Senior Living Business:Hospice Care: End of the Continuum
Adding hospice care to the services offered in a senior facility is an additional benefit for residents — one that means they don’t have to move to receive end-of-life care. Moving is one of the greatest fears of seniors diagnosed with a life-limiting illness. "It’s very stressful for a person to leave the place where he or she has been living either for a lifetime or, in the case of a senior living community, for two, three, four, or five years," says Jamison Gosselin, external communications manager at Sunrise Senior Living (NYSE: SRZ). Sunrise delivers hospice care to residents of its communities in their own suites — just as a patient might receive hospice care in his or her own home.
In fact, "trauma transfer," an accepted psychological term that refers to a set of symptoms and outcomes that result from a transfer from one environment to another, can increase mortality rates by two-to-four times the rates for otherwise comparable residents without transfer, according to controlled studies on which the U.S. Dept. of Aging based its "Emergency Preparedness Manual for the Aging Network (1995)."
Further findings indicate that death frequently occurs within hours or days of transfer and that the mortality risk is higher following inter-facility rather than intra-facility transfer. So if moving can be avoided, it’s generally helpful to the patient.
Hospice care and assisted or independent living are very different business models in terms of management, operations, and staffing, and different options for providing hospice care are available to senior care facilities. Following are examples of three such options:
1. Operate hospice units in an existing facility.
Rest Haven Christian Services, founded and supported by local Reformed and Christian Reformed churches, offers the complete spectrum of senior services in nine facilities that the organization operates in Illinois and Michigan. Rest Haven has a Home and Community-Based Services Division that incorporates a hospice agency and which has provided hospice care to residents for a couple of years now as part of the organization’s continuum of care. "We provide hospice care primarily through our three skilled nursing buildings," says Scott Kolzow, vice president, home and community-based services. "Very few of our hospice patients reside outside those buildings."
About 20 Rest Haven residents per month receive hospice care — a relatively small operation. Specially trained caregivers provide the hospice services, because the care requires skills that differ from general nursing skills. While general care nurses may have a rapport or relationship with the family, their primary focus is the patient. On the hospice side, 50 percent of the effort is patient-related and 50 percent is family-related. The bereavement care and counseling, for example, may continue for 12-13 months after the patient has passed away. "Hospice care integrates much more of the family dynamics than does skilled nursing," Kolzow says.
"We’re very careful, though, not to give our nursing staff the feeling that its responsibilities are being taken over by another group," he adds. "The nurses may have known and worked with the patient and a key family member for years, but they’ve got to understand that the physician is on board, the family is on board, and the specialized care is in the best interest of the patient. We’ll even sit down with the nursing staff to explain the direction we’re taking with the patient and let them express any concerns."
To deal with staff turnover, Kolzow continuously runs training sessions in which the new people discuss end-of-life issues, the benefits of hospice, and the hospice services that Rest Haven provides. "We try to alleviate any angst that a staff member may have and any personal belief issues such as the disconnection of feeding tubes. We try to be as proactive as possible and initiate new staff members regarding who we are and what we do with regard to hospice care."
Only one independent hospice operates in the state of Illinois, according to Kolzow, so offering hospice services in a free-standing building that Rest Haven would operate — or perhaps turning a wing of one of its skilled facilities into a 15- to 20-bed hospice unit — are options that he’s considering to broaden Rest Haven’s horizons. "Those ideas are on the table right now," he says.
2. Acquire or contract with a hospice provider.
Sunrise Senior Living currently operates more than 440 senior living communities throughout the United States, Canada, the United Kingdom, and Germany. Last fall, Sunrise acquired Dallas-based Trinity Hospice, which provides hospice care and services to patients where they live, whether that’s in a senior living community or in a single-family home. When Sunrise residents get to the point where they need hospice care, they remain in their own units and hospice care comes to them.
Sunrise operates residential communities, primarily independent living and assisted living facilities, that focus on wellness and living. That’s very different from the clinical mindset required for a hospice. "Hospice providers offer a significantly different skill set from what we typically provide in our communities," Gosselin says. "Our care and services revolve around activities of daily life, recuperation, and wellness. Hospice services comfort a person who is unlikely to get better; they help to relieve the pain and symptoms that are part of the dying process."
At Sunrise, for example, care managers from the hospice service come into the facility to provide physical, emotional, and spiritual care. Young children, spouses, and even grandparents may be involved. To help everyone work through the process, a chaplain provides spiritual services and a social worker provides counseling to the resident, family members and loved ones, and perhaps even the facility’s non-hospice caregivers.
