Recent allegations that staff at HCA Healthcare (NYSE: HCA) put pressure on patients to enter hospice dovetail with longstanding questions over how and when patients should be referred.
A recent report from the Service Employees International Union (SEIU) alleges that HCA has pressured clinicians to inappropriately “push” patients and families to accept hospice referrals. The report pointed to several contributing factors, including financial incentives for executives who have a track record of reducing in-hospital deaths and expansion in HCA’s own hospice operations.
While SEIU has acknowledged that its report does not contain conclusive proof of malfeasance, the union called on HCA and federal regulators to investigate the accusations.
”When we’re looking at the sources that we have, all these matters are public, but we don’t have medical records. We don’t have all the personal things that are really between the caregiver and the patient,” Joe Lyons, research coordinator for SEIU’s health care division, told Hospice News. “It’s hard to say that you have proof. At the same time, it’s really hard to picture what could have occurred there without some sort of corporate involvement. This looks really questionable.”
SEIU analyzed Medicare claims data showing that the average hospice transfer rate among HCA hospital discharges was nearly 40% above the national average in 2021 and represented a 50% growth rate over four years.
Its report alleges that this in part occurred because HCA put pressure on families to choose hospice in order to reduce inpatient mortality rates and maximize profits.
HCA Healthcare is among the nation’s largest hospital systems, which employs more than 294,000 people, including 45,000 physicians. The company operates 180 hospitals and roughly 2,300 sites of care and earned close to $16 billion in the first quarter of 2023.
Regarding the SEIU report, the hospital system has denied any wrongdoing.
“This is not a serious report. It’s propaganda filled with misleading and absurd accusations that are not supported by facts,” an HCA spokesperson told Hospice News in an email. “It is simply untrue and wrong to suggest that medical care in HCA Healthcare hospitals is based on anything other than a physician’s independent medical judgment of what is in the best interest of a patient.”
During the past several years, HCA has closed a number of home health and hospice acquisitions. Among the most prominent was its 2021 purchase of an 80% stake in Brookdale Senior Living’s (NYSE: BKD) health care services segment for $400 million.
SEIU called out this transaction and others as potential motivations for the alleged pressuring of patients, citing HCA’s stated intent of expanding the business.
The potential influence of health care trends
The accusations against HCA could be counterbalanced to some degree by larger trends in the health care system.
For one, hospice utilization has been on a steady upswing nationally for several years. More than 1.72 million Medicare beneficiaries elected the benefit in 2021, up from 1.43 million in 2016, according to the U.S. Centers for Medicare & Medicaid Services (CMS).
Also, across the board, more health care has been steadily moving into the home setting, particularly in the wake of the pandemic. This has led many hospitals and health systems to make their own investments in home-based care, including hospice, a development that HCA CEO Samuel Hazen noted in a 2022 earnings call following the Brookdale deal.
“[Brookdale home health and hospice] provides us with a large platform that complements our local provider systems,” Hazen said. “Additionally, we believe the home will become a more important setting for health care in the future, with continuing growth in demand.”
We believe the home will become a more important setting for health care in the future, with continuing growth in demand.-HCA Healthcare CEO Samuel Hazen
Other major health systems have made similar moves, either through acquisitions, joint ventures or by developing their own in-house programs. Examples include California-based Kaiser Permanente, one of the nation’s largest integrated health systems, as well as Adventist Health and Aspirus Health System, among others.
Large payers have also jumped into the home-based care bandwagon.
In February, the UnitedHealth Group (NYSE: UNH) subsidiary Optum closed its $5.4 billion acquisition of the home health and hospice company LHC Group. Optum subsequently made a bid on Amedisys Inc. (NASDAQ: AMED), a proposed all-cash transaction equivalent to $100 per share.
This followed Humana Inc.’s (NYSE: HUM) $5.7 billion purchase of Kindred at Home in 2021. The insurance giant has set a goal of covering nearly 50% of its Medicare Advantage members under a value-based home health model within the next five years.
Both insurance companies cited the growing prevalence of home-based care as a driver for these investments and expressed similar intentions to grow those businesses.
