Hospice: What are the Costs Involved with Hospice Care?

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Sally Smith: Welcome to Age to Age. I'm Sally Smith. Let's talk. We're interviewing my good friend Angus Baker today. Angus is a physician who has been in the practice of Hematology and Oncology for 30 years, before becoming the director of Charleston Hospice. He's the Medical Director. We thank you very much for being with us today.

Dr. Angus Baker: Thanks, Sally.

Sally Smith: Thank you for coming. What are the costs of hospice? We've talked a little bit about what is hospice and why it developed. We've talked a little bit about how you become a hospice patient. Everything in this world of health care, we know care is the cause. Nursing, administrating, health professionals, your menu of services is so complex and in all encompassing that there must be serious cause. What is the average daily cost of hospice?
Dr. Angus Baker: Well, as many things with hospice these days, it's really organized by the hospice Medicare benefit, the majority of the patients are Medicare or Medicaid. The Medicaid model for cost coverages is the same as Medicare.
What Medicaid does is they pay hospice an amount everyday, that hospice is responsible for providing all services and supplies and equipment or whatever needed for that patient's care for that disease. This is good from medicines, the doctors, the nurses, home health aids, hospital beds, whatever and balance transportation if they needed that, hospitalization if they needed that.

What Medicaid does is like a capitated thing and a lot of people, patient and physicians, and all those, don't understand when they see it that hospice gets a certain amount per day if hospice didn't come to see you on that day, why do they get paid?. Most hospices don't make any or little of any profit. Ours makes a little more than a non-profit organization but pretty much breakeven.

Medicare pays the hospices something like around $115 to $125 a day for care for patients. Well, that includes all their medicines for their illness, if patients on chemotherapy, radiation therapy, or have an operation, then it covers that. It covers the nurse coming to see them, usually a couple of times a week, social workers as needed, chaplains, home health aids, physical therapist if needed and any of all these things that were already mentioned.

Sally Smith: Well, I'm stunned. I am stunned.
Dr. Angus Baker: That's for home care. That amount is for home....
Sally Smith: But that's a power kit. You're talking about hospitalization, every kind of crisis care, medicines. I'm amazed that that works, that you're able to survive with that.

Dr. Angus Baker: Well in actual fact, most hospice patients don't need those things as part of the reason that can work is that one of the primary effort of hospices is to provide comfort and dignity at or near end of a patient's life that very often, pain medicines or relaxing medicines, nausea medicines, they might not be necessary. Usually, chemotherapy, radiations, operation room visit are usually not needed because you have the caregiver in your home.

If you have an emergency, the nurse comes to your home and very often at end of life, better care can be provided at home with the attendance of these professionals than it can be by operating, going to the hospital emergency room, waiting for hospital emergency room for several hours, be in the middle of the hospital, when often hospital care is really not helpful at the end of life.

Sally Smith: Well, you know it's so interesting because I grew up with a father who is a physician and the day when you still made house calls, he was a pediatrician.

And now, wouldn't it be divine to think all those people could have just knocked on the door and the health care comes to them as they did in their age and that another reason's people go to hospitals and good reasons. But honestly, you're right! If the end of the life, would I go to the waiting room, for many hours if you could avoid it, I think they're getting a bargain by itself.

If a family was interested in hospice, this is the estimate they would get. In other words, if they said from that care about what I expect to spend. And you want to get let's say you just gave Medicare, he set this kind of amount and it covers everything.

Dr. Angus Baker: And what I didn't say is Medicare does it. In essence, covers everything that there might be some co-payers I would say unofficial in most hospices aren't really diligent about expecting people pay their co-payers. It may be required the son of patient the bill by Medicare or regulations as well but in our record they already collected it.

So most hospices, if not all hospices, really expect that the payments from Medicare or of the insurance companies will cover that cost. And they don't expect the patients to, and in substantial way, could cover their own cost.

Sally Smith: So that sounds such of allotment to me to figure out how you would pay.
I will say one way you could pay is you just write a check. You could pay with personal money if...
Dr. Angus Baker: ...to get hospice care if you didn't have Medicare?
Sally Smith: ...to get hospice care if for someone who's a new or out of the system, you could pay. But then you could have Medicare or Medicaid, which you said both have the same price tag.
Dr. Angus Baker: Yeah. And the same rules...yeah.
Sally Smith: Whether you're part of those programs or not, but it does cover hospice and it covers all hospice that it has accredited as a credited hospice.
Dr. Angus Baker: So now if somebody has may be cancer of the throat and they also have diabetes that can kill, might not provide care for the diabetes but the regular Medicare would pick up for that. And they could have regular Medicare for you. Non-terminal illness but hospice Medicare would cover your terminal illness.
Sally Smith: Well, that's a fascinating concept because sometimes these things have duality too. If that were the case, and someone was dying from say cancer but they also have diabetes and Medicaid would pay for the diabetes, could the hospice doctor be paid to give that so they don't have to go to the hospital for it?
Dr. Angus Baker: Very often the hospice doctor or the attending physician whose providing hospice care will take care of the whole patient's...
Sally Smith: So that's allowed.

