Access to Palliative Care and Hospice in Nursing Homes

Nursing homes are common sites of terminal care. The United States has an aging population, and by the year 2030, 23% of the population will be aged 65 years and older.¹

Nearly half of Americans who live to 65 years of age will enter a nursing home before they die.² Two thirds of persons who consider a nursing home their usual place of residence will remain in the nursing home until death.³ In the 2 most recent years of the National Mortality Follow-back Survey, the probability that a nursing home will be the site of death increased from 18.7% in 1986 to 20.0% by 1993.^{3 - 5} Current health care trends, including aging of the population and pressures to decrease hospital and home health costs, are likely to promote the use of nursing homes as a site for terminal care.

Most nursing home residents have incurable chronic diseases, and more than half have been diagnosed with a progressive dementia.⁶ Patients in the final stages of chronic physical illnesses or dementia often prefer treatment that emphasizes pain management and supportive care for themselves and their families, while limiting use of life-prolonging therapies.^{7 - 8} Palliative care is comprehensive interdisciplinary care designed to promote quality of life for patients and families living with a terminal or incurable illness.⁹ It includes expert pain and symptom management, emotional and spiritual care, and bereavement support for survivors. These services are typically, though not exclusively, delivered by hospice providers. Palliative care may be offered at any point during the course of illness, but reimbursement for hospice services is usually limited to the final 6 months of life expectancy.

Hospice care in the United States was originally conceived as a home-based service to support family caregivers, but in 1989 the rules for the Medicare hospice benefit were clarified to include residents of long-term care institutions. The nursing home hospice population expanded from 7.7% of all Medicare hospice beneficiaries in 1989 to 17% in 1995.¹⁰

Despite this rapid growth, hospice care reaches very few dying nursing home residents. Only 1% of the nursing home population enrolls in hospice care.¹¹ Similar numbers of Medicare beneficiaries die in nursing homes and in private homes, yet those who die at home are more likely to receive hospice care. For example, in 1997 in North Carolina, 19% of deaths occurred in nursing homes and 22% in private homes. During the same year only 13% of hospice enrollees were in nursing homes, while 87% were in private homes.¹² Furthermore, access to hospice care in nursing homes varies markedly by region, and 70% of nursing homes have no hospice patients.¹¹ Nursing home residents are unlikely to receive hospice care prior to death, and access to care may be more influenced by the facility or county in which they live than by their preference for treatment.

Surviving family members report greater dissatisfaction with nursing homes than with any other component of terminal care.¹³ Residents increasingly forgo life-sustaining treatment and hospitalization, but these decisions are not linked to effective plans for palliative care.^{14 - 15} Usual nursing home care results in high rates of untreated severe pain^{16 - 19} and provides little or no support for bereaved family members.²⁰ On-site palliative care programs in nursing homes are rare but may improve pain management or reduce costs.^{21 - 24} Two studies provide evidence that hospice services improve quality of care in nursing homes. The first study asked families of nursing home hospice enrollees to compare quality of care before and after enrollment in hospice. The addition of hospice care increased favorable ratings of symptom management from 64% to 90%. Family respondents identified unique hospice services, and 53% believed hospice care reduced the need for hospitalization.²⁵ The second study used the Minimum Data Set to compare clinical outcomes for dying nursing home residents with and without hospice care. Decedents with hospice care had improved pain management, decreased hospitalization, and decreased use of feeding tubes.²⁶

Although nursing home residents benefit from palliative care, few facilities have staff with this expertise and their use of hospice care is limited. Several aspects of current health policy limit nursing home residents' access to palliative care and hospice, including emphasis on restorative care and reimbursement mechanisms.

Nursing homes provide housing, nursing care, and rehabilitative services for people with physical, cognitive, or behavioral impairments. Residents typically require help with 3 or more activities of daily living and often seek care in nursing homes because they lack a family caregiver or access to home-based services to meet their dependency needs.¹

Federal policy emphasizes rehabilitation and restoration of function as the goals of nursing home care. Following an Institute of Medicine report documenting uneven and often seriously neglectful care in nursing homes,^{27 - 28} the US Congress passed landmark legislation aimed at improving the quality of care and quality of life for residents. Nursing home reforms codified in the Omnibus Budget Reconciliation Act of 1987 define the primary goal of care to be "to attain or maintain the highest practicable physical, mental, and psychosocial well-being of each resident."²⁹

