Hospice Financial Outlook Brightens as Facilities Loosen Restrictions

Hospice providers have struggled to access facility-based patients during the coronavirus pandemic. Restricted access to facilities has hit providers hard financially and diminished the availability of care for patients. Thanks to widespread vaccination, facilities in some regions are re-opening to visitors, including interdisciplinary hospice teams. This trend is improving the outlook for providers’ business during the second half of 2021. 

Long-term care and skilled nursing facilities have been among the hardest hit by the deadly virus. Hospice providers vyed to improve access to facility-bound patients as closures went into effect nationwide, typically relying on telehealth to reach the nursing home and senior housing populations.

Many hospice leaders believe that states’ relaxation of COVID-19 shelter-in-place restrictions would positively impact their businesses. Last year more than half of hospice providers responding to a Hospice News survey indicated that they believed their organizations would benefit from states’ reopening, compared to 30% of respondents who stated it would have a negative impact.

Advertisement

“While the reopening has helped to normalize operations and financial expectations, it has made the biggest impact on patient care,” said Catherine Dehlin, regional vice president of operations and sales for Three Oaks Hospice. “Having the entire complement of [interdisciplinary team (IDT)] professionals providing care to nursing facility patients has greatly enhanced our clinical outcomes, family satisfaction and relationship with the facility staff.”

All of the facilities serviced by Three Oaks Hospice now allow hospice nursing visits, according to Dehlin. However, only about 40% to 50% are allowing all interdisciplinary team members into the facility.

Oregon remains the only state without a reopening date established, while New Mexico plans to reopen in July, The New York Times recently reported. Currently 47 states have eased restrictions and mask mandates. Even with state mandates lifting, facilities can still limit access of their own accord. 

Advertisement

The availability of vaccines was a key factor in updated national guidance from the U.S. Centers for Disease Control & Prevention (CDC) for nursing homes to safely begin reopening.

Cases of COVID-19 have been declining in recent months, with a little more than 14,100 new cases reported last week. By comparison, the nation saw more than 15,100 weekly cases at the close of May and upwards of 54,400 new infections at the end of April, according to the CDC.

Hospice referrals from nursing homes and senior housing remained low compared to pre-pandemic levels for most providers. Even hospices that saw a rise in admissions suffered financially due to reduced lengths of stay, as facility-bound patients are typically referred to hospice earlier than others.

VITAS Healthcare, a subsidiary of Chemed Corp. (NYSE: CHEM), reported that their nursing home referrals were down 26.2%. Despite promising signs of recovery, patient access varies by region, according to VITAS CEO Nick Westfall.

“It’s really market-specific; it’s local,” said Westfall in a Q1 earning call. “That has consideration towards how many new referrals we get from those settings as opposed to the ability for us to continue to access existing patients in those settings to provide care.”

Industry giants Encompass Health (NYSE: EHC) and Amedisys (NASDAQ: AMED) reported similar results. Despite overall strong performance in their hospice segments, length of stay was down.

Hospices will need to carefully navigate reentry into nursing home facilities. While facility expectations for entry continue to evolve, this requires hospice agencies to be innovative and anticipate the impact to operations, according to Dehlin. Understanding each facility’s policies is key to ensuring safety and  compliance.

“The extreme highs and lows of nursing facility census creates difficulty in predicting hospice staffing requirements and ensuring hospice staff are both available and meet the requirements for entry,” Dehlin told Hospice News. “This has added extra costs and burdens on back-office staff. Recognizing those rules and regulations and providing educational resources to facilities enables them to navigate the regulations quicker and with more success.”

Companies featured in this article:

, , , , ,