn't necessarily blame the skilled-nursing facilities,” Braveman says. “There's no mechanism for payment for the nursing homes.”
The American Health Care Association, a nursing home industry group, estimated that the Medicare Part A skilled-nursing reimbursement is on average $467 per patient a day, including any copayments but not including Medicare Advantage Part C payments. Hospice providers, meanwhile, are paid a base rate of $153 a day in the current federal fiscal year, but can get as much as $896 a day during a “crisis,” according to the Medicare Payment Advisory Commission. The CMS defines a crisis as a situation in which the hospice patient needs at least eight hours of continuous medical care to ease pain or manage acute symptoms, and must mainly be provided by a licensed nurse. Both hospice rates are subject to adjustment for regional wage differences.
Nationally, Medicare paid $31.8 billion for skilled-nursing facility care in 2011 and $27 billion in 2010, according to MedPAC. Medicare paid $13 billion for hospice care in 2010, the latest year for which data is available.
Sentara Healthcare, Norfolk, Va., avoids the financial incentive conflicts between hospice and skilled-nursing care because it offers both types of care, says Bruce Robertson, president of Sentara Life Care, the system's long-term-care division.
Sentara is a proponent of hospice, and recently opened an inpatient hospice facility in Virginia Beach, Va., within an assisted-living facility. The hospice will care for Medicare hospice patients living in the home who need the Medicare program's short-term hospice benefit, a spokesman says. The typical stay would be five to seven days, he says. If the hospice facility is successful, Sentara will consider adding one at an assisted-living facility in Norfolk, Robertson says.