To improve the quality of care, subsequent regulations require the use of a comprehensive, uniform assessment system for all nursing home residents focused on "identifying treatable, reversible causes of functional limitations and on restoring and maintaining function."³⁰ The Resident Assessment Instrument (RAI) was developed as a consequence of this mandate. The RAI consists of the Minimum Data Set, a 9-page form documenting residents' status on a wide range of indicators, and a separate set of in-depth Resident Assessment Protocols. These in-depth assessments are triggered by the presence of specific health conditions thought to be indicators of inadequate treatment. Some of the expected signs and symptoms of terminal illness—functional decline, weight loss, and dehydration—are used as indicators of potentially treatable illness. Assessment protocols assume that care plans will include treatment to reverse these conditions. The RAI does not include protocols for palliative care outcomes such as symptom control. Use of the RAI has corresponded to temporal improvements in the prevalence of the target conditions but has not led to improvements in other important outcomes such as pain control.³¹

The restorative focus of the RAI assessment system is reinforced by surveys of all nursing homes based on the same data. Since 1999, surveyors receive periodic summary reports that compare 24 quality indicators within a specific facility with average rates. Surveyors use these data to plan their investigations. If they determine that conditions such as functional decline or weight loss were medically avoidable, they then recommend penalties. While this process has promoted improved care for reversible or preventable conditions, it does not include quality standards specific to the needs of residents suffering or actively dying from progressive incurable illness. Clinical experts have proposed adding standards for palliative care in nursing homes, such as documentation of advance directives and pain management plans, but these quality indicators are not emphasized in the current survey process.^{32 - 36}

Reimbursement policy also encourages nursing homes to focus on restorative care. While Medicaid covers a larger portion of nursing home costs, Medicare provides higher reimbursement for restorative care following hospitalization. The Medicare skilled nursing benefit covers skilled nursing and therapy, and many facilities attempt to maximize the number of resident-days with this coverage. Beginning in 1999, Medicare reimbursement rules require that a new resident be prospectively categorized in 1 of 44 Resource Utilization Groups (RUGs). Each RUG has a different reimbursement rate, but the highest rates are for intensive rehabilitation or procedural nursing skills such as intravenous medications or tube feedings. Reimbursement rates are lower for intensive personal care services, symptom management, and emotional and spiritual care needed in terminal illness. For example, per diem payments are more than $300 to treat a resident with a hip fracture who requires intensive rehabilitation and intravenous feedings. A nursing home would receive about half this rate to care for an equally dependent resident with metastatic cancer and a pathologic hip fracture who needs intensive pain management, assisted feeding, and treatment for depression. As with the RAI-based quality standards, Medicare reimbursement rules assume that rehabilitative care and medical technology are more costly to provide, and that restoration of function is the rationale for economic valuation of services. The RUG categories do not acknowledge the many hours of nursing and social work needed for skilled pain and symptom management, personal care, and emotional support during dying. Therefore, this payment structure may fail to cover the cost of palliative care or create financial incentives to promote restorative care or use of medical technology.

Medicare covers the majority of hospice care (65%), with smaller proportions of funding from private insurance (12%) and Medicaid (8%).³⁷ Medicare and most other insurers pay a per diem amount to the hospice providing services to a nursing home resident.^{38 - 39} With this payment the hospice program covers a range of services related to the terminal illness including nursing care, medical equipment, outpatient drugs, short-term inpatient care, aide services, social services, spiritual support, and counseling. Hospice programs must also provide 1 year of bereavement support to family and to nursing home staff as part of the overall benefit. Usual nursing home services, room and board, and other illnesses are not included in the Medicare hospice benefit and must be paid using other sources. Reimbursement for hospice care in the nursing home is therefore a result of a contractual arrangement between the nursing home and a hospice agency that varies based on the nursing home resident's insurance coverage.

Nursing home residents with Medicare as their only insurance may elect coverage under the skilled nursing care benefit following an acute hospital stay or may elect coverage under the hospice benefit if they are terminally ill with a life expectancy of 6 months or less. A terminally ill Medicare recipient admitted to the nursing home from the hospital could choose the skilled nursing benefit or the hospice benefit, but the choice is not financially neutral.^{40 - 41} Compared with hospice, the Medicare skilled nursing benefit provides a higher reimbursement rate to the nursing home and covers room and board costs otherwise billed to the resident. The skilled nursing benefit is therefore financially advantageous to both the nursing home and the resident. For example, a newly admitted Medicare resident with cancer and failure to thrive could elect either the skilled nursing benefit or hospice care. However, if the resident elects hospice care, the nursing home will receive less and the resident will have to pay for room and board. Many nursing homes simply do not offer hospice care to residents who are eligible for the Medicare skilled nursing benefit. Recent actions will partially address this problem: the graduated Medicare payments implemented in 1999 have lessened the magnitude of the financial incentive to use skilled nursing care. While residents with Medicare hospice will still be responsible for their room and board costs, nursing homes may now find it more financially reasonable to offer hospice care as an option.