Dr. Angus Baker: But say medicine, that's what we really think about of a diabetes medicine or insulin or something, might have to be paid for through the usual Medicare ways or the insurance ways but not by the hospice. Of course, if it's not related to the terminal illness.

Sally Smith: Are there many instances where people have trouble getting the insurance to cover this sort of thing?

Dr. Angus Baker: Never with Medicare or Medicaid. Each private insurance comes in here as contract. Some of them have no hospice care coverage. Most of them have some. Sometimes, it's very specific about how it can be given or not given. For private or health insurance policies who also have look into the details and the patients have to do that but usually most of what the patient needs is covered by the insurance that they have - a decent private insurance policy.

Sally Smith: I see. So usually, since this is in majority covered, there are not people that end up with from huge amount like can happen in hospital stays where they are paying out for 10 years afterwards and having to work out some sort of a credit plan. That's not something that you have to traffic with very often.

Dr. Angus Baker: I don't think that ever happens at all, not from hospice care.

Sally Smith: Well, I was interested in another thing I read which is some hospices have what they call open access, where they won't turn a person away for inability to pay. In other words, if a person is somehow outside of the safety net of Medicare of Medicaid, they will not be turned away. Is that because you get donations to cover this or ... ?

Dr. Angus Baker: Well, two answers to that. One is that all hospices are required to be able to show that they do a certain amount of care to people who cannot pay anything. And I think it might be somewhere in the range of 5 or 10% of their patient care should be. And even in some hospices if they haven't got referred any indigent patients lately, they get a little nervous because they don't want to be found to be not sufficient in providing indigent care.

Sally Smith: [Laughs] They're going out and looking for that!

Dr. Angus Baker: Well, that's the least to make sure that they don't turn out anybody away or accidentally or whatever. Another thing about that, you mentioned open access. Open access is generally a term that we use for patients who probably do have insurance but they are coming to us on chemotherapy on their expense, and some of the chemotherapy drugs, and some are cancer-related drugs, or even on dementia drugs or Parkinson's drugs can be very, very expensive, especially the cancer-related ones can be $20,000 a month or something like this.

No hospice can do that routinely and survive. But sometimes in open access will take somebody with on those drugs temporarily and if as we expect most hospice patients I know will offer those pretty soon because they're not helping, then, that's not an issue. Whether if we solve and give them the needed care.

Sally Smith: What would be considered criteria for getting the free ride and being not part of a program that accepts you and then having a very expensive care that would not be able to be maintained with your $120 a day sort of thing?

Dr. Angus Baker: Well, that's our problem, not the patient's problem. If this is just of something that we cannot survive, we'd go out of business with the particular patient then we'll probably say that we cannot take care of the patient on a certain drug. But the idea of Medicare inspection is not toward what they do, what they call 'unbundle the services' if you know, "Take a patient, he needs these things", then you need to provide all of the cares needed.

And if a patient really is getting a very aggressive care, that is not symptom-related, not comfort-related at the last six months of life, they were might very well suggest that patient would do better not on hospice care until that aggressive disease oriented care instead of comfort-related care is finished.

Sally Smith: I have to say I'm so fascinated with you being able to pull it off, with the numbers of people, the amount of drugs, the comprehensive-themed plan, the whole deal. I've got to ask, I mean our hospital studying how you can extend this to the last ten years of life and have some sort of a comprehensive day plan for people with other illnesses because it sounds to me like you've captive very well considering the cost that you hear about from anybody who comes to the hospital for regular stay.

Dr. Angus Baker: One thing that hospitals are giving everyone is what they call palliative care programs. It extends the same concepts of end of life, comfort care, people may or may not be end of life, what part of care consultancy and we do that in our hospice is trying to figure out who is at the end of life, who is benefiting and not benefiting from the current therapies and how to help them make these decisions.

Sally Smith: Wow, it's fascinating. I want to thank you so much Angus for talking to us about hospice today. Also, I want to thank my producer Betsy Reeves, web administrator Sujit Kara. Thank you to all of our listeners too for joining us today. We welcome your suggestions and invite your comments on our website. This is Sally Smith, Age to Age, saying goodbye and wishing you courage and joy on your journey. We are all connected.

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