“We have an opportunity to more deeply and effectively serve people in their homes,” UnitedHealth Group’s President and COO Dirk McMahon said in an earnings call last year. “Nearly all the patients we’ll add this year in fully accountable, value-based relationships will have access to support through our home-based platform. Consumers value and benefit from services delivered in the home and we’ve expanded our capabilities to serve that need.”
But even with these considerations in mind, Lyons contends that HCA remains an outlier.
“It gets really difficult to make the claim that this is the response to some sort of national or even regional change in policy or anything like that when you see this kind of deviation,” Lyons said. “One of the big things for us is this system, this huge system is doing this without respect to geography, and it doesn’t match what we see their peers doing. So that leads very strongly to those kinds of questions — What are they doing, and why is it different than everyone else?”
The cost-of-care conundrum
On the surface, one could make the argument that an increase in hospice referrals and reductions of inpatient deaths is a positive trend that aligns with patient preferences as well as the overarching drive to reduce the nation’s massive health care spend.
Policymakers routinely wring their hands over the long-term solvency of the Medicare program, and CMS has spent years designing a slough of payment models and demonstrations that aim to reduce the total cost of care. Examples include Medicare Advantage, Accountable Care Organization (ACO) models and Medicare Shared Savings Programs to name a few.
This has prompted payers, providers and policymakers to take a closer look at lower-cost care settings, including the home.
“I don’t know that there’s enough access to hospice and palliative care services,” Rep. Joe Morelle (D-N.Y.) told Hospice News. “When I look for ways to make sure that we try to drop the cost of Medicare per person, hospice and palliative care are attractive to me, because the more we utilize that, the lower costs can drop.”
Patients themselves have also indicated a preference to spend their final days at home.
Close to 70% of adults in the United States say they wish to die in their homes, but only 9% said they would choose to pass away in a hospital, according to the Kaiser Family Foundation.
Moreover, families frequently give feedback that they wished their loved ones had entered hospice earlier in order to reap the full benefits, often via Consumer Assessment of Health Care Provider and Systems (CAHPS) surveys, according to the National Hospice & Palliative Care Organization (NHPCO).
So, on one hand, patients do benefit from hospice care, and those services do reduce health care costs. On the other, you have the ethical dilemma of ensuring that patients enter hospice at the right time, in accordance with their wishes, without undue pressure from the hospice or the referring provider.
The SEIU report refers to an executive incentive program used by HCA that includes inpatient mortality as a metric, which may have partially prompted the alleged pressure on families.
The company’s Performance Excellence Program (PEP) rewards executives based on three categories — performance on health care-associated infections, morbidity and mortality, and patient care experience.
Among the determining factors is a metric called the Mortality Index, which is partially calculated based on the number of inpatient deaths, SEIU reported.
The union alleges that this compensation structure rewards low in-hospital mortality, which can be reduced via hospicel referrals.
While this in itself is not proof of malfeasance, reports have circulated about hospitals (beyond HCA) urging hospices to accept patients who are on the verge of death in order to reduce inpatient mortality rates.
NHPCO cited these concerns in its comments on CMS’ 2024 proposed hospice rule.
“Hospices are getting increasing pressure to admit the hospital’s patients who are very near death in order to avoid the death being included in the hospital’s mortality statistics,” NHPCO indicated in a letter to CMS. “If the hospice does not agree to admit these patients, many of whom may have only hours to live, at the [General Inpatient] level of care, they risk not receiving referrals from the hospital in the future.”
Hospices are getting increasing pressure to admit the hospital’s patients who are very near death in order to avoid the death being included in the hospital’s mortality statistics.-NHPCO in a comment letter to CMS
The industry group did not comment specifically on the HCA allegations.
SEUI, however, did bring forth similar concerns in its analysis. According to its report, nearly 1 in 5 Medicare fee-for-service beneficiaries who were discharged into hospice from an HCA hospital died on the same day they left the facility.
“That is a strong outlier from national trends; in 2021, HCA’s system average rate of roughly 18% is more than double the national average,” the report indicated. “In short, our findings from this data analysis lead us to worry that the potentially perverse financial incentives to transfer hospital inpatients to hospice may be affecting the related care decisions at HCA hospitals. These data trends are especially concerning since HCA has been rapidly expanding in the hospice/home health space in recent years. “
Independent of SEIU’s research, NBC News on Wednesday released its own investigation into HCA’s hospice discharge practices.