Sunrise opted to buy its own hospice services company in order to better manage the hospice services and meet resident expectations. Prior to the acquisition, Sunrise partnered with various hospice services companies around the country, both national and local hospices. One difficulty that Sunrise experienced initially was that the provider partners didn’t understand the cultural differences among different kinds of senior living facilities. "They didn’t understand that assisted living offered a homelike environment with comfortable accommodations and not the clinically oriented environment of a skilled nursing facility," says Gosselin. "The caregivers showed up in scrubs!"
Hospice care has evolved just as the entire senior living field has evolved; but when partnering with a hospice company, make sure that the provider’s operation is in line with your mission and your service environment.
3. Lease space to a hospice provider.
Brookdale Senior Living (NYSE: BKD), which operates 547 properties in 35 states, offers hospice services to its residents by leasing space in some of its facilities to hospice providers. "The only in-patient hospice units that we have are operated by outside hospice companies that lease the space," says H. Todd Kaestner, executive vice president, corporate development. "Hospice providers know how to operate hospices, deliver the care, and market the services." As part of the lease agreement, Brookdale provides basic services such as meals, housekeeping, and general building security in the building — but the care, the nurses, and the administrative staff are all provided by the hospice provider. The economic benefit for Brookdale, then, is the lease itself, along with reimbursement from the hospice provider for the basic services that Brookdale provides.
The outside hospice provider may have its own patients, but it also provides services to Brookdale’s eligible patients, as well. "When our residents need hospice care, we arrange for the hospice provider to deliver it to the patient," Kaestner says. "The patients may move into the hospice unit, or the hospice care will be delivered to them in their rooms. In either case, we make the referral, and the hospice bills Medicare for the services. In one case, where we directly lease out units, the facility was oversized. We walled off a corner and leased it to a hospice company, which runs the unit there."
In another case, Brookdale donated three acres of land on a large CCRC it owns in Florida to a not-for-profit hospice company that built a small, eight-bed hospice on the property to serve patients from the CCRC and also from outside. "The average stay is about a week in that particular hospice," says Kaestner. "Turnover is about 25 patients per month." The hospice enrolls patients early on but transfers them into the hospice unit and cares for them there in the last days of life. Other hospices, of course, have different philosophies and different average lengths of stay in the in-patient units.
"Hospice care is a very specialized business and not one where you need a lot of patient beds," Kaestner adds. "Hospices also have different ways of delivering care." Generally, hospice care is delivered in the patient’s residence, either a private home or a room in a senior facility. Other times the patient moves to the hospice. Some hospice stays lasts weeks or months; in other cases, the patient spends only a few final days in the hospice.
All that said, Kaestner doesn’t think hospice care is an opportunity for long-term care providers to suddenly decide to take up. "It’s a much-needed service that a lot of people don’t coordinate very well," he notes, "but it’s also a completely different orientation to patient care — one that most nursing homes and most nurses can’t handle very well. It takes a very special kind of staff to run a hospice."
The business of hospice care
From a business standpoint, offering hospice services obviously extends the average length of stay per resident — an important metric for for-profit companies. "Helping our residents stay in their homes longer is a win for our company but also for the resident," says Gosselin. "But you must have the resources, the expertise, and the business platform from which to operate the hospice business."
Finances are not the ultimate driving factor for Rest Haven, a not-for-profit organization. "We’re mission-driven," says Kolzow, "but hospice care is a legitimate part of the overall continuity that we offer. Our hospice services actually do very well financially."
Hospice care is 100 percent reimbursable by Medicare, whereas most other senior care services are not. So adding hospice services to an organization’s continuum of care results in an extra benefit to offer residents with no added fee attached. For the facility, however, the additional financial platform requires a different accounting process, so it’s important to have someone on board with expertise in Medicare reimbursement and experience working with the government regulations.
Medicare also mandates a huge list of requirements for the person referred to hospice care. An attending physician must certify that the patient has only about six months to live and then make the referral to the hospice. Hospice organizations, therefore, "live or die" by their physician referral base. In order for a hospice to succeed, its physician referral base must be very strong.
Kolzow points out one other difficulty when first opening a hospice: "You literally eat the cost until you’re certified," he says. "When we opened up our hospice, for the first four-to-six months we provided without any reimbursement everything that you would normally offer once you’re licensed and operational. For organizations that may not have a strong financial backing, that’s a pretty tough pill to swallow. With 20 residents a month getting hospice care, the cost might be $85,000 to $100,000 a month. That adds up rather quickly."
A for-profit provider may have a greater level of available resources than a not-for-profit provider, but either type of business should be able to accomplish the goal of offering hospice care as long as the mission is to serve and help people through the last stages of life. "That’s really the bottom line," says Gosselin.