Hospice Leverage Emerging Technologies to Build Efficiency

Hospices are seeking to build new levels of efficiency into their workflows as they contend with COVID-19 headwinds and prepare for participation in value-based payment models. A rising number of providers are turning to emerging technologies to support those efforts including artificial intelligence, telehealth and robotic process automation.

Payment models that are newly available to hospice include the value-based insurance design (VBID) system, often called the Medicare Advantage hospice carve-in, as well as the soon-to-be implemented direct contracting options. A third payment structure, the Primary Care First Serious Illness Population model, was recently delayed indefinitely by the U.S. Centers for Medicare & Medicaid Services. The agency indicated that the program was “under review.”

“COVID has really accelerated what was already occurring — a much more authentic or organic focus on costs, improving outcomes and the patient experience while reducing the overall cost of care,” said Michael Lang, CEO and co-founder of NurseCare.AI. “Post-acute providers are in a perfect situation to implement true efficiencies through tech-enabled care improvements, and hospice in particular is going to need to do this with the value-based reimbursement programs.”


A year into the pandemic, providers are still plagued by the high cost of equipment and supplies, including personal protective equipment and COVID-19 tests. They are also contending with increased need for paid leave for staff and rising rates of turnover in an already competitive labor market. Currently paid an established per diem rate through the Medicare Hospice Benefit, providers have few opportunities to boost their incomes. This makes reducing costs with more efficient workflows a pressing need.

Coupled with this is the opportunity to participate in value-based payments. CMS began testing coverage of hospice care through Medicare Advantage plans beginning in January. The carve-in, according to CMS, is intended to increase access to hospice services and facilitate better coordination between patients’ hospice providers and their other clinicians.

Medicare Advantage plans are offered by private insurance companies approved by the U.S. Centers for Medicare & Medicaid Services (CMS), and include HMO, PPO, and fee-for-service plans among other options. The program represents an integrated care model that promotes coordination of services and provides incentives for quality and patient satisfaction.


One concern among hospices eyeing the program is the potential for lower payments that what they currently receive from traditional Medicare. MA plans often request significant discounts during contract negotiations with providers, offering increased volume to make up the difference.

As hospices move into these value-based systems, cost reductions through improved efficiency is gaining new importance. A key area in this regard is telehealth, particularly during the pandemic when regulatory flexibility and the need to limit in-person contact led to skyrocketing utilization.

“Telehealth is quietly revolutionizing hospice and palliative care. We’re seeing economies of scale with a lot of investment and organizations coming together to provide more efficient service,” said Brian Mistler, president of the palliative care provider Resolution Care. “Companies that can create vertical integration to help more people across the entire lifespan and can leverage technology are in the best position to solve the biggest problems. The real winners will be organizations who can effectively bring technology and quality service together.”

Within a value-based payment arena, hospice providers accept more financial risk associated with caring for patients in exchange for incentives for improving quality or reducing costs. Risk-based contracts with payers are structured around estimates of the expected costs necessary to address the patients’ health care needs. These models typically involve capitation, bundled payments and shared savings arrangements.

In these arrangements, providers must understand how to manage their anticipated utilization and the related expenses, with efficiency and cost control essential to maximizing their margins. They operate on a total cost of care basis, usually with a capitation per member, per month payment. The provider is responsible for the full cost of care and quality of all the members that are enrolled with them.

In some programs, this is a longitudinal risk, or risk spread over a long period of time. In some of the payment models, the risk is episodic, where a provider is responsible for a particular episode of care and a time period that follows the episode.

In either type of risk-based system, data collection and management will be keys to success. Hospices will need performance data to demonstrate their value proposition to MA plans and other payers, as well as to drive efficiency. Hospice providers are using new machine learning tools to identify patients in need of end-of-life or palliative care services earlier in the course of their illnesses and to track outcomes.

Machine learning is a form of artificial intelligence that uses algorithms and statistical models to detect patterns in data and make predictions based on those patterns.

“Hospices are going to need to be able to say, ‘my total cost per member per month in an aggregated pool of patient populations is [a certain amount], and it’s this much better than the market control group,’” said Jeremy Powell, CEO of Acclivity Health. “If they don’t have technology that can look at that level of data, if they can’t serve the patient’s intensity needs, then they’re going to be placed out of position in this new world where the economics of how they get paid are going to change.” 

Machine learning systems can boost efficiency by analyzing patient characteristics to predict changes in their condition. This can allow providers to anticipate their needs and the intensity of service they will require. If a hospice can predict when a patient is likely to expire within the following seven to 14 days, for example, that provider can ensure resources are in place to ensure they receive sufficient care during that time.

“Utilizing technology that can give us a whole picture for patients and families lends itself into being able to provide better bedside care, because we can have much more of a targeted approach,” said Brian Bertram, executive vice president of Infinity Hospice Care, told Hospice News. “We’re not just trying to get everybody a one-size-fits-all type of hospice or palliative care. When you have a limited amount of resources, anything you can do to deploy those resources more effectively is really helpful in hospice care.”

Another emerging technology that is gaining ground is robotic process automation (RPA). This technology can be configured to perform actions within and between systems. RPA uses robots to automate workflows and manage complex and repetitive tasks involving electronic health records (EHR), payer sites and financial systems. RPA systems can be used to automate certain workflows in patient intake, authorizations and reauthorizations and revenue cycle management.

When double checking a patient’s authorization, for instance, a staff member typically has to login to the EHR and enter information from that system into a payer portal, as well as download required documentation and in turn update the EHR with the authorization data. RPA can automate the data entry process, eliminating several steps, according to Joe Randesi, co-founder & CEO, Element5.

“Risk is paramount to participating in value-based payment models. Efficient operations position providers at a stronghold to take on the clinical and financial risks associated with value-based care delivery,” Randesi said. “To improve efficiency, data has played a critical role over the last few years in helping understand bottlenecks. More recently, data-driven decision making has made its way to the hospice and palliative care space.”

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