According to their report, NBC interviewed six nurses and 27 physicians who have worked at 16 HCA hospitals in seven states, some of whom are still employed by the health system.
“All said their HCA hospitals pushed palliative and end-of-life care in pursuit of better performance metrics,” NBC News reported. “Internal HCA hospital documents and texts between hospital staffers provided to NBC News support these health care professionals’ views.”
These clinicians reported told NBC that they were pushed by “HCA officials” to pressure patients into electing hospice in order to reduce mortality rates and free up beds for new inpatients.
In some of these cases, patients were officially discharged from the hospital but expired before they could leave the building, NBC News reported.
Though the news outlet’s account corresponds with some of the concerns raised by SEIU, including ties between executive compensation and mortality rates, its report stated: “There is no direct evidence that HCA’s palliative and hospice care push was intended to increase its executives’ pay.”
According to HCA, pinning executive rewards to quality measures is a good practice that can drive improvement.
“The SEIU has a distorted view of health care and seems to not understand that providing quality care and saving lives is a good thing. Length of stay and mortality rates are two common metrics used by CMS and others in health care to measure hospital quality,” an HCA spokesperson said in an email. “We believe aligning our leaders’ compensation with quality is not only the right thing to do but also supports our focus on continuous quality improvement.”
We believe aligning our leaders’ compensation with quality is not only the right thing to do but also supports our focus on continuous quality improvement.”-HCA Healthcare spokesperson
But some complaints about HCA have come from the inside.
In 2018, a physician employed by HCA, Dr. Santosh Potdar, filed a False Claims Act lawsuit in federal court against HCA and one of its affiliated physician groups, Access Healthcare Physicians.
The complaint described a web of alleged unethical and fraudulent practices, including kickbacks, reportedly generating millions of dollars in cost savings.
Though the document does not focus exclusively on hospice, it alleges that patients, particularly those in Medicare Advantage, were denied necessary or appropriate care in order to maximize margins on per-member, per-month payments.
Potdar in 2020 withdrew the complaint after the U.S. Department of Justice and the State of Florida decided not to pursue it at that time, though those agencies indicated that they reserved the right to intervene “for good cause at a later date.”
Despite this outcome, Lyons told Hospice News that the lawsuit, coupled with the information in their analysis, should raise questions about the company’s actions.
“We can see that people are raising these questions inside the system. So it’s not just a peculiarity of data,” Lyons said. “If there is a system that has shown repeatedly that the benefit of the doubt isn’t really warranted, it’s this system. It’s really hard to look at these patterns and not really start to get worried.”
Dispelling misconceptions about hospice
While NHPCO refrained from weighing in on HCA, the organization did voice concerns that some portions of the NBC News story would perpetuate misconceptions about hospice care.
In a statement, NHPCO pointed to three aspects of the report. Its first concern was an apparent implication that end-of-life conversations between clinicians and patients involved “playing God.”
This was referenced in NBC’s headline for the story: “’You’re not God’: Doctors and Patient Families Say HCA Hospitals Push Hospice Care.”
Secondly, NHPCO took issue with statements that patients “typically don’t live long” after entering hospice, citing length of stay data from Medicare Payment Advisory Commission (MedPAC). The median length of stay in hospice care is 17 days and the average lifetime length of stay is 92.1 days, MedPAC reported.
The third issue was a sentence indicating that hospice patients “typically only receive pain medication.”
“While pain management and symptom control are core to hospice care, patients are offered so much more,” NHPCO said in the statement. “By definition, statute, and regulation, hospices provide interdisciplinary care driven by patient goals.”
While SEIU’s report did not make similar claims, Lyons said the organization hopes that their finding will spur further investigation without dissuading patients from considering hospice care.
“Our priority is making sure that the people who are trained, the people who got into this business to actually take care of patients, are able to make those decisions with their patients, without having the non-medical administrators weigh in, without having algorithms dictate the care that an individual patient receives,” he said. “I don’t want that extra scrutiny on hospice. That is not our perspective. Our perspective is very much to let caregivers and patients and patient families make the decisions on their own.”