Most nursing home residents who receive hospice care are dually eligible for Medicare and Medicaid. After 1 year in nursing home care, approximately 90% of elderly residents receiving Medicare also become eligible for Medicaid as they spend their savings down to Medicaid poverty levels.⁶ Dual coverage provides Medicaid payment for room and board and Medicare payment for hospice care.^{40 - 41} With Medicare and Medicaid, a terminally ill patient admitted from the hospital may choose the skilled nursing benefit or hospice care. However, in contrast to a resident with Medicare alone, Medicaid coverage of room and board costs makes this choice financially neutral.

Both Medicare and Medicaid payments are initially directed to the hospice provider, and the hospice passes on the room and board amount to the nursing home. State Medicaid programs must pay hospice providers at least 95% of the usual rate for room and board. Room and board services are not uniformly defined, but this payment is generally assumed to cover personal care services, assistance with activities of daily living, activities, medication administration, cleaning, and use of durable medical equipment and prescribed therapies unrelated to the terminal diagnosis.³⁹ The incentive for nursing homes to participate in a hospice program may vary with the perceived adequacy of this room and board "pass-through" payment. Some hospice–nursing home contracts have given nursing homes more money for room and board services than the state Medicaid payment. However, this practice is likely to decrease, as federal investigations have interpreted increased room and board payments as potential health care fraud.^{42 - 43}

Since 70% of deaths occur after 65 years of age,³ most dying patients in the United States have Medicare coverage for hospice services. However, nursing homes also house some impoverished younger patients with chronic diseases, particularly human immunodeficiency virus disease and progressive neuromuscular disorders such as amyotrophic lateral sclerosis or muscular dystrophy. Medicaid covers nursing home care in all states, and it covers hospice care in 43 states.⁴⁰ Although Medicaid is the single largest insurer for overall nursing home costs, only 0.1% of total Medicaid dollars are spent on hospice care.^{44 - 45} The Medicaid hospice benefits are state-specific but typically cover the same services and reimburse at rates similar to the Medicare hospice benefit with the addition of coverage for room and board.^{39 - 40} Enrollment in hospice care is financially neutral for residents covered by Medicaid, and it adds services at no financial disincentive for the nursing home.

Anyone may refer a patient to hospice care—the patient, a family member, nursing home staff, or a physician.⁴⁶ To use the Medicare hospice benefit or other insurance coverage, a physician must certify that a patient has 6 months or less to live if the disease follows its usual and expected course. In 1996, 58% of all hospice patients had a primary cancer diagnosis, in part due to physicians' ability to identify the final phase of illness in cancer.⁴⁷ This level of prognostic certainty is more difficult in causes of death other than cancer.⁴⁸

Compared with people who die at home or in hospitals, nursing home residents more often die of heart disease and stroke and are less likely to die of cancer.^{4 - 5} Thus, the 6-month prognosis requirement for hospice services may limit access to hospice care even when the resident prefers a palliative approach to care. To address the difficulty of predicting a 6-month life expectancy, the National Hospice Organization published specific guidelines to document prognosis in some noncancer diagnoses.⁴⁹ However, even these guidelines cannot identify patients with dementia who will die within 6 months. As a consequence, physicians may be reluctant to refer nursing home residents with end-stage dementia or cardiopulmonary diseases to hospice care.^{48 ,50 - 51} Strict reliance on disease-specific guidelines will result in the exclusion of many dying nursing home residents who prefer palliative care or need expert symptom management. In response to this difficulty, some hospice advocates have suggested cost-effectiveness studies of alternatives such as hospice or palliative consultation services, extended eligibility periods, or complete lifting of the 6-month criterion.

For a nursing home resident to enroll in hospice care, the nursing home must first contract with a hospice agency to define a shared plan of care and payment arrangement. The hospice and nursing home must create a coordinated care plan with specified roles. Under Medicare regulations, the hospice agency assumes overall responsibility for management and implementation of the care plan related to the terminal illness.⁴¹ The nursing home is required to continue the same level of service and personal care as if the patient had not been in hospice care, while hospice staff provide added palliative care. Services unique to hospice include expert pain and symptom assessment and management, emotional and spiritual care, and bereavement services for nursing home staff as well as family.

