Cost Savings, Rising Awareness Boosting Palliative Care Growth

The track record of palliative care providers helping patients avoid hospitalizations and readmissions is a significant driver of their growth. Rising awareness of the nature and availability of palliative care is also promoting utilization of these services, though providers continue to wrestle with the limited avenues for reimbursement.

More stakeholders are beginning to realize the cost-saving potential of palliative care. Community-based palliative care can reduce total health care costs by 36%, a Turn-Key Health paper indicated. These services can also reduce hospital admissions by 48%, resulting in 28% cost savings per patient day.

Home-based palliative care could reduce societal health care costs by $103 billion within the next 20 years, the nonprofit economic research group Florida TaxWatch said in a 2019 report.


“We’re seeing this rapid interest and influx of practitioners within this space, because it meets the value equation within health care of increasing quality while driving down cost,” said Christopher Kerr, CEO and chief medical officer of Hospice & Palliative Care Buffalo, at Hospice News’ Palliative Care Summit. “We’re essentially in an insolvent system if we keep hospitalizing and taking care of complex illness by recurring readmissions with intense intervention. There’s an enormous opportunity to do things differently.”

About 50% of community-based palliative care providers are hospices, according to the Center to Advance Palliative Care. A rising number of hospices have been diversifying their services to engage patients further upstream and take advantage of emerging value-based payment models, with palliative care as one of the most common new business lines. 

Historically, palliative care providers to a large degree have used a moral argument to market their services. Palliative care was simply the right thing to do. In today’s environment, demonstration of cost savings is coming to the fore as providers work to educate referral partners and payers about the value they can bring, Kerr told Hospice News.


This proposition is paying off for providers, many of whom are seeing substantial growth as awareness of palliative care and its clinical and financial benefits becomes more prevalent.

“Palliative care is our fastest growing service. Providers and patients are understanding more about palliative care,” said Tracy Wood, CEO of Alleo Health, at the Hospice News event. “The home is where patients want to be, and they want to have that holistic approach to care.”

Promoting greater awareness will be key to palliative care growth. As many as 71% of people in the United States have little to no understanding of what palliative care is, including many clinicians in a position to refer patients to palliative care or hospice, according to a 2019 Journal of Palliative Medicine study. This includes many clinicians in other health care fields.

While no standardized definition exists for “palliative care,” the U.S. Centers for Medicare & Medicaid Services (CMS) defines the term as “patient and family-centered care that optimizes quality of life by anticipating, preventing and treating suffering. Palliative care throughout the continuum of illness involves addressing physical, intellectual, emotional, social and spiritual needs and to facilitate patient autonomy, access to information and choice.”

Even as palliative care utilization expands, Alleo Health’s Wood cautions about pursuing too much growth too quickly.

“It’s important to understand what your capabilities are and to not forget what you set out to do, provide that holistic approach to care,” Wood said. “It is not an easy feat to have a well-run palliative care program that is growing super fast. Definitely understand what your limitations are and know what you’re getting into.”

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