Collaboration between nursing home and hospice staff members is dependent on good communication and coordination of care, and many providers may be unwilling or unable to enter into contracts. Nursing home staff may see the hospice as interfering with or duplicating their work or as another source of criticism and oversight.⁵² The nursing home continues to provide most direct care to hospice enrollees, and nursing home staff members remain responsible for the quality of care under the survey process. Hospices must acquire specialized clinical and administrative skills to contract with and provide care in nursing homes, and many smaller agencies may be less willing to assume the care of nursing home residents.

Nursing home administrators decide whether they will accept hospice contracts, and some evidence suggests that organizational characteristics account for regional variation in access to the hospice care in the nursing home. One survey study has examined the relationship between the use of hospice services and administrators' attitudes toward hospice care.⁵³ In 23 facilities owned by a single company, rates of hospice use ranged from 2% to 39% of dying residents. Investigators found that the rate of hospice use was correlated with administrators' attitudes toward hospice care generally and toward the potential burdens imposed by contractual obligations. In another national cross-sectional study of nursing home hospice use, Petrisek and Mor¹¹ found that 70% of nursing homes do not have any residents enrolled in hospice care. Organizational characteristics of both the hospice and the nursing home were correlated with rates of use of the hospice benefit. Thus, some nursing home residents may not be able to access their hospice benefit under Medicare because of local barriers to contractual agreements.

In 1995, the Office of the Inspector General (OIG) within the US Department of Health and Human Services undertook an investigation of waste, fraud, and abuse practices in services funded by the Health Care Financing Administration. This investigation, called Operation Restore Trust, was designed to identify programs' vulnerabilities to fraud and abuse. In its first 2 years, Operation Restore Trust identified more than $187.5 million in unjustified Medicare and Medicaid payments potentially due to fraud and abuse.⁵⁴ In hospice, OIG investigators focused on providers with longer lengths of stay, higher rates of noncancer diagnoses, and large numbers of nursing home enrollees. The investigators cited numerous examples of abuse within the hospice nursing home system, and at one point recommended eliminating the nursing home hospice Medicare benefit.⁴³

Critics of the OIG report argued that the investigation used flawed methods to define enrollees who met the 6-month prognostic criterion. Prognosis, especially in noncancer diagnoses, is of necessity imprecise.^{48 ,50 ,55} Clinically, a 6-month prognosis may mean an average life expectancy or a maximum life expectancy of 6 months.⁵⁵ The OIG used the more conservative definition and scrutinized hospices with higher than average numbers of patients who lived longer than 6 months.

Investigators from the OIG also found fault with the methods used to pass along room and board payments from hospices to nursing homes for residents receiving both Medicare and Medicaid coverage. When pass-through payments exceeded 95% of Medicaid room and board reimbursement, inspectors interpreted the excess payments as potentially fraudulent incentives for hospice referrals.^{42 - 43} Hospices and nursing homes, in turn, have argued that the definition of room and board varies, and payments should be varied by contractual divisions of responsibility for services between the 2 care providers. Investigations performed by the OIG found and penalized some fraud and abuse in hospice care, but their investigations have acted as a broader deterrent on further expansion of hospice care in nursing homes.

In nursing homes, as in home or hospital care, the preferences of patients and families tempered by the judgment of physicians should be the primary determinant of the decision to use palliative care or enroll in hospice care. These clinical considerations do not change in the nursing home setting, yet residents have less access to palliative care services. Federal nursing home quality assessments and reimbursement incentives both emphasize restorative care while failing to reward high-quality palliative care. Administrative and contractual barriers, as well as suspicions of fraudulent use, limit access to hospice care in nursing homes. Since nursing homes are an increasingly important site for terminal care, it is reasonable to anticipate growing demand for palliative care and hospice in this setting.

Changes in current incentives and policies could be used to promote the appropriate use of palliative care for people who live the final phase of their lives in a nursing home. The following strategies could enhance access to palliative care services in nursing homes:

As the population ages, increasing numbers of persons with serious chronic illness will spend the final phase of their lives in a nursing home. Training for nursing home staff and physicians must be coupled with changes in health policy and reimbursement to meet the palliative care needs of residents in long-term care settings. Increasing access to nursing home hospice care can expand the capacity for palliative care, but the model of hospice care may need to be modified to match service delivery in nursing homes. Changes in nursing home hospice contractual rules may also decrease geographic variation and permit access to services in the nursing homes that do not currently enroll residents. For many nursing home residents, palliative care may be the preferred approach to care in their final months—or even years—of life. Quality standards, reimbursement policy, and clinical practice will need to change in synchrony to make